2017 was a record breaking year for container volumes recorded at the Port of New York and New Jersey with 6.71 million Twenty Foot Equivalent Units (TEUs) handled, as reported by Metropolitan Airport News. This activity accounts for 15.4 percent of the national market share and leads the East Coast. Only the Port of Los Angeles and the Port of Long Beach are busier. Interestingly, the number of containerships that called the port was down. This is due to the increased usage of larger, environmentally friendly ships. This trend will continue thanks to the raising of the Bayonne Bridge.
It was not just ports that saw increased activity. Air freight had its best year in seven years with 9% growth. E-commerce, pharmaceuticals, and general consumer confidence are the leading factors in this growth. JFK Airport alone handles about 1.4 million tons of air cargo annually.
Since about 90% of freight is delivered to New York City via truck and over a billion tons of freight flows through the region by truck, this increased cargo activity is good news for the trucking industry. Though it must be noted, that the lack of truck parking (both overnight & curbside) as well as increased congestion, costs the industry billions of dollars annually. Both City DOT and the Port Authority are working on new freight mobility plans to improve the freight network for the next few decades.
The three leading import countries in order are China, India, and Germany which brings us to the elephant in the room, the status of tariffs. President Trump has already imposed tariffs on steel and aluminum but he is looking to go much further, particularly in regards to Chinese imports. To the tune of $50 billion in tariffs. Many in the business community have been furious with certain Chinese industrial practices for years. Not to mention allegations of intellectual property theft. However, between concern about Chinese retaliation to fears about another Smoot-Hawley, and the idea of a trade war represent a controversial measure. Even if tariffs are water down, the short term instability could have a negative impact on cargo freight.
There are more reasons to be optimistic rather than pessimistic about cargo freight growth, particularly in the Metropolitan area, it will be interesting to monitor how 2018 compares with 2017’s highs.
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