TRG | The Bottom Line – 3/19

In advance of TRG’s Construction & Industrial Conference to be held April 8-9, we anticipated a hot topic this year will be supply chain disruptions, which are finally making bigger headlines. Even with the expansion of the Panama Canal in 2016, opening greater traffic flow to fast growing East Coast ports such as Charleston and Savannah, U.S. port congestion has surged to all time-time highs. The ports in the L.A. area handle ~40% of the nation’s container traffic. Data supports anecdotal feedback TRG has receiving from a wide variety of industry contacts – Inbound flow has surged, and with congested ports, empty ships are being sent back to Asia to feed growing demand. From a seasonal standpoint, imports peak July-October and then drop in February and March. This year, southern CA ports saw a 52% YOY surge in February imports, while exports were down 15%.