Sea Container Counts Send Mixed Economic Signals

The Ports of Los Angeles and Long Beach sea container counts for the month of October 2010 are sending opposing economic signals.  Most consumer items and manufactured goods travel internationally in sea containers.

Economic health of a country can be tracked by following the transport of goods and materials.  If the goods transport is rising, the economy is improving.  Conversely when goods transport is falling, the economy is contracting.

The Ports of LA and Long Beach account for much of the container movement into and out of the United States.  And these two ports report their data significantly earlier than other USA ports.

The good news is that container exports are at historical highs for the month of October, and are at their highest level since 2008.  This is interpreted as a growing USA competitive advantage overseas and / or an expanding global economy.

The bad news is a contracting import container count – MoM and lower than each of the last five years (except 2009).  There is no evidence that the reduced container import counts are a result of a change to domestic production based on little improvement in recent Industrial Production data.  Econintersect can only assume this translates to a reduction in demand.

As the overall container count is up this month when combining imports and exports – the net result should have a slight positive economic bias for the USA.

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