Dive Brief:

• The Northwest Seaport Alliance (NWSA), a coalition between the ports of Seattle and Tacoma, Washington, reported a 16.7% YoY decline in container volumes in January 2018.
• The decline was mainly due to a decrease in international container volumes, with imports falling 22.7% and exports another 9.6% compared to last year. Domestic volumes from Alaska and Hawaii also fell.
• "The decrease appears to be a result of shifting alliance deployments last year," the alliance wrote in a press release.

Dive Insight:

The ports' combined container volume drop shows how U.S. ports are subject to intense competition for the right to manage freight traffic.

When a new set of ocean carrier alliances came into play last April, the transportation providers also had to reorganize their shipping networks. An ocean alliance allows major carriers to enter into so-called slot-sharing agreements, wherein one carrier's client may book a container slot on a competitor's ship.

The dynamic allows carriers to achieve economies of scale, filling up bigger ships. A side effect of this, however, is that major carriers may organize fewer calls at smaller ports. If the timing of those calls does not meet a shipper's needs, the would-be client may opt to trade via another port, instead.

The system allows carriers to retain business and offer shippers more and cheaper options due to network dynamics, but hurts ports dependent on that captive business.

Make no mistake: the NWSA is far from a small port group. The coalition is the fourth-largest container gateway in the U.S. — but fourth place may be a spot too low, considering two of the top three gateways are also in the West Coast.

"We saw fewer ships call this January over last January," Tara Mattina, communications director at the NWSA, told Supply Chain Dive. "Some of that could be attributed to a ship that was temporarily pulled out of service. It also could reflect continued competition with Canada and East Coast ports."

Yet the decrease in volumes this January may not really mean a loss of business for NWSA. 

January is a traditionally strong month for container volumes, and there are many reasons why fewer containers could have come in. Chinese New Year fell two weeks later in 2018 than 2017, for example, which may have shifted some of the traditionally-rushed holiday imports into the first half of February.

"All of the major shipping alliances call at the NWSA, but they shifted some of their service strings last year, and we’re still trying to figure out what is a monthly blip versus what is a trend," Mattina said.