Shipping stats reveal economic downturn

 Daily Caller:

Ocean logistics companies are canceling orders amid declines in worldwide consumer demand, according to a Monday report from CNBC.

As the world’s leading economies battle inflation, supply chain crises, and geopolitical tensions from the Russian invasion of Ukraine, logistics managers told CNBC that they are seeing 20% declines in ocean freight orders — a reality arising from uncertain consumer demand outlooks and the accumulation of existing inventory.

“Inventory levels are high as consumerism shifts further to off-price,” United National Consumer Suppliers CEO Brett Rose told the outlet. “Bigger brands are very conscious of current season and trends. A Bloomingdale’s consumer doesn’t want last season’s shoes or handbags. These items will be attractive to consumers of retailers like T.J. Maxx, Marshalls, Ross Stores.”

Falling demand has impacted multiple industries, from machinery and industrials to housing and clothing, according to CNBC. Demand for some goods, such as retail displays and ultrasound machines, remains strong. The growth of the global economy is expected to decline from 5.7% last year to 2.9% in 2022, according to June forecasts from the World Bank, which marked a downgrade from predictions made in January.

“The war in Ukraine, lockdowns in China, supply-chain disruptions, and the risk of stagflation are hammering growth. For many countries, recession will be hard to avoid,” World Bank President David Malpass explained. “Markets look forward, so it is urgent to encourage production and avoid trade restrictions.”

Companies are canceling voyages to match lower customer demand with vessel space. HSL Logistics said in a note to clients that it cut vessels by nearly 50%, while other companies, such as DHL Ocean Freight, told CNBC that demand is expected to remain flat through October.
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I suspect that inflation has led consumers to cut back on expenditures to cover the basics like food and fuel.  Those are two of the items that have seen significant cost increases.

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