June 23, 2021 – A widely held theory on pandemic spending is that container imports surged because Americans bought a lot more goods when COVID prevented them from buying services. Ergo, with more vaccinations and fewer hospitalizations, Americans will resume spending on services and consequently have less to spend on goods, the pandemic-induced driver of import demand will wane, spot rates will fall, and the market will return to some semblance of normality.

And yet, Americans’ spending on restaurants, air travel and other services has rekindled but there’s still no evidence of a drop in spending on goods.

Container imports remain at peak volumes. Spot ocean rates are still rising. Inventory-to-sales ratios remain stubbornly low – so low that it now looks inconceivable that they can revert to normal this year.

Paul Bingham, director of transportation consulting at IHS Markit, said, “We’re too far into the year without having recovered [inventories] to get out of this in 2021. We have to look to 2022 for any hope. So many portions of the supply chain are so far behind that it’s not going to happen in the next six months.”