More U.S. imports backlogging commodity export movement
February 8, 2021 By Nicole Heslip Filed Under: Dairy, Dairy, News, Trade
A market analyst says Americans are spending more on “stuff” instead of services and experiences while staying home during the pandemic and it’s affecting commodity prices.
“Instead of going to restaurants, theaters, and taking vacations, going to Disney World, we’re spending that money on stuff.”
Nate Donnay with StoneX says U.S. consumers have been buying five to 10 percent more stuff, that’s mostly imported, over the past six months which has driven up shipping costs and caused widespread logistical delays.
“About 75 percent of the containers I believe leaving the West Coast of the United States are going back empty now instead of the normal 50 percent and that means less commodities are being shipped out of the U.S. and to Asia,” he says.
He says the same delays are also happening in Europe and logistical issues could take a while to sort out. Donnay expects it to be at least fall before consumers shift their disposal income back to service spending instead of goods.
Donnay says shipping delays are liking causing pressure for nonfat dry milk prices and have limited New Zealand dairy exports recently.
The U.S. Dairy Export Council points to holiday demand for goods as a likely factor and says tighter pocketbooks and more vaccines could swing the purchasing power back to services after the first quarter.
Donnay shared his thoughts during his weekly outlook forecast.
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