Chart of the Week: Import Ocean TEUs Quantity Index – USA SONAR: IOTI.USA
Reserving volumes for container imports, as measured by the Inbound Ocean TEUs Quantity Index (IOTI), seem to have peaked in early July—a few month forward of the everyday peak transport season. Whereas “typical” has change into a relative time period in recent times on account of shifting and more and more normalized transport behaviors, this early peak presents beneficial perception into what transportation markets may anticipate for the rest of 2025.
The IOTI is a 14-day transferring common index that tracks twenty-foot equal unit (TEU) containers arriving at U.S. ports from around the globe. Whereas it typically follows secure seasonal patterns, 2025 has seen important disruption on account of an rising commerce conflict initiated by the present administration in an effort to rebalance U.S. commerce and help home manufacturing.
The IOTI reached a multi-year excessive of two,356 following the Fourth of July—roughly 4% larger than final yr’s peak of two,273, which occurred on August 5, 2024.
Nonetheless, this doesn’t essentially point out stronger items demand in comparison with final yr. A portion of this quantity improve doubtless displays a restoration from misplaced time earlier within the yr when cost-prohibitive tariffs on Chinese language imports, enacted in April and early Might, briefly froze exercise. Many importers halted purchases from the U.S.’s largest abroad buying and selling companion on account of skyrocketing prices, which led to a 15% drop within the IOTI throughout Might.
When the tariffs have been paused (at present set to run out in August), shippers rapidly resumed ordering—each to make up for delayed shipments and to make sure ample stock forward of potential demand spikes.
This case presents a double-edged sword for a lot of corporations. On one hand, tariffs improve direct import prices; on the opposite, they contribute to broader financial uncertainty and will suppress client demand. The extent to which this commerce conflict will influence the broader economic system stays unclear.
To this point, it has clearly rattled sentiment, as seen in a number of client and enterprise confidence indexes. Whereas the roles market seems wholesome on the floor, deeper evaluation reveals underlying weak point. In accordance with ADP, private-sector hiring stalled in June, resulting in a web lack of jobs. Retail gross sales additionally softened in Might, prompting many economists to forecast additional weakening within the second half of the yr as the complete influence of tariffs begins to filter into costs.
Though authorities employment figures confirmed positive factors—thanks largely to state and native hiring—that development could also be overstated, as a rising variety of folks have exited the labor power in current months.
