Economists are still debating the reasons behind the significant drop in inflation over the past year without substantial job losses. A key factor contributing to this appears to be the decline in the volume of shipping containers. In 2023, the physical volume of imports arriving at U.S. ports returned to pre-pandemic levels, registering at 28.9 million equivalent units of freight, as reported by Panjiva and S&P Global Market Intelligence. This marked the second consecutive year of decline following the record import surge in 2021, which overwhelmed ports and warehouses, causing container ships to idle offshore.

These idle ships became iconic symbols of the supply chain crisis, a major contributor to U.S. inflation. The reduction in container volumes has helped alleviate the supply chain crisis, thereby easing pressure on prices. One key insight is that many of the supply chain issues in 2021 were a consequence of an unprecedented surge in American consumer spending.

Chris Rogers, who leads the supply chain research team at S&P Global Market Intelligence, emphasizes that the strain on shipping and ports was primarily due to heightened demand rather than operational failures. The decline in consumer goods demand, coupled with retailers destocking inventory, has effectively relieved the pressure on ports and shipping companies.