Retailers Scale Back after Inventory Buildups

Some retailers are working through inventories built up earlier in 2015, which could limit shipping ahead of holidays

The Wall Street Journal

Sept. 28, 2015—Some major retailers say they still are trying to pare down inventories from big buildups earlier this year, potentially dampening prospects for a surge in shipping heading into the holiday season.

Inventories swelled in the second quarter as West Coast ports cleared backlogs of imports and exports that had piled up during a labor dispute. Economists say the inventory expansion helped fuel strong growth in the spring. But a pullback by retailers and manufacturers may slow output through the rest of 2015.

The latest Global Port Tracker report by the National Retail Federation and Hackett Associates LLC projects only modest growth in container imports at U.S. gateways this fall. Freight rates for shipping from Asia, where the largest share of imported goods originate, have been at multi-year lows this year, reflecting the muted expectations and an oversupply of shipping capacity.

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