Recently it was announced that the nation’s leading seaports continued to see solid gains in overall shipping activity. Port activity is a leading economic indicator because ports are the entry andpoint of goods coming to and leaving this country. Growth in imports obviously indicates that the is growing and demand is up. Growth in products being exported tells us that U.S. manufacturers are expanding, which eventually leads to job growth and further economic expansion.
As reported last month, despite the massive earthquake in Japan and rising fuel costs, the Port of Los Angeles reported a 10 percent increase in cargo shipments during the first quarter of 2011. According to DailyBreeze.com, the nation’s busiest port handled more than 1.8 million cargo containers during the first three months of the year, buoyed in part by California United Terminal’s recent move to Los Angeles from neighboring Long Beach.
“We think the strong numbers represent the fact that we’ve been working on infrastructure improvements and expansion at the port, and that’s starting to pay off with increased cargo and efficiency,” said Phillip Sanfield, a spokesman for the Port of Los Angeles.
The Port of Los Angeles handled 600,796 cargo containers in March alone, a 9.2 percent increase from March 2010. Imports were up 10 percent and exports dramatically increased by 19.2 percent.
The Port of Long Beach, the nation’s second busiest port, handled more than 1.3 million cargo containers during the first quarter of 2011, a 6.4 percent increase from the same period last year.
According to the Los Angeles Times, these first quarter trends continued in April with the Port of Los Angeles handling 312,360 cargo containers carrying imports, up 3.4% from the same month a year earlier. Export containers through the port climbed 5.8% to 167,448. And at the Long Beach port, the number of import containers rose 12% to 270,107 in April. Exports through Long Beach jumped 10.4% to 143,683 containers.
As reported, the nation’s two busiest ports experienced solid growth in expansion and activity during the first four months of 2011. This certainly bodes well for the continued recovery of the U.S. economy. And this news applies to your business too whether you are involved in importing or exporting of goods. Simply put, port data is a leading indicator of economic growth overall, growth which will eventually positively impact all segments of the economy.
Unfortunately, too much of this positive economic news gets under-reported in the press. Our goal in these postings is to provide insight on key economic trends as indicators of future potential M&A activity. In most economic recoveries that we have experienced over the past 30 years, M&A activity rebounds quickly and with great velocity coming out of a recession. We are seeing the same in this recovery.
As we have stated before, the best time to find a buyer and close an optimal deal is in the early phases of the M&A cycle. We are in that phase right now. If you are considering the sale of your company, economic indicators are telling us that the next 12 to 36 months could be a terrific time to find a buyer.
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