Latest news with #PortofLA
Yahoo
6 hours ago
- Business
- Yahoo
After widespread slowdown, Port of LA import surge is a sign Trump's ‘whipsaw' tariffs sparked ‘one last' stockpiling push, executive director says
After reporting slumping shipping volumes in May, the Port of Los Angeles rebounded in June with an 8% surge in year-over-year imports. But Executive Director Gene Seroka is not yet celebrating, warning the spike is reflective of stockpiling activities from companies trying to dodge tariff deadlines. For months, Port of Los Angeles Executive Director Gene Seroka warned of slashes to shipment arrivals from China and reduced hours for dock workers and truckers as a result of President Donald Trump's aggressive tariff threats. As the busiest port in the U.S. saw record-setting shipping volumes last month, Seroka still isn't breathing a sigh of relief. The Port of LA reported its busiest-ever June in its 117-year history with 892,000 container units, an 8% increase from the year before and a turnaround from the precipitous 9% year-over-year drop in May. Still, Seroka sees this improvement as a sign of businesses bracing themselves for the next round of tariff uncertainty. 'While record-setting volume is welcome news, it also highlights the tariff whipsaw effect that we've mentioned before,' Seroka told reporters in a press briefing on Monday. Supply-chain platform Project44 has seen similar trends globally, with 'higher-than-normal imports from China' on a global scale, Eric Fullerton, Project44 senior director of product marketing, told Fortune. The pull forward in shipping volumes is likely a result of Trump's 90-day tariff pause in April and a deescalation of a trade war with China in which tariffs on the country's exports fell to 30%. Seroka said he expects the wave of shipments to ease again in August. Not only does the late summer represent the conclusion of a flurry of shipment orders in preparation for the busy holiday shopping season, but also the latest trade deadline. Trump has doubled down on an Aug. 1 cutoff, threatening to impose flat 25% tariffs on Japan and South Korea unless a deal is reached. 'We're going to probably get one last push on imports coming to the United States, and [businesses are] doing as much as they can to sneak in under that new Aug. 1 deadline,' Seroka said. 'While it's good news for our waterfront workers, truck drivers, warehouses, and our marine terminals…shifting timelines simply means shifting volume and more uncertainty here at the Port of LA.' June's shipping volume spike resembles one supply chain experts saw in March, when companies pulled forward shipments to dodge higher costs before Trump's first round of tariffs went into effect. Project44 reported that ahead of Trump's April 2 announcement tariffs on China would balloon to 145%, import volumes from China to the U.S. increased year-over-year for a successive three weeks. The trade environment 'is still really uncertain, which means you're going to stockpile, you're going to put as much inventory as possible, because you control the cost and either pass it on to consumers or put it on your supplier,' Fullerton said. 'But the risk of stock-ups is still way, way, way too great,' he added. In order to pull forward shipments, companies may have to dip into cash reserves or take out loans with favorable terms only to potentially slash prices to get rid of excess inventory. While businesses may be reprising their pull-forward strategy, they have made noticeable supply chain shifts. Some Fortune 500 companies are 'able to push their size and their relationships with their suppliers to their advantage' by asking suppliers to switch manufacturers, Fullerton said. Others are pulling back from China in favor of doing business with manufacturers in Vietnam, Indonesia, Thailand, and Bangladesh where operations could be cheaper, Fullerton said. To be sure, shipping data will likely continue resembling peaks and valleys as businesses try their best to remain nimble amid continued trade turmoil, according to Rebecca Homkes, lecturer at the London Business School and faculty at Duke Corporate Executive Education. Trump has yet to unveil the details of a framework trade agreement with China, and there's no sign of trade deals with Mexico, Canada, or the European Union following Trump's latest tariff blitz. 'The only way that we're going to get more steady [shipping norms] that we're used to is if we have clarity on the actual tariff level that will remain mid- to long-term,' Homkes told Fortune. 'And we are far from having that level of clarity.' This story was originally featured on
CNBC
2 days ago
- Business
- CNBC
Port of Los Angeles sees record container traffic as shippers race to beat Trump's tariff deadlines
The Port of Los Angeles reported its best June ever for shipping container traffic, an increase in ocean freight that port executives described as a tariff whipsaw effect, with shippers racing to beat President Trump's trade taxes, especially a mid-August deadline for tariffs on Chinese goods. A total of 892,340 twenty-foot equivalent units (TEUs) were processed at the Port of Los Angeles in June, containers filled with holiday season and consumer replenishment products. The increase in containers was not a surprise after President Trump lowered the 145% tariff on Chinese goods to 45%. The deadline for the tariff negotiations with China is currently set for August 12. An increase in U.S. manufacturing orders from China during the pause helped fuel China's trade surplus to $114.7 billion last month. It's been the busiest June in the 117-year history of the port, but port officials have stressed in recent commentary that the increase in freight should not be referred to as a surge, and that tone was reiterated with the June numbers now official, and an 8% improvement over last year, Port of LA Executive Director Gene Seroka said that more than anything else, the monthly data highlights the tariff whipsaw effect. Imports had slowed significantly in May and continued to drop through the first half of June. "Shifting timelines simply mean shifting volume and more uncertainty here at the Port of LA," said Seroka. "Looking into August, if everything holds the way we see it right now, I expect volume to ease because of those new tariffs being in place, making it more costly for American importers," he said, citing a National Retail Federation forecast for a double-digit percentage drop in cargo volume from August through November at U.S. ports. Seroka said the year-end holiday cargo orders should already be in. "It's too late to try to negotiate orders at this point in time for that year-end product," he said. For importers, even amid the trade war pause, the cost of the mounting tariffs has been significant for their businesses. Bobby Djavaheri, president of Yedi Houseware, told CNBC during a monthly container update call hosted by the Port of Los Angeles that the layering of China tariffs plus stainless steel tariffs has greatly increased the tariff bill his firm is paying on air fryers and other kitchen appliances. "Before the tariffs, one load would have cost between $1,500 to $2,000. Now it's between $40,000-$50,000," said Djavaheri. Mike Short, president of global freight forwarding for C.H. Robinson, said even with the big June numbers in LA, some shippers are reducing import volumes and only bringing in essential products like back-to-school items. "Others accelerated shipments to beat tariff deadlines from Southeast Asia, and many stuck to their standard peak season schedules, taking a more wait-and-see approach," said Short. "Although we're approaching traditional retail peak season for ocean, it's not likely the industry will see traditional peak volumes, as many of our 7,500 retail customers are working through inventories and being highly selective and strategic, bringing in only the essential products they must import," he said. Trump last week issued letters covering new tariffs he plans to place on several Asian nations, while recently striking a preliminary trade deal with Vietnam that brings tariffs on many of its products up to 30%. Short said while the recent deadline extensions provided nearly a month of breathing room, that's not enough time for most ocean shipments, which take on average between 20–30 days of transit time. East Coast travel time can be longer. For U.S. companies that need to bring in product but did not secure ocean freight, more expensive air freight is the only option. Josh Allen, COO of ITS Logistics, said the landscape of sourcing is changing, and supply chain and logistics professionals are now charged with building new routes to move goods from manufacturing locations to end markets. When a company's manufacturing base is changed to a different country, travel time on the ocean can be longer, and the U.S. port destination can be different. "We are watching and responding to these changes in real time," Allen said. He added that despite a record June for LA's port, the broader trade slump is helping to navigate the changes. "The logistics industry can handle and recover because demand has been depressed," he said. Kim Vaccarella, founder and CEO of fashion and accessories company Bogg, started to diversify her company's manufacturing in Vietnam to offset the tariffs on China, but all of the machines, product molds, and raw materials continue to come from China. "We have narrowed the production of our bags from four to two," said Vaccarella. "Originally, we cut our manufacturing by 50% but because we are now manufacturing two bags we added back some orders, but not all." President Trump's trade deal with Vietnam is still not official, and the initial language on the deal includes a 40% additional tariff on transhipments, a reference to products that begin their manufacturing journey in China even if they are ultimately finished in another nation such as Vietnam. Bogg temporarily increased prices back in April before Trump paused tariff schedules, but then reinstated the original pricing. "Everything is up in the air because of all the uncertainty," Vaccarella said. "After the April claw back in prices we announced we would make a decision in July on prices, but we still have no clear picture."
Bloomberg
06-06-2025
- Business
- Bloomberg
Lots More on Trade Tariffs at America's Busiest Port
We're about two months on from Liberation Day, and there's still a lot of confusion about what's going on with global trade. Some countries, like China, have been granted delays from tariffs. But other trade restrictions, like the 50% tariff on foreign steel, have come into effect. So what exactly is going on and what impact is this having on the physical flow of goods into America? In this episode, we catch up with Gene Seroka, executive director of the Port of LA, to get a sense of what he's actually seeing and what it means for US consumers and the prospect of empty store shelves.
Bloomberg
06-06-2025
- Business
- Bloomberg
Lots More on What America's Busiest Port is Seeing from the Trade Tariffs
Listen to Odd Lots on Apple Podcasts Listen to Odd Lots on Spotify Subscribe to the newsletter We're about two months on from Liberation Day, and there's still a lot of confusion about what's going on with global trade. Some countries, like China, have been granted delays from tariffs. But other trade restrictions, like the 50% tariff on foreign steel, have come into effect. So what exactly is going on and what impact is this having on the physical flow of goods into America? In this episode, we catch up with Gene Seroka, executive director of the Port of LA, to get a sense of what he's actually seeing and what it means for US consumers and the prospect of empty store shelves.
CBS News
04-06-2025
- Business
- CBS News
Los Angeles Mayor, officials say tariff impacts to Angeleno wallets are coming soon
Leaders from the city of Los Angeles and the Port of L.A. held a roundtable on Wednesday morning to discuss the impacts of mass tariffs being levied on foreign nations. Tariffs on imports from other countries have been one of the defining economic policies from President Donald Trump since he took office in January. Trump has also levied a trade war against China, leading to severe tensions. Business at home Officials say the tariffs have already impacted business at local ports, and could reach the wallets of Americans shortly. During a news conference following Wednesday's roundtable, Mayor Karen Bass said Americans and Angelenos may not realize the impact of tariffs yet, but it's coming. "[We need] to communicate to Angelenos specifically how this impacts their pocketbook," Bass said. "I think that sometimes this issue seems kind of far away and people don't see the immediate impact because the bottom line is that it's a tax on individuals and their families." Port of L.A. Executive Director Gene Seroka said the port has averaged about five ships in port over the last seven days. Normally, he says, it's about 10-12 per week. Seroka said the difference in business has been noticeable in the last couple of months. Seroka added that retailers have been uncertain about the amount of money American families will be willing to spend in the upcoming Holiday season, leading to trepidation when it comes to the amount of goods they're ordering for their stores. SAN PEDRO, CALIFORNIA - MAY 06: Container ships sit docked at the Port of Los Angeles on May 06, 2025 in San Pedro, California. Los Angeles and Long Beach ports are seeing significant drops in expected cargo ships coming into port this week due to tariffs imposed by the Trump Administration. The Port of Los Angeles expects a 35 percent decline in arrivals this week compared to the same period one year ago. / Getty Images City officials say they've been meeting with workers in the importing industry in recent weeks. "Everyone was saying the same thing," said Councilmember Tim McOsker, who represents L.A.'s 15th District. "That the tariffs have had a negative impact on this economy." McOsker said thousands of workers, from those who work at the ports to train workers and even those who stock shelves at stores, have "less money in their pockets" as a direct result of tariff policy. McOsker concluded his remarks by stating that he has yet to hear a valid reason for the imposition of mass tariffs. "This is a self-inflicted wound. This is an unforced error," McOsker said. "This is a mistake for absolutely no reason." Trump's reasoning Despite legal challenges, many of the sweeping tariffs remain in place while the process plays out in the appeals system. Trump says the tariffs are being used to increase "fairness" in trade, as the U.S. operates on a deficit while trading with other countries, and says he'd like to see companies manufacture goods in the U.S. as opposed to importing. Still, Trump has acknowledged that the prices of good could still rise. "Maybe the children will have two dolls instead of 30 dolls," he said in an April 30 Cabinet meeting. "And maybe the two dolls will cost a couple of bucks more than they would normally."
