SoCal Ports
BY JIM FORBES, PUBLISHER
PERRIS – COMBINED SOURCES
First, there was a glut, and now predictions of severe shortages on the near horizon.
This week has brought dire predictions from many quarters of international trade grinding down, particularly with China, impacting the local economy, from workers to consumers. A one-two punch to many in the Inland Empire who work in the far-flung industries that support global trade and are, of course, consumers themselves.
Shortly after President Donald J. Trump took office for a second term, he indicated his promised tariffs were coming. What followed was on, off, on-again, selected carve-outs for certain products and industries, and confusion. Massive confusion.
The administration, depending on who was at the microphone, said confusion was good, a negotiating tactic. The financial markets, hungry for predictability and stability, decided, not good, not at all.
One initial result was a surge in trade, importers and exporters, rushing to get their orders in and fulfilled before the shared pain hit the fan. The Port of LA, the busiest American port for containers from China, reported a 5.2% first-quarter gain over a robust 2024 first quarter. That was through March 31st.
But two days later, on April 2 (eliminating the chance it may be dismissed as a joke if announced the day before), Trump declared “Liberation Day,” steep tariffs across the board, sparing few, from nations with powerful economies to the now-known island of penguins.
The biggest hit was to the 2nd biggest economy, China. The two largest economies counter-punched, trading tariff blows, with Trump landing a right hook at 145%.
Molson Hart, founder of the educational toy company Viahart whose products include Brain Flakes, writes, “Around April 10thChina to USA trade shut down.”
It remains to be determined whose teeth are littering the ring, one or both combatants, or the world economy at large.
“Essentially all shipments out of China for major retailers and manufacturers have ceased,” Port of Los Angeles Executive Director Gene Seroka told Investor’s Business Daily. Trade with China represents 45% of the port’s business.
Seroka reports that some of the 125,000 companies that use his port, including big-box retailers, have already stopped much of their imports from China.
This observation is supported by the numbers. The volume of imports at the Port of LA for the week ending this Saturday, May 3rdis down 30% from the previous week. And the volume of goods expected to arrive next week will be down nearly 36% from the same week last year.
TEU’s stand for Twenty-foot Equivalent Unit, for a 20-foot-long container. So, from this week to next, nearly 12 thousand fewer containers will arrive in port.
Craig Fuller, a staunch supporter of Donald Trump’s reelection, expected measured tariffs with targeted aims of bringing select manufacturing to the U.S. He writes that he did not expect what has occurred. The founder of multiple outlets that publish shipping trends, Fuller warned on social media, “Truckers should avoid taking freight to Southern Cal, else risk having to deadhead back to Dallas to get loaded.”
Truckers, dock, warehouse, delivery, and logistics workers, and all industries that support consumers receiving their goods, are sure to feel the impact if this trend continues and even grows. All of these are industries that are vital to the local economy.
“Hundreds of thousands of jobs are dependent on or connected to global trade. Constricted trade between the world’s two largest economies could lead to devastating job losses for workers employed in the global supply chain,” the International Longshore and Warehouse Union (ILWU) declared in a statement that “unequivocally condemns the recent tariffs.”
The union endorsed former Vice President Kamala Harris in 2024.
“Tariffs are taxes. These and other reckless, shortsighted policies have begun to devastate American workers, harm critical sectors of the economy, and line the pockets of the ultra-wealthy at the expense of hardworking families. The tariffs have also sown distrust among our allies and inflamed geopolitical tensions. These tariffs are nothing more than a direct attack on the working class and should be opposed outright.”
Seroka of the Port of LA told Investor’s Business Daily that major retailers have indicated to him they have a six to eight-week inventory of goods that “will quickly dry up.”
Even if there were an instant truce between countries, the clock governing trade is already nearing, if not already struck Midnight. First, there is the restart of production, and it’s not clear what the damage may be to those relationships.
Then, on average, it takes about 30 days port-to-port, China to Los Angeles, loading and unloading of containers. It’s 45 days to Houston by sea, 45 days to Chicago by rail, and 55 days to the Port of New York by sea.
Port of LA Director Seroka doesn’t see those cards being played anytime soon. “Now, major importers are saying, ‘I’m going to wait, hit the pause button,’” he told the New York Times, “I don’t see any quick change.”
His counterpart, Mario Cordero, Executive Director of the Port of Long Beach, told The Times that so far, at least 30 ships scheduled to sail into Long Beach through June have already been cancelled.
“The trajectory is not good.”
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