Imports declined in August at the nation’s largest hub for trade with China, as a shipping surge ahead of potential trans-Pacific tariffs began to wane.
The neighboring seaports of Los Angeles and Long Beach, which make up the largest maritime trade hub in North America, handled a combined 763,602 20-foot equivalent units, or TEUs, of loaded inbound containers last month, down 3.1% from the same month last year.
The second straight monthly decline followed a sharp 8.4% increase in June that appeared to be fueled by companies pulling forward shipments as the trade tensions between the U.S. and China flared and both countries threatened new tariffs on hundreds of billions of dollars’ worth of trade. July and August are usually among the highest-volume months for imports, as retailers prepare for the busy fall and holiday shopping seasons.
“You aren’t seeing the volumes you would have expected in the peak months of peak season,” said Paul Bingham, a trade economist with the Economic Development Research Group. “With tariffs taking effect and starting to have some influence….growth has slowed compared to what the underlying economic demand would imply should be there.”
Mr. Bingham added, “The snowball hasn’t stopped going downhill here.”
Still, goods appear to be flowing into other ports around the U.S. The monthly Global Port Tracker, published by the National Retail Federation and Hackett Associates, estimates that imports into the nation’s major seaports reached a record 1.92 million TEUs in August, up 4.8% from the same month in 2017.
“More tariffs could come any day, and retailers have been bringing in record amounts of merchandise ahead of that in order to mitigate the impact on their customers,” Jonathan Gold, NRF’s head of supply chain and customs policy, said in a statement.
Holding the inventory over a longer period will carry a cost to the retailers, but the expense is slim compared with the tariffs. “Obviously that’s preferable to having to pay 25% more for these items, affecting retail prices and hurting revenues,” said Mr. Bingham.
According to trade analysis group Panjiva Inc., the Los Angeles and Long Beach ports are the most exposed to the U.S.-China trade tensions, with more than half their cargo volume coming from China. Big East Coast ports like Savannah, Ga., and Jacksonville, Fla., are much less exposed.
The South Carolina State Ports Authority reported the Port of Charleston handled a record volume of 206,541 total TEUs last month, a 16% jump from the same month in 2017.