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U.S. Seaborne Imports Plunged in February

Tuesday, 19 March 2019 | 12:00

Seaborne imports into the biggest U.S. gateways for Asia trade fell sharply in February, halting a monthslong shipping surge driven by strong consumer demand and a rush by companies to bring goods into the country ahead of potential new tariffs.

Loaded container imports into the ports of Los Angeles and Long Beach declined a combined 10.2% last month from the same month a year ago. The gateways in February handled 651,180 20-foot equivalent units, a common measure of container shipments, down nearly 75,000 fewer containers from February 2018.

The drop came during the annual pause in China’s manufacturing during the Lunar New Year celebration, when factories typically shut down for several weeks. It also followed a boom in imports into Los Angeles and Long Beach that began early last summer as new trans-Pacific tariffs loomed amid growing trade tensions between the U.S. and China.

The Port of Oakland also reported a 5% decline in imports in February from the year before.

Retailers are “taking a break from the rush to bring merchandise in ahead of tariff hikes now that the increase that was scheduled for March has been delayed,” Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation, said in a statement. “We are hoping that the delay is permanent and, better yet, that tariffs of the past year will be removed entirely.”

The import surge at the California gateways reached a peak late in the year after U.S. trade officials announced a plan in September to raise tariffs on $200 billion in Chinese imports by 25% on Jan. 1. That was later pushed back to March 2 and now has been postponed while the U.S. and China seek to strike a new trade pact.

During the last three months of 2018, import volume at the ports of Los Angeles and Long Beach rose 9% over the same period a year earlier, and the growth continued in January, long after the holidays that typically trigger stronger shipping volumes in the fall.

Walter Kemmsies, an economist specializing in ports and infrastructure at real-estate firm Jones Lang LaSalle Inc., said most of the February decline was the result of supply chains already stuffed with goods, leaving an “overhang from the rush to overhang to avoid tariffs.”

“Chinese New Year normally gives you a little dip, but it’s usually just a 5 or 6% drop-off from January to February,” said Mr. Kemmsies. Inbound volumes into Los Angeles fell 18.2% from January to February.

Combined exports at the Southern California ports also fell 13.9% in February from a year ago, including a 19.6% decline at the Port of Long Beach to the lowest level since January 2015. Oakland’s export volumes dropped 8.2% from a year ago in February.
Source: Dow Jones

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