The container ship will appear on November 22, 2021 at the Port of Los Angeles, California.
Mike Blake | Reuters
Due to the impact of President Donald Trump’s tariffs, shipments from China to the US west coast will plummet next week as businesses cut import orders.
Jeanseroca, executive director of the Port of Los Angeles, said on CNBC’s “Scoobox” on Tuesday that he expects cargo volumes to slide more than a third of next week.
“According to our own port optimizer measuring Asian load, it will be just under 35% next week compared to last year. And that will drop sharply as many major retailers stop shipping all from China based on tariffs,” Celoka said.
Shipments from China account for around 45% of the LA Port’s business, but some carriers are trying to fill the ship by picking up goods at other points in Southeast Asia.
“In reality, the volumes that come out of it (save a few different products) will be very light at best until we can reach an agreement or framework with China,” Celoka said.
In addition to the smaller amount of goods, Celoka said it expects about a quarter of the usual number of vessels arriving at the port, which will be cancelled in May.
Trump announced a sharp rise in tariffs on Chinese products on April 2, which led to escalation on both sides, and ultimately both the US and China charged more than 100% of the collection on many products from each other. US Treasury Secretary Scott Bescent described the situation as “unsustainable”, but there were no signs of substantial negotiations between the two countries.
Data on shipments from China are already beginning to show slower trade volumes to the US, bringing some economists wary. Torsten Slok, chief economist at Apollo Global Management, recently laid out a timeline that leads to low imports from China, leading to US transport and retail layoffs, empty shelves and a recession.
Celoka said US retailers believe the effects of reduced shipments will be around five to seven weeks before they start to bite.
“You won’t see any complete emptiness on store shelves or online when you’re buying. However, if you’re looking for a blue shirt, you may find a blue with a purple shirt and one blue that’s not yours. So your choice of these shelves will start to decrease.
