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The Executive Director of the Port of Los Angeles predicted Thursday that arrivals at his port would drop by more than a third in the coming weeks, largely as a result of tariffs imposed on China.
Speaking at a hearing on a proposed crane project, Director Gene Seroka told the L.A. Board of Harbor Commissioners “we are beginning to see the flow of cargo to the Port of Los Angeles Slow. It is my prediction that, in two weeks time, arrivals will drop by 35%, as essentially all shipments out of China for major retailers and manufacturers is ceased.”
President Donald Trump imposed a staggering 145% tariff on imports from China on April 10, as part of his administration’s response to China’s retaliation against his own, earlier trade policy. As a result, businesses have sought to move supply lines away from the country.
Trump also implemented high “reciprocal” tariffs on all trading partners on April 2, said to be a response to trade barriers in place in other countries. These barriers were temporarily lowered to a universal 10% for all countries except China for the next 90 days.
Because of this, Seroka also expects trade with other countries to decrease. Businesses looking to trade internationally face uncertainty when estimating costs in the long term, as higher barriers are set to be established in July.
“In our business, that’s not a lot of lead time for the industry to make decisions on procurement, manufacturing, locations or sourcing, and it is still a 10% increase on goods,” Seroka said.
“Those prices go up immediately. Typically retailers and manufacturers alike put in their orders to factories in Asia some three to four months in advance of shipments leaving via vessel. No real difference will be made in the international procurement sector based on that 90-day pause.”
For now, however, the expected drop in trade remains in the future. The Port of L.A. saw a 5% increase in cargo this March compared to a year earlier, as businesses and customers attempted to place orders before the tariffs were imposed.
