Imports at major U.S. container ports are expected to remain strong as retailers bring in goods ahead of increasing tariffs on China and potential levies on other countries. The Global Port Tracker report, released by the National Retail Federation (NRF) and Hackett Associates, highlights the challenges facing supply chains and the retail industry.
Photo: Dreamstime.
Jonathan Gold, NRF Vice President for Supply Chain and Customs Policy, acknowledged the complexities of global supply chains and the long timelines required for diversification. 'While we support the need to address the fentanyl crisis at our borders, new tariffs on China and other countries will mean higher prices for American families,' he stated. Many retailers have sought to mitigate the impact of tariffs by stockpiling goods, but this approach has led to added warehousing costs. Gold stressed the urgency of resolving border security issues, warning that prolonged tariff increases could significantly affect the economy.
Retailers have been front-loading imports for months, anticipating potential disruptions such as a threatened East Coast and Gulf Coast port strike in January. The situation became more uncertain after former President Donald Trump announced a 25% tariff on most goods from Canada and Mexico and a 10% tariff on Chinese goods. While the Canadian and Mexican tariffs were temporarily suspended for 30 days, the China tariffs took effect immediately, adding to the financial pressures on businesses and consumers.
Table: NRF.
Ben Hackett, Founder of Hackett Associates, noted that the initial impact of tariffs on Canada and Mexico would be limited since most goods from these countries are transported by truck, rail, or pipeline. However, he warned that tariffs on goods receiving final manufacturing in Canada or Mexico but originating elsewhere could drive an increase in direct maritime imports to the U.S. In contrast, higher tariffs on Asian and European goods could hurt port traffic if rising prices lead to reduced consumer demand. 'At this stage, the situation is fluid, and it's too early to know if the tariffs will be implemented, removed or further delayed,' Hackett said.
Despite these uncertainties, U.S. ports handled 2.14 million Twenty-Foot Equivalent Units (TEU) in December, marking a 14.4% year-over-year increase and the busiest December on record. The total import volume for 2024 reached 25.5 million TEU, a 14.8% rise from 2023, making it the highest level since the 25.8 million TEU peak of 2021. Projections for early 2025 suggest continued strong imports, with January expected to reach 2.11 million TEU, up 7.8% year over year, while February is forecast at 1.96 million TEU, a modest 0.2% increase. March is expected to see an 11.1% rise to 2.14 million TEU, with steady growth continuing into the spring.
Global Port Tracker, which provides insights into ports across the West, East, and Gulf Coasts, remains a crucial resource for retailers navigating shifting trade policies. With tariffs in flux and economic uncertainty looming, the retail industry continues to adapt to maintain stability in global supply chains.
More information:
National Retail Federation
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www.nrf.com