Severe Decline in Cargo Traffic at Southern California Ports

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A stark representation of the decline in cargo traffic at Southern California ports due to trade tariffs.

News Summary

Southern California ports are experiencing a drastic decline in cargo traffic, with no ships departing from China for major West Coast ports in 12 hours. The significant drop, attributed to new tariffs imposed by President Trump, has raised alarms among officials and the shipping industry. With tariffs as high as 145%, cargo volume at the Port of Long Beach has plummeted by 35-40%. Experts warn of potential job losses and economic instability in the region, highlighting the impact of national trade policies on local economies.

California – A drastic decline in cargo traffic has been observed at Southern California ports, with a significant impact reported as a consequence of President Donald Trump’s newly imposed tariffs on China. On Friday, not a single cargo vessel departed from China for the two major West Coast ports in the past 12 hours, marking an unprecedented event since the onset of the pandemic.

Just six days earlier, there were 41 vessels scheduled to leave China en route to the San Pedro Bay Complex, which comprises the Port of Los Angeles and the Port of Long Beach. The steep drop in vessel activity has raised alarms among port officials and the broader shipping industry, largely attributed to the substantial tariffs that have effectively raised costs for trading goods with China, a key trading partner for the U.S.

Recently enacted tariffs include a 145% tax on most Chinese imports and a 125% tariff on U.S. exports to China, creating a challenging trading environment. As a consequence, cargo volume at the Port of Long Beach has plummeted by 35% to 40% compared to typical levels, while the Port of Los Angeles reported a 31% drop in cargo volume over the past week. Additionally, the Port of Seattle faced a rare scenario where zero container ships were in port on Wednesday.

Trade representatives from both the U.S. and China are scheduled to meet in Geneva to discuss the possibility of de-escalating the ongoing trade war. President Trump has floated the notion of reducing the tariff rate with China to 80%, with the final decision resting with Treasury Secretary Scott Bessent.

Due to these trade restrictions, consumers can expect to see increases in prices or shortages of specific items in the foreseeable future, particularly within the next 30 days. Analyses reveal that imports from China accounted for 63% of the total volume at the Port of Long Beach, a significant decrease from 72% recorded in 2016.

Reporting from the shipping company Maersk indicates a staggering 30% to 40% decline in cargo volume between the U.S. and China compared to historical averages. The Port of Long Beach is bracing for a marked reduction in import volumes projected between mid-April and mid-May, forecasting a 44% drop in vessel calls for the week beginning May 4 when measured year-over-year. This situation raises concerns about potential empty store shelves should trade disruptions persist.

Economic experts warn that the tariffs pose a substantial threat, with potential repercussions including the jeopardization of $500 billion in regional revenue and the risk of 2 million local jobs within the LA area. The World Trade Organization has estimated that ongoing trade wars could ultimately diminish U.S.-China trade by as much as 80%.

Some businesses are reacting to these circumstances by canceling warehouse leases in light of diminished cargo traffic, indicating that job losses could follow suit. According to an economics professor, even if manufacturing moves back to the United States, consumers might not benefit from lower prices due to the inherent costs in production.

The Port of Long Beach serves a vital function in California’s local economy, with approximately one in nine jobs in greater Los Angeles linked to activities at the port. The continued reduction in cargo traffic not only disrupts supply chains but also creates uncertainty for the economic stability of the region and underscores the extensive impact of national trade policies.