Imports at major US retail container ports are expected to continue to grow this summer as retailers stock up inventory to get ahead of higher tariffs.
The Trump administration last month increased punitive tariffs from 10% to to 25% on US$200bn worth of Chinese goods, with the increase applying to imports that arrive in the United States after 15 June. The administration has also proposed new 25% tariffs on $300bn worth of Chinese goods and recently removed India and Turkey from the Generalized System of Preferences (GSP) programme, which allows certain items to be imported duty-free.
“With a major tariff increase already announced and the possibility that tariffs could be imposed on nearly all goods and inputs from China, retailers are continuing to stock up while they can to protect their customers as much as possible against the price increases that will follow,” says Jonathan Gold, vice president for supply chain and customs policy at the National Retail Federation (NRF).
His comments accompanied the latest monthly Global Port Tracker report released by the NRF and Hackett Associates. This shows major US retail container ports handled 1.75m Twenty-Foot Equivalent Units (TEU) in April, the latest month for which after-the-fact numbers are available. That was up 8.4% from March and up 6.9% year-over-year. A TEU is one 20-foot-long cargo container or its equivalent.
May was estimated at 1.88m TEU, up 3% year-over-year. June is forecast at 1.86m TEU, up 0.3%; and July at 1.93m TEU, up 1.1%.
Meanwhile, looking further ahead, August is forecast at 1.95m TEU, up 3.3%; September at 1.89m, up 0.9%, and October at 1.95m TEU, down 4.4%.
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By GlobalDataThe August and October numbers would be the highest monthly totals since the 2m TEU record set last October as retailers rushed to bring merchandise into the country ahead of expected tariff increases.
Imports during 2018 set a new record of 21.8m TEU, an increase of 6.2% over 2017’s previous record of 20.5m TEU. The first half of 2019 is expected to total 10.6m TEU, up 3% over the first half of 2018.
Hackett Associates founder Ben Hackett adds: “One must wonder who the Trump administration is trying to punish with its growing enthusiasm for tariffs. The tariffs are offsetting much of the savings from tax cuts, and if this continues there could be tough months ahead.”
