New signals on exports to the U.S. and why U.S. importers are stocking up again Fer House

The peak season at U.S. West Coast ports is earlier than usual.

The Red Sea crisis has led to capacity constraints that have pushed freight rates higher, but why did U.S. importers pick this time to start stocking up?

In the opinion of Matt Priest, president of the Association of Footwear Distributors and Retailers, freight rates are higher now than they were more than two years ago. The reason for this is that, for one thing, while some of the Biden administration's new tariffs won't directly affect the footwear industry, "we think capacity is already tightening up in order to get product in before the tariffs go into effect on Aug. 1."

"There is also the question of whether former U.S. President Donald Trump will win the election in November." Priest explained that Trump's campaign proposed raising tariffs, which prompted many U.S. footwear distributors and members of retailer associations to consider shipping their products into the U.S. ahead of a possible decision to raise tariffs.

Trump's proposed tax idea involves a number of countries and regions. In a recent briefing, Gene Seroka, Executive Director of the Port of Los Angeles, responded to a question about global shipping lane turmoil and tariff uncertainty by stating, "If Trump wins and imposes a 10 percent tariff on imports in general, and a 60 percent tariff on imports from China, it could change the landscape and the future of the Port of Los Angeles. "

"But since Trump first imposed tariffs in 2018, we've been pretty flexible and we've definitely been out there grabbing goods." Seroka said.

For his part, Roger, an industry insider who works year-round on U.S. linehaul in California, said that one factor currently influencing importers' decision-making when it comes to replenishing inventory is the U.S. election.

Trade volumes at U.S. West Coast ports grew strongly in the first half of the year.

The Port of Los Angeles, California, handled 4.7 million 20-foot containers (TEUs) in the first half of 2024, up 14.4 percent from the same period last year, according to the latest data released by the Port of Los Angeles.

Seroka said that falling inflation, rising wages and a strong job market have spurred consumer spending, which has resulted in steady cargo volumes, "and I think we'll see that pattern continue as we move through the third quarter"

The neighboring Port of Long Beach also posted its highest-ever June total, with inbound container throughput the highest since mid-2022.2024 In the first half of the year, the Port of Long Beach's total container volume was up 15 percent compared to the same period last year.

We are regaining market share, and consumer spending is driving cargo to our terminals as the peak shipping season approaches," said Port of Long Beach CEO Mario Cordero. I see moderate growth in the second half of 2024."

Not traditionally a peak season until September, the season on the West Coast came earlier than usual due to concerns about more U.S. tariffs on Chinese goods and the impact of strikes by port workers on the East and Gulf coasts.

On May 14 local time, the U.S. released the results of the four-year review of the 301 tariff increase on China, announcing that on the basis of the original 301 tariffs on China, it would further increase tariffs on imports from China of electric vehicles, lithium batteries, photovoltaic batteries, key minerals, semiconductors, and steel and aluminum, port cranes, and personal protective equipment.

Among them, the new tariffs targeted for 2024 started on August 1 this year, and the tariffs targeted for 2025 and 2026 will start on January 1 of that year.

On May 14, a spokesperson for the Ministry of Commerce (MOFCOM) spoke on the U.S. side's release of the results of the four-year review of the 301 tariffs imposed on China, expressing China's resolute opposition and making solemn representations. The spokesman for the Ministry of Commerce said that the U.S. side, out of domestic political considerations, abused the 301 tariff review process to further raise some of the 301 tariffs imposed on China's products, and politicized and instrumentalized economic and trade issues, which is typical of political maneuvering, with which China expresses its strong dissatisfaction. The WTO has long since ruled that the 301 tariffs violate WTO rules. Instead of correcting it, the United States side is bent on making mistakes again and again.

Importers are also now worried about Trump's proposed tariff plan.

In his latest interview, Trump said he would impose a 10 percent tariff across the board on imports from other countries and complained that foreign countries aren't buying enough American goods.

He cited Europe's reluctance to import U.S. automobiles and agricultural products as the main reason for the more than $200 billion trade deficit between the two sides, a statistic he considers an important measure of economic fairness.

In a campaign speech on March 17 of this year, Trump went so far as to say, "We're going to put a 100 percent tariff on every imported car." However, Trump did not specify who the tariffs would be levied on, and it is not clear whether Trump is only taxing imported cars, or whether he is also including parts.

Cui Hongjian, director of the Center for the Study of the European Union and Regional Development at Beijing Foreign Studies University, said that from the perspective of auto tariffs, Trump had raised the issue during his first term. He argued that the rise of the European auto industry had impacted the U.S. auto industry, leading to a large number of workers losing their jobs. Therefore, if he comes back to power, he will likely continue to pursue this policy.

"On the European side, I think there will be a bargaining strategy. They can come up with an overall program that will align and balance the interests of other parties as a way to soften the impact of the tariffs." He said, "In addition, Europe may shift the conflict outward. For example, at present, China has become the world's top auto exporter, and Europe may use this to shift its focus to China as a shield against Trump's tax hikes."

"I think Europe's response strategy will jump out of soft and hard and become more pragmatic. If Trump comes back into power and announces tariff hikes, Europe will no longer react emotionally, as they have fully experienced the ineffectiveness of emotional responses over the past four years. Instead, they will pay more attention to details and specific issues and seek a benefit exchange with the US." Cui Hongjian said.

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