Court battle over Trump tariffs prolongs shipper uncertainty as holiday season nears
[LOS ANGELES] Importer uncertainty ahead of the vital holiday ocean shipping season remains high, the executive director of the busiest port in the US said on Thursday, as a court battle broke out over President Donald Trump's trade tariffs.
A US Court of International Trade ruling late on Wednesday threatened to kill or at least delay the imposition of Trump's 'Liberation Day' tariffs on most US trading partners, but a federal appeals court on Thursday temporarily reinstated those duties.
Gene Seroka, executive director at the Port of Los Angeles, said business is softer than usual going into traditional ocean shipping season for back-to-school, Halloween, Thanksgiving and Christmas merchandise.
He expects the port's May volume to be down by double-digit percentages versus a year earlier, after 30 per cent drops in the first and fourth weeks of the month.
For June, 10 scheduled vessel arrivals to the Port of Los Angeles have been cancelled, including five in the first week of the month, Seroka added.
'Companies really don't have the certainty, and they remain on pause,' he said, adding that since January, there have been close to 60 different announcements on trade policy and tariffs.
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The Port of Los Angeles is the No. 1 ocean gateway for goods from China and seen as a barometer for trade between the world's two largest economies. Key customers include major retailers like Walmart and sellers of parts for major auto makers such as Ford.
Trump slapped 145 per cent tariffs on China last month, halting many shipments of goods to the United States. The resulting drop in cargo volume was delayed by two to three weeks due to transit times, and this month fewer ships carrying less cargo are docking at the Port of Los Angeles and other seaports.
That's despite the US and China striking a deal to temporarily reduce tariffs on Chinese goods to 30 per cent earlier this month.
The federal appeals court on Thursday directed the plaintiffs in the legal challenge to the tariffs to respond by June 5 and the Trump administration to respond by June 9, meaning the uncertainty is likely to drag on.
'People are really wagering right now, 'Do I put my order in at elevated tariff rates? Could something change over time?'' Seroka said. 'There's no surge coming our way.' REUTERS
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