Latest news with #China-to-U.S.
Yahoo
21-05-2025
- Business
- Yahoo
LA Port Director Expects ‘Muted' Peak Season Despite Expected Cargo Surge
Although temporary relief was granted to China-to-U.S. supply chains when the countries agreed to substantially roll back tariffs for 90-days, West Coast ports are starting to feel the initial impacts of tariffs after a busy April. The Port of Los Angeles experienced a more than 30 percent decline in inbound cargo volume in the first week of May, with the remainder of the month 'likely to be substantial,' according to executive director Gene Seroka. More from Sourcing Journal US Ports Warn of $6.7B Bill if 100% Tariff on China-Made Cranes Kicks in NRF VP: Retailers 'Need Clarity' on New China Tariff Deadline Trans-Pacific Freight Rates Soar as China Cargo Bookings Rebound Its twin gateway, the Port of Long Beach, is now expecting a more than 10-percent drop-off in imports, according to CEO Mario Cordero. During the first 15 days of this month, 74 container ships arrived at the San Pedro Bay ports, 11 fewer than usual, according to data from Marine Exchange of Southern California. The Port of Los Angeles processed 842,806 20-foot equivalent units (TEUs) in April, 9.4 percent more than last year. the Port of Long Beach, moved 867,493 TEUs in April, up 15.6 percent from the same month last year and surpassing the previous record set in April 2022 by 5.7 percent. So far this month, 17 out of 80 sailings have been canceled and another 10 cancellations next month are expected, Seroka said during his monthly news briefing held Monday. The industry has largely seen a surge in China-to-U.S. cargo bookings in the wake of the rollback, with container movement on the trade lane skyrocketing 157.6 percent week-over-week for the week of May 12, according to data from container-tracking platform Vizion. This is the strongest weekly volume this year by landslide, the company says. But Seroka has held a more subdued viewpoint about the impacts of the incoming imports on the L.A. port in recent interviews. His recent briefing was no different. 'You won't see a deluge of freight here at the Port of Los Angeles,' said Seroka. 'That likely means that there'll be lower inventory across a variety of retail sectors. That'll leave us with fewer selections of products and likely higher prices. But for now, uncertainty remains in every business meeting that I have.' Based on the lower inventory and higher prices, Seroka expects import levels during the peak season 'may be a little bit more muted compared to years past.' While Seroka acknowledged that the L.A. port was going to see an uptick in bookings from China, he said any potential surge would not overtly impact the gateway's ground operations. Seroka highlighted the port's ability to learn from Covid in moving 25 percent more empty containers back to Asia in April, using it as an example for how it better responds to 'the peaks and valleys of import demand.' 'Right now, we have less than 30 percent of the number of containers that we had during the peak during Covid,' Seroka said. Like Seroka, ZIM CEO Eli Glickman did not want to jump the gun on import projections either, and remained cautious on the expectations for trans-Pacific trade for the remainder of 2025 even after the anticipated surge. According to Glickman, it is 'too early' to determine whether the coming rush will represent a return to normalized U.S.-China volumes. 'I think the more important element that will allow us to have a more definitive view as to how volume can look like for the second half of 2025 will be very much where we'll land from a tariff discussion perspective once the [first] 90-day pause has elapsed, which is now coming up soon July 9,' said Glickman. Nevertheless, ZIM is one of multiple carriers realigning its network to account for a possible trans-Pacific normalization, with the ocean carrier reversing its prior decision to suspend its Central China Xpress (ZX2) service line. This reinstates a trade lane that travels eastbound directly from the Port of Ningbo to Los Angeles, before traveling west back to the Port of Shanghai. Ocean Network Express (ONE), HMM and Yang Ming will bring forward their Premier Alliance Pacific South 5 (PS5) service launch to June 5 in anticipation of increased market demand. The six-week service will host six vessels, and will call at the ports of Qingdao and Ningbo before sailing the Pacific to the Long Beach and Oakland ports. It will then turn back to Kobe, Japan, before returning to Qingdao. One carrier, South Korea's KMTC, is returning to the trans-Pacific trade lane for the first time in 40 years, joining SeaLead Shipping's Asia-to-U.S. West Coast service. That line will start sailing on June 17, with KMTC providing one vessel to the grouping.
Yahoo
20-05-2025
- Business
- Yahoo
China tariff reduction drives uptick in Asia-to-US bookings
This story was originally published on Supply Chain Dive. To receive daily news and insights, subscribe to our free daily Supply Chain Dive newsletter. The Port of Los Angeles expects to see bookings from Asia pick up following the 90-day tariff reduction on China-based goods, Executive Director Gene Seroka said during a May 19 press briefing. A push to import cargo prior to duties increasing to 145% again will likely contribute to the uptick, Seroka said. However, prices are still very much elevated, which will continue impacting shipping activity. 'We'll probably see that uptick in origin bookings, especially from China, but I don't see a surge that would really overtly impact the Port of Los Angeles,' Seroka said. 'On the ground right now, we have less than 30% the number of containers that we had during the peak of the peak during COVID.' Shippers and supply chain stakeholders have battled trade instability as negotiations play out between the U.S. and China. After months of tariff-driven frontloading — a common strategy to navigate logistics hurdles — some shippers began pausing ocean shipments from China to avoid paying the high tariff rates. In April, China-to-U.S. freight demand plummeted 30% to 50%, per Freightos. Trading partners outside of China have been subject to a 10% baseline tariff since President Donald Trump issued a 90-day pause on most country-specific duties in April. However, the 90-day pause is 'not a long time in our business,' Seroka said. 'May is traditionally the month where a lot of purchase orders go in for the year-end and Christmas holidays,' he said. 'It typically takes about three months to send an order to a factory, have those goods made and get them ready to ship from Asia to the United States.' The port director added that there may also be a stronger flow of goods, like hospital supplies and some manufactured parts and components, as inventory dwindles Last month the Port of Los Angeles processed 842,806 twenty-foot equivalent units, up 9.4% year over year — its third-best April on record, the port reported. Since the start of 2025, the port has handled over 3.3 million TEUs, up 6.2% YoY. Loaded imports landed at 439,230 TEUs in April, up 5% YoY primarily due to importers pushing to move cargo before tariffs take effect. Exports, meanwhile, were down 3% YoY to 128,394 units, marking the fifth consecutive month in declining exports. Empties were up 25% YoY to 275,183 container units. Seroka also reported a 30% drop in imports in the first week of May, adding that the total monthly decrease is 'likely to be substantial." Looking ahead, cargo flows for June and July remain uncertain, said Seroka. In May, 17 of 80 sailings have been canceled so far — 11 of those cancellations being China port calls. As of the press briefing, 10 cancellations are slated for June. Seroka noted that a third-party logistics company reported that bookings three weeks down the line are 80% of what is typically expected for this time of year. 'So, I don't know that we're going to see — with the information I have today — that we're going to see just such an amount of cargo that it's going to put us at a stoppage and have ships at anchor, like we witnessed before,' he said. 'I think it's a more deliberate flow, and I'm looking at real data from trusted contacts in Asia that are working both private sector and at ports, looking at how these bookings are starting to pick up.' Recommended Reading Brands temporarily halt ocean shipments from China Sign in to access your portfolio
Yahoo
16-05-2025
- Business
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Container ship owners swamped as US-China trade detente revives demand
By Lisa Baertlein, Farah Master and Casey Hall LOS ANGELES/HONG KONG (Reuters) -Container ship bookings for China-to-U.S. cargo have surged since the countries declared a 90-day truce on punitive tit-for-tat tariffs last weekend, operators said, spawning traffic jams at Chinese ports and factories that could take weeks to clear. U.S. importers of sneakers and sofas to construction supplies and auto parts are racing to get goods in before the deadline resets tariffs again, setting the stage for disruptions that recall the global transport quagmire during the COVID-19 pandemic. The cargo surge at major trade gateways like Shenzhen's Yantian Port, which handles more than a quarter of China's exports to the United States, has ship owners scrambling to coordinate berths and adjust vessel schedules. "The demand is so high that we can only serve customers who have made long-term contracts with us," a spokesperson for German container ship operator Hapag-Lloyd told Reuters. "We have hardly enough space for spontaneous bookings." Container-tracking software provider Vizion said average bookings for the seven days ended on Wednesday soared 277% to 21,530 20-foot equivalent units from the 5,709 TEU average for the week ended May 5. Owners of factories that make toys to holiday decor told Reuters they are booking previously frozen cargo headed to U.S. stores, including Walmart. Lalo, for example, which sells its baby furniture online and through retailers like Target and is among the companies that gave factories the green light to move their finished orders. "We had hundreds of thousands of units waiting to ship," said Lalo co-founder Michael Weider. "These products can now get on the water." "Everybody is very busy from my company, at my friend's companies," said Richard Lee, CEO of NCL Logistics, in China's southern metropolis of Shenzhen. "They are preparing a lot of cargo, a lot of products, to be shipped immediately from China to the U.S." SECOND TSUNAMI? The shipping surge will translate into a rush of arrivals at U.S. West Coast ports in the coming weeks. Still, industry experts, including the executive director of the Port of Los Angeles - the busiest U.S. seaport and No. 1 for ocean shipments from China, do not foresee a COVID-level tsunami of cargo. Rather, they project a large, but manageable wave. On Thursday, the off-contract spot rate from Shanghai to Los Angeles shot up 16% from the prior week to $3,136 per 40-foot container, according to data from maritime consultancy Drewry. That is less than half than in April 2024, but could jump sharply on June 1 to about $6,000 per container if ship owners push through rate increases. In the early days of the pandemic, as now, cargo demand spikes overwhelmed factories and container ships, kinking supply chains. Shipping and retail experts said 90 days is not enough time for most factories to fill new orders. Fewer slots are available on cargo ships because vessel owners had been culling China-to-U.S. voyages and schedules. Now, ocean carriers are "cancelling cancellations" of sailings, Drewry said. Demand, however, is markedly different this time. Trump's second-term tariffs have weakened U.S. retail sales, homebuilding and manufacturing - key drivers of container shipments. Moreover, many U.S. companies are sitting on inventory accumulated before Trump imposed tariffs on China and other countries. And nobody knows what import duties will be when the 90-day deadline expires in August. The Trump administration confirmed to Reuters that the U.S. rate would reset to 54%, assuming no agreement is reached by the deadline. HIGH ANXIETY Many retailers are prioritizing which products to order and ship, said Jessica Dankert, vice president of supply chain for the Retail Industry Leaders Association trade group, whose members include Home Depot, Gap and Dollar General. "It's still 30% at the end of the day," said Jamie Salter, CEO of Authentic Brands Group, referring to tariffs on China. Authentic Brands owns and licenses clothing brands including Reebok, Champion, and Forever 21. Some large suppliers to Detroit's Big Three automakers told Reuters that on customers' requests, they are flying in parts from China and stockpiling them. Others declined to add to inventories, saying they lacked the space and funds to do so. A Halloween goods exporter from the city of Yiwu in China, who gave her English name, Cecilia, said tariff increases have cut total orders in half this year and warned that prospective buyers are running out of time. "If you order now, you will have an anxious wait to see if it will be too late," she said. Jimmy Zollo, CEO at Joe and Bella, sells Chinese-made clothing for adults who have trouble dressing themselves due to arthritis, dementia or being in a wheelchair. He placed a new order with his supplier even though the 90-day window could close before he can take delivery. "We're hopeful that a new trade agreement is implemented, and the lowered tariffs do not expire," Zollo said.
Yahoo
16-05-2025
- Business
- Yahoo
Container ship owners swamped as US-China trade detente revives demand
By Lisa Baertlein, Farah Master and Casey Hall LOS ANGELES/HONG KONG (Reuters) -Container ship bookings for China-to-U.S. cargo have surged since the countries declared a 90-day truce on punitive tit-for-tat tariffs last weekend, operators said, spawning traffic jams at Chinese ports and factories that could take weeks to clear. U.S. importers of sneakers and sofas to construction supplies and auto parts are racing to get goods in before the deadline resets tariffs again, setting the stage for disruptions that recall the global transport quagmire during the COVID-19 pandemic. The cargo surge at major trade gateways like Shenzhen's Yantian Port, which handles more than a quarter of China's exports to the United States, has ship owners scrambling to coordinate berths and adjust vessel schedules. "The demand is so high that we can only serve customers who have made long-term contracts with us," a spokesperson for German container ship operator Hapag-Lloyd told Reuters. "We have hardly enough space for spontaneous bookings." Container-tracking software provider Vizion said average bookings for the seven days ended on Wednesday soared 277% to 21,530 20-foot equivalent units from the 5,709 TEU average for the week ended May 5. Owners of factories that make toys to holiday decor told Reuters they are booking previously frozen cargo headed to U.S. stores, including Walmart. Lalo, for example, which sells its baby furniture online and through retailers like Target and is among the companies that gave factories the green light to move their finished orders. "We had hundreds of thousands of units waiting to ship," said Lalo co-founder Michael Weider. "These products can now get on the water." "Everybody is very busy from my company, at my friend's companies," said Richard Lee, CEO of NCL Logistics, in China's southern metropolis of Shenzhen. "They are preparing a lot of cargo, a lot of products, to be shipped immediately from China to the U.S." SECOND TSUNAMI? The shipping surge will translate into a rush of arrivals at U.S. West Coast ports in the coming weeks. Still, industry experts, including the executive director of the Port of Los Angeles - the busiest U.S. seaport and No. 1 for ocean shipments from China, do not foresee a COVID-level tsunami of cargo. Rather, they project a large, but manageable wave. On Thursday, the off-contract spot rate from Shanghai to Los Angeles shot up 16% from the prior week to $3,136 per 40-foot container, according to data from maritime consultancy Drewry. That is less than half than in April 2024, but could jump sharply on June 1 to about $6,000 per container if ship owners push through rate increases. In the early days of the pandemic, as now, cargo demand spikes overwhelmed factories and container ships, kinking supply chains. Shipping and retail experts said 90 days is not enough time for most factories to fill new orders. Fewer slots are available on cargo ships because vessel owners had been culling China-to-U.S. voyages and schedules. Now, ocean carriers are "cancelling cancellations" of sailings, Drewry said. Demand, however, is markedly different this time. Trump's second-term tariffs have weakened U.S. retail sales, homebuilding and manufacturing - key drivers of container shipments. Moreover, many U.S. companies are sitting on inventory accumulated before Trump imposed tariffs on China and other countries. And nobody knows what import duties will be when the 90-day deadline expires in August. The Trump administration confirmed to Reuters that the U.S. rate would reset to 54%, assuming no agreement is reached by the deadline. HIGH ANXIETY Many retailers are prioritizing which products to order and ship, said Jessica Dankert, vice president of supply chain for the Retail Industry Leaders Association trade group, whose members include Home Depot, Gap and Dollar General. "It's still 30% at the end of the day," said Jamie Salter, CEO of Authentic Brands Group, referring to tariffs on China. Authentic Brands owns and licenses clothing brands including Reebok, Champion, and Forever 21. Some large suppliers to Detroit's Big Three automakers told Reuters that on customers' requests, they are flying in parts from China and stockpiling them. Others declined to add to inventories, saying they lacked the space and funds to do so. A Halloween goods exporter from the city of Yiwu in China, who gave her English name, Cecilia, said tariff increases have cut total orders in half this year and warned that prospective buyers are running out of time. "If you order now, you will have an anxious wait to see if it will be too late," she said. Jimmy Zollo, CEO at Joe and Bella, sells Chinese-made clothing for adults who have trouble dressing themselves due to arthritis, dementia or being in a wheelchair. He placed a new order with his supplier even though the 90-day window could close before he can take delivery. "We're hopeful that a new trade agreement is implemented, and the lowered tariffs do not expire," Zollo said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
14-05-2025
- Business
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Hapag-Lloyd: China-to-US Volumes Surge 50% Since Tariff Rollback
Hapag-Lloyd is seeing a surge in container volumes on the China-to-U.S. trade lane after the countries agreed to lower their respective tariffs for 90 days. Bookings from China to the U.S. shot up 50 percent compared to the week prior, according to Rolf Habben Jansen, CEO of Hapag-Lloyd, in an earnings call Wednesday morning. More from Sourcing Journal Temu Re-Ups Direct-from-China Shipments Amidst Tariff Pause Suez Canal Offers 15% Rebates to Attract Shipping Back to the Red Sea Ocean Carriers Levy Surcharges, Cut Pakistan Port Calls Amid India Trade Embargo Additionally, import bookings are up 'in double-digit percentages' compared to the pre-tariff period, he said. While Hapag-Lloyd doesn't expect the 50 percent increase to hold up, Habben Jansen said he expects to see 'a little bit of a surge' in volume over the next 60 to 90 days. Beyond that period, it would be difficult for the ocean carrier to predict volumes, which will be dependent on trade agreements the U.S. makes with China and other countries. The volume increases represent a clear reversal from before the tariff rollback, when Hapag-Lloyd saw 'bookings being down on average around 20 percent, with peaks up to 30 percent,' in recent weeks. Some of that dip was compensated elsewhere by additional volume from Southeast Asia, Habben Jansen said. With the swift return of cargo to the trans-Pacific trade lane, Hapag-Lloyd's Gemini Cooperation with Maersk is going back on its original vessel swapping plans to further align with the capacity on the route. 'We deployed some smaller ships on the trans-Pacific instead of doing blanks in order to continue to offer those weekly sailings. Now we will reverse that, and that means that we will, as of next week or the week after next, go and deploy bigger ships again in the positions where we have put smaller ones in over the last couple of weeks,' Habben Jansen said. 'I expect that people that have put blanks into their schedules, as the quarter progresses, will continue to put ships and services back in.' Blank sailings had been the calling card for many carriers in the wake of the 145-percent tariffs on imported Chinese goods, but Hapag-Lloyd and Maersk opted not to take that approach. In the wake of the change in volume, Habben Jansen said he doesn't expect congestion to overwhelm the ports, but remained wary about them accepting too many extra ships in the coming weeks. Like other industry experts, the CEO expects at least a brief increase in ocean spot freight rates on the elevated U.S. imports. 'More than half of the cargo we have is contracted cargo, so we will continue to move that as per contract. But of course, there are also spots that have not yet been booked because they move on short term rates,' Habben Jansen said. If, as we see right now, demand is significantly stronger than or more than supply, then it would not be illogical if short-term rates go up.' Amid the about-face in the trans-Pacific, the container shipping giant affirmed its full-year guidance, with company stock increasing 12 percent Wednesday. The outlook calls for total earnings before interest and taxes (EBIT) to be in the range of $0 to $1.5 billion. The tariffs and the Red Sea crisis are two of the main factors that continue to subject the earnings range to such a high level of uncertainty, according to the company. Habben Jansen said the ocean carrier reassesses the Red Sea situation on a weekly basis, with the company judging whether the situation is safe for its workers—and whether it will remain that way for the foreseeable future—before making a return. 'We don't want to go in and out of the Red Sea all the time,' Habben Jansen said. 'We think there's going to be a transition phase of hopefully 60 to 90 days to gradually bring the ships back to their original routing. And that will generate some additional capacity.' If the Suez Canal does end up opening, Habben Jansen estimates that there would be a mid-single-digit increase in capacity that would open up for the company's ships. This total could expand up to the high-single digits, he said, but higher levels of congestion in Northern Europe and the U.S. and fuel-conserving slow steaming is likely to take up added capacity. Total revenue for the first quarter came in at $5.3 billion, up 15 percent year over year from $4.6 billion last year. Net profit at Hapag-Lloyd increased 45 percent to $469 million. The company's liner shipping segment saw 9 percent volume growth to 3.3 million 20-foot equivalent units (TEUs), the highest quarterly year-over-year increase Hapag-Lloyd has had in several years.
