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This is ground zero in Trump's trade war
This is ground zero in Trump's trade war

Boston Globe

time21-06-2025

  • Business
  • Boston Globe

This is ground zero in Trump's trade war

The Port of Los Angeles, along with a nearby facility in Long Beach, makes up a shipping complex that stretches across nearly 75 miles of Southern California shoreline. The ports are a bellwether for trade and the U.S. economy. Together, they move an astonishing 40% of the goods that come into the United States via containers. They also account for 30% of what the country exports. Get Starting Point A guide through the most important stories of the morning, delivered Monday through Friday. Enter Email Sign Up As Trump's chaotic and aggressive tariff strategy has seesawed this year, activity here has, too. That has threatened the livelihood of the roughly 100,000 workers at the port complex and complicated life for the hundreds of thousands of companies that bring goods through the port each year. The trends at the port hint at the pain that will ripple through the broader economy in the coming months as fewer and higher-priced goods travel from ports and warehouses to U.S. stores and consumers. Advertisement The ports experienced a surge of activity this year when shippers rushed to bring in goods before tariffs that reached their highest levels in a century. That rush has faded, and trade has become more sluggish. With higher tariffs set to snap back within weeks, importers and port workers remain cautious, unsure of what their futures will hold. Advertisement Most arrivals to the Southern California ports come from China. After Trump ratcheted up tariffs on Chinese goods to at least 145% in April, many shipments between the world's two largest economies came to a halt. From March to April, U.S. imports and the trade deficit plummeted by the biggest volume on record. In the roughly four weeks that the 145% tariffs were in effect, future bookings to send shipping containers from China to the United States plunged by half from a year earlier, according to data from Vizion and Dun & Bradstreet, which track global shipping activity. In May, Chinese exports to the United States were down roughly 35% from a year earlier, the biggest drop in decades apart from the pandemic. For the Port of Los Angeles in particular, May was the slowest month in more than two years. Now the port is preparing for another uptick in traffic, a delayed reaction after the president paused some levies in April so he could negotiate new trade deals. Bookings have since rebounded modestly, especially after an agreement in early May between the United States and China to reduce some of the tariffs they specifically targeted against each other. The surges and crashes are lowering the supply of certain goods. They are also pushing up the costs for companies to import goods. The cost of shipping a container to Southern California from China has doubled since the start of March, according to data from Freightos, a shipping marketplace, as importers try to find space on vessels in case tariffs increase. Advertisement For some economists, these compounding forces hold ominous implications. While inflation this year has stayed relatively steady so far, economists say the higher cost for imports could filter more noticeably into prices in stores later this year. Consumer demand could also weaken, a reaction in part to rash purchasing in the early months of 2025 before tariffs took effect. Companies and people rushed to buy machinery and cars, furniture and computers, meaning they could most likely spend less later this year. Mark Zandi, the chief economist of Moody's Analytics, said the tariffs posed a 'very significant threat to the economy' that would become visible in the next few months. 'The hit to the economy is dead ahead,' he said. 'We haven't dodged that bullet.' The ports are an illustration of the effects of globalization that Trump criticizes. As factories moved abroad over decades, particularly to China, the ports formed one end of a busy ocean superhighway. Most of that traffic flows in one direction. For every four containers that arrive stuffed with foreign cars, textiles and toys, only one is sent out filled with corn, soybeans and other U.S. exports. The other three containers often return empty -- evidence of the trade deficit that the president rails against. Trump has used tariffs to try to force Americans to buy more domestically made goods instead. The problem, critics say, is that this strategy threatens many jobs that Americans hold now, which are dependent on trade, without much indication that manufacturing could thrive again in the United States. Advertisement Only 8% of Americans work in manufacturing, down from 22% in 1980. Since Trump has returned to office and adopted protectionist policies, the number of manufacturing jobs is still roughly flat, according to the Labor Department. In fact, spending on the construction of new factories has slumped in recent months. 'Maybe it's a worthwhile goal to incentivize manufacturing jobs, but the way that we're going about it is putting a lot of other jobs at risk,' said Mario Cordero, the CEO of the Port of Long Beach. The days of U.S. manufacturing dominance, he added, are 'long gone.' Today, the ports are an economic engine in their own right, supporting the communities that blanket the rolling coastal hills leading down to San Pedro Bay. Across Southern California, port officials estimate, 1 million jobs are tied to the port, including truckers, warehouse workers, manufacturers and freight forwarders. Their jobs now hinge on the terms of trade set by the president. On the recent Thursday, the effects of the tariffs were evident in the union hiring hall across the channel from the Port of Los Angeles where dockworkers go each morning to claim new assignments. The screens displaying jobs for daily workers showed about 40% fewer positions than normal. Some truckers say tariffs have already hammered their business. Erick Gordon, the vice president of Redefined Transportation, a trucking business based in Long Beach, said he was moving roughly half the number of containers that he did last year. In response, his company had lowered its rates, pushed harder to get new business and let half its drivers go. He has had to sink money into his business just to hang on for now. Advertisement 'They're almost killing the industry,' he said. 'It's survival mode.' The last time the United States raised tariffs so high was nearly a century ago, when Congress passed the Smoot-Hawley Tariff Act in 1930. The move was meant to protect U.S. businesses during the Great Depression. It instead instigated a global trade war and deepened the economic crisis. Within two years, imports fell 40%. It took years for trade to recover. The Port of Los Angeles was founded two decades before, in 1907, and it blossomed because of its connection to major railroads. In the 1960s, the advent of the shipping container and the growth of factories in Asia began to transform the port. By the end of the 1980s, the Port of Los Angeles had eclipsed the ports of New York and New Jersey as the country's largest. After China's entry into the World Trade Organization in 2001, Chinese factories and the port grew in tandem. Now 45% of the port's business is connected to China, followed by Japan, Vietnam, South Korea and Taiwan. It receives some of the world's largest container ships, stretching the length of four football fields and holding tens of thousands of steel containers. Over the last decade, the ports have undergone a crash course in dealing with disruption. They say it has helped them in the current moment. Trump's trade war against China during his first term hit the ports hard. Shipments from China dropped sharply, though traffic from some other countries, like Vietnam, grew double digits. Advertisement With the onset of the pandemic, factories shuttered in China, and imports plunged again. Then the ports experienced an uptick as Americans stuck at home began mass ordering exercise equipment, office furniture, toys and video games. Jon Poelma, the managing director of APM Terminals, which is part of the Port of Los Angeles, said the pandemic had taught the port lessons about handling the shortages and surges it was seeing now, including how to maximize space when the port is overcrowded and better share information to speed up the flow of cargo. 'We got used to it,' he said. 'We tested our ability to handle pain.' Last month, dozens of semi trucks and self-driving straddle carriers were buzzing around the terminal, stacking pink, white, blue and gray containers. Hulking blue container ships stained with rust rose up behind the stacks. The part of the port that Poelma runs -- the biggest container terminal in the Western Hemisphere -- was emptier than in previous weeks. But it was still performing well compared with last year, in part because of its partnership with a major shipping alliance used by big retailers that have continued to bring in shipments when smaller companies have not. Poelma admitted that most importers were having trouble trying to figure out how to forecast demand. And he did not see those challenges abating anytime soon. 'The one thing that is certain is that it continues to be very uncertain,' he said. This article originally appeared in

Tariff truce keeps China-US trade flowing across the Pacific
Tariff truce keeps China-US trade flowing across the Pacific

Malaysian Reserve

time30-05-2025

  • Business
  • Malaysian Reserve

Tariff truce keeps China-US trade flowing across the Pacific

THE ceasefire in the tariff fight between the world's two largest economies is encouraging trade across the Pacific, holding up freight prices three weeks on, even as container bookings have begun to slow. Thanks to the reprieve, which began earlier this month, the price of shipping a forty-foot equivalent unit from Shanghai to Los Angeles notched its biggest relative weekly gain this year, rising by nearly 17% to $3,738. The price per container in the week through May 29 was still almost a third below this year's peak in January, but above a late-March nadir of $2,487, just before President Donald Trump's 'Liberation Day' announcement. Bookings for containers have eased though. In the first three days of this week, bookings totaled about 106,000 twenty-foot equivalent units, data from Vizion and Dun & Bradstreet show. That's a drop from 137,000 TEUs in the same period the previous week, as the initial enthusiasm that followed the announcement of the truce began to ease. Globally, the week beginning May 19 marked the highest volume of bookings so far this year. Data tracking shipping over the last two weeks, which tends to move at a lag to bookings, showed a similar softening. There were about 34 vessels departing Chinese ports for the US over the past 15 days, according to a Bloomberg analysis of transponder data. That's down from an average of 48 the previous week. The ships were also carrying one-third fewer containers. The delay between booking and sailing means that current departures from China to the US are frequently a reflection of the reality at the start of the month — in this case, when the US and China were still at loggerheads — prompting container liners to cancel or blank some services, meaning vessels sail empty. 'It's a fluid situation. What we're seeing is a constant rebalancing of the supply chain and between indicators like freight rates, bookings and sailings,' said Jayendu Krishna, a director at Drewry Maritime Services. Other factors contributing to the drop include Chinese companies' supply chains, which can allow them to ship products from other countries around the region, according to Bloomberg Intelligence shipping and logistics analyst Kenneth Loh. Capacity, however, is beginning to recover. Major container liners have already promised to add more, while smaller forwarders are also returning to the route after years of absence as demand improves. Chinese operator China United Lines will start shipping across the Pacific to connect Chinese ports with Long Beach, while South Korea's KMTC Line will resume a trans-Pacific service after pulling out from it for decades. Chinese trade overall is still at high levels, with the total number of containers processed at the country's ports up 6% last week from the same period a year earlier, the 16th straight week of improvement. And air cargo flights have also continued to rise, despite the US ending the de minimis tariff exemption for small packages. Earlier this month, Trump reduced duties on items valued up to $800 to 54% from 120%. –BLOOMBERG

Tariff truce keeps China-US trade flowing across the Pacific
Tariff truce keeps China-US trade flowing across the Pacific

Time of India

time30-05-2025

  • Business
  • Time of India

Tariff truce keeps China-US trade flowing across the Pacific

The ceasefire in the tariff fight between the world's two largest economies is encouraging trade across the Pacific, holding up freight prices three weeks on, even as container bookings have begun to slow. Thanks to the reprieve, which began earlier this month, the price of shipping a forty-foot equivalent unit from Shanghai to Los Angeles notched its biggest relative weekly gain this year, rising by nearly 17% to $3,738. The price per container in the week through May 29 was still almost a third below this year's peak in January, but above a late-March nadir of $2,487, just before President Donald Trump's 'Liberation Day' announcement. Bookings for containers have eased though. In the first three days of this week, bookings totaled about 106,000 twenty-foot equivalent units, data from Vizion and Dun & Bradstreet show. That's a drop from 137,000 TEUs in the same period the previous week, as the initial enthusiasm that followed the announcement of the truce began to ease. Globally, the week beginning May 19 marked the highest volume of bookings so far this year. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 2 ingredientes para remover as manchas na pele Conselhos E Truques Undo Bloomberg Data tracking shipping over the last two weeks, which tends to move at a lag to bookings, showed a similar softening. There were about 34 vessels departing Chinese ports for the US over the past 15 days, according to a Bloomberg analysis of transponder data. That's down from an average of 48 the previous week. The ships were also carrying one-third fewer containers. The delay between booking and sailing means that current departures from China to the US are frequently a reflection of the reality at the start of the month — in this case, when the US and China were still at loggerheads — prompting container liners to cancel or blank some services, meaning vessels sail empty. Bloomberg 'It's a fluid situation. What we're seeing is a constant rebalancing of the supply chain and between indicators like freight rates, bookings and sailings,' said Jayendu Krishna, a director at Drewry Maritime Services. Live Events Bloomberg Other factors contributing to the drop include Chinese companies' supply chains, which can allow them to ship products from other countries around the region, according to Bloomberg Intelligence shipping and logistics analyst Kenneth however, is beginning to recover. Major container liners have already promised to add more, while smaller forwarders are also returning to the route after years of absence as demand improves. Chinese operator China United Lines will start shipping across the Pacific to connect Chinese ports with Long Beach, while South Korea's KMTC Line will resume a trans-Pacific service after pulling out from it for decades. Bloomberg Chinese trade overall is still at high levels, with the total number of containers processed at the country's ports up 6% last week from the same period a year earlier, the 16th straight week of air cargo flights have also continued to rise, despite the US ending the de minimis tariff exemption for small packages. Earlier this month, Trump reduced duties on items valued up to $800 to 54% from 120%.

The 90-day rush to get goods out of China
The 90-day rush to get goods out of China

Mint

time25-05-2025

  • Business
  • Mint

The 90-day rush to get goods out of China

Adam Leeb is rushing to ship $700,000 of electronic typewriters from China while the trade truce holds. After forking out $23,000 for tariffs in March when President Trump hit Chinese goods with a new 20% levy, Leeb, a Detroit-based business owner, decided to pause shipments altogether when the administration then pushed tariffs to an eye-watering 145%. Now that a 90-day truce agreed between Washington and Beijing this month has brought that down to 30%, Leeb's company, Astrohaus, which makes typewriters, keyboards and other tools for writers, is taking the opportunity to restock. 'I'm assuming this is probably the best-case scenario for a while,' Leeb said. Sky-high tariffs pummeled U.S.-China trade and now the cease-fire is causing a snapback. Firms across the U.S. are racing to rebook canceled orders and find space on containerships to get products out of China and bring them stateside before the 90-day window closes in August. In the week beginning May 12, when the trade truce was announced, bookings for containers to the U.S. from China more than doubled compared with the week before as the tariff rollback unleashed a wave of pent-up demand. Bookings surged to the equivalent of around 2.2 million 20-foot boxes, a level not seen in more than a year, according to data from Vizion, a container-tracking software company, and data provider Dun & Bradstreet. Executives, logistics specialists and analysts are cautious about how big the rebound will get. They say there is still too much uncertainty over tariff policy and the health of the U.S.'s consumer-driven economy to fuel a splurge in new orders. Gene Seroka, executive director of the Port of Los Angeles, said earlier this month that he doesn't anticipate a big surge in imports after the rollback. Vizion's data show container bookings last week fell back to the equivalent of around 1.4 million 20-foot containers. Nonetheless, many Chinese manufacturers are welcoming any bump in activity after the high tariffs froze orders and halted production. Lisa Wang, a salesperson at a textile manufacturer in China's Zhejiang province, said the 90-day tariff pause has been a huge help to her company. The company has been able to ship out about a dozen containers of previously delayed orders, mostly mattress protectors and pillows. Clients are also placing some new orders. 'Because we don't know what the policy will be like after 90 days, we are rushing to ship what we can now,' she said. Shipping executives in Asia say one headache for importers is there aren't enough ships available to move goods to the U.S. right away. Carriers diverted some of the vessels that would usually ship goods to the U.S. West Coast from China to other busy routes when tariffs slammed U.S.-China trade. Some carriers replaced their biggest containerships with smaller vessels, while others canceled some scheduled sailings altogether, shipping executives say. Now, freight rates are picking up as importers compete for scarce space as carriers rush to bring ships back. The Shanghai Shipping Exchange's index of container prices to ship goods from Shanghai jumped 10% in the week beginning May 12, compared with the week before. 'The next 90 days will be quite chaotic,' said a senior logistics executive in Asia, who said it would take weeks to return rerouted vessels. But for many industries, 90 days just isn't long enough to get products ordered, manufactured and shipped across the Pacific. Vincent Ambrose, chief commercial officer of FranklinWH Energy Storage, which makes home energy-storage systems in California and Shenzhen, China, said the 90-day reprieve on tariffs isn't long enough to rush in extra stock, as manufacturing and delivery typically takes about 12 weeks. Even if he could, he said he can't compete with the likes of Amazon, Apple and Walmart for scarce space on U.S.-bound containerships. 'There's really no opportunity to rush a bunch of products here,' he said. Industry executives also say that a 30% tariff is still high enough to pinch trade, albeit not as severely as a 145% levy. Some products from China are subject to tariffs higher than the baseline 30% because of prior duties, making other countries more attractive for manufacturing still. 'Yes, there is a reprieve. Does that suddenly result in masses of volume? I honestly doubt it,' said Niels Rasmussen, chief shipping analyst at BIMCO, an international shipping association. Godfrey Chan, who started his business as a paper-goods manufacturer in China more than 30 years ago before opening a factory in northern Vietnam in 2023, said the trade truce hasn't sparked a rush back to China. Tariffs on the products he makes—which include paper bags with flowers, hearts and colorful designs for Christmas and birthdays—would total 55% if they were produced in China, compared with 10% currently on Vietnamese goods. His Vietnamese factory, Max Fortune VN Paper Products, has been slammed with orders from customers hoping to get products as soon as possible, while tariffs on Vietnamese goods are much lower than those on Chinese imports. 'You can easily see the difference,' Chan said. Earlier this year, the Trump administration placed tariffs of 46% on Vietnamese imports, but suspended them for 90 days, pending trade talks. Leeb, the typewriter maker, is keeping another order with his Chinese manufacturers on hold that was previously scheduled for production in August. He is worried about buying too much inventory and running short on cash if tariffs return to higher levels after the pause ends. He tried to negotiate lower prices with his Chinese manufacturers to reduce the burden of tariffs, but didn't manage to get price cuts because the factories are operating on low profit margins. Astrohaus has already raised prices up to 10% on certain products to deal with the tariff increase and is giving priority to presale orders. Leeb recently toured factories in Vietnam and Indonesia to explore moving some production outside of China for the first time. 'I have to take it seriously now,' he said. Write to Hannah Miao at and Jason Douglas at

China-US trade soars as exporters race to hit trade truce window
China-US trade soars as exporters race to hit trade truce window

Business Times

time21-05-2025

  • Business
  • Business Times

China-US trade soars as exporters race to hit trade truce window

[HONG KONG] A temporary trade truce between the world's two largest economies has sparked a knee-jerk bounce across China's ports and factory floors. In the week beginning May 12, when the US and China agreed to sharply reduce tariffs for 90 days, bookings on freighters headed from China to US shores more than doubled from the prior week to about 228,000 TEUs, or twenty-foot equivalent units, data from container-tracking platform Vizion and data provider Dun & Bradstreet shows. Prices for space on ships across the Pacific into the US also rose, with spot rates from Shanghai to Los Angeles jumping about 16 per cent – the biggest increase for the route this year – to US$3,136 per forty-foot equivalent unit for the week ending May 15, according to the Drewry World Container Index. The global composite index also rose the most this year. And the demand was not just by sea: The number of international air cargo flights rose almost 18 per cent, according to data released by China's Ministry of Transport. The surge is likely a wave of front-loading as the trade truce opens a window to avoid steep US tariffs, said Jayendu Krishna, a director at Drewry Maritime Services. It's also an important buying season for the holidays – it takes about a month for items to arrive stateside and retailers are rapidly running through inventory they have had on hand awaiting some trade certainty. 'The current surge in bookings is likely to lead to supply chain disruptions for the next two to three months, unless there is another tariff shock from Trump,' Krishna said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Bookings on ships are due to be filled by factories like supply-chain manager Chen Lei's, which makes various types of home appliance products from coffee machines and toasters to irons and humidifiers. The Guangdong-based manufacturer where Chen works counts Royal Philips and Walmart among clients, and has received a flurry of requests from the US to resume production on orders that were put on hold in April. 'Machines in the factories are working non-stop now,' said Chen. '90 days is too short. Production, shipping – we can't wait a single minute.' AP Moller-Maersk, a major container liner that's also one of the largest on the trans-Pacific route, added capacity again after seeing an increase in bookings when the truce was announced, a spokesperson said. Even with the boost in activity from earlier weeks, the overall level of shipments remains in-line with this time last year. That shows many retailers are either not ordering to the same extent, waiting for more certainty, or maybe have already stocked up earlier this year. Liners were also bringing unused capacity already on these routes back online, with the share of voided sailings down to 13 per cent as at May 26, compared to 25 per cent a week before, data from HSBC and Flexport show. A flurry of trade figures from across Asia this week show the chaos that Trump's policies have wrought this year. In South Korea, the value of exports fell 2.4 per cent in the first 20 days of May from the prior year, with outbound shipments to the US down about 15 per cent. Japanese exports rose only 2 per cent in April – the weakest growth in seven months, data out on Wednesday (May 21) showed. BLOOMBERG

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