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Trump tariff threat helps lift US ocean imports

investing.com 18/12/2024 - 11:03 AM

New Import Tariffs Prompt Retailers to Act

By Lisa Baertlein
LOS ANGELES (Reuters) – When U.S. presidential candidate Donald Trump started discussing new import tariffs on the campaign trail, Danny Reynolds, owner of a bridal salon, checked the tags on wedding dresses and expedited shipments to his Indiana clothing store.

> "I was grabbing tags specifically to look at the country of origin and it was China, China, China, China, China, China," said Reynolds, who moved deliveries of around 20 bridal gowns ahead by about two months.

Trump has threatened to impose tariffs of at least 10% on goods from China and 25% on products from Mexico and Canada. This has led importers like Reynolds to bring in goods early to avoid higher costs that are often passed to consumers.

A potential second round of Trump tariffs, effective after his presidency begins on Jan. 20, adds to other factors such as robust U.S. consumer spending, federal investment in electric vehicle manufacturing, and potential strikes at East and Gulf Coast seaports, prompting a surge in U.S. imports.

Container-tracking software provider Vizion reported that Walmart, a major container shipper, has increased bookings each week since the third week of September, reflecting front-loading behavior.

Columbia Sportswear has also shown significant year-over-year increases in bookings. However, these retailers did not respond immediately to requests for comments.

In November, U.S. manufacturers, especially in consumer goods, increased their safety stocks in preparation for possible tariff hikes, stated John Piatek, VP at procurement software provider GEP.

According to trade data from Descartes Systems Group, U.S. imports of containerized goods rose by 12.8% year-over-year in November, with imports from China up by 13.3%.

Analyst Fadi Chamoun of BMO Capital Markets anticipates elevated import levels could continue into the first quarter of 2025 as shippers aim to evade new tariffs under Trump.

Port of Los Angeles Executive Director Gene Seroka noted that uncertainty looms over what to expect, adding that the busiest U.S. container seaport is on track for its highest December on record.

Reflecting on past experiences, Seroka warned, "We saw a run-up of cargo before tariff milestones or implementation dates, followed by a significant drop-off."

Retailer Reynolds expressed concern about the unpredictability of the situation, stating, "The best hope is that some of this is, for lack of a better way to put it, scare tactics on the President-elect's part."




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