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Port Boss' Advice for Anxious Consumers as Tariff-Related Shortages Loom
@Source: newsweek.com
The Port of Long Beach moves nearly 15 percent of all cargo arriving in shipping containers and destined for the U.S. It is one half of the West Coast's twin-engine gateway—alongside the Port of Los Angeles—that has powered America's supply chain for decades, a symphony of advanced logistics, industrial might and human labor that's responsible for the buffet of material abundance American consumers have come to take for granted.But in recent weeks, that engine has begun to stall.Mario Cordero, executive director of the Port of Long Beach, told Newsweek a wave of canceled orders and growing uncertainty over the on-again, off-again tariffs is already constricting a key trade artery—and if nothing changes before July 2, when a 90-day suspension on steep new tariffs targeting Chinese imports expires, consumers could soon feel the impact on store shelves and in their wallets."If you're planning to buy something that could face a high tariff—like electronics—buy it before July 2nd," Cordero told Newsweek. "We're in a moment of radical uncertainty."A Ticking ClockThe cause, according to Cordero, is rooted in a sharp shift in U.S. trade policy. A sweeping slate of tariffs announced by the Trump administration has sent shockwaves through the shipping industry, particularly for goods from China. While some products are temporarily exempt, others—like industrial parts, plastics, toys and basic household items—now face levies as high as 145 percent. China responded with a 125 percent tax on U.S. exports.Cordero's concern is far from abstract. A recent report from Sea-Intelligence, a maritime data analytics firm, found that the trade war has led many shippers to pause—or outright cancel—shipments, with the Port of Long Beach already feeling the impact."We've had 34 canceled sailings through the end of June," he said. "That clearly indicates fewer vessels will be arriving—and that, of course, means lower volume."Canceled sailings—called "blank sailings" in industry terms—are one of the earliest signs that global trade is in the process of a major retrenchment. Each "blank" translates to tens of thousands of containers that will not reach American shores. At the nearby Port of Los Angeles, another 36 sailings have been dropped, bringing the San Pedro Bay complex's total to 70 missed shipments.In a typical week, the Port of Long Beach plans for about 17 vessel arrivals. This week, Cordero said, only three or four were expected.Importers FrontloadData from the Census Bureau showed a spike in imported goods, from $268 billion in October to $343 billion by March, before collapsing in April. Many Chinese firms, attempting to frontload ahead of the tariffs, accelerated exports to the U.S. in the first quarter, surging over 10 percent year-on-year despite mounting geopolitical tensions."Importers were trying to avoid future tariffs," Cordero said of the early-year surge. "But now, that volume is declining."The uncertainty, which Treasury Secretary Scott Bessent labeled on Monday as "part of the negotiation" the administration is conducting with various trade partners, has left importers wary during what should be the busiest time of year. July marks the beginning of peak shipping season, when back-to-school and holiday merchandise makes its way into the U.S. ahead of fall.But shipments arriving in July need to be booked now, in May. And for many retailers, those decisions are on hold."If you're an importer in the U.S. planning to bring in cargo from Asia—especially China—you're likely hesitating," Cordero said. "Many are leaving products in warehouses in Asia."Or as Owen Carr, chief merchandising officer for e-commerce firm Spreetail, put it: "You don't want to be the idiot that imported at 145 percent, because you'll never get that money back."While much of the public focus has been on tariffs targeting Chinese imports, Cordero, a former chairman of the Federal Maritime Commission, said the disruption extends well beyond a single nation."This issue isn't limited to China—51 countries could face high tariffs," he said. That includes Vietnam, which had previously benefited from companies like Nike and Adidas moving their assembly lines out of China. "Now, even Vietnam could face a 46 percent tariff."On the WaterfrontAt stake, Cordero said, are the jobs and livelihoods that depend on the volume of goods flowing through Southern California's waterfront. "If nothing changes, the supply chain will face job losses," he told Newsweek, listing truck drivers, warehouse staff and dockworkers as those first in line for disruption.Gary Herrera, president of International Longshore and Warehouse Union (ILWU) Local 13, said union members are anxious. "Some of the workforce will not be getting their full 40 hours a week based on the loss of cargo. Job loss is definitely a concern," Herrera told the Los Angeles Times. "This is the ripple effect of not having work at the waterfront."President Trump has defended the tariffs as leverage to renegotiate trade terms and boost domestic manufacturing. "At some point, I'm going to lower [tariffs on China] because otherwise, you could never do business with them," Trump said, appearing to acknowledge that the current 145 percent rate was not sustainable.But as port officials warn that more than 30 scheduled ship arrivals will be skipped at the ports of Los Angeles and Long Beach in May—taking an estimated 400,000 containers out of circulation and straining an economy that depends on just-in-time logistics—Cordero is nonetheless staying optimistic, believing at least some tariff negotiations will be resolved before the full impact is felt in the consumer economy."Despite the threats, I hope this policy is being used as a negotiation tool rather than an endpoint," he said.
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