This week on Monday (May 12), the United States confirmed the implementation of new tariff rates on China, imposing a 30% tariff on Chinese goods, which is nearly 4/5 lower than the previous 145%. Following this news, the logistics and shipping industries anticipate an increase in shipments due to concerns over potential changes in tariff policies, leading to a surge in orders at American ports soon.
Theresa Lee, director of TRK Customs Brokerage at the port of Los Angeles, recently stated in an interview that she has observed a rapid increase in warehouse orders at the port. Previously, ships that had stopped in China without unloading goods are now requesting quick deliveries, and some disrupted routes are resuming.
“With only 90 days, we don’t know what will happen next, so now warehouses are becoming overwhelmed again,” Ms. Lee said, referring to the sudden news of the new tariffs between China and the U.S. “No one expected this sudden agreement, so businesses are rushing to clear out their remaining goods, leading to an overflow of warehouses.”
The viewpoints of other industry professionals at the port support Ms. Lee’s observations. Major ports, logistics companies, and business groups anticipate a significant increase in cargo volume in the coming months.
During a press conference held in Long Beach, California on Monday, Tracy Hernandez, CEO of the Los Angeles County Business Federation representing 900,000 business owners, indicated the possibility of a substantial increase in cargo volume at the port in the next 90 days.
Ryan Calkins, vice chairman of the Seattle Port Commission, told CNN that he expects to see a surge in orders during the summer season, with the port expected to increase personnel significantly to meet the management demands.
Flexport, a supply chain management company headquartered in San Francisco, saw a 35% increase in sea freight orders from China to the U.S. on the first day of the new trade agreement. CEO and founder Ryan Tetersen stated that a large backlog of orders is imminent, with vessels expected to be booked to capacity soon. This increase of 35% is in comparison to the average order volume tracked since April 9.
Having worked in the customs brokerage industry at Southern California ports for many years, Ms. Lee has witnessed the evolution of goods imported from mainland China to the U.S. over the years. Particularly during the pandemic in recent years, she noted that even basic items like masks needed to be imported in large quantities from China to meet the emergency demand in the U.S., which left her feeling unsettled.
“This is quite a serious matter: the U.S. relies on foreign countries even for simple items like masks, hand sanitizers, essential for public safety, and many pharmaceutical ingredients from China or India, indicating our country’s vulnerability,” she expressed her concerns over how the U.S. would respond if challenged today.
The ports of Los Angeles and Long Beach are major transit points for Chinese imports. 45% of trade at the Port of Los Angeles and 63% of goods at the Port of Long Beach come from China, including clothing, footwear, toys, electronics, and more.
“If any industry poses a serious threat to national security, then these goods must be manufactured on U.S. soil,” she questioned. “If the U.S. can’t even produce simple items like masks domestically, then what about our steel, aluminum, and aircraft? Are we going to import everything from China? This means our defense industry is completely in the hands of others.”
She also expressed concerns about the quality of Chinese products and supported the localization policy advocated by former President Trump, believing that products manufactured by Americans will ensure quality as they are accountable for it. “For the airplanes and ships we make, the materials we use must be durable enough, as this concerns human lives.”
“We can’t always prioritize cheap, cheap, cheap,” Ms. Lee stated. “If we choose to continue living in the U.S. and our children will study and work here, then we should also take responsibility for this land.”
Ms. Lee genuinely understands the significant actions taken by Trump regarding tariffs. She believes that many U.S. media outlets have not accurately reported on U.S.-China tariffs and that failing to address the serious issues in U.S.-China trade will have severe consequences for America’s future.
“Why do we have to go through a somewhat tough period today in the U.S.? I feel that by doing so, the U.S. will take a big step forward,” she concluded.