Retail Imports Remain at Near-Record Levels Despite Tariffs
There is much debate about the effect of the tariffs, both those in effect and proposed, on imports. A Global Port Tracker report released on August 8 by the National Retail Federation and Hackett Associates found that imports at the nation’s major retail container ports are expected to continue at near-record levels this month. The same is expected for the remainder of the year as well despite a new round of tariffs on goods from China,
“Even with virtually everything American imports from China soon to be subject to tariffs, it isn’t quick or easy for retailers to change their supply chains,” NRF vice president for Supply Chain and Customs Policy Jonathan Gold said.
“That means American families are ultimately going to pay more for goods they can’t do without. And even if sourcing eventually shifts away from China, it will simply come from other countries, Gold added. “ It’s time to stop punishing American businesses, workers and families for China’s wrongdoing.”
President Trump announced last week that new 10% tariffs on an additional $300 billion in Chinese goods will take effect on September 1.
Coupled with 25% tariffs imposed on $250 billion worth of imports over the past year, the new round will tax almost all goods the United States imports from China. Meanwhile, America’s tariff bill continues to grow. According to data released this week by the Tariffs Hurt the Heartland coalition. American importers paid $6 billion in tariffs in June, one of the highest-tariffed months in U.S. history and up 74% from the same month last year.
“The uncertainties of the administration’s tariff policies continue to vex the markets,” Hackett Associates Founder Ben Hackett said. “Our overall outlook is more pessimistic than last month, underlining that trade wars are not harbingers of good things to come.”
Hackett said the 10% tariffs would not likely have an immediate impact on import volumes but an increase to 25% – as happened earlier this year with the most recent previous round of tariffs – “would have a significant impact and would cause us to lower our trade projections further.”
U.S. ports covered by Global Port Tracker handled 1.8 million Twenty-Foot Equivalent Units in June, the latest month for which after-the-fact numbers are available. That was down 2.9% from May and down 3% year-over-year.
July was estimated at 1.86 million TEU, down 2.6% year-over-year.
Looking ahead the forecasts are:
-August -- 1.91 million TEU, up 0.6%
-September -- 1.85 million, down 1.1%
- October -- 1.91 million TEU, down 6.2%
- November -- 1.84 million TEU, up 1.8%
- December -- 1.81 million TEU, down 7.9%
The August and October numbers would be the highest monthly volumes since 1.96 million TEU last December, tying for the third-highest month on record behind that and the all-time record of 2 billion TEU set last October. While imports will decline year-over-year most months during the remainder of this year, that is largely because of high volumes seen last year as retailers rushed to bring in merchandise ahead of scheduled tariff increases.
The first half of 2019 totaled 10.5 million TEU, up 2.1% over the first half of 2018, and 2019 is expected to total 21.7 million TEU. That would come within 0.4% of last year’s record 21.8 million TEU, which was up an unusually high 6.2% over 2017.
