McCown: U.S. ports may see an unprecedented 25% drop in volume by July

Based on current projections, U.S. ports could see an unprecedented year over year reduction in container volumes of 25% by July 2025, according to John McCown, publisher the John McCown Container Report.

In an interview with AJOT, McCown said that based on the current impact of the Trump administration tariffs on U.S. imports, container volumes at U.S. ports will be “if nothing else changes, I see the year over year reduction … in volume … potentially printing in at the 25% range.”

McCown said he expected the 25% drop to impact U.S. ports by July: “I would speculate probably by July …is going to be the first time that we start to see an impact. In May … more on the West Coast. June is going to be kind of more on the East Coast but … June will probably start to be pretty meaningful. But July would seem to have the effect of everything that is in place now.”

He noted that “40% of the inbound containers the U.S. come from, come from China and imposing a 145% tariff pretty much knocks the stuffing out of that.”

Unprecedented Drop

McCown said the 25% drop in container volumes at U.S. ports is unprecedented and he has never seen such a dramatic drop off:” Not in any, any month … I remember. … I think the financial crisis was right at about 10% … as I recall, this goes back to 2008, but the financial crisis worked up to about a 10% reduction in volume … But I think 25% … I'm not aware that we've ever in the U.S. ever seen any single month approaching a 25% reduction … On the back end of the …pandemic, we started to see some months that were about a 10%. (reduction).”

McCown said that he would expect some “workarounds” where imports from China and Asia are transported via ports in Mexico and trucked into the United States at major U.S. border crossings:” There's going to (be) workarounds and … some of those workarounds could be highly inefficient in terms of additional cost, for instance, like … moving cargo that is going to Chicago, moving it through ports in Mexico … that's adding time, that is adding cost. “

McCown says the McCown Report is based on the volume at the ten largest ports in the United States that generate 86% of the container volumes for the nation and are located on the West Coast, East Coast and Gulf Coasts.

Blankety Blank Sailings…

Alan Murphy CEO, Sea-Intelligence, issued an advisory on April 16^th warning that Transpacific blank sailings to North American Pacific and Atlantic coast ports would result in a 12% decline in container volumes to North American Pacific coast ports and a 14% decline for Atlantic coast ports: “For the 4-week period of weeks 16-19 (this week + the next three weeks), we have looked at the capacity scheduled at different points over the past six weeks, to … gauge the impact of tariffs. On Asia-North America West Coast, 1.43 million TEU was scheduled for deployment for weeks 16-19 in week 10. This remained consistent at week 11, and only slightly decreased to 1.40 million by week 12. In week 13, however, scheduled deployed capacity for weeks 16-19 dropped by -8% week/week to 1.29 million TEU, further dropping to 1.37 million TEU by week 15. Overall, this is -12% lower than what was scheduled six weeks ago. On Asia-North America East Coast, scheduled capacity for weeks 16-19 declined from 1.01 million TEU scheduled by week 10 to 867,000 TEU scheduled at week 15, which represents a -14% decline across the 6-week period.”

McCown told AJOT that Sea-Intelligence may be understating the impact: “While nobody has an accurate crystal ball on the effect of these unprecedented catalysts, I think Sea-Intelligence is light on the volume impact.”

John D. McCown is a Non-Resident Senior Fellow at the Center for Maritime Strategy. He is an internationally recognized expert in container shipping and maritime commerce. McCown has more than four decades of operating and investment experience in his field. He was a co-founder and CEO of U.S. flag carrier Trailer Bridge, Inc. and formerly led transport investments at a large hedge fund. McCown is the author of “Giants Of The Sea: Ships & Men Who Changed The World,” a book on the modern cargo shipping industry and how it developed. McCown writes extensively about maritime issues and the McCown Report is widely quoted.