Port of LA projects 10% volume drop due to tariffs … for now

The Port of Los Angeles is projecting a 10% volume decline, possibly beginning in the month of May, as the impact of higher tariffs causes a decline in imports and exports, according to Eugene Seroka, executive director, Port of Los Angeles.

In his April 11^th media briefing, Seroka said: “I anticipate a drop of at least 10% in our cargo volume from July until the end of this year. But that drop off could begin as early as next month in May. Of course, we are working with the information we have at this moment and this estimate may necessitate revisions as we learn more. The bottom line is this: the ripple effect of these tariffs will be felt by all of us, and there is no way around that.”

Additional uncertainty comes from the imposition of higher U.S. tariffs on Chinese goods that will have a major impact on the Port’s container volumes: “Companies and consumers are still facing a great deal of uncertainty. The latest (Trump administration) announcement also included a 145% duty on all goods made in China, which represents about 40% of the imports that pass through our terminals here at the Port of Los Angeles.”

Seroka did point out that the initial downturn will not be serious because volumes had been unusually high in 2024 due to labor uncertainty with the longshore labor contract on the Atlantic and Gulf coasts, plus closure of the Suez Canal due to conflicts in the Middle East and a slowdown at the Panama Canal due to low water levels.

Even so, the Port is projecting 12 cancelled or blank sailings in the month of May: “What I am seeing right now … is that we've got about 12 canceled or voided sailings for the month of May.”

Seroka said the impact could be worse as he gathers more information to get more accurate projections: “What I did hear is that some globally famous brands have hit the pause button on shipments out of China for the next couple of weeks and maybe beyond. I am going to get a pretty good eight week rolling forecast from some of these locations that will give us a closer beat to what is happening on the booking side. And as you know, … an importer here in the United States may turn in their purchase order to the manufacturer … three, four months before a ship even leaves Asia.”

L.A. Rebuilding Fire Costs to Soar

Seroka highlighted the impact that higher import prices would have on the cost of people rebuilding their homes after the catastrophic fires that hit Los Angeles in January: “Following the January fires in Altadena and Pacific Palisades and Malibu … the price of softwood lumber, appliances, electronics, furniture, and metal products, copper, steel, aluminum, all went through the roof 10 days ago. And while some people were talking about this 90-day reprieve (on Trump administration tariffs) mind you, the costs out of every country except for China, are 10% more expensive than they were 10 days ago. So, we have got a lot in front of us here, and especially we have got 50,000 people in Los Angeles County without homes today because of those fires. That is 50,000 that are desperately trying to rebuild their homes, communities, and businesses in these areas. We have got to get to the doing and these cost increases are not helpful.”

March Cargo Figures

In March, the Port of Los Angeles processed 778,020 TEUs (twenty-foot equivalent container units): “That is a 5% increase over last year, and 4% above our all-important five-year average for the month of March … Starting with imports … in March, we processed 385,000 TEUs, partly due to continued front loading as a hedge against tariffs. Over on the export side, we moved 123,000 units, which is an increase from last month, but still a 15% drop from 2024. This marks the fourth consecutive month of year-on-year declines, raising concerns for our ag and manufacturing partners as counter tariffs on exports begin to take effect. Turning now to empties, we saw a significant year-on -year increase of 21% with 270,000 empty units moving across our docks back to Asia in the month of March. Overall, in quarter one, we moved 2.5 million TEUs, putting us 5% ahead of last year and making this our third busiest first quarter on record.”

Impact on Southern California Jobs

Seroka said that he did not expect an immediate impact of people losing jobs but did expect that truckers and longshore workers will see some decline in work: “One in 15 working Angelenos today has a job related to this Port of working Californians. Thirty percent are in the transportation industry ... Of five counties in the Southern California area, about one in nine jobs emanate from the work at this Port. That is about a million people that go to work every day. Based on what we do here, 15,000 of those million are the women and men of the International Longshore and Warehouse Union (ILWU). So, there are more than 985,000 other jobs that count on this port's work. There are 9,000 service providers that do business hauling these shipments around the region every single day. Now, what I do not see is mass layoffs at the Port … but what probably will happen is the trucker who is hauling four loads a day right now, maybe hauls three loads in the second half of the year every day, the longshore member who has been getting solid overtime … probably works a more traditional work week as volume dips down.”

Less Rail Delays

One bright spot: Seroka noted that there had been a significant reduction in rail delays moving containers off the Port’s docks to U.S. inland destinations: “We have seen a significant reduction in rail dwell times. In fact, there are currently around 900 containers on our docks waiting more than nine days to be loaded onto rail cars. That is a big decrease from the 6,000 that we saw just last month.”