Tariffs take toll on Port of Los Angeles imports

The Port of Los Angeles reported that imports for the month of May were down by 9% compared to the same period last year, according to Eugene Seroka, Executive Director Port of Los Angeles. Seroka said uncertainty plagues orders for peak season and therefore for the holidays.

May Imports Off by 9%

Seroka spoke at the Port of Los Angeles media briefing on June 13th where he noted: “In May, the Port of Los Angeles processed 717,000 container units. That is about 5% less than last year at this time, which is just a little better than we expected. However, a closer look at the data shows that May imports fell by 9% from last year and 19% compared to the month of April. Inbound cargo totaled 355,950 TEUs, which was 25% less than what we forecasted on April 1st before the tariffs were announced. For context, we typically expect May volume to be a little stronger than that of April because we are approaching peak season … compared to our five-year running average for the month of May, imports are down 17%.”

In addition, exports were down by 5% in May: “Moving over to exports, we handled 120,000 units, a 5% decrease from 2024. That lands us at six straight months of declining exports, much of that at the expense of American farmers. Next week, I'll be in Tacoma, Washington for the 37th Annual Agriculture Transportation Coalition Conference [June 16-19]. The largest gathering of its kind led by AGTC’s Peter Friedmann (where we) will strategize on actionable steps both on the ground and in Washington D.C. to turn the tide and begin boosting U.S. exports.”

Seroka said the Port’s projections for the remainder of 2025 were modest: “I expect overall cargo flow to remain modest for the balance of 2025. Further released just this week, the National Retail Federation's Port Tracker predicts a decline in imports for each month, June, July, and August … To give you some perspective, the last six months of 2024 here at the Port of Los Angeles, we averaged 927,000 container units each month.”

Progress With China but Tariffs Remain

Seroka said that he thought news from the trade talks between the United States and China were promising, but warned that continued uncertainty was bound to dampen investment and demand: “While it's promising that the two sides were talking again with those meetings in London, what we saw was a tentative framework that is not close to a final agreement, and it basically takes us back to the result of the discussions in Geneva earlier in May.”

Seroka noted that tariffs on imports of Chinese goods remained elevated: “Tariffs remain elevated on average due to the cumulative effect. Imports from China to the United States are at 55% tariffs.”

At the same time, US exports are facing retaliatory tariffs from China: “Conversely, 10% tariffs in a retaliatory fashion have been placed on all U.S. exports. There is much more work to be done here. This likely won't move the needle for many businesses. What I continue to hear is ‘we want clarity, longer range planning capability, and much lower tariffs.’”

Tariffs Could Dampen Holidays

Seroka said that holiday and peak season orders remained uncertain: “Starting off with consumers as a leading economic indicator here in the United States, we see activity up to three months before products hit the ground here in Los Angeles and are distributed throughout the country, and it's very slow here seasonally. We have already blown past summer fashion and looking forward now to back-to-school and Halloween before the all-important year-end holidays, that cargo for those micro seasons needs to be here on the ground right now. I do not necessarily see that in inventory levels; we will likely see higher prices and fewer selections for both that back-to-school and Halloween season.”

Decisions related to the holiday season need to be made very soon: “On the business side, many continue to tell me that they've paused on hiring capital investments and overall strategic supply chain initiatives. The year-end holiday cycle usually sees purchase orders going into Asia factories during the month of May. Maybe we could lead into June, but absolutely the full stop date of July 1st is fast approaching … We have got two key milestone dates upcoming: August 11th is the end of that 90 day pause period between the United States and China on their negotiations, and for the rest of the world save Canada and Mexico, July the eighth is right around the corner for us.”

Decline In Purchasing Power

Ernie Tedeschi, Director of Economics at The Budget Lab at Yale University, was Seroka’s guest. The Budget Lab is a nonpartisan policy research center that provides in-depth analysis of federal policy proposals.

Tedeschi said the effect of Trump administration tariffs so far in 2025 was to reduce average purchasing power by $2,500: “Tariffs to date announced in 2025, raised the average effective tariff rate in the United States by an additional 12 percentage points. So, to translate that into consumer impacts on average for American families, that is an increase in prices of 1.5%, which may take time to fully bake in … may take a year or two. That one and a half percent would lower purchasing power for the average American family by $2,500 per family per year.”
In terms of products, he said: “Products that Americans are more likely to import are going to be pinched much more than other products. So, in particular, products like leather goods, things like shoes and handbags, products like apparel, products like consumer electronics.”