How Are U.S. Tariffs Driving the Port of Los Angeles’ Import Decline?

How have U.S. tariffs triggered a 19% plunge in import volumes at the Port of Los Angeles in May 2025, disrupting the nation’s busiest seaport? The port processed 717,000 twenty-foot equivalent units (TEUs), which included 356,000 import containers, representing a 9% decrease from May 2024; this decline was caused by Trump administration tariffs, particularly the 145% duties on Chinese goods, which led retailers to stop shipments and raised concerns about shortages, job losses, and increased consumer prices, according to port officials.

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What Tariffs Are Impacting the Port?

President Trump’s April 2, 2025, “Liberation Day” tariffs imposed 145% duties on Chinese imports, 10% on global goods, and reciprocal rates like 24% on Japan and 34% on South Korea. A May 12 truce lowered China’s tariff to 30% for 90 days, but uncertainty persists.

China, accounting for 45% of the port’s imports, retaliated with 125% duties on U.S. goods, disrupting trade flows. These policies followed a frontloading surge, with October 2024 imports hitting 905,000 TEUs as firms stockpiled goods.

Why Did Imports Drop So Sharply?

Major retailers, including big-box stores, paused Chinese shipments after tariffs escalated, with 17 of 80 scheduled May vessel calls canceled, a 20% rise in “blank sailings.” April’s 842,806 TEUs, up 9.4%, reflected pre-tariff stockpiling, but May’s 717,000 TEUs marked a 30% weekly drop from 2024, per port data.

Executive Director Gene Seroka noted that retailers’ 5-7 week inventories could lead to shortages by July, as firms hesitate to order at elevated costs.

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How Are Businesses and Consumers Affected?

The port’s downturn threatens Southern California’s economy, which supports 2 million jobs and $500 billion in revenue. A 1% cargo drop could eliminate 2,769 jobs, with truckers and dockworkers already facing reduced hours.

Retailers warn of price hikes on electronics, clothing, and furniture, with small businesses, unable to frontload, hit hardest. Consumers may face empty shelves for holiday goods, as import declines ripple to all 435 U.S. congressional districts.

What Role Did Frontloading Play?

Importers rushed goods before tariffs, boosting first-quarter 2025 volumes to 3.3 million TEUs, 6.2% above 2024. This frontloading depleted demand, with May’s 356,000 import TEUs reflecting a post-surge lull.

Seroka projects a 10% annual decline in the second half of 2025, as stockpiles dwindle and high tariffs deter new orders. The truce with China sparked a slight booking uptick in Asia, but no “deluge” is expected.

Are Alternative Trade Routes Emerging?

Shippers are exploring Southeast Asia, particularly Vietnam and Indonesia, which are gaining traction, while China's share of port traffic has dropped from 60% to 45%. These routes face capacity constraints, and Maersk reported a 30-to-40% U.S.-China volume plunge in April, suggesting limited immediate relief.

Long-term, firms adopting a “China plus one” strategy may diversify, but higher costs and logistics challenges persist.

Did you know?
U.S. tariffs of 145% on Chinese goods led to a 19% import drop at the Port of Los Angeles in May 2025, with 20% of vessel calls canceled.

What Economic Risks Loom?

The port’s decline could spark a U.S. recession, with economists warning of layoffs in transportation and retail if imports fall 20% in 2025’s second half, per National Retail Federation forecasts.

Rising prices may curb consumer spending, while retaliatory tariffs hit U.S. agriculture, with China buying record Brazilian soybeans in March. The $1 trillion U.S.-China trade war’s ripple effects threaten global trade stability.

Can the Port Recover Quickly?

Seroka plans infrastructure investments to weather the downturn, but recovery hinges on tariff negotiations. Even if duties ease, supply chain disruptions could linger for months, with 30 blank sailings in May signaling persistent caution.

The port’s role as an economic bellwether suggests broader challenges unless trade policies stabilize, prompting calls for clearer government guidance.