Major Los Angeles (LA) ports, which were expected to take a heavy hit from the Donald Trump administration's high tariff policy last year, instead enjoyed a record boom. The logistics industry's preemptive response in anticipation of tariff imposition appears to be the reason.
On the 15th (local time), Bloomberg News reported, "The two ports in Los Angeles that dominate U.S. container shipping had a very strong year last year despite the turmoil caused by President Trump's trade policies."
According to each port's statistics, the Port of Long Beach in California, regarded as the largest U.S. trade gateway to Asia, handled 9.9 million TEUs (1 TEU is one 20-foot container) last year, an all-time high. Imports alone reached 4.79 million TEUs, up 1.1% from a year earlier. The nearby Port of LA also processed 10.2 million TEUs last year, the third-highest volume on record.
Until the first half of last year, the two ports were expected to be hit directly by the tariff policy. Most major export items from Asia pass through these ports before moving into the U.S. interior, and in April last year the Trump administration imposed high tariffs on key trading partners worldwide. At one point, the United States levied a 145% tariff on Chinese products.
In fact, right after the tariff announcement, in May last year, Long Beach's cargo volume fell about 26% from the previous month to about 640,000 TEUs. In particular, import containers plunged from 420,000 TEUs in April to 310,000 TEUs in May. But as the Trump administration adjusted tariff rates through negotiations with various countries, volumes gradually recovered, reaching around 900,000 TEUs in July.
Despite the high tariffs, volumes at major LA ports increased because U.S. importers rushed shipments ahead of the tariff imposition. Noel Hasegawa, the Port of Long Beach's chief executive officer (CEO), said it was "the result of importers preemptively loading cargo ahead of the new tariffs taking effect."
Even early last year, before mutual tariff imposition, imports rose sharply as President Trump pledged before taking office to levy large tariffs on China and Mexico, America's biggest trading partners. In January last year, import container volume at Long Beach reached 471,649 TEUs, a record high for the year. Import containers brought into the Port of LA also totaled 483,831 TEUs, up 9.5% from the same month a year earlier.
Moreover, as imports from China became more difficult, importers diversified their supply chains, which also boosted volumes. According to CEO Hasegawa, about 70% of Long Beach's total cargo (imports and exports) was related to China six years ago, but that has now fallen to around 60%. Instead, cargo flowing into the United States from Southeast Asian countries such as Vietnam and Thailand has increased significantly.
The outlook for this year is also bright. Long Beach expects this year's cargo volume to rank in the port's top five ever. The LA Times reported on the 13th that Long Beach is planning large-scale investments to double the amount of cargo handled by 2050.