Trump's Tariff Threat Drives Surge in U.S. Shipping Imports — From Reuters

Los Angeles, Dec 18 (Reuters) — When U.S. presidential candidate Donald Trump began talking about new import tariffs, Danny Reynolds checked the labels on wedding dresses at his bridal shop and accelerated shipments, sending goods to independent clothing stores in Indiana.

"I specifically checked the labels to see the country of origin, and it was China, China, China, China, China, China," said Reynolds, owner of Stephenson's Elkhart Boutique, who moved up the delivery of about 20 wedding dresses by roughly two months.

Trump threatened to impose tariffs of at least 10% on goods from China, and 25% on products from Mexico and Canada. This prompted importers like Reynolds to bring in goods earlier to avoid higher costs that could potentially be passed on to consumers.

The possibility of a second round of tariffs after Trump takes office on January 20 is one of the factors driving the surge in U.S. imports. Other factors include strong consumer spending in the U.S., federal investment in electric vehicle manufacturing, and potential strike risks at East Coast and Gulf Coast ports.

Container tracking software provider Vizion highlighted the preemptive shipment behavior, citing Walmart (WMT.N), the largest user of container shipping, as an example. Walmart has been consistently increasing orders since the third week of September, a “pre-positioning” action that suggests the company is accelerating shipments to avoid potential tariff hikes or disruptions in the supply chain.

Vizion also noted that since the U.S. presidential election, Columbia Sportswear (COLM.O) has consistently increased its weekly year-over-year bookings, also indicating that the company is speeding up imports to mitigate possible tariff changes or economic uncertainty.

"In November, U.S. manufacturers, especially in the consumer goods sector, increased safety stocks to help mitigate any upcoming tariff increases," said John Pietteck, Vice President at GEP, a procurement and supply chain software provider, in a statement.

According to trade data provider Descartes Systems Group (DSG.TO), U.S. containerized cargo imports rose 12.8% year-over-year in November.

Descartes also stated that imports from China increased by 13.3% last month, and these goods would face new tariffs potentially implemented by President Biden or Trump.

BMO Capital Markets analyst Fadi Chamoun said in a client report that import levels may remain high through the first quarter of 2025 as shippers try to avoid the new tariffs Trump may impose.

Importers did not disclose how much additional cargo was brought in due to the "pre-positioning" behavior driven by multiple factors.

Gene Seroka, Executive Director of the Port of Los Angeles, said the port expects Trump to implement new tariffs quickly and added that, as the busiest container port in the U.S., the Port of Los Angeles is heading for a record-breaking busy December.

Seroka said that if history from Trump’s first round of tariffs in 2018-2019 is any indication, importers might sharply reduce imports in the coming months.

"We saw a significant surge in goods before the tariffs were implemented, followed by a sharp drop," Seroka said.

Retailer Reynolds said, "Everyone is very uncertain about what will happen," adding that his major suppliers also include Canadian brands like Joseph Ribkoff, Frank Lyman, and Tribal, but those brands did not respond to requests for comment.

He said, "The best hope is that these are just some kind of scare tactics from the president-elect, in other words, trying to scare everyone."