With global shippers looking to get in front of the beginning phase of recently implemented tariffs, United States-bound waterborne shipments saw in , according to data recently released by global trade intelligence firm .

June shipments, at 1,025,643, were up 6.5% annually. This represents another month of growth, with the exception of a 0.2% decline in March, which was the first one going back to a 7.7% annual drop-off in February 2017. Through the first six months of the year, Panjiva said U.S.-bound imports are up 6.5% annually at 5,870,275.

“Putting aside the duties, there is clearly solid underlying growth in trade activity,” said Chris Rogers, Panjiva research director, in an interview. “There was a big surge in June, and the second quarter as a whole was up around 5% [4.8%] compared to a year ago, when there was not this kind of ‘ rush.’ And if you look at things like business sentiment and consumer confidence, both of those look fairly positive as well. If it were not for tariffs, we would be pretty well set up for another great year for the global supply chain, which has got this complication in the way.”

The tariff rush Rogers speaks of is highlighted by China-bound imports to the U.S. being up 13% in June, which far outpaced a 3% gain in May and are also above typical Peak Season levels, he said.

With the White House recently announcing it plans to add tariffs of 10% on an additional $200 billion of Chinese imports, he explained that creates additional uncertainty in the middle of Peak Season.

“The supply chain question for shippers with this really is ‘do I rush my imports to try to beat the tariffs or do I run the risk that it never happens and don’t end up with inventory I don’t need,’” said Rogers.

What’s more, Rogers added that many companies have already indicated they will need to raise prices to counter the tariff impact, especially those in similar industries so that it is not just a few companies raising prices.

“On one hand, Peak Season will be earlier than normal,” he said, “ and on the other hand, it remains to be seen if companies will play chicken with President Trump and maybe consumers pay the price. We will have a better idea of how that plays out in the coming weeks, and that is important for logistics services providers, freight forwarders, and ocean cargo carriers. They need to be ready for an early Peak Season, but it may be one that does not come. This really cannot come at a worse time for the container lines that are struggling with profitability and are talking about cutting routes and making potential alliances. This uncertainty is not going to help.”

If there were to be no major impact from tariffs in the second half of 2018, which remains to be seen, Rogers said U.S.-bound shipments would be up 5% annually at 12.19 million shipments, which would be the highest number on record.

As for the second half of 2018 over all, Rogers said the potential of a broader economic slowdown caused by tariffs needs to be closely monitored.

“It is not just about the U.S. and China,” he said. “It is also about the supply chains upstream from there are doing….and could lead to higher costs for other things too. If Trump and Xi could reach some type of agreement to not disagree, that would be great, and if they don’t things could go downhill from there.”

About the Author

Jeff Berman, Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

Source link http://www.scmr.com/article/_of_tariff__u.s._bound___see__june_gains_repo


Please enter your comment!
Please enter your name here