by Lloyd's List

20 February 2025 (Lloyd's List) - SHIPPERS’ rush to bring in cargo ahead of expected tariffs and the Lunar New Year propelled the ports of Los Angeles and Long Beach to a stellar start to the year.

The ports handled a total of 1.87m teu and 955,480 teu of imports in January, which was their strongest-ever January and third strongest month on record, according to Lloyd’s List aggregation of port statistics.

The busiest January until this year was January 2022 (1.66m teu total throughout and 816,542 teu imports) during the pandemic-era supply chain crisis, when more than 100 containerships were backed up off the San Pedro Bay.

Shippers frontload ahead of tariffs

On February 1, US president Donald Trump announced tariffs on goods from Canada, Mexico, and China, which are the US’s three-largest trading partners. However, tariffs on Canadian and Mexican goods were delayed for one month on February 3.

The port of Long Beach said January’s volumes were “largely driven by retailers moving cargo ahead of the anticipated tariffs on goods from China, Mexico and Canada”.

Port of Los Angeles executive director Gene Seroka echoed a similar sentiment during a press conference on Wednesday.

“Looking back, over the past seven months, the Port of Los Angeles has averaged more than 927,000 teu without a single ship backed up,” he said.

“Our performance has been sustained by three key factors. First, strong consumer spending and a resilient US economy. Second, importers frontloading due to tariff concerns… And third, we've seen incremental gains related to the Panama Canal and Red Sea diversions as well as labour negotiations [on the east and Gulf coasts].”

In addition, “many imports arrived early to avoid scheduled production slowdowns due to the Lunar New Year holiday”, Seroka said. The Lunar New Year holiday began on January 29.

February cargo volumes will likely dip, as is typically the case in the period following the Lunar New Year.

“This decrease typically occurs as factories in Asia ramp back up after their break,” Seroka explained.

“Our data indicates that volume will land in the 700,000 teu range, a bit lower compared to last February, when Lunar New Year fell a few weeks later.”

Frontloading to continue

The strength of the US economy and consumers helped drive near-record import volumes in the second half of last year, but economic indicators in January showed some warning signs.

The US Commerce Department said in a report on Friday that retail sales in January fell 0.9% month-over-month, which Seroka said was the biggest decline in nearly two years. He warned that while some of the decline was likely due to winter storms across the country and the fires in California, “it could also indicate the start of a consumer pullback”.

Additionally, the consumer price index spiked by 0.5% month-over-month in January, more than economists expected.

There were also reasons for optimism in the coming months, Seroka said. The National Retail Federation expects “positive retail growth” in 1H25 and there weren’t many blank sailings to Los Angeles, “which is a reliable early market indicator for the coming months”, he argued.

However, concerns over tariffs remain “significant” worldwide.

“I'm hearing that front loading strategies will continue for some importers,” Seroka said.

“However, trade may ease in the second half of the year, just given the volume of cargo that has already been shipped.”

A more complex re-run of 2018

When US president Donald Trump started the trade war in China in 2018, volumes surged ahead of tariff implementation date and dropped off significantly afterwards.

This time would be similar, Seroka said, adding that the port is ready to handle a surge in volumes.

“We saw a lot of run up in cargo before milestone implementation dates, then pretty big drop offs thereafter, and it’s no different now.

“We've had seven consecutive peak season type months, all in preparation for possible tariffs that were talked about on the campaign trail last summer. And as we've mentioned a couple of times, we've been able to handle that cargo quite well.”

However, Seroka said that the “possibility of retaliatory tariffs” will lead to higher costs and increased uncertainty.

“All in all, this is a repeat of what we saw in 2018, but at a much higher level with more complexity,” he concluded.