California Faces Decline in Eastbound Container Volume

News Summary

California is experiencing a significant decline in eastbound international container traffic, with a 5% drop for the week ending May 18, marking a six-month low. This decline is attributed to high tariffs on imports from China amidst the ongoing U.S.-China trade war. Experts anticipate a possible surge in imports following a recent 90-day truce, but current forecasts warn of substantial decreases in cargo arrivals, affecting the local economy and retailers’ supply chains.

California is experiencing a significant decline in eastbound international container volume, with figures for the week ending May 18 hitting the lowest point in six months. The recent data reveals a 5% drop from the previous week and a substantial 10% drop when compared to the four-week rolling average of container traffic. This downturn is largely attributed to steep tariffs imposed on imports from China amid the ongoing U.S.-China trade war, affecting cargo logistics and trade forecasts across the region.

The international container volume on eastbound trains, as monitored by RailState, is down 26.3% from the peak week of March 3-9, 2025. During that peak, importers increased shipments in an effort to beat the tariff implementation deadline. With tariffs reaching as high as 145% on various goods, businesses are now grappling with significantly lower shipment volumes as the trade war continues to escalate.

As part of the complicated trade relations, the U.S. and China have recently agreed to a 90-day truce in the trade war, reducing tariffs on most Chinese goods to 30%. Experts expect this pause to encourage a surge in imports as companies rush to bolster their inventories, potentially reversing some of the recent declines. However, immediate forecasts indicate that the Port of Los Angeles is set to experience a 35% decrease in cargo arrivals, primarily due to reduced shipments from China and lower volumes from Southeast Asia.

The expected declines translate to a 28.6% drop in cargo to 85,486 TEUs (Twenty-Foot Equivalent Units) and a nearly 33% decline to 74,925 TEUs in subsequent weeks. The tariffs have serious implications for the trade and logistics sectors, which contribute nearly $300 billion to California’s local economy and support close to 2 million jobs in Southern California.

The situation for retailers is equally concerning, as many have reported maintaining only a limited six-to-eight-week supply of inventory, leading to fears of shortages. The ongoing strain from tariffs, especially notable for smaller businesses, is exacerbated by a year-over-year decline in TEU volumes, which reached 15% in March alone. The March figures also marked the fourth consecutive month of decline, indicating a troubling trend for the region’s economy.

Following the initial announcement of tariffs back in January 2025, there was an observable increase in TEU volumes as suppliers moved to ship products before the new duties took effect. However, the peak in early March was followed by a sharp decline, with a loss of 15,000 TEUs signaling the end of the rush to “beat the tariff.” Current TEU volumes now sit at two-thirds of their earlier peak, underlining the severe impact on logistics and trade flows.

Gene Seroka, the Executive Director of the Port, has highlighted that without significant changes in current tariff policies, both consumers and manufacturers will face challenging decisions in the months ahead. The long-term implications of the trade war indicate potential price increases and decreased availability of products for U.S. consumers as supply chains continue to become disrupted.

The effect of these tariffs is already being felt across the economy, as retailers and importers brace for continued volatility. As the situation unfolds, the trade landscape in California will require careful monitoring to assess how these changing dynamics will influence future cargo volumes and economic stability.

Deeper Dive: News & Info About This Topic

• FreightWaves: Southern California International Intermodal Volume Sees Weekly Decline
• Wikipedia: International Trade
• LA Times: Traffic at the Port of Los Angeles Set to Plunge Amid Tariffs Disruption
• Google Search: Port of Los Angeles
• Reuters: Shipping Volume Will Plummet 35% Next Week, LA Port Official Says
• Encyclopedia Britannica: Trade War
• Transport Topics: Record Cargo Volumes at LA Port
• FreightWaves: Plunging LA Port Volumes Trouble Truckers