NRF: Escalating tariff threats could spell trouble for retail imports
The threat of escalating tariffs is putting a damper on the otherwise healthy retail marketplace and has caused retailers to up their import orders.
Imports at the nation’s major retail container ports are expected to remain strong this month after setting three new records this summer, according to the monthly Global Port Tracker report released by the National Retail Federation and Hackett Associates.
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“More tariffs could come any day, and retailers have been bringing in record amounts of merchandise ahead of that in order to mitigate the impact on their customers,” said NRF VP for supply chain and customs policy Jonathan Gold said. “Retail sales are growing stronger than expected this year thanks to tax cuts and job creation, but tariffs are the wild card that threaten to throw away a significant portion of those benefits.”
The current boom in shipping can primarily be explained by importers’ response to the U.S. trade war with China, according to Hackett Associates founder Ben Hackett.
“Consumers appear to be spending money on goods ahead of the tariff price increases that will eventually come,” he said. “But there could be a rocky road ahead as the impact of tariffs begins to be more fully felt.”
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Ports covered by Global Port Tracker handled 1.9 million twenty-foot equivalent units (a TEU is one 20-ft.-long cargo container or its equivalent).
In July, the latest month for which after-the-fact numbers are available. That was up 2.8% from June and up 5.6% year-over-year.
August was estimated at 1.92 million TEU, up 4.8% year-over-year. September is forecast at 1.83 million TEU, up 2.4%; October at 1.88 million, up 5%; November at 1.79 million TEU, up 1.7%, and December also at 1.79 million TEU, up 3.6%.
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August was the third month in a row to set a new record for the number of containers imported during a single month, following July’s 1.9 million TEU and June’s 1.85 million TEU. The previous record of 1.83 million TEU was set in August 2017.
The first half of 2018 totaled 10.3 million TEU, an increase of 5.1% over the first half of 2017. The total for 2018 is expected to reach 21.4 million TEU, an increase of 4.4% over last year’s record 20.5 million TEU.
Global Port Tracker, which is produced for NRF by the consulting firm Hackett Associates, covers the U.S. ports of Los Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Port of Virginia, Charleston, Savannah, Port Everglades, Miami and Jacksonville on the East Coast, and Houston on the Gulf Coast.
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About the National Retail Federation
The National Retail Federation has represented retail for over a century. "As the nation’s largest private-sector employer, retail contributes $3.9 trillion to the annual GDP. No other industry comes close. Wherever the industry goes, the nation follows — so we’re committed to helping retail go further."