Growing trade war a threat to retailers
Imports at retail container ports are expected to grow 5.8% this month but could be threatened if the trade war between the United States and China continues to escalate, retailers say.
The National Retail Federation issued the following statement from President and CEO Matthew Shay after the White House instructed the U.S. Trade Representative to consider an additional $100 billion in tariffs against China:
“This is what a trade war looks like, and what we have warned against from the start. We are on a dangerous downward spiral and American families will be on the losing end. To be clear, we agree it’s time to address China’s unfair trade practices, but an additional $100 billion in tariffs amount to $100 billion in taxes on the American people. Tax reform delivered a real benefit to working families, and tariffs take them away.
The Retail Industry Leaders Association also expressed alarm over the move. "If the administration follows through on this threat, American families should prepare to pay more for summer clothes, shoes, back to school gear, home décor, holiday shopping — this will hit every season and every category," Hun Quach, vice president of international trade for RILA, said in a statement.
Ports covered by NRF's Global Port Tracker handled 1.69 million Twenty-Foot Equivalent Units in February, the latest month for which after-the-fact numbers are available. That was down 4.1% from January but up 15.8% from a year ago, with the year-over-year number skewed because of fluctuations in when Lunar New Year factory shutdowns occur in Asia each year. A TEU is one 20-foot-long cargo container or its equivalent.
“Tariffs are a tax on American consumers in the form of higher prices but they are also a tax on American jobs,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “If tariffs ultimately lead to a reduction in imports and exports, that will put dockworkers and countless others in the supply chain out of work. American consumers and workers should not be punished for China’s wrongdoing.”
March was estimated at 1.54 million TEU, down 1.2% year-over-year. April is forecast at 1.72 million TEU, up 5.8% from last year; May at 1.82 million TEU, up 4.1%; June at 1.83 million TEU, up 6.5%; July at 1.88 million TEU, up 4.5%, and August at 1.9 million TEU, up 3.9%.
“There is nothing good about a trade war,” Hackett Associates Founder Ben Hackett said. “It is a vicious circle of retaliation where there are no winners, only losers.”
The first half of 2018 is expected to total 10.4 million TEU, an increase of 5.6% over the first half of 2017. The total for 2017 was 20.5 million TEU, up 7.6% from 2016’s previous record of 19.1 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.