Shipping volumes slightly rose in April, as reported.
Container Traffic Experiences Slight Increase in April, Amid Global Trade Tensions
Despite escalating trade conflicts, particularly the ongoing dispute between the United States and China, container traffic showed a modest gain in April, according to a preliminary report from the RWI research institute and the Institute of Shipping Economics and Logistics (ISL). The container traffic index rose to 137.3 seasonally adjusted points in April, up from 136.2 points in March.
The recent trade tensions have resulted in increased tariffs on Chinese imports, with duties peaking at 145 percent by mid-April. Despite this, the impact on container traffic in U.S. ports has so far been limited. Since it takes approximately two weeks for containers from China to reach the West Coast ports of the U.S., further repercussions are to be expected in May.
Torsten Schmidt, the chief economist at RWI, notes that "the unpredictable course of US trade policy is, for now, causing minimal disruption to container traffic. However, short-term changes are difficult to capture in monthly data." The ever-changing trade policies foster uncertainty among businesses, making it difficult to plan for imports and exports.
While a 90-day truce in the trade war was agreed upon in May by both the U.S. and China, the temporary deal has been met with challenges due to the ongoing unclarity and high tariffs. The continuation of uncertainty persists, making it challenging for companies to make long-term commitments to import goods.
In May, the Port of Los Angeles reported the cancellations of 17 ships out of a total of 80, indicating the impact of trade uncertainty on shipping decisions. Furthermore, the volatility in trade policies has affected agricultural exports, resulting in a decline in soybean exports from the U.S. to China, which have gradually been substituted by Brazilian exports.
In California, the ongoing trade dispute has led to decreased imports from China, accounting for 40% of the imports at the Port of Los Angeles, 63% at the Port of Long Beach, and 45% at the Port of Oakland. The uncertainty and volatility in trade policies continue to significantly impact container traffic and business planning.
[Source: ntv.de, rts]
The ongoing trade dispute between the United States and China has produced notably challenging circumstances for California's ports, affecting both imports from China and exports, particularly in agriculture. The unpredictable nature of trade policies persists, causing uncertainty for businesses and creating challenges in logistical planning.
- The European Union, faced with the unpredictable course of US trade policy and its impacts on global industries such as finance and business, may find it difficult for businesses to plan for imports and exports, akin to the challenges currently faced by US businesses due to escalating trade tensions with China.
- In light of the increasing tariffs on Chinese imports and the subsequent impact on container traffic in US ports, the European Parliament, the Council, and the Commission may need to address the repercussions of such policies on European businesses and ports, ensuring continued industry growth and stability amidst global trade volatility.
