Higher tariffs have taken a toll on shipping activity at American ports as the agricultural sector and the trade in goods take a hit. But oil and natural gas exports have provided a steadying influence on exports.
The erratic rollout of the tariffs has been a feature, not a bug, of U.S. trade policy. Expect more volatility in shipping costs as well as in shipping volume at U.S. ports.
One result of the tariffs has been higher prices for American households on goods, which will affect their spending especially as the back-to-school and holiday shopping seasons approach.
Since consumer spending is responsible for such a large portion of the American economy, economic activity is likely to ease as consumers pull back.
We now expect growth to moderate in the second half of the year as producers and wholesalers draw down their inventories and consumers pull back.
Imports
West Coast: The number of import shipping containers processed at the West Coast seaports increased in June following the sharp slowdown in May. Imports coming into the West Coast have been in decline since peaking last August, with sharp drops this year.
East Coast: Imports along the Atlantic and Gulf Coasts continued their four-month decline, but levels were largely consistent compared with the ups and downs of the West Coast imports of goods from Asia.
Exports
West Coast: Export activity levels among the Pacific seaports have been in decline since 2017, most likely with buyers of agricultural goods looking to cheaper and more consistent markets elsewhere. Compared to December 2017, there has been a 30% drop in the number of export containers shipped from West Coast seaports.
East and Gulf Coast: Export containers along the East Coast and Gulf Coast are 9% higher compared with 2017, most likely benefiting from the overseas demand for U.S. oil and liquified natural gas. Still, exports have been in decline since March, perhaps a signal of a loss of confidence in trading with America.
