Monday, June 17, 2019

US Container Port Defies the Logic of Falling Cargo Flows Due to Chinese Freight Tariff Increases

Asian Neighbours Help Take Up the Slack
Shipping News Feature
US – Despite all the rhetoric about US trade wars with China, the Port of Oakland has managed to turn logical predictions about flows of containerised cargo on their head. Exports last month, primarily to Asia, were up 8.4% compared to May 2018 totals, whilst imports also rose, climbing 4.2% against last year.

Somewhat ironically the Port said reasons for its export growth centred on China’s neighbours including Vietnam, Taiwan, South Korea and Japan. Importers, too, are turning to those markets to purchase products previously sourced in China. Oakland’s total cargo volume last month, imports, exports and empty container returns, increased 9% and the volume of empty containers shipped back to Asian markets for reuse climbed 17.5%.

Oakland set a record by handling 2.55 million cargo containers in 2018. Through the first five months of 2019, volume is up 5.5% compared to last year, however the Port cautioned against projecting future volumes due to the uncertain global trade outlook, with the US beginning this month to impose even higher tariffs on goods imported from China. Port of Oakland Maritime Director John Driscoll, commented:

“Logic tells us that at some point, tariffs should drive down cargo volumes because they’re making international trade more expensive, but our customers have so far defied conventional wisdom by finding new markets for their products.”