- The expectation that President-elect Donald Trump will implement new tariffs early next year and an impasse over the use of automation at East and Gulf Coast ports with a new strike deadline looming has shipping companies gaming out an uncertain supply chain environment.
- Logistics firm C.H. Robinson tells CNBC it is fielding inquiries about front-loading of freight ahead of potential Trump tariffs.
- Inventories are already increasing, according to Everstream Analytics, and the supply chain pull forward may accelerate in December, according to a forecast from Honour Lane Shipping.
Uncertainty among U.S. shippers is escalating into 2025 with the expectation of new Trump tariffs and the possibility of a new ports strike that could begin in mid-January. Supply chain and logistics executives tell CNBC that shippers are now trying to game out the snafus that could be coming in the global supply chain and how much inventory to order against a consumer backdrop that remains strong, but subject to macroeconomic risks, and an early start to Lunar New Year, a holiday period in Asia during which manufacturing operations halt for as long as a month.
In an advisory to clients, Honour Lane Shipping said it did not expect a volume spike in November because it took two to three weeks for production cycles to adjust, but frontloading may start in the first half of December, it wrote. It added the implementation of new tariffs could be delayed though, and push back the frontloading to a later date during the first half of 2025.
The earliest new tariffs could be in effect is in late February or early March, according to an alert from C.H. Robinson to clients. “With continued port labor uncertainty and the potential for increased tariffs in Q1, shippers should anticipate a strategic pull-forward of inventory out of Asia, which would impact both international and certain domestic freight markets (e.g., Southern California),” it wrote.
But shippers must now decide which coast to send freight to given exposure to a possible ILA strike at ports from New England to Texas which could begin in mid-January. Travel time for ocean freight from China to the East Coast and Gulf Coast ports is 40-55 days. The negotiation deadline between the United States Maritime Alliance and the ILA is January 15. Last week, USMX announced the ILA had walked away from negotiations after an impasse over automation issues.
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