THE Port of Long Beach had its busiest month ever in June, but an intensifying trade war could stunt the momentum.
The port's June's report showed that container volume increased 14.2 per cent compared to June 2017, with the equivalent of roughly 752,000 TEU shipped to and from the facility, which was 4.4 per cent higher than the port's previous record month.
News of the record-setting month comes in the middle of escalating trade tensions between the Trump Administration and China, with both sides levying tens of billions of dollars in tariffs and the administration threatening to ratchet those up to US$200 billion in goods.
Two-thirds of the port's revenue comes from trade, so anything that could negatively impact that could have dire financial consequences for one of the nation's busiest ports.
To date, $34 billion in mutual tariffs have been levied by the two countries, which so far have had little impact on business as evidenced by the port's most recent report.
Port CEO Mario Cordero said that if the tariffs increase to $50 billion, cargo at the Port of Long Beach could dip by over 7 per cent, reports Transport & Transportation.
Mr Cordero is optimistic that a healthy economy will continue to support high levels of activity at the port, but also wary of the impacts that a protracted tit-for-tat trade war with China could have.
About 70 per cent of imported goods coming into the San Pedro Bay port complex, which includes the Port of Los Angeles, are from China. About one-third of the exports leaving the port are bound for China, with the 2017 cargo value figure sitting at about $173 billion.
Mr Cordero said the majority of the products coming into the port are household wares like furniture, clothing and footwear as well as toys, electronics and auto parts. He cautioned that because something is branded as American doesn't mean that its components originate from domestic producers.
'When you make reference to American cars, American cars as we know them today, there's no true American car that has all parts manufactured in the United States,' he said. 'When we talk about what we know as a domestic vehicle, that vehicle is composed of parts that have been imported.'
Mr Cordero pointed to Apple, based in the Northern California city of Cupertino, which manufactures some of its products in China - including the ubiquitous iPhone. He said about $70 billion worth of iPhones were shipped to the US in 2017, but a tariff placed on any one product - like an iPhone - would have consequences for countries outside of the US and China.
For now, he remains optimistic that the port will continue it potentially record breaking year and the worst case scenario involving hundreds of billions of dollars in tariffs can he averted.
Mr Cordero noted the port's ability to rebound from the economic downturn in the mid-2000s with gradual growth culminating in last year's record setting year. The port, he said, 'has been able to weather and navigate whatever the crisis has been.'
The port's June's report showed that container volume increased 14.2 per cent compared to June 2017, with the equivalent of roughly 752,000 TEU shipped to and from the facility, which was 4.4 per cent higher than the port's previous record month.
News of the record-setting month comes in the middle of escalating trade tensions between the Trump Administration and China, with both sides levying tens of billions of dollars in tariffs and the administration threatening to ratchet those up to US$200 billion in goods.
Two-thirds of the port's revenue comes from trade, so anything that could negatively impact that could have dire financial consequences for one of the nation's busiest ports.
To date, $34 billion in mutual tariffs have been levied by the two countries, which so far have had little impact on business as evidenced by the port's most recent report.
Port CEO Mario Cordero said that if the tariffs increase to $50 billion, cargo at the Port of Long Beach could dip by over 7 per cent, reports Transport & Transportation.
Mr Cordero is optimistic that a healthy economy will continue to support high levels of activity at the port, but also wary of the impacts that a protracted tit-for-tat trade war with China could have.
About 70 per cent of imported goods coming into the San Pedro Bay port complex, which includes the Port of Los Angeles, are from China. About one-third of the exports leaving the port are bound for China, with the 2017 cargo value figure sitting at about $173 billion.
Mr Cordero said the majority of the products coming into the port are household wares like furniture, clothing and footwear as well as toys, electronics and auto parts. He cautioned that because something is branded as American doesn't mean that its components originate from domestic producers.
'When you make reference to American cars, American cars as we know them today, there's no true American car that has all parts manufactured in the United States,' he said. 'When we talk about what we know as a domestic vehicle, that vehicle is composed of parts that have been imported.'
Mr Cordero pointed to Apple, based in the Northern California city of Cupertino, which manufactures some of its products in China - including the ubiquitous iPhone. He said about $70 billion worth of iPhones were shipped to the US in 2017, but a tariff placed on any one product - like an iPhone - would have consequences for countries outside of the US and China.
For now, he remains optimistic that the port will continue it potentially record breaking year and the worst case scenario involving hundreds of billions of dollars in tariffs can he averted.
Mr Cordero noted the port's ability to rebound from the economic downturn in the mid-2000s with gradual growth culminating in last year's record setting year. The port, he said, 'has been able to weather and navigate whatever the crisis has been.'