Decline in Eastbound Container Volume from Southern California

Categories: California Business NewsCalifornia News

A view of the Southern California shipping port reflecting declining container volumes.

News Summary

The eastbound international container volume from Southern California hit a six-month low, dropping 5% from the previous week. This downturn is attributed to high tariffs on Chinese imports amidst the U.S.-China trade war, leading to projections of significant decreases at the Port of Los Angeles. The trade tensions have lasting effects on supply chains, impacting retailers and consumers as inventory levels dwindle and shortages loom. With nearly 2 million jobs tied to trade in the region, the economic implications are substantial.

California – Eastbound international container volume out of Southern California saw a significant decline during the week ending May 18, reaching its lowest level in six months. This downturn involves a 5% decrease from the previous week and represents a 10% drop when compared to the four-week rolling average. The decline is primarily linked to the steep tariffs imposed on Chinese imports amidst the ongoing U.S.-China trade war, with some tariffs rising as high as 145% on specific goods.

RailState, an organization that tracks international container volumes, reported that the eastbound container volume is currently 26.3% lower than the peak week recorded from March 3-9, 2025. This surge in early March was largely attributed to importers accelerating shipments before the implementation of the original tariff increase. The trade conflict between the United States and China had escalated prior to this, resulting in both nations agreeing to a 90-day truce recently that reduced tariffs on most Chinese goods to 30%. This temporary easing allows importers a brief window to restock their inventories.

The data indicates that the expected surge in imports could be possible, with many companies working to handle inventory levels ahead of any potential future tariff increases. RailState’s tracking involves various container sizes, including 20-, 40-, and 45-foot containers, which are primarily moved on BNSF Railway and Union Pacific main lines.

Following the tariffs announced in January 2025, there was an observed increase in Twenty-foot Equivalent Units (TEUs), as suppliers rushed to ship products prior to the tariffs’ enforcement. However, after reaching a peak on March 3, 2025, the volume dropped sharply by about 15,000 TEUs, signaling the end of the “beat the tariff” shipping rush. Since then, the TEU volumes have dwindled to only two-thirds of their previous peak.

Forecasts indicate the Port of Los Angeles may face a substantial 35% decrease in arrivals, which is a direct consequence of the halt in cargo from China and a reduction in shipments from Southeast Asia. Upcoming forecasts predict a drop of 28.6% in cargo to approximately 85,486 TEUs, while another week sees a nearly 33% decline to approximately 74,925 TEUs.

The tariffs are expected to have lasting impacts on the trade and logistics sectors, industries that collectively contribute close to $300 billion to the Southern California economy. In the month of March alone, the port experienced a 15% year-over-year decline in TEUs—the fourth month in a row to report a decrease. As major retailers now report having only a six-to-eight-week supply of inventory, the risk of shortages looms.

Though some tariffs may reduce for certain goods in the future, retailers, especially smaller businesses, are already feeling the impact. The Port Executive Director highlighted that, unless current policies change, consumers and manufacturers might face increasingly difficult choices in the near term.

With nearly 2 million jobs reliant on the trade industry in Southern California, the slowing container volumes hold significant implications for the region. If trends continue, U.S. consumers may confront price increases and diminished product availability, a consequence of disrupted supply chains.

Overall, the current decline in eastbound container volume from Southern California illustrates a complicated intersection of multinational trade policies and their far-reaching effects on local economies and consumer markets in the United States.