Despite trade wars and inflation, America has been importing a lot of stuff. The Port of Long Beach in Southern California just logged its busiest August ever and its fifth-biggest month ever. Right next door, the Port of Los Angeles just had its biggest summer ever.
The nation as a whole just logged its third-highest month for container imports, which are commercial items — like what consumers buy on Amazon.
Lisa Ellram, a supply chain management professor at Miami University in Ohio, said that one big reason behind this boom is that the economy is still pretty strong. “I wouldn’t anticipate that consumers would still be buying things like they have been, but apparently they are,” she said.
Another reason: the economy is really uncertain, partly because the war in the Middle East keeps dragging on and dragging oil prices up.
“[Importers] want to lock into the rates now for anything that they think they might be needing in the future,” Ellram said.
Importers are also wary of ever-changing tariffs.
“The uncertainty caused companies to start hedging, to start inventory front-loading,” said Joseph Sarkis, a professor of management at Worcester Polytechnic Institute’s Business School.
Sarkis said the tariffs are not doing what the Trump administration wants them to do.
“These tariffs are not stopping organizations [or] companies from purchasing from international sourcing,” he said.
Those importers don’t really have any alternatives. Rob Handfield, a professor of supply chain management at North Carolina State University, said that building domestic infrastructure could take a decade.
“Transitioning to a domestic manufacturing base isn’t easy, because we just don’t have that capacity,” he said.
In part, it has been a good summer for imports because that time of year is usually good.
“August is traditionally a big month for imports,” Handfield said, because it’s the month when companies are setting up their inventories for holiday shopping.
Related Topics