Port Feeling the Impact of Trump Tariffs

On March 4, President Trump’s 25% tariffs on imports from Canada and Mexico kicked in, with a limit of 10% on Canadian energy; he also doubled the tariff on all Chinese imports to 20%. All three countries have vowed to strike back against the U.S. with their own measures. In the Long Beach area and across the state, businesses of all types are feeling the impact of the on-again, off-again tariff disruption from Washington, D.C.

At the end of March, the president announced a 25% tariff on auto imports, which is complicating things for domestic automakers that import a lot of the parts and components that go into their U.S.-manufactured vehicles. The tax hike will be starting in April, which will likely bring higher cost and lower sales to automakers. Trump hopes to see more auto parts and components coming from America instead of what he’s called a “ridiculous” supply chain in which auto parts and finished vehicles are manufactured across the United States, Canada and Mexico.

The Port of Long Beach announced that trade continued rising in February for the ninth consecutive month, bringing praise and thank-yous from Port of Long Beach officials. Retailers continued to move goods in anticipation of tariffs impacting the market for a number of products and materials.

Dockworkers and terminal operators moved 765,385 twenty-foot equivalent units in February, up 13.4% from the same month last year. Imports rose 11.8% to 368,669 TEUs and exports increased 2.9% to 90,026 TEUs. Empty containers moving through the Port climbed 19.1% to 306,690 TEUs. Retailers continued to move goods ahead of anticipated tariffs placed on some imported products and materials.

“No matter the situation, the Port will remain competitive by delivering exceptional customer service and moving ahead with capital improvement projects that will allow us to grow well into the future,” said Port of Long Beach CEO Mario Cordero. “We thank our industry partners for choosing to do business with us.”

The Port has moved 1,718,118 TEUs during the first two months of 2025, a 27.4% increase from the same period in 2024.

Bonnie Lowenthal, President of the Long Beach Board of Harbor Commissioners, recently commented on a new economic impact study on the potential impact of tariffs. One in five jobs in the city of Long Beach come from the Port directly or indirectly. The study says that in Southern California, 575,000 jobs are related to business at the Port of Long Beach, Lowenthal said.

Huge Impact On Agribusiness

In March during an edition of Port Update, Cordero spoke with Agriculture Transportation Coalition Executive Director Peter Friedmann to discuss the new tariffs on China, Mexico and Canada. These markets account for 50% of U.S. imports, Cordero said.

Port of LB and LA have been the hub for agribusiness going in and out of the country, Friedmann said.

“This is a very challenging time,” he said. “About six-to-seven years ago, the then Trump administration got into a tariff war with China where China retaliated. U.S. agriculture imports took a lot of injuries. The Trump administration then had to generate billions of dollars of price support and other subsidies to help U.S. farmers to survive the loss of cargo.”

“For our agriculture exports, those hogs in China that eat the soybeans, they don’t give a darn if it’s coming from Minnesota, or North Dakota, or Brazil, or Argentina, or wherever. We have that competition for everything,” Friedmann said.

China is our largest market for agriculture exports, and Asia Pacific is the biggest region. It’s the reason Port of Long Beach is in the best location. It’s the closest one to our largest market for agriculture exports. In Asia Pacific, they remember what happened six years ago. They’re worried we’re going to have more tariffs, he said.

“Now we’re at 20% tariffs, imposed on China, and China announced its imposing 25% on our exports. The difference is that China has learned over the last six years, they better diversify their sourcing,” Friedmann said.

They also talked about competitive countries taking advantage of opportunities during tariff upheaval to tap into the strong U.S. market. Brazil has come in and taken a lot of market share from the U.S. Cattle and hogs coming out of Brazil has been growing substantially in the market, which has had an impact on the U.S. market.

Other Market Sectors Feeling the Impact

Lumber suppliers and construction contractors are feeling the impact. Tariffs have also been coming down strong on steel. The majority of the lumber that some hardware stores sell comes from Canada, and many of its steel products are made in China.

Across the state of California, businesses of all types – farmers, automakers, home builders, tech companies and apparel retailers – have been complaining about how hard it’s been to go through the on-again, off-again announcements on tariffs between the U.S., Canada, Mexico and China. It’s made it very difficult for business owners to do any planning for 2025 and beyond, said Jonathan D. Aronson, a professor of international communication and international relations at USC, to the LA Times.

One of their biggest challenges is that they don’t know who their business partners are going to be. That’s an essential part of setting up international business and it becomes quite vulnerable during tariff wars.

California is still the major wine producer in the country, accounting for about 85% of it, with the state being home to thousands of grape growers and wineries. Many of them are small businesses and are several generations old.

The Wine Institute said the industry supports employment for more than 420,000 Californians and generates $73 billion in economic activity in the state. However, Canada is the largest market for California wine, which is going to feel the impact.

Cordero said that the Port of Long Beach lost about 20% of its expected cargo from China in 2019 during another tariff battle. China’s tariff was also supplemented by a 10% increase in imports from Southeast Asia nations including Vietnam, Indonesia and Thailand. Cordero wouldn’t be surprised if the same thing happened again.

What Will Happen to the Department of Education?

There’s also been a good deal of concern in the state over announcements by the Trump administration that several federal departments and agencies will be seeing staff layoffs and deep budget cuts.

Trump’s decision to dismantle the U.S. Dept. of Education brought up a wave of complaints and criticisms in Sacramento and Los Angeles County. Attorney General Rob Bonta said Trump’s action to shut down the department is dangerous yet unsurprising.

“(The Trump Administration) continues to do everything it can to destroy the department’s ability to carry out its most vital, congressionally-mandated functions with the clearly stated ‘final mission’ of shuttering the department for good,” said the Attorney General’s office.

Bonta said that the attorney general’s office will be carefully monitoring how the Dept. of Education will be affected.

“Our recourse is to take them to court if they break the law,” Bonta said to NBC Los Angeles.

Los Angeles Unified School District Superintendent Alberto Carvalho had his own warnings to share on this topic, as well. He warned that dismantling the department will impact students, teachers, food and education programs.

“For those who argue that maybe there’s a better way of earmarking dollars directly to states through block grants and empower states with local decisions, I have news for you: That’s already the reality,’’ Carvalho said to NBC Los Angeles. “This begs the question, `Why?’ and `Why now?’ and `What is the impact long-term that will directly impact our kids?’’’

Jon LeSage is a resident of Long Beach and a veteran business media reporter and editor. You can reach him at jtlesage1@yahoo.com.