U.S.-bound waterborne shipments are up in August, reports Panjiva

United States-bound waterborne shipments were up in August, but at a reduced rate, according to data recently issued by global trade intelligence firm Panjiva.

August shipments, at 1,095,208, eked out a 0.1% annual gain, and on a year-to-date basis, shipments through August, at 8,212,273, are up 1.5% compared to the same period a year ago.

Despite the gain, the three-month rolling average for shipment activity is down 0.1% annually, which Panjiva said is the first decline for that reading going back to June 2016. Panjiva added that a similar rate of development was intact in containerized and non-containerized growth.

Panjiva said that import growth in August was hindered by the ongoing United States-China trade war, with shipments from China off 1.8% annually on the heels of a 4.6% decline over the previous three months and also “likely” reflects the absence of stockpiling. What’s more, it added that the main winners of the trade war continue to be providers of alternative supplies of tariff-afflicted products in Asian countries, excluding China which saw shipments tick up 9.1% in August, with Vietnam (up 27.3%) and Thailand (12.2%) leading the way.

In an interview, Panjiva Research Director Chris Rogers put this most recent batch of data into perspective, explaining that since 2016 there has been sustained mid-to-high single digit growth, with 2018 up 6.5%, 2017 up 4.1%, and 2016 up 2.5%.

“The data throughout 2019 has been trending down,” he said. “That is the cost of the trade war right there. There is also a slowdown in imports from Europe, which is quite noticeable as well. If there was not a trade war, that is what we would be talking about, and it is probably tied to a slowdown in luxury goods in the U.S like automobiles, wine, and food out of Europe. While U.S. consumer spending can still be viewed as robust, there is a reversal in purchasing from Europe. Exports out of Germany has been pretty rough as well and is tied more to the industrial sector.”

Rogers noted it would not be surprising to see a further slowdown, in import growth, over the rest of the year, too. And despite the recent shifting of new tariffs from October 1 to October 15, as per a Tweet earlier this week by President Trump, Rogers pointed out that these tariffs are being delayed and not removed, while serving as an overhang of an economic drag.

That was made clear, with U.S. Customs duties climbing to $7 billion in August, for a new record, with the possibility it could hit $12 billion per month, when new tariffs are put in place on October 15.

“These are some big numbers, and they are serving as a real drag on both the U.S. industrial and consumer economies,” said Rogers. “It is not like President Xi is going to sit around and wait for the election. The recent Democratic Presidential debate made it clear that being tough on China is where everybody is at, whether it is tariffs or through the WTO or how you restrict investments by Chinese companies. Those are just tactics; the strategy is the same. It is not going to change after the election.” 

On a product level, Panjiva reported that imports of consumer goods in August were solid, with apparel up 6.6% and toys up 14.8%, adding that the delay of tariffs on a large part of the apparel industry and all toys could slow import growth by late September. Further signs of what Panjiva called “potential damage that tariffs can cause to demand” are apparent on furniture imports, which were down 1.9% in August, falling for the fourth consecutive month, going back to when tariffs were bumped up to 25% from 10% in May.