What ship movements reveal about the effects of US tariffs

We review dramatic media reports on trade slumps

Although the elevated, country-specific rates of the so-called “reciprocal tariffs” have been suspended for 90 days, the US tariffs introduced by Donald Trump are still many times higher than before he took office. Now, the media in the US are at times dramatically reporting on the initial consequences: for example, cargo handling at the important port of Los Angeles fell by 30% at the beginning of May compared with the previous year. Other alarming reports follow suit.

However, many countries only publish reliable trade statistics after a long delay. In order to understand the disruptions in trade and their effects on the economies of the US and China, we have therefore analyzed current container ship movements. These represent an approximation of actual trade flows. However, as these time series fluctuate heavily and are subject to seasonal trends, we compare the data with a hypothetical scenario without tariffs. The comparison with these expected goods flows allows us to make economically meaningful statements and reveals some surprising findings, which we describe below. A full overview of the methods and limitations of the data is provided below (see Box .)

The US supply chains are unlikely to break down

Despite media reports, we have not observed any dramatic slump in the ten largest US ports as of May 16. Compared to April, imports via container ports may have fallen by around 10%. However, this means that current imports are only slightly below the hypothetical level that would have been expected at this time of the year without tariffs. On the contrary, there had been massive pull-forward effects in recent months. This follows from ports recording 10% more throughput than expected in recent months.

This suggests that importers have very likely built up sizeable stocks of critical goods. On the other hand, the US' import levels remain very high, at least via maritime transport. We therefore do not expect US tariffs to cause massive supply chain problems due to lost imports, as was the case during the pandemic. Rather, the data shows that many importers are likely to be forced to pay the tariffs. This will either increase consumer prices in the US in the coming months or reduce corporate profits.

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