By Lisa Baertlein, Farah Master and Casey Hall
LOS ANGELES/HONG KONG (Reuters) -Container ship bookings for China-to-U.S. cargo have surged since the countries declared a 90-day truce on punitive tit-for-tat tariffs last weekend, operators said, spawning traffic jams at Chinese ports and factories that could take weeks to clear.
U.S. importers of sneakers and sofas to construction supplies and auto parts are racing to get goods in before the deadline resets tariffs again, setting the stage for disruptions that recall the global transport quagmire during the COVID-19 pandemic.
The cargo surge at major trade gateways like Shenzhen’s Yantian Port, which handles more than a quarter of China’s exports to the United States, has ship owners scrambling to coordinate berths and adjust vessel schedules.
“The demand is so high that we can only serve customers who have made long-term contracts with us,” a spokesperson for German container ship operator Hapag-Lloyd told Reuters. “We have hardly enough space for spontaneous bookings.”
Container-tracking software provider Vizion said average bookings for the seven days ended on Wednesday soared 277% to 21,530 20-foot equivalent units from the 5,709 TEU average for the week ended May 5.
Owners of factories that make toys to holiday decor told Reuters they are booking previously frozen cargo headed to U.S. stores, including Walmart.
Lalo, for example, which sells its baby furniture online and through retailers like Target and Amazon.com, is among the companies that gave factories the green light to move their finished orders.
“We had hundreds of thousands of units waiting to ship,” said Lalo co-founder Michael Weider. “These products can now get on the water.”
“Everybody is very busy from my company, at my friend’s companies,” said Richard Lee, CEO of NCL Logistics, in China’s southern metropolis of Shenzhen. “They are preparing a lot of cargo, a lot of products, to be shipped immediately from China to the U.S.”
SECOND TSUNAMI?
The shipping surge will translate into a rush of arrivals at U.S. West Coast ports in the coming weeks.
Still, industry experts, including the executive director of the Port of Los Angeles – the busiest U.S. seaport and No. 1 for ocean shipments from China, do not foresee a COVID-level tsunami of cargo. Rather, they project a large, but manageable wave.
On Thursday, the off-contract spot rate from Shanghai to Los Angeles shot up 16% from the prior week to $3,136 per 40-foot container, according to data from maritime consultancy Drewry. That is less than half than in April 2024, but could jump sharply on June 1 to about $6,000 per container if ship owners push through rate increases.
