This week:
- President Trump issues executive order mandating reciprocal tariffs for all countries
- ILA members set for ratification vote next week on new six-year USMX master contract
- Despite a sluggish start to 2025, US LTL carriers optimistic about expected spring demand surge
- Stakeholders speak out about congestion at Port of New York-New Jersey
- As import volumes surge at Los Angeles-Long Beach port complex, rail dwell times rise
President Trump Orders Reciprocal Tariffs For All US Trading Partners
US President Donald Trump signed an executive order this past Thursday, February 13, implementing a policy of reciprocal tariffs for all current and future American trading partners. The policy equals tariffs and taxes applied to US exports, including the value-added tax (VAT).
“In other words, they charge us a tax or tariff, and we charge them the exact same tax,” the President said in an Oval Office press conference.
The new policy essentially amends Trump’s January 20 order instructing the Secretary of Commerce, the US Trade Representative, and other government officials to perform a trade review and deliver a report by April 1. The officials will now conduct a country-by-country review to identify non-reciprocal trade agreements.
Earlier this month, Trump ordered new tariffs on goods imported to the US from China, Canada, and Mexico but suspended the implementation of duties on Canada and Mexico for 30 days.
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ILA Members to Vote on Six-Year USMX Master Contract Next Week
Longshoremen on the US East and Gulf Coasts will vote on a proposed six-year master contract on February 25, according to an announcement by the International Longshoremen’s Association (ILA). The union’s wage scale committee unanimously approved the tentative agreement with the United States Maritime Alliance (USMX) earlier this month, paving the way for next week’s ratification vote.
According to multiple news reports, the ILA shared contract details with its members in a video. The complete agreement will be available for review by local ILA chapters before the vote. ILA Executive Vice President Dennis Daggett has publicly shared several provisions of the contract, including a guarantee of no fully automated terminals or equipment during the contract’s term. Port automation technology was a key sticking point in the contract negotiations.
The agreement comes after months of negotiation. The ILA went on strike at East and Gulf Coast ports for three days last October, then agreed to a temporary contract extension through January 15. Negotiations broke down multiple times between October and January. The two sides regrouped last month and reached an agreement just before the contract extension was set to expire.
US LTL Carriers Optimistic as Spike in Demand Expected This Spring
The US less-than-truckload (LTL) freight market is anticipating a spike in demand soon, according to a report by Journal of Commerce (JoC) editor William B. Cassidy. While LTL rates were hampered by weak demand and winter weather in January and early February, LTL carriers are increasingly optimistic about a spring rebound.
Cassidy said LTL carriers are successfully negotiating contract rate increases, and that’s just one reason for their rosy outlook. According to data from the Bureau of Labor Statistics (BLS), the US long-distance LTL producer price index (PPI) jumped 5.8% in January, the largest monthly increase since the collapse of Yellow in August 2023 and an indicator of rising rates even before a volume increase.
March is a critical month to watch for the LTL sector, as it typically sets the tone for the first quarter. But while optimism is growing, Cassidy also noted January saw a 5.3% drop in overall LTL shipment volume from December, an 8.2% decrease year-over-year.
Heavy Import Volumes, Holidays, and Weather Lead to NY-NJ Port Congestion
Severe congestion is plaguing marine terminals at the Port of New York and New Jersey, according to multiple stakeholders. Heavy import volumes, holiday scheduling, and winter weather issues have all combined to create bottlenecks, making it difficult for truckers to return empty containers and putting shippers at risk for late fees.
In an operational update published last week, Hapag-Lloyd confirmed it had been impacted by the congestion. The carrier is actively seeking additional container storage and waiving late fees in an effort to restore fluidity. Hapag-Lloyd’s statement follows a recent poll by the Association of Bi-State Motor Carriers (BSMC), which found nearly two-thirds of drayage truckers described the empty container return situation as a “crisis.”
The congestion coincides with a period of significant growth for the NY-NJ port. The Port Authority reported an 11% year-over-year increase in import volumes for 2024, its busiest year since 2021. At the same time, the average weekly import container inventory reached 31,933 — up from around 25,000 in recent months.
Rail Container Dwell Times Rise at LA-LB Port Complex as Imports Surge
Rail container dwell times at the Ports of Los Angeles and Long Beach rose in January due to a surge in pre-Lunar New Year imports and frontloading ahead of new US tariffs. According to reporting from JoC Senior Editor Bill Mongelluzzo, the import surge helped create one of the strongest Januarys on record for eastbound trans-Pacific shipping.
Infor Nexus data shows an average rail container dwell time of 8.6 days at Long Beach in January, compared to 8.29 days in December. However, dwell times can vary significantly between terminals within the LA-LB port complex, the largest in the US. For example, SSA Marine reported a much lower three-day dwell time at their Long Beach terminals last month.
Yusen Terminals in Los Angeles reported progress in reducing backlogs from the fourth quarter, with an average rail container dwell of 6.8 days. Port of Long Beach COO Noel Hacegaba estimated container volumes were up about 13% from December, but that average dwell time actually improved to around four days, down from 4.64 days in December, highlighting the variability across the complex.
According to Mongelluzzo, a significant drop in imports is expected in the second half of February due to Lunar New Year factory closures. However, terminal operators anticipate a return to normal dwell times and cargo fluidity by the end of the month.
