Port of Los Angeles sees new June box mark

“Importers aren’t simply moving more cargo – they’re moving it differently,” Seroka said. “Many companies have stepped away from traditional seasonal shipping patterns, advancing cargo whenever they see an opening rather than waiting for perfect conditions. Retailers are making strategic decisions about when and how much to ship, balancing back-to-school and holiday demand against tariffs, rising fuel costs, and global uncertainty.”

Exports remained essentially flat at 126,000 TEUs compared with the previous June, reflecting ongoing headwinds for American agricultural and business interests competing in overseas markets. Empty containers totaled approximately 345,000 units, up 17% year over year, as that equipment heads back across the Pacific to support continued import demand.

At the halfway mark of 2026, the port has moved 5.1 million TEUs, about 3% ahead of 2024’s pace and 4% above the five-year average. The fiscal year closed with 10.4 million TEUs, placing it among the best fiscal years in port history.

Impending tariff rolloffs and policy shifts

On July 24, the Section 122 temporary tariffs announced in February will expire, ushering in a new tariff regime with significant implications for importers.

The outgoing tariffs will be replaced by Section 301 tariffs in two tranches, said Seroka. The first tranche will impose a flat tariff of 10% to 12.5%, ostensibly targeting countries not complying with forced labor provisions in trade agreements. This represents a continuation of the existing tariff structure without dramatic changes.

Importantly, the same date brings the elimination of de minimis provisions in the U.S. tariff code. Small packages will now go through a special tariff process, creating new compliance requirements for importers who previously relied on easy shipment of lower-valued items by mail. 

“This change particularly affects small retailers and family-owned businesses that have relied on platforms like JD, Shein, and Alibaba, as well as consolidators bringing in smaller parcels,” Seroka said. “Beyond paying the import surcharge, these businesses face bureaucratic compliance burdens in shipping forms and documentation that will create friction until the new system is understood.”

What’s been less discussed is the uncertainty in a second tranche of Section 301 tariffs targeting “excess capacity” and alleged dumping of foreign goods. Unlike the flat forced-labor tariffs, these could replicate what was seen on “Liberation Day” in April 2025 – high rates with significant variance across countries, hitting certain trading partners hard while treating others more leniently. This variability means potential large-scale reshuffling of supply chains depending on the final tariff rates announced, Seroka said.

Additional questions remain about whether these tariffs represent initial bargaining positions or long-term policy, and whether rates will change month to month or remain fixed. The administration has articulated multiple objectives for tariffs – reducing the trade deficit, raising federal revenue, and reshoring manufacturing jobs – but these goals involve trade-offs that cannot all be achieved simultaneously.

And, the tariff impacts extend beyond imports, said Seroka, who just returned from a fact-finding trip to Germany. “American exporters face challenges not only from retaliatory tariffs but from quiet deal-making that sidelines U.S. producers. Trade agreements on soybeans with Brazil and Argentina, on almonds with Australia, and partnerships between Indonesia and the European Union represent collaborative arrangements that leave American farmers and manufacturers on the sidelines.”

Steel tariffs, for example, illustrate the economic trade-offs. While U.S. producers enjoy improved profitability and higher prices, downstream users like General Motors, Ford, Caterpillar, and John Deere face elevated costs that put them at a competitive disadvantage against foreign rivals who don’t pay those premiums in their home markets.

Global geopolitical headwinds

The conflict in the Middle East and its impact on the Strait of Hormuz have created ripple effects across global supply chains, most immediately felt through fuel prices.

In Southern California, gas prices have risen 18% to 20% from a year ago, Seroka noted, while diesel prices remain elevated at more than 25% higher. “These increases hit hard for the port’s trucking community, where the majority of operators are small to midsize businesses,” he said. “Fuel now accounts for approximately 30% of a vessel voyage’s overall cost for shipping lines.

“The next impact will come through fuel surcharges passed on to importers and exporters. Shipping lines typically require three months of data demonstrating increased fuel costs before assessing surcharges to cargo owners. Once implemented, these surcharges tend to lag when prices decrease, remaining elevated for some time before reflecting current market conditions.”

Despite these challenges, trans-Pacific cargo has continued moving largely unimpeded. Key Asian ports including Singapore, Shanghai, and Yokohama have effectively segmented Middle Eastern cargo from trans-Pacific trade, Seroka said, ensuring containers destined for Los Angeles move through without significant delays.

The region faces massive post-conflict rebuilding regardless of when hostilities cease. The situation proves particularly acute in other regions: Southeast Asia relies almost exclusively on Arabian Gulf nations for refined jet fuel, while 75% of the European Union’s supply comes from the same source.

Port performance and local infrastructure gains

Amid global uncertainty, the Port of Los Angeles has achieved significant operational improvements.

Average truck turn time has dropped by a third from 97 minutes during the height of the 2021 supply chain crisis to 62 minutes today, a reduction of more than one-third. This matters because two-thirds of port cargo moves in and out by truck daily, and benefits cargo owners and retailers through a more reliable supply chain, truck drivers through more productive runs and less idle time, and surrounding communities through cleaner air from reduced idling.

Rail operations show similar improvement though networks have been stressed by the recent intermodal surge. On-dock rail dwell times currently average about five days, Seroka said, slightly above the preferred two-to-four-day range but dramatically improved from crisis levels. In October 2021, the port had 89 ships at anchor, 97,000 import boxes on the ground, and 37,000 containers sitting nine days or longer. Of those aging containers, 22,000 were rail boxes awaiting on-dock loading. Today, approximately 1,300 boxes are sitting nine days or longer designated for rail.

Looking ahead, July cargo volume is expected to remain above 900,000 container units. Beyond that, the picture becomes harder to read as businesses adapt in real time to changing conditions. Trade policy developments, Section 301 tariff implementations, Middle East developments affecting transportation costs, and broader economic indicators will all shape the second half of 2026.

Read more articles by Stuart Chirls here.

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