FND Floor and Decor Holdings Inc

By Erica E. Phillips 

LOS ANGELES -- Imports into U.S. seaports are surging over usual seasonal patterns in an apparent push by retailers and manufacturers to pull orders forward ahead of a new round of tariffs set to hit U.S.-China trade in January.

Ports in Southern California, Georgia and Virginia reported double-digit growth in import volume from September to October, setting monthly records as furniture, apparel, auto parts and other goods streamed in.

"It's going fast and furious," said Alan McCorkle, senior vice president with Yusen Terminals LLC, a container-handling operation at the Port of Los Angeles. "October was just pumping."

The neighboring ports of Los Angeles and Long Beach, the nation's top hub for container trade and the main destination for imports from China, handled a combined 849,908 20-foot equivalent units, or TEUs, of loaded inbound containers last month. That was up 17.7% from the same month last year and 10.2% from September.

Mr. McCorkle said Yusen has opened an additional entry gate for trucks coming to handle the latest wave of imports. Container stacks on the terminal are "five- or six-boxes high, where normally it'd be four," he said.

Goods affected by tariffs in particular appear to be moving. Trade analyst Chris Rogers of the Panjiva research group said imports of apparel rose 19.7% year-over-year in October. Furniture imports were up 14.7%, and auto-parts imports rose 9.9% last month compared with a year ago.

The surge follows a slight lull in Southern California during the normally busy months of July and August, after an earlier round of tariffs kicked in. But port officials and logistics companies said they expected another rush before the end of the year, with a new round of tariffs slated to go into effect Jan. 1.

October's import activity proved them right.

On the East Coast, container ports in Norfolk, Va., and Savannah, Ga., reported swells in October imports. The Port of Virginia said loaded imports rose 17% to 127,677 TEUs from September to October. In Georgia, import cargo was up 18.5% month-to-month, reaching 205,836 TEUs.

Additional ocean vessels have been added to trans-Pacific routes, and some ocean shipping companies are sending larger ships, analysts with Citigroup Global Markets Inc. wrote in a research note last week. Citi added that companies including Costco Wholesale Corp., Floor & Décor Holdings Inc., Lumber Liquidators Holdings Inc., and Eaton Corp. PLC have said they planned to pull forward their import volumes to get ahead of tariffs.

Advancing orders early carries direct and potentially indirect costs for retailers and manufacturers. Companies will have to hold inventories longer, and the longer lead times mean retailers could be stuck with extra products that don't sell.

Executives at Walmart Inc. said on a recent call with reporters they are reviewing every item expected to be subject to tariff-related increases in the coming months, and discussing with suppliers ways to reduce costs.

Meanwhile, shipping companies are bracing for a potential drop-off in demand once the calendar flips.

A.P. Moeller-Maersk AS Chief Executive Soren Skou said the U.S.-China trade dispute has boosted the flow of goods on the company's ships, but he expects demand to decline early in 2019 after more tariffs are expected to go into effect. If the U.S. and China resolve their differences, he said, companies could start destocking, or selling off existing inventories, while scaling back new orders.

Write to Erica E. Phillips at erica.phillips@wsj.com

(END) Dow Jones Newswires

November 15, 2018 14:53 ET (19:53 GMT)

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