December 2024 saw imports to the United States surge. The increase in foreign goods coming into the U.S. during the month was driven by two main factors:
- A potential strike at U.S. east coast ports as the deal the Biden-Harris administration worked out with labor unions to end a three-day strike in early October 2024 was only for three months. The prospect of the deal expiring again in January 2025 without a labor agreement put firms trying to bring foreign goods into the U.S. in the position of trying to beat the clock ahead of another disruptive strike. The same thing happened in the months preceding the October strike.
- A similar dynamic applied to west coast ports, as firms seeking to bring Chinese-produced goods into the U.S. tried to front-run potential tariffs threatened by President-elect Donald Trump and the doubling of real tariffs on semiconductors imposed by the Biden-Harris administration that were set to go into effect in 2025. The same thing happened during the summer of 2024, thanks largely to firms trying to beat the clock on new trade restrictions imposed by the Biden-Harris administration.
Focusing on trade between the U.S. and China, the following chart shows a year-over-year increase from December 2023 to December 2024:
We anticipate January 2025's trade levels will be elevated as Chinese firms typically boost their shipments ahead of the country's week-long Spring Festival holiday, which falls in early February this year. We'll also note that January saw surprisingly few sustained trade actions by the incoming Trump administration, most of which involved very short-lived tariffs. That is changing with tariffs being announced on steel and aluminum in February, so we'll need to develop a new counterfactual to measure their impact.
We'll also be taking a last look at the anti-free trade legacy of the Biden-Harris administration, which has been more negative than President Trump's trade actions during his first term.
References
U.S. Census Bureau. U.S. International Trade in Goods and Services (FT900). U.S. Trade in Goods with China, Not Seasonally Adjusted, Nominal Figures, Total Census Basis. [Online database]. Accessed 5 February 2025.
Image credit: Port Of Los Angeles by Linnaea Mallete on PublicDomainPictures.net. Creative Commons Creative Commons - CC0 Public Domain.
Labels: trade
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