US importers rush in goods from China as Trump tariff threat looms (updated)

Helen of Troy

15/01/2025 20:24

* 
      Chinese officials say December exports surged to record
levels
    

        * 
      China cargoes at US seaports jumped 14.5% in Dec, data
shows
    

        * 
      Overall US imports boosted by factors including Red Sea
attacks
    

  
 (Adds China trade official comment in paragraph 5, details on
companies building inventories in paragraphs 8-11, 14, 18-21)
    By Lisa Baertlein and Ellen Zhang
       LOS ANGELES/BEIJING, Jan 15 (Reuters) - U.S. imports
from China finished the year strong after some companies
stockpiled shipments of apparel, toys, furniture and electronics
ahead of President-elect Donald Trump's plan to impose new
tariffs that could revive a trade war between the world's
economic superpowers.
    Trump, who has threatened to slap tariffs of 10% to 60% on
goods from China, takes office on Jan. 20. During his first
term, Trump mainly targeted Chinese parts and components.
Economists and trade experts predict his next wave of tariffs
could apply to finished goods. 
    "There has thus been an uptick in the exports of final goods
from China to the U.S., as importers aim to front-run possible
tariffs on consumer items," said Frederic Neumann, chief Asia
economist at HSBC in Hong Kong.
    Chinese trade officials on Monday said December exports
surged to record levels.
    The large rise was in part a reflection of concerns about
escalating trade protectionism, Lv Daliang, spokesperson for the
Chinese customs administration, said at a press conference in
Beijing. 
    U.S. seaports handled the equivalent of 451,000 40-foot
containers of goods from China in December, a year-over-year
increase of 14.5%, according to trade data supplier Descartes
Systems Group  DSG.TO . 
    That capped a year when U.S. imports of bedding, plastic
toys, machinery and other products from China rose 15% from
2023, according to Descartes.
    Helen of Troy Ltd  HELE.O , seller of OXO kitchen gadgets,
Hydro Flask water bottles and Vicks over-the-counter medicines,
contributed to that increase. It has been building strategic
inventories aimed at reducing exposure to tariffs, executives
said on an earnings call last week.  
    "The inauguration is literally days away. I think we'll get
some more clarity once President-elect Trump is in office,"
Helen of Troy CEO Noel Geoffroy said of new U.S. tariff
policies.
    Tool and electrical and plumbing supply distributor MSC
Industrial Direct  MSM.N  sources roughly 10% of its inventory
from China. It is stocking up on its most popular products that
could be at risk from new tariffs while developing promotional
campaigns for goods made in the United States, executives told
investors last week.
    Teasing out the true effect of the risk of Trump tariffs on
overall import gains is difficult because companies closely
guard trade data.
    
    RESILIENT DEMAND
    Further complicating the analysis, resilient U.S. shoppers
have been fueling demand. Some importers also brought in safety
stocks to protect against disruptions from Houthi attacks on
shipping near the Suez Canal trade shortcut and a labor dispute
at seaports on the U.S. East Coast and Gulf of Mexico.
    Meanwhile, Trump also has threatened to tariff goods from
many other countries, including North American neighbors Mexico
and Canada.
    Walmart  WMT.N , the biggest user of container shipping, is
among the retailers that cargo data analysts say have ramped up
imports in recent months. Walmart did not comment on that
assessment.
    Several categories of U.S. imports from all geographic
sources posted meaningful gains during the fourth quarter,
according to S&P Global Market Intelligence.
    Textiles and apparel jumped 20.7%; leisure products, chiefly
toys, gained 15.4%; home furnishings increased 13.4%; and
household appliances and consumer electronics posted gains of
9.6% and 7.9%, respectively, according to S&P. 
    Consumer staples categories such as household and personal
care, as well as food and beverages, rose 14.2% and 12.5%, S&P
said.
    Michael O'Shaughnessy, CEO of Element Electronics Corp.,
said there was a year-end rush to get goods into the United
States. 
    Element imports components, mainly from China, for its
flat-screen TV assembly plant in Winnsboro, South Carolina -
America's last large-scale television production plant. It also
imports finished televisions. The company built buffer stocks
when dockworkers were threatening to shut the East Coast ports
it uses.
    Still, O'Shaughnessy said there's a limit to how much he's
willing or able to bring in.
    "There's just no place to put everything," he said. "Also,
there are working capital constraints. Every day it sits there
it costs you money." 

 (Reporting by Lisa Baertlein in Los Angeles, Ellen Zhang in
Beijing and Tim Aeppel in New York; Editing by David Gregorio
and Aurora Ellis)
 ((lisa.baertlein@thomsonreuters.com))