MW Pandemic-era shortages could return soon absent a trade-war truce with China, businesses warn

By Jeffry Bartash

Imports arriving at U.S. ports are set to plunge. And that's just the tip of the iceberg.

Businesses stocked up ahead of the Trump tariffs. Shoppers looking to buy tools at Home Depot or toys for their children at Target might want to stock up, too.

How come?

Prices are likely to rise soon and shortages of popular consumer goods could even start to develop next month unless the White House reduces tariffs soon, especially punitive duties on China that go as high as 145%.

That's what major retailers, manufacturers, shipping experts and other companies are telling investors, the public and even the president himself.

President Trump on Monday met with the chief executives of Walmart Inc. $(WMT)$, Target Corp. $(TGT)$ and Home Deport Inc. $(HD)$, Axios reported, and they are said to have told him they will have to raise prices soon. Some shortages could even begin to arise in early May, they also reportedly told him.

None of the companies would elaborate on their conversations with Trump.

"We had an informative and constructive meeting with the President and look forward to continuing the dialogue," Home Depot said in a statement. Target and Walmart offered similarly worded statements.

Jonathan Gold, vice president of the National Retailers Federation, said it's too soon to tell when shortages might arise.

"Retailers have been working to mitigate the impact of tariffs for some time, including front-loading cargo when possible," he said.

No kidding: Lots of American companies began to stock up late last year after Trump won election in November, taking seriously his threat to boost tariffs when hardly anyone in Washington did.

A surge in U.S. imports began in December, and they shot up to a record high in January - topping $300 billion for the first time ever, according to the most recent trade statistics collected by the U.S. Census Bureau.

From December to February, total U.S. imports of goods rose to $951 billion from $791 billion in the same three months a year earlier - a 20% increase.

Efforts to front-run the tariffs also continued in March and April before the duties fully kicked in.

These precautionary measures might be able to tide retailers and other U.S. companies over for a few months, but not much longer than that given the insatiable appetite of Americans for cheap foreign imports.

Why so? Imports appear about to fall off a cliff.

Consider what's going on at the huge U.S. ports in Los Angeles and Long Beach, which handle about one-third of all goods imported into the U.S.

These ports reported a 56% increase in import volume in the week of April 20 to April 26 compared to a year earlier, reflecting the last vestiges of tariff front-loading.

Yet the number of vessels expected to offload goods in the following two weeks is on track to decline sharply, with import volumes set to drop 11% and 33% from a year earlier.

Experts say the situation could get worse. A lot worse.

The large shipping company Hapag-Lloyd (XE:HLAG) $(HPGLY)$, for instance, said in a statement that container bookings to the U.S. from China have dropped by about one-third since the start of April.

Many ships are sitting in Chinese ports, waiting to see if the Trump White House relents. The sky-high tariff levels make it unprofitable to ship many of the goods crammed into the vessels.

"Chinese exports have ground to a halt and goods are piling up at the ports," said Mark Dowding, BlueBay chief investment officer at RBC Global Asset Management.

One of the first signs of trade-war distress would likely show up in the toy industry. As much as 80% of all toys sold in the U.S. are produced in China, industry and government statistics show.

Other U.S. industries are also heavily reliant on China, including consumer electronics, clothing and pharmaceuticals. Last year, the U.S. imported $439 billion in goods from China, and most of them can't be replaced quickly by other countries.

Even if the U.S. and China sharply reduce tariffs, problems could persist, analysts say.

Ships have to travel a month or more before arriving at American ports, for one thing. Then it takes several more weeks for goods to travel by rail or truck to other parts of the U.S.

If many ships begin to head to the U.S. at the same time, logjams could develop that ensnarl supply chains, much like what happened during the pandemic recovery.

As a result, any shortages that occur could take time to resolve. Nor would prices fall immediately.

"The whole situation is a bit like lockdowns," tweeted Molson Hart, chief executive of Viahart, a toy manufacturer with operations in China. "Once you shut down, it takes a long time to get economic activity back to where it was, if you ever can."

-Jeffry Bartash

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April 24, 2025 14:24 ET (18:24 GMT)

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