The Port of Los Angeles had a great start to 2025, with the busiest January in its 117-year history, Executive Director Gene Seroka said during a monthly news conference on Wednesday, Feb. 19.
“A strong economy, along with importers bringing in cargo as a hedge against tariffs and ahead of Lunar New Year, were key factors in January,” Seroka said.
The Port of Long Beach also saw a strong start for 2025, with its strongest January on record and its second-busiest month — largely driven by retailers moving cargo ahead of the anticipated tariffs on goods from China, Mexico and Canada.
The Port of Los Angeles moved 924,245 cargo container units in January, an 8% increase over the same month last year.
The Port of Long Beach processed 952,733 container units last month, up 41.4% from January 2024. That surpassed the previous record set in January 2022 by 18.9%.
But despite the record-breaking cargo surges, caution continues to build as shipping and retail industries eye anticipated impacts of new tariffs — expected to drive costs up — being put in place by the new presidential administration.
A possible consumer pull-back and trade industry shifts, Seroka said, could bring changes.
Seroka’s guest for this month’s discussion, Rachel Michelin, president and CEO of the California Retailers Association, said smaller businesses could get hit especially hard.
“Blanket tariffs are going to have an impact on consumers,” she said, adding that the bottom line will “go back to their pocketbooks.”
On Feb. 1, President Donald Trump announced 25% tariffs on all imports from Mexico, 25% tariffs on all products from Canada (other than energy resources, which are subject to a 10% tariff), and 10% tariffs on all imports from China.
While larger retailers can “pivot” and bring cargo in earlier to escape some of the pain, Michelin said, the mom-and-pop shops don’t have “that much room to absorb” the hit as they’re still trying to catch up from the pandemic years.
“I worry about my smaller retailers,” she said. “It’s the uncertainty, the stress. When it’s your store and your livelihood, that has an impact.”
California’s penchant for regulations, Michelin said, also makes doing business in the state especially difficult and costly.
“I think we’ve sometimes fallen into the perception that we’re the fifth largest economy in the worl,” he said. “We’re a big state and there’s a lot about California I love. I grew up here, my parents live here. But you wonder how much can we take.
“Sometimes you wonder what is going through the minds of our elected officials in Sacramento,” Michelin added. “There are a lot of us in the business community who share the same goals but talk to us, engage us.”
Discussions around waiving some of the state’s regulations to rebuild the areas hit by fires in Los Angeles County, she said, “tells you we can get rid of some regulations in California.”
She predicted consumers will be hit with “sticker shock in the next few months,” with the rising costs of insurance, groceries and gas.
“We’re hitting a tipping point,” Michelin said, “and I think consumers can only take so much.”
The regulatory environment in California, Michelin added, is another challenge that creates higher costs to businesses. Regulatory boards grew during the pandemic, she said, and is “causing businesses not to invest more in California, or, unfortunately, making decisions to leave the state. We really need to get a handle on how out of control some of these regulatory boards are.”
Asked about how tariffs might impact cargo flow, Seroka pointed to the experiences from 2018 during Trump’s first administration.
“We saw a lot of run-up in cargo and pretty big drop-offs afterward,” he said.
The prospect of reciprocal or retaliatory tariffs, Seroka added, could “all lead to higher costs and more uncertainty.”
What’s shaping up now, Seroka said, is a “repeat of what we saw in 2018, but at a much higher level and with more complexity.”
Smaller retailers, Michelin said, will feel the pinch more quickly with tariffs coming into play.
While Seroka said Southern California’s chain of warehouses are running smoothly, cargo could also slow as inventory now — due to front loading — is especially high.
But with the rebuilding process the state faces following the fires, Seroka said, soft lumber, furnishings and other building materials will be needed.
“The concern,” he said, “is that all those costs are rising because of the tariffs. We will also need skilled workers for houses. There’s a lot to consider. I’m talking about policy, not politics.”
Asked about the prospects for reaching zero-emissions goals under the Trump administration — which may not provide the federal dollars earlier administrations did — the port remains committed and sees it as a “multi-decade approach,” Seroka said.
The port will also continue investing in those goals, as well as pursuing state and private sector participation, he said.
“We’re going to continue to run as fast as we can to invest in clean technology,” Seroka said, “and for as long as it takes to get to our zero-emissions goals.”
The port closed 2024, Seroka added, by reaching a milestone: the busiest container port in the Western Hemisphere — for 25 straight years.
Port of Long Beach CEO Mario Cordero said the strong start for POLB in 2025 was encouraging.
“We will continue to focus on enhancing both our competitiveness and sustainability,” Cordero said in a written comment, “no matter the uncertainties in the supply chain.”