Trade softness is structural, not episodic

The slowdown showing up at American ports is no longer a one-off detour around a war zone. On April 9, the National Retail Federation said import cargo at major United States container ports is expected to drop sharply beginning in May because new tariffs and policy uncertainty are changing retailer behavior. (nrf.com) The same report said ports handled 2.06 million twenty-foot equivalent units in February, down 7.5% from January but still up 5.2% from a year earlier. That gap tells you companies were still unloading earlier orders even as they started preparing for a weaker second half. (nrf.com) Jonathan Gold of the National Retail Federation said retailers had spent months pulling goods forward to get ahead of tariffs, and that window had closed. Ben Hackett of Hackett Associates said second-half 2025 imports are now expected to be down at least 20% year over year, with total 2025 cargo volume down 15% or more unless policy changes. (nrf.com) That is why the story at ports has shifted from expansion to upkeep. On April 8, the Port of Los Angeles said the United States Army Corps of Engineers allocated about $70 million from the Harbor Maintenance Trust Fund for harbor maintenance, seismic resiliency, and navigational safety, while the wider San Pedro Bay complex received a record $131.8 million. (portoflosangeles.org) The Harbor Maintenance Trust Fund is paid for by a cargo tax on importers, so the money comes from trade even when trade is softening. Los Angeles said donor ports like it contribute more than half of the fund’s revenue but have historically received less than 3% back, which makes this year’s award look less like a growth bet and more like deferred maintenance finally getting funded. (portoflosangeles.org) Ports are also not racing into full automation at the speed many investors once expected. The Government Accountability Office said in March 2024 that all 10 of the largest United States container ports use some automation, but operators still weigh labor agreements, costs, and politics, and some automated equipment has actually worked slower than conventional equipment. (gao.gov) On the East and Gulf Coasts, labor is still writing the rules of that slowdown. Labor Notes reported that the International Longshoremen’s Association’s 2025 contract deal included a 62% wage increase over six years and expanded automation protections as employers pushed for more semi-automated cranes. (labornotes.org) So the system is getting hit from both sides at once. Demand is weakening because importers do not know what tariff bill they will face next month, and productivity gains are arriving slowly because ports and terminal operators are still bargaining over how much machinery can replace labor. (nrf.com) (gao.gov) The first visible cracks usually do not show up at the giant port authority level. They show up in the trucking yards, warehouse networks, and drayage firms that move containers the last few miles after a ship unloads. (epiq11.com) That is why the January 12 Chapter 11 filing by STG Logistics matters. Court records show STG Logistics and 64 affiliates filed in New Jersey, and the debtor list includes warehousing, freight forwarding, and regional transport units that sit exactly in the part of the supply chain that feels lower volumes and tighter credit first. (epiq11.com) Put together, the picture is not “ships rerouted for a few weeks.” It is retailers living off inventory, ports spending on dredging and resilience instead of giant new throughput bets, automation moving in fits and starts, and smaller logistics operators absorbing the stress before the headline numbers fully catch up. (nrf.com) (portoflosangeles.org) (gao.gov) (epiq11.com)