US-China cargo volume plunged in April as customers reacted 'very, very fast' to tariffs, says Maersk CEO
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- US-China container volumes fell 30% to 40% in April due to tariffs, Maersk's CEO said.
- Maersk, a key global trade indicator, has noticed rapid order cancellations amid tariff impacts.
- Chinese exports to the US plunged about 20% in April from a year ago.
Container volumes between the US and China plunged 30% to 40% in April as President Donald Trump's tariffs took hold, the Danish shipping giant Maersk said on Thursday.
"It has gone very fast, so this is the result of customers reacting very, very fast on canceling orders or stopping orders, and waiting to see if this is going to resolve itself," Maersk CEO Vincent Clerc said at the company's first quarter earnings call.
Often seen as a bellwether for global trade trends, Maersk — the world's second-largest shipper by capacity — is seeing the effects of a sharp pullback in transpacific activity.
US-China container volumes make up just 5% of Maersk's business, but Clerc's assessment of the sharp decline in trade between the world's top two economies aligns with the 35% drop in cargo volumes from Asia that the Port of Los Angeles expects.
The drop coincides with the US's 145% tariff rate on Chinese imports, which went into effect in early April. Trade talks between Washington and Beijing are scheduled for this weekend, but uncertainty continues to ripple through supply chains.
Clerc said many companies are responding by drawing down existing inventory and postponing new orders until the policy outlook becomes clearer. Businesses are pulling stock not just from their own warehouses, but also from inventory held in Canada, Mexico, and across US-based distributors and vendors, as they wait for clarity on trade policy.
Clerc warned of potential shortages for some products, like solar panels and batteries, for which China dominates the supply chain, should the standoff between Washington and Beijing persist.
"Let's be clear, if we don't find something before the summer, it's going to start to hurt quite a lot across the board, because there are certain commodities and certain things where you can't really substitute some of these imports freely," he said.
Maersk previously projected a 4% growth in global container volumes for the year. It has now changed that outlook and expects the volume to range from a 1% decline to 4% growth.
Logistics experts and shipping specialists told Business Insider last week that the US could face price hikes and empty shelves within weeks as Trump's tariffs hit supply chains.
Despite the disruption, Maersk said it has been able to redeploy unused US-China capacity to other trade lanes where demand remains strong.
In April, Chinese exports rose 8.1% in dollar terms compared to a year ago, official customs data showed on Friday. Shipments to Southeast Asia jumped 21% while exports to the European Union rose 8%.