Port of Seattle’s Precipitous 30 Percent Cargo Decline

The Port of Seattle and its maritime partner, the Port of Tacoma, could be forgiven for thinking the Trump Administration has singled them out for punishment. The ports are both suffering from a combination of Trump Administration tariffs on foreign goods, crackdown on DEI programs, and get-tough immigration policies.

The Northwest Seaport Alliance, a joint venture of the Seattle and Tacoma ports, saw cargo drop 30 percent in May due to Trump Administration tariff taxes on imported Asian products. That translates into far fewer hours for longshore workers and truck drivers in the harbor.

This was before Trump bumped tariffs against China, the NWSA’s largest trading partner,  and imposed added taxes on imported steel and then lowered them again. Steel is the NWSA’s number one container import from Taiwan and the number four import from Japan.

The Trump anti-DEI and immigration policies also are threatening millions of dollars in funding for Seattle-Tacoma International Airport terminal and airfield projects. The Port of Seattle, along with King County and several other cities across the country, won a preliminary injunction in federal court to preserve the grants, at least for now.

Trump’s on-again, off-again tariffs have upended the trans-Pacific market, creating great uncertainty for importers and exporters here and abroad. Shipments of Asian goods accelerated in January, in anticipation of Trump tariffs. But in May, China’s exports to the U.S. dropped 34.5 percent, the sharpest drop since the pandemic, according to customs data. Similarly, the Port of Los Angeles, the nation’s largest, saw imports plummet 25 percent in May.

Cargo forecasts for the rest of the year are cloudy.  Shipments for the Christmas season typically start in the summer.  “It’s hard to know what July through the rest of the summer season brings, because there is great uncertainty still,” NWSA CEO John Wolfe said.

The Alliance is trying to get the word out that its terminals have unused capacity and can help relieve congestion at other terminals. “We stand ready to handle any surge coming our way,’’ said Tong Zhu, NWSA chief commercial officer.

The tariff chaos is only the latest challenge for the NWSA, which is still struggling to reverse the drop in cargo resulting from the COVID pandemic. In Seattle, Terminal 46 no longer handles international container shipments, and Terminal 30 is shut down, partly due to a lack of business but also because of a legal dispute over stormwater runoff. Zhu and her commercial team are scouring the markets for new business, while Wolfe is pushing terminal operators and unions to be more efficient.

The trade dispute may accelerate the movement of manufacturing out of China, but not into the U.S. as Trump wishes. Factories are moving to Vietnam, Thailand, and other South Asian countries to stay out of the political fray. The executive of one U.S. company in Seattle said it is shifting manufacturing from China to Thailand, not necessarily because labor costs are lower but to avoid the tariff penalties.

Another unintended consequence of the Trump tariffs may be to accelerate the re-direction of Asian imports from Puget Sound ports to arch-rivals Vancouver, BC, and Prince Rupert, which have fast connections for goods headed to Midwest U.S. cities.  Goods entering from Canada do not pay a harbor-maintenance tax charged on imports through U.S. ports, although U.S. tariffs still apply.

Vancouver, BC, is coming off strong growth in 2024, with its May volumes up 4 percent compared to 2024. “We continue to monitor the situation in the U.S. — which remains both fluid and uncertain — and are in regular conversations with our industry and supply chain partners regarding capacity and fluidity,” said Arpen Rama, Vancouver Fraser Port Authority spokesperson. The Prince Rupert port to the north also reported a small jump in cargo in May.

The Port of Seattle, along with border communities, has felt the backlash by Canadians reacting to Trump’s tariffs and threats to make it the “51^st state.’’ The Victoria Clipper, which operates at the Port’s Pier 69, has cut back sailings to Victoria and laid off workers due to a drop in demand.

At Sea-Tac Airport, the Trump Administration’s assault on immigration and DEI programs threatens to throttle a major renovation of the 1970s-era South Concourse, formerly the South Satellite. The Port is depending on federal aid in the coming years to revamp the airport’s primary gateway for international flights, along with several other projects.

Earlier this year, the federal Department of Transportation imposed new conditions on $55 million in previously approved grants for the long-planned South Concourse renovation. To receive the funds, the Port would be required to certify it “does not operate any programs promoting diversity, equity, and inclusion” and required to fully cooperate with Immigration and Customs Enforcement (ICE) officers and federal agencies.

The Port of Seattle and King County–joined by San Francisco, Boston, and several other local governments–sued the Trump Administration to block enforcement of the new conditions. Federal Judge Barbara Rothstein issued a strongly worded preliminary injunction against the new conditions, citing “irreparable harm’’ that would result from the loss of funding as the litigation proceeds. “Not only are these conditions contrary to our values, we think it’s illegal and probably unconstitutional,’’ said Seattle Port Commissioner Sam Cho.

The Port had anticipated receiving $356 million through 2030 for projects including terminal redevelopment, airfield pavement, and community noise reduction. Also at risk are environmental grants, maritime construction funding, and other assistance. Without federal aid, projects will likely be delayed, thus becoming more costly, funded by taking on more debt, or cancelled outright.

“Quite honestly, I’m waking up most nights stewing about how we approach this,’’ said Seattle Port Commissioner Ryan Calkins. Commissioners were angered to learn Customs and Border Patrol agents at Sea-Tac detained a traveler on immigration charges, confining the traveler in the Border Patrol’s airport holding area. Commissioners are powerless in immigration matters, but they did ask to meet with Border Patrol officials “where we will request information on standards for communications regarding individuals held for an extended period of time, standards of care for individuals detained for extended period of time, and strategies to communicate transparently with the Port and community members and families,” Commissioner Toshiko Hasegawa said.

Trump’s travel ban on citizens of several Mideast and African countries could disrupt the summer travel season. The action echoes Trump’s 2017 Muslim ban, which triggered a protest by hundreds of demonstrators who stormed the Sea-Tac passenger terminal.

It hits home particularly for Port Commissioner Hamdi Mohamed, who came to the U.S. as a three-year-old Somali refugee. “We can protect national security without banning people based on how they pray or where they come from. This ban isn’t about safety. It’s about scapegoating,’’ she said in a social media post, calling the action “reckless, cruel, and racist.”