Here is some preliminary data that is rolling in after Trump declared a trade war with China and tariffs on everybody else. Nothing yet on prices for goods, but there is data on commodity exports and freight container bookings. And none of it looks good to the experts or even to simply laymen like me. Bottom line: commodity exports have plunged and businesses are holding off on overseas orders.
This is from the very Republican friendly Axios:
Key commodity exports plunge as Trump’s trade war bites
There is a lovely chart that Axios made of the data for the past several years for soybean sales to China. They did a comparison to the same time period (several weeks in April) over the last four years, and from April 11th to 17th, there is a 50% plunge in soybean exports to China. The four week average is down 25%. Remember, Trump had “liberation day” on April 2nd.
And it’s not just soybeans.
- Net pork sales were down 72% week on week and 82% versus the four-week average, the USDA said.
I’m not a farmer, but I’d say those drops in commodity exports to China are more than “a little significant.” Oh yeah, the article has a quote from an agricultural consultant who states that this is DIRECTLY attributed to Trump’s tariffs.
And if you are a farmer, you just have to love hearing this:
Between the lines: “This already looks worse than 2018,” American Soybean Association economist Jacquie Holland tells Axios. “That’s because there’s also a trade spat with Canada, a major supplier of potash which is a really key input for soybean production.
- “Farmers are going to feel the pain of this at so many points on the supply chain, not just from the prices that they receive.”
Wait a minute! That woman Holland works for the American Soybean Association. Isn’t that the same group that has Caleb Ragland of KY as the president? It sure does!
You folks may remember that Ragland is a “Yee Haw!” when it comes to Trump and his tariffs. Yee Haws believe that Trump has their backs and won’t let farmers down! The tariffs are all part of “The Art of The Deal!”, and Trump is going to bring home a GREAT TRADE DEAL with China!
But deep in Ragland’s heart, he is a little bit afraid that a long drawn out trade war will be bad for farmers, so he is BEGGING Trump to wind up that great trade deal soon!
I wonder if Ragland was aware that Ms. Holland was being all reality based with Axios?
Next up, we have some data from freight container bookings, and it is not looking great either.
Shipping rates are already down
Bookings of ocean freight shipments have been down significantly in the weeks since Trump’s sweeping tariffs took effect. Though on April 9, the president paused his higher tariffs on goods from many countries for 90 days, his 10% baseline tariff on all countries remains in effect, as does his 145% tariff on imported Chinese goods.
During the first week of April, following Trump’s initial April 2 tariff announcement, ocean freight container bookings saw a sharp global decline of nearly 50%, according to data from the digital logistics company, Vizion. Specifically, imports into the US fell 64% compared to the previous week, including imports from China to the US, which dropped 36%. Exports out of the US also dropped 30%, according to Vizion data.
In the following weeks, that nosedive continued in what Vizion has called a “tariff shockwave.” For the week of April 14, ocean freight container bookings showed that overall US imports declined 12% week over week, and imports to the US from China declined 22% week over week, Vizion data shows.
The article from Business Insider lays out what happens when you inject tariffs and further tariff uncertainty in a global supply chain. Basically, if Trump keeps this shit up, store shelves are going to look a lot like they did during the COVID-19 pandemic. Remember how hard it was to find toilet paper? I know I sure do.
And I know it made everyone oh so happy during that pandemic.
This is real. It’s not hypothetical. What Trump has started is like some tsunami of economic bad tidings. And like a tsunami, it takes time for the energy of the initial shock wave to travel through the medium of the global supply chain and imports/exports.