China’s latest report on economic growth fell short of expectations, but for those who monitor traffic on the global water highways, the news was not a surprise.
Source: Ocean Trade Database, Department of Commerce
Experts say the goods on the tariff list are going elsewhere.
“You have already seen a shift in moving Chinese cargo away from the U.S. to other countries,” said Michel Looten, Director, Maritime, Seabury Consulting. “Those goods went on to Japan, South Korea, Taiwan, Germany, and Italy.”
In addition to containers, there are other ways to measure the health of a nation’s economy. Demand for raw materials shows up in data on dry bulk (usually small solid materials like coal, grain and iron ore) or tankers (which transport liquids and gases).
In September, the DHL Global Trade Barometer lowered its Chinese trade outlook by four points to 59, saying the country is growing but at a slower pace. This barometer’s readings above 50 indicate growth. The forecast is based on Accenture’s analysis of freight and shipping trade flow data.
Experts say the effects of the $200 billion tariffs that went live in September will help forecasters on their 2019 outlooks. “We will have some insight into the impact in a couple of weeks when that trade data is released,” Seabury Group’s Michel Looten told CNBC. “But that’s the tip of the iceberg. The real effect hits in 2019 when the 25 percent tariff is enforced.”
The trade data on the $16 billion tariff that went into effect will be out in November and September’s $200 billion will be out in December.