The adjacent ports of Los Angeles and Long Beach handled a combined 2.04 million TEUs in September, the busiest month in the history of the San Pedro Bay gateway, as importers gained tariff cost certainty and rerouted cargo away from disruptions at the Panama and Suez Canals.

The Port of Los Angeles moved 1,042,652 TEUs, its busiest month in 118 years and more than 20,000 units above the previous record set in July 2025. Loaded imports reached 545,696 TEUs, up 18.6 percent year over year — the tenth month in which the port has topped 500,000 loaded imports. Loaded exports rose 9.6 percent to 125,751 TEUs, while empties hit a record 371,206 TEUs, up 20.4 percent, as carriers rushed boxes back to Asia.

Long Beach posted its own record: 997,177 TEUs, beating October 2024's 987,191 TEUs and jumping 25 percent from September's 797,537 TEUs. Imports surged 31.3 percent to 509,390 TEUs, exports rose 7.8 percent to 91,747 TEUs and empties climbed 22.1 percent to 396,040 TEUs. The takeaway: US West Coast gateways are absorbing cargo that canals and cost pressures have pushed away from other routes.

What is driving the volume shift?

Combined loaded imports across the twin ports totaled 1,055,086 TEUs, up 24 percent year over year. Executive director Gene Seroka expects the LA port to process around 900,000 TEUs in October — a minimum 6.1 percent increase over last year's 848,424 TEUs — with most holiday merchandise in the country by early November.

At a media briefing Friday, Seroka attributed the surge to three converging forces:

• Tariffs running lower than earlier this year, giving importers more cost certainty
• Resilient consumer demand
• Cargo allocated to Los Angeles at origin as shippers navigate "continued challenges along other global trade routes"

In August, Seroka projected that Panama Canal congestion and Middle East uncertainty could divert an additional 5 percent of volumes to Los Angeles. This month he upgraded that figure: "it's probably going to be a little bit more than that."

Meetings with shipping lines, 3PLs and manufacturers in South Korea and Singapore confirmed carriers are shifting "even more of their traditional allocation that would normally go through the canals" to Los Angeles, Seroka said. He also noted vessel fuel prices have doubled in eight months amid the war in Iran and Middle East conflicts, making shorter transits a bigger priority.

Where is sourcing moving?

Vietnam has become the number two trading partner at the Port of Los Angeles behind China, with Vietnam-to-LA volumes quadrupling over the past decade. Thailand has entered the port's top five origin countries for the first time. At Long Beach, Vietnam is also the second-largest trading partner, with furniture, apparel and footwear leading — and China's share of the port's cargo has fallen from 70 percent six years ago to 55 percent last year.

Harvard Business School professor Willy Shih, who joined the briefing, urged caution on declaring the China era over. China's direct share of US imports fell from 21 percent in 2017 to 9 percent by 2025, but the share of Chinese value added in those imports has "barely moved," he said, noting many products from Vietnam and Mexico still rely on Chinese intermediate goods at assembly.

"Companies, in some sense, are rearranging the final assembly step while the upstream dependence remains," said Shih. "It's really at the core about dependence on suppliers who are often unique or lowest cost, and that's going to take time to change."

The shift follows the meeting between Presidents Donald Trump and Xi Jinping, at which both governments agreed to scale back tariffs on $30 billion in imports. "People need a longer horizon where they can have some stable framework, a stable set of rules to engage in their planning," said Shih, adding that the old annual calendar model has given way to contingency planning amid volatile US trade policy.

What does this mean for drayage costs?

California's average diesel price reached $7.87 a gallon on Friday, up 62 percent since late February. Two-thirds of the port's cargo leaves by truck, and more than half of registered truckers at the port run five rigs or fewer — operators who cannot easily absorb the increase.

"If you're a small business competing with larger companies that can absorb some of this shock, that's a tough spot to be in," said Seroka. "We're trying our best to help support these folks, getting them clear and clean runs every day so they can make more turns, which means more money for those truck drivers."

For sourcing teams, the record month signals continued heavy reliance on West Coast entry points and Vietnam-led origin diversification, while landed-cost planning must now account for Chinese content embedded further upstream and inland freight inflation.