One year after President Trump imposed tariffs, Chinese factories and ports are booming

A year after President Donald Trump’s tariffs spooked exporters and customers, Chinese factories and ports are booming ahead of the Lunar New Year, and freight rates are rising.

Factory activity in China typically spikes at the beginning of the year, with manufacturers rushing to fulfill orders and ship goods before China enters a long Lunar New Year holiday. This year’s pre-holiday rush appears to be as strong as ever, despite President Trump’s tariffs.

Renaud Enjorin, founder and CEO of Guangdong-based electronics manufacturer Asian Technology, said his factories were running at near full capacity despite the threat of stop-start tariffs for a year. “We’re very busy,” he said.

“We’re back to a situation where tariffs don’t exist. U.S. customers aren’t thinking about (buying from) other countries,” Enjorin said, adding that some customers had to pay extra costs to manufacture and ship their goods before the holidays.

His factory in the city of Dongguan ships more than half of its products to the United States, keeping exports at the level they were before President Trump imposed tariffs last year.

“Factories saw a surge in orders, production and profits ahead of the Lunar New Year holiday,” according to China Beige Book, which tracks economic data in the world’s second-largest economy.

The research firm estimates that industrial production surged year-on-year in January, with both domestic and export orders “accelerating significantly year-on-year and month-on-month.” Official figures on output for January and February are expected to be released in March.

The volume of containers handled at China’s major ports rose 40% year-on-year in the week ending February 1, according to HSBC Bank’s transport and logistics analyst team. This marks the highest year-on-year growth rate in more than 12 months and is well above the average weekly growth rate of around 10% in 2025.

Citing the port of Ningbo, one of China’s most important maritime hubs, terminals are “operating beyond capacity, individual vessels are overbooked by more than 20%, and container gate-ins have been suspended,” said Jay Guo, director of the Ningbo China Institute of Supply Chain Innovation.

Guo said trucking rates have increased by 80% due to severe traffic congestion, noting that many factories and transport companies have suspended operations starting Friday and are scheduled to resume next Thursday.

“Currency-focused advisories for shippers in Europe, North America and Asia report a clear front-loading of bookings from China ahead of the holidays,” said Wolfgang Lehmacher, a global supply chain and logistics expert.

However, this surge is also due to the low base effect due to the timing of the Lunar New Year, which is in mid-February this year compared to late January in 2025.

A surge in activity ahead of the holidays pushed freight prices higher. The Shanghai Container Freight Index, a key benchmark for container freight rates from Shanghai to major destinations around the world, has been hovering in the range of 1,400 to 1,656 as of early January, compared to an average level of 1,337 to 1,568 over the past 15 years, according to a cargo monitoring report released by HSBC on Monday.

Analysts at HSBC said interest rates peaked three weeks earlier than historical patterns suggest, suggesting the holiday will be brought forward this year.

Large container shipments to the U.S. were above levels for the same period in 2024 and 2025 for much of January and February, according to an HSBC cargo report.

Airfares to the United States and Europe increased compared to the same period last year. Baltic Exchange’s Shanghai Pudong Outbound Index rose 5.3% in the week ended February 2 compared to the previous week.

Companies are also developing new products as tariff tensions ease. Following a high-level meeting in October, China secured a one-year trade ceasefire with Washington that would keep tariffs on its products low against the United States.

For much of 2025, China reduced direct shipments to the United States while increasing exports to alternative markets, including Southeast Asia and European countries.

The buzz in Chinese factories comes even as companies seek to diversify their supply chains. Many multinational companies are accelerating their “China plus one” sourcing strategies in Southeast Asia, nearshoring in markets such as Mexico and parts of Europe, but continue to maintain the majority of their production and sourcing in China, Lehmacher said.

Unsurprisingly, factory floors in China are buzzing with customers coming from all over the world to place orders for the next production cycle, Cameron Johnson, a Shanghai-based senior partner at business consultancy Tidal Wave Solutions, told CNBC after visiting several factories in southern China last month.

Johnson said auto, consumer and sporting goods manufacturers in southern China are “pretty busy” dealing with backlogs of orders and field inquiries from foreign buyers, including from the United States.

The trip follows a tumultuous year with President Trump’s sweeping tariffs that triggered a wave of panic buying and a sudden freeze as companies suffered trade uncertainty and played a stop-and-go game of orders.

Johnson said business owners “have waited as long as possible for the uncertainty to end and now we have to figure out how to move forward.”

Enjorin said U.S. customers’ interest in developing new products has rebounded significantly since then. “Many had new products in mind, but they froze their projects due to uncertainty,” he said. “Right now it seems to be relatively stable.”

—CNBC’s Evelyn Cheng contributed to this report.