Hawaii faces new inflation risk on top of Trump tariffs

Hawaii is facing a new inflation risk and incoming financial trouble due to President Donald Trump’s tariffs.

The state’s only interisland shipping company, Young Brothers, has applied to The Hawai’i Public Utilities Commission (PUC) to raise shipping rates by an average of 20 percent. Young Brothers has said this price hike will help cover the cost of new equipment, infrastructure and operating expenses. However, it will also raise the cost of shipping items between the islands.

Newsweek reached out to the PUC and Young Brothers via email for comment.

Why It Matters

This proposed rise in shipping prices within Hawaii comes at the same time as Trump’s retaliatory tariffs, which are expected to raise the cost of goods across the United States. This means Hawaii residents will not only pay more upfront for their goods but will also have to pay even more to ship them.

Hawaii is already one of the least affordable states in the country.

What To Know

With a house price-to-income ratio of 10.6 and 67.9 percent of a resident’s income needed to cover an average mortgage, Hawaii is the most expensive state in the country for housing.

Hawaii is the third most expensive state for goods in the U.S. due to existing shipping costs. Since everything has to be shipped to the islands, the cost of transportation is added to the price of the goods. So, a loaf of bread that costs $3.66 in Fayetteville, Arkansas, will cost $5.34 in Honolulu.

Young Brothers is set to host four public meetings about its application to raise costs. The first meeting is scheduled for April 7 at 5:30 p.m. at the Hawai’i Public Utilities Commission Hearing Room, 465 South King Street, Room 103, Honolulu.

Honolulu news station KHON2 reported that if the shipping company raises its prices, container shipping costs will rise by at least 20 percent. Shipping to Hilo will cost 35 percent more. Shipping a car will cost 30 percent more, and shipping refrigerated items will cost 40 percent more.

Young Brothers wants to raise prices to cover the cost of new equipment. Its Facebook account shows several shipping delays over the past year due to mechanical failures.

Trump tariffs on steel and aluminum may also result in their new mechanical purchases being higher than anticipated.

What People Are Saying

The Hawai’i Public Utilities Commission, in a statement: “The Commission will review Young Brothers’ requests to determine whether the proposed General Rate Increase, WICI, and Temporary Rate Increase are just and reasonable.”

What Happens Next

Young Brothers is hosting four public hearings about its proposal. The first is today, April 7, at 5:50 p.m. HST on Oahu. It will be hosted at the Hawai’i Public Utilities Commission Hearing Room in Honolulu.

The second is April 8 at 5:50 p.m. HST on Hawaii island. It will be at the Natural Energy Laboratory of Hawai’i Authority (NELHA), Kailua-Kona.

The third is April 9 at 5:30 HST at Hawai’i Community College in Hilo.

The fourth is April 14 on Kauai at 5:50 p.m. HST at the Līhu’e State Office Building.