Given an increase in Section 232 tariffs on steel and aluminum (see 2506030071), it may be less costly for importers to no longer take advantage of an exemption from tariffs on autos and auto parts for USMCA goods, according to a tariff expert at supply chain logistics platform Flexport.
As importers, customs brokers and attorneys feel whiplash from the ever-shifting changes in U.S. tariff policy, one particular issue that these stakeholders will continue to grapple with over the coming months is ensuring that importers understand and comply with all the regulations on country of origin, according to experts speaking on a May 30 webinar sponsored by the International Trade Institute titled "Rules, Risk and Reality: How EU Exporters Can Navigate the New US Trade Era."
The emphasis on collecting the revenue generated from the higher tariffs levied during President Donald Trump's second term, as well as the political will behind those higher duties, are compelllng CBP to shift toward prioritizing trade enforcement over trade facilitation, trade experts told International Trade Today.
As reciprocal tariffs against imports from China and Hong Kong fall from 125% to 10% for 90 days as the U.S. and China seek to hash out a trade deal (see 2505120006), so are Southern California port volumes and trans-Pacific freight rates reflected the volatility seen in the trade space.
Although the reciprocal tariff for imported Chinese goods may have fallen to 10% for 90 days (see 2505130074), Flexport trade experts advised companies to not treat this action as if there will be an extension. Doing so will prevent companies from having to ask later whether they will have any in-transit exemptions as the 90-day period ends around Aug. 12, according to Angela Lewis, global head of customs for Flexport.
Given the fast-evolving trade dynamics in the U.S., some suppliers from China have been advising importers to take advantage of delivered duty paid terms -- which is bad advice and can get companies in trouble with CBP, customs consultant Tom Gould said during a May 13 webinar hosted by Revenue Vessel.
Tariff rates above 200% essentially function “as an import ban” for some members of the American Apparel and Footwear Association because, at that price point, “companies don’t ship, they don’t import, they don’t make, they don’t buy,” the trade association’s head said on the Trade Guys podcast April 29.
Recent U.S. trade actions, such as the IEEPA tariffs on China, Canada and Mexico, the Section 232 tariffs on steel and aluminum derivatives, and the temporarily paused reciprocal tariffs on dozens of countries worldwide, could cause global container volumes to slump by 1% in 2025, according to U.K-based maritime shipping advisory firm Drewry.
With so much uncertainty occurring with U.S. import regulations, companies should develop multiple strategies that address potentially different tariff outcomes, with some strategies being deployed in the short-term and others being deployed further down the road as the geopolitical situation becomes more clear, according to trade experts with professional services firm KPMG.
More and more companies are requesting bonds that are worth millions of dollars and even "up to the billions at this point" as importers seek to ensure they have enough bonding to cover anticipated higher duties, Patrice Lafayette of Roanoke Insurance Group said during an April 23 webinar on tariffs hosted by Flexport.