us china tradewar

US Tariff Developments and Global Trade Reactions

Apr 9, 2025 | , , , , , , , , , , , , , , , , , , , , , , , ,

Further to our recent update on the major changes to US tariffs (link), the global trade landscape remains highly fluid, with the situation evolving rapidly.

Last Wednesday, 2nd April, President Donald Trump announced a comprehensive tariff strategy, imposing a universal 10% tariff on all imported goods, effective from the 5th April.

Additionally, as of today, 9th April, a second wave of higher “reciprocal” tariffs has been implemented, targeting specific countries with rates ranging from 11% to 50%, based on perceived trade imbalances and barriers. Notably, China which now faces a tariff rate of 104% on its exports to the US, combining previous and new duties.

The UK, Australia, Indonesia, Singapore, Vietnam, and Taiwan have confirmed they will not introduce countermeasures at this stage. Notably, both Vietnam and Taiwan have expressed willingness to negotiate with the US and explore zero-tariff agreements.

In contrast, China responded with retaliatory tariffs of up to 34% on US goods, which has seen President Trump follow through with his threatened escalation of an additional 50% duty on Chinese imports. As a result, US importers now face an unprecedented degree of uncertainty around landed costs.

The European Union has proposed a zero-tariff arrangement on autos and industrial goods, which was rejected by the US. So far, the EU’s potential response appears limited to steel and aluminium, though speculation persists around broader negotiations and potential shifts in trade policy.

This environment puts US importers in a difficult position: ship now and risk overpaying if tariffs are reversed, or delay and risk facing even higher costs if further duties are imposed. Many are opting to pause shipments where possible, disrupting vessel utilisation, bookings, and spot market rates.

Early indicators suggest the impact on global logistics is already being felt. Sea freight container bookings into the US from China have dropped a massive 67% in the past 7 days compared to the week prior, with export bookings also down 40%. If these figures are anywhere near accurate, this marks an extremely large and immediate disruption to trade flows into the US.

If this slowdown continues, significant blank sailings from the carriers are inevitable, and signs of this are already emerging. Yesterday, Ocean Network Express (ONE) announced that the Premier Alliance PN4 Pacific service, scheduled to begin in May, has been suspended until further notice—an early indication of broader cancellations to come.

There are several mechanisms that can be utilised to temporarily avoid duties for exports into the USA including Free/ Foreign Trade Zones, customs regimes, bonded facilities, temporary import bonds (TIB’s), carnets and more. There are options to carry on shipping goods to USA and not clear them until it is absolutely clear whether commodity tariff rates will be reduced or withdrawn as, or if, deals are agreed between countries.

From an objective standpoint, it remains unclear what concessions the US is seeking in exchange for easing these tariffs, particularly since the justification of “tariffs imposed on the US” lacks clarity in many cases.

For shippers and carriers the coming days and weeks will require vigilance and adaptability. The tariff landscape may shift dramatically and without warning, both upward and downward.

We continue to monitor developments closely and will issue further updates as more information becomes available, particularly concerning potential EU countermeasures and UK trade policy responses.

If you would like to review your specific supply chain impact, assess your exposure, or explore strategic alternatives, please don’t hesitate to get in touch. Metro is well-positioned to support you, bolstered by our expanded US presence and strong focus on North American trade flows.

Expect further insights in the coming days as the situation unfolds and if you have any questions please give me a call, or drop a message, and we will ensure that you receive immediate attention and advice.

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Major US Tariff Changes

Apr 3, 2025 | , , , , , , , , , , , , , , , , , ,

On 2 April , President Trump unveiled sweeping new tariffs that will have global implications for international trade. 

These measures mark the most significant restructuring of U.S. tariff policy in decades and they will impact many businesses, irrespective of whether they trade with the United States.

Key Tariff Measures

  • Universal Tariff: A baseline 10% tariff will now apply to all imported goods entering the United States, effective immediately. The UK has been hit with this baseline.
  • Targeted Tariffs: Elevated tariffs have been introduced for a wide range of countries, including:
    • China: 34% (bringing total duties to 54%)
    • Vietnam: 46%
    • Cambodia: 49%
    • Bangladesh: 37%
    • European Union: 20%
    • Japan: 24%
    • South Korea: 25%
    • India, Indonesia, Taiwan and others: 26–36%
  • End of de minimis: The $800 duty-free threshold for China imports into the U.S. will be eliminated from May 2, disrupting cross-border eCommerce flows.

Implications for UK Importers and Exporters

Many production hubs like Vietnam, Cambodia, and Bangladesh now face tariffs approaching or exceeding 40%. UK brands that re-export to the U.S. from Asia could see significant cost hikes and supply chain disruptions.

U.S. importers are expected to face increased landed costs and margin pressure. Brands may be forced to raise prices or renegotiate terms with suppliers, especially as cost-conscious consumers in both the U.S. and UK continue to feel inflationary pressures.

Even UK-based businesses that manufacture domestically could be affected due to their reliance on imported raw materials, which could now become more expensive due to universal tariffs on U.S. imports.

While automotive was less explicitly detailed in last night’s announcement, the baseline tariff applies to all goods and a separate 25% duty on imported automobiles (previously announced) remains in place. This could impact UK automotive component manufacturers that export to the U.S. and face increased costs on U.S.-sourced parts for use in European production.

The sector is also exposed to the broader risk of retaliatory tariffs, particularly from the EU and Asian economies, which may further complicate trade flows and cost structures.

European Response

While the UK is pausing reaction, the European Commission has already indicated a strong and coordinated response is likely. While details of retaliatory measures are still unfolding, the EU is expected to pursue countermeasures, which could further disrupt transatlantic supply chains, including UK firms trading with both blocs.

There’s also growing concern about goods being diverted into UK and European markets as exporters from Asia and other regions look for alternative markets in response to the new U.S. tariffs. This could lead to ‘dumping’ and potential price pressure, especially in fashion and fast-moving consumer goods.

Putting the Tariffs in Perspective

  • Not always an additive cost:
  • The new tariffs replace existing duties rather than stacking on top of them. For example, if a product currently has a 5% duty and the new universal rate is 10%, the increase is 5%, not an additional 10%. This makes the change less severe than it might first appear.
  • Customs regimes can help: Tools such as Outward Processing Relief (OPR) and Inward Processing Relief (IPR) can help businesses avoid customs duties on goods that cross borders multiple times for processing.
  • Low-cost countries still competitive: Despite increased tariffs, production in countries like Vietnam and Bangladesh may still be more cost-effective than U.S. manufacturing—though consumers are likely to see price increases.
  • No substitute for specialised goods: Products under copyright, or those requiring specialised manufacturing, cannot easily be relocated. In these cases, additional costs will be passed directly to consumers.
  • Opportunities for the UK: Low-duty countries such as the UK could become more attractive as manufacturing bases for goods destined for the U.S. This may stimulate local manufacturing activity.
  • Are these changes permanent? It’s too early to tell. The tariffs could be temporary, as demonstrated by reversals in January 2025 involving Canada and Mexico. The long-term outcome will depend on how events unfold following this decision by the Trump administration.

What This Means for Your Business

We recommend that clients in affected sectors:

  • Reassess Supply Chains: Identify exposure to high-tariff countries, especially if goods transit through the U.S. or rely on U.S.-based components or partners.
  • Prepare for Cost Changes: Anticipate adjustments to landed costs and pricing strategies. Engage early with suppliers to explore cost-sharing or alternative sourcing.
  • Monitor for Retaliation: Be alert to EU and UK policy shifts that could either mirror or respond to the U.S. measures.
  • Watch for Dumping Risks: Be aware of the potential for market saturation as exporters redirect goods, especially in fashion, household goods, and footwear.

We are closely monitoring the situation and will keep you updated as further developments emerge—particularly in relation to EU countermeasures and UK trade policy adjustments.

Please don’t hesitate to reach out if you’d like to discuss your specific supply chain, explore alternative strategies, or assess your risk exposure.

Metro is well positioned to support you, especially through our recent U.S. expansion and our strong North American trade focus. Expect further updates in the days and weeks ahead as more details become available.

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A Quiet Week in finance…

Mar 17, 2025 | ,

When we sit down to discuss the latest article on recent happenings in the financial world and their impact on the supply chain and the businesses that operate in this sector, we find no shortage of topics.

We could discuss the upcoming changes to Employer NIC rates, where the amount paid on behalf of employees increases from 13.8% to 15%, as well as the reduction in the secondary threshold from £9,100 to £5,000 per year, leading to higher payroll costs soon to be borne by companies.

We could also discuss the upcoming Bank of England meetings set to be held on March 20, May 8, June 19, and August 7, with further meetings in September, November, and December. Whilst economists tell us several interest rate cuts may happen throughout 2025, the next cut is reportedly unlikely to happen at the upcoming meeting on March 20. Economists predict the BoE will likely reduce rates in May, with further cuts later in the year.

If time and space allowed, we could discuss the return of a familiar face in Mark Carney as the Prime Minister of Canada and the immediate challenges he faces, including a trade war with the US. Carney aims to pursue fiscal responsibility and social justice while forging new trading relationships, leveraging his crisis management experience to counter Trump’s hostilities.

Trade wars and tariff discussions are not limited to Canada. At the time of writing, Trump has introduced a 25% tariff on all steel and aluminium imports from around the world, as well as 25% tariffs on other imports from Mexico and a 20% levy on Chinese goods.

Retaliation has followed, with the EU targeting US goods worth a reported £22bn. These tariffs, covering products ranging from boats to bourbon to motorbikes, will start on April 1 and be fully in place by April 13. It is reported that American distillers are rushing to ship as much whiskey as possible to the EU before the above 50% tariff takes effect.

On the other side of the Atlantic, we could discuss Europe’s anticipated defence spending, which could provide an economic boost and reduce the need for the ECB to provide financial support. If we had time, we could also discuss the strengthening of the EURO, which is currently one of the top performers among G10 currencies. Increased fiscal spending and the potential end to the Ukraine war, alongside uncertainty in the US, where renewed recession fears have emerged, have led to improved sentiment toward both the EUR and GBP, causing the swift rise back to 1.29.

There are lots of things we could write about in this forum, or you could reach out to us on any specific topic, and we can discuss how any of the above may impact you and your business specifically.

EMAIL Laurence Burford, Chief Financial Officer.

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UK trade update

Mar 5, 2025 | , , , ,

The UK continues to develop its global trade strategy, advancing negotiations with key partners while navigating post-Brexit relations with the EU.

With multiple trade discussions in progress and regulatory changes affecting movement between Great Britain and Northern Ireland, businesses should prepare for evolving trade conditions in the coming months.

Northern Ireland trade lane: transition deadline approaches

From 31st March 2025, updated processes for parcel movements between Great Britain and Northern Ireland will take effect, marking a significant transition for businesses.

  • Private individuals in Northern Ireland will continue to receive parcels from Great Britain without customs declarations, tariffs, or the need to present goods to customs, provided they are for personal use.
  • Business-to-business (B2B) parcel movements will follow freight procedures, with traders requiring authorisation under the UK Internal Market Scheme (UKIMS). Either the sender or recipient must be authorised to declare goods as ‘not at risk’, ensuring they qualify for duty-free movement under the Simplified Process for Internal Market Movements (SPIMM).
  • B2B goods that do not qualify for SPIMM will require a full customs declaration, reinforcing the importance of ensuring compliance with eligibility criteria.

With NIRMS, UKIMS, SPIMM, and IMMI frameworks creating a complex regulatory landscape, businesses are encouraged to seek guidance to ensure compliance. Metro offers support in navigating these schemes, including post-Brexit audit reviews to assess eligibility for retrospective duty reclaims.

UK trade negotiations: expanding global agreements

The UK is actively pursuing new and expanded trade agreements to strengthen its global economic position.

  • Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP): The UK formally joined in December 2024, becoming the first European country to enter this major trade bloc, enhancing access to 11 key markets.
  • India and the Gulf Cooperation Council (GCC): Negotiations with India and the GCC are currently the highest priority, with discussions ongoing to finalise agreements.
  • South Korea, Switzerland, and Israel: The UK is working to deepen market access and streamline trade flows with these nations through revised agreements.

EU trade discussions: cautious expectations for change

Despite renewed diplomatic engagement between the UK and the EU, businesses should not expect imminent changes to existing trade arrangements.

Since the UK’s government change in July 2024, there has been a positive shift in UK-EU relations, yet uncertainty remains regarding what the UK seeks from a proposed trade ‘reset’. European officials have emphasised the need for clarity, particularly on youth mobility, but discussions remain in the early stages, with Brexit-related complexities still shaping the dialogue.

With UK-EU delegations set to meet in May, expectations are that the summit will establish a foundation for future talks rather than delivering immediate policy changes.

  • Supply chain operators should not anticipate short-term relief from Brexit-related challenges.
  • No significant changes to frontier processes appear likely, with both sides committed to fully implementing the current trade and cooperation agreement before considering modifications.
  • SMEs remain disproportionately affected by post-Brexit trade changes, with industry groups urging policymakers to prioritise reducing red tape.

As the UK’s trade strategy evolves, we will share important developments, particularly regarding EU discussions and the phased implementation of new trade agreements.

Navigating the complexities of international trade requires real-time insights and expert guidance. At Metro, we continuously monitor market influences and evolving regulations, to help you de-risk your supply chain and maximise opportunities.

With over 40 years of expertise in multimodal transport and customs brokerage, we lead the way with CuDoS, our automated customs declaration platform, ensuring swift compliance with UK and EU trade regimes.

Make informed decisions with Metro’s strategic support. For trade insights and risk management advice, EMAIL Laurence Burford, Chief Financial Officer. For customs and regulatory solutions, EMAIL Andrew Smith, Managing Director.

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