U.S. Tariff Policy Could Lead to Port Congestion and Higher Freight Rates

The U.S. has imposed an additional 10% tariff on Chinese imports, effective Tuesday, February 4. Similarly, Donald Trump confirmed a 25% tariff on imports from Mexico and Canada starting the same date. Additionally, a plan was announced to introduce a 25% tariff on imports from the European Union “very soon.” However, some of these measures are still under negotiation and could be reduced.

Global Trade Impact and Business Concerns

These announcements have raised concerns, leading to declines in European automaker stocks. The application of these tariffs and countermeasures could result in longer processing times for cargo owners, increased exposure to delays, and higher demand for customs compliance staff. Additionally, products from current suppliers or countries could lose competitiveness due to cost increases.

Potential Port Congestion and Supply Chain Disruptions

A more immediate consequence would be port congestion, as shipping lines seek to avoid levies at U.S. ports. The threat of even higher import costs must be taken seriously, but it remains to be seen whether this will materialize due to its potential impact on U.S. businesses and consumers.

“Trade barriers create significant inefficiencies in the global supply chain, affecting businesses and consumers alike.” – International Trade Expert

Additional Tariffs on Steel and Aluminum

On March 12, the U.S. implemented 25% tariffs on steel and aluminum imports, in addition to those imposed on March 4. Mexico will decide on April 2 whether to impose reciprocal tariffs on the U.S.