Major US Tariff Changes

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.

Uncertain Waters: Securing Ocean Freight Rates

Uncertain Waters: Securing Ocean Freight Rates

Apr 2, 2025 | , , , , , , , , , , , , ,

While there’s talk in the market about further pressure on rates, the reality is more complex, with container spot rate indices showing mixed signals last week, suggesting that any softening on key east-west routes might not last.

The global supply chain remains unpredictable, and several factors are still keeping the container market tight, which means any short-term dip in rates could quickly reverse, making it risky to assume that prices will continue to ease.

Carriers Act to Support Rates
Shipping lines are actively removing capacity from major east-west trades to reduce supply and put upward pressure on pricing. According to Drewry’s, 68 sailings across the Pacific, Asia-Europe, and Transatlantic trades have been blanked between this week and the end of April, while Sea-Intelligence data reports 47 blank sailings in the same period.

While methods of tracking blank sailings may vary, particularly as the major alliances transition between old and new service structures, the trend is clear; carriers are taking deliberate action to support General Rate Increases (GRIs) and stabilise the market in their favour.

Charter Market Dynamics Are Holding Rates Firm
While spot pricing may hint at a softer market, the time-charter sector continues to show strength. Many non-operating shipowners are keeping older, fully paid vessels in service, since they remain profitable even at lower margins.

This keeps theoretical capacity high but delays any significant correction in long-term charter rates, providing a buffer of rate stability for carriers. Basically the return is greater to ship owners to work the aging vessels in the current market than to scrap them. However once the charter rates diminish as freight rates are not at sustainable levels to support higher charter rates then scrapping vessels becomes more profitable and the supply of capacity will be eroded.

This willingness to keep tonnage in play – rather than scrap it – creates a layer of structural overcapacity. But crucially, it also delays any meaningful correction in longer-term charter costs, which in turn supports rate stability for shipping lines.

Shippers on the Asia-Europe trade lane should be particularly alert. With the traditional peak season approaching and transit times still extended due to Red Sea routing changes, demand could pick up sooner than expected, just as it did in 2024, when European importers advanced bookings to avoid delays.

Utilisation remains relatively high, and the market is only one or two strong booking weeks away from tightening significantly. Once that happens, space could quickly become constrained and prices may respond accordingly.

Congestion, Reliability and GRIs
At the same time, much of the market’s theoretical capacity isn’t actually accessible. Port congestion continues across Europe, including Antwerp, Hamburg, Rotterdam, and Le Havre, with yard occupancy levels of 75–90%, disrupting container flows and delaying vessel turnarounds.

Conditions are similar in Asia. Shanghai is experiencing delays due to fog and vessel bunching, while Singapore and Port Klang are seeing large backlogs and productivity slowdowns. Globally, schedule reliability remains under 55%, and with new carrier alliances still in rollout mode until July, disruption is likely to persist.

This operational friction reduces effective supply, keeping pressure on rates and creating risk for those waiting to move goods last-minute.

The container shipping lines have begun applying General Rate Increases (GRIs) and surcharges in recent weeks to stabilise rate levels in key corridors. While results may vary, these moves signal a clear intent to maintain pricing discipline, particularly as demand indicators begin to shift.

In an environment where schedule reliability is poor, congestion is high, and demand could rebound with little notice, waiting for rate relief may come with unintended consequences.

Certainty Beats Volatility
Shippers looking to avoid surprises would be well advised to fix rates where possible—because securing capacity and cost visibility offers valuable protection in a market that remains anything but predictable.

Freight markets can shift quickly, and when they do, the cost of waiting may outweigh any potential benefit. Fixing rates now delivers stability, security, and peace of mind in today’s volatile environment.

Our fixed-rate agreements act as a practical safeguard against market swings, offering predictable costs to support confident budgeting and planning.

Whether you’re managing high-volume trade lanes or simply seeking greater control over your supply chain, we’re here to help you stay ahead in 2025.

EMAIL our Managing Director, Andy Smith, to learn how we can support your business today.

Shipping at Risk from $1.5M Port Charge

Shipping at Risk from $1.5M Port Charge

Apr 1, 2025 | , , , , , , , , , , , , ,

To combat China’s dominance in shipbuilding and revive the US maritime sector, a sweeping proposal from the Trump administration to penalise container ships built in China has sent shockwaves through the global shipping industry. The policy would levy up to $1.5 million per port call on Chinese-built or Chinese-operated vessels entering American ports. 

The scale and scope of these potential fees have alarmed the world’s largest container shipping lines, who warn that the move could disrupt global supply chains and dramatically increase costs for shippers and ultimately consumers.

China has become the undisputed powerhouse of global shipbuilding, accounting for over 80% of all newly built container vessels. The largest ocean carriers — including MSC, Maersk, CMA CGM, and Hapag-Lloyd — have heavily invested in Chinese shipyards due to their cost-efficiency, financing advantages, and output capacity. For instance, MSC, the world’s largest carrier, has 24% of its fleet built in China, with 92% of its order-book also tied to Chinese yards. Maersk and CMA CGM show similar reliance, with well over half of their future tonnage scheduled from China.

The proposed fees would apply not only to Chinese-owned carriers like COSCO, but also to foreign lines that have Chinese-built vessels in their fleets or on order. This has drawn strong opposition from the industry, with MSC CEO Soren Toft warning that the policy could add between $600 and $800 to the cost of moving a single container.

That cost, he stressed, would either have to be absorbed by carriers, prompting a withdrawal from US trades, or passed down the supply chain to cargo owners and consumers.

To avoid the financial hit, carriers may consolidate services, eliminating calls at smaller ports and serve only major hubs. This will inevitably create congestion at the terminals and strain inland transport, as containers pile up in fewer locations lacking the right mix of trucks, chassis, and rail capacity.

Reduced carrier capacity, port consolidation, and higher operational costs will all converge to drive prices up. As Andrew Abbott, CEO of ACL, put it bluntly, the plan “would cause a freight rate explosion that would dwarf the COVID-era increase.”

US Trade Representative (USTR) Hearings
The policy has mobilised intense opposition, with over 500 submissions made to the USTR, and dozens of executives testifying at public hearings in recent weeks. Alternative mechanisms such as phased implementation, tiered fees based on vessel type or service region, or per-container charges instead of flat port call levies have been proposed, with the USTR’s final proposals due later in April.

The Trump administration argues that these measures are necessary to rebuild US maritime capacity and ensure national security. But critics note that the US lacks the infrastructure, workforce, and financing mechanisms to quickly scale up shipbuilding, and that domestic vessels are not only four times more expensive to build but also cost double to operate. Even if construction began tomorrow, new ships would not be delivered for years and US exports and imports would suffer in the meantime.

If implemented in its current form, the port fee proposal would reshape global liner networks, drive up transportation costs, and jeopardise the competitive position of US exporters. It may also lead to structural realignments in trade patterns, with cargo diverted to Canadian and Mexican ports, and long-term erosion of US port and logistics competitiveness.

We’re working closely with clients as we monitor regulatory developments, ready to react and adapt container shipping strategies in real time. If your supply chain depends on US port access, now is the time to assess your exposure and prepare contingencies.

EMAIL our Managing Director, Andrew Smith, to learn how we can protect your network, manage cost risks, and keep you competitive — no matter how the tide turns.

ICS2 and ELO: Preparing for the Next Phase of EU Border Compliance

ICS2 and ELO: Preparing for the Next Phase of EU Border Compliance

Mar 28, 2025 | , , , , , , , , , , , , , ,

As of 1st April, the European Union’s Import Control System 2 (ICS2) entered its final implementation phase; a critical milestone for businesses moving goods into the EU. 

Designed to enhance the safety and security of EU-bound shipments, ICS2 is now live across all transport modes, including road and rail, in addition to air, maritime, and inland waterways.

Import Control System 2

ICS2 introduces a standardised, data-driven pre-arrival notification for goods entering the EU. The system mandates the submission of accurate and complete Entry Summary Declarations (ENS) before arrival at the EU’s external border. These declarations allow customs authorities to perform detailed risk assessments and target high-risk consignments before they enter the supply chain.

This not only improves customs enforcement but supports a more secure and streamlined trade environment.

This latest phase introduces two key updates:

  1. 1. Mandatory House Bill Filings for Surface Containerised Movements
    This update predominantly affects sea freight and applies to:

    • Goods moving to the EU
    • In-transit shipments through the EU
    • Freight Remaining on Board (FROB)
  1. 2. Live ICS2 Filing for Road and Rail Movements
    Both accompanied and unaccompanied trailers now fall under ICS2’s scope. Businesses must submit ENS data 1 to 2 hours before EU arrival, depending on the transport type. Timing is critical — incomplete or late submissions could lead to delays, detentions, or even denied entry.

The Enveloppe Logistique Obligatoire

As introduced during our most recent webinar, ELO is not to be confused with the 70s rock band, it represents a major evolution in French customs procedures.

ELO is an extension of France’s import/export pairing process. Under the new system, every crossing from GB into France will require a declaration barcode, which also supports onward movement into the remaining 27 EU countries. The goal is to digitise and streamline freight verification, with a single ELO envelope covering the full logistics trail.

Metro’s Briefing Webinar

On Friday, 28th March, Metro hosted its second industry webinar, focusing on the latest regulatory developments. The webinar audience were briefed by our experts on the latest regulatory developments, including ICS2 declarations, the introduction of ELO, updates and the Carbon Border Adjustment Mechanism (CBAM). 

They were also updated on changes to the UK Customs Declaration Service (CDS) for exports, evolving trade agreements such as the CPTPP, and implications of the Windsor Framework for Northern Ireland.

The session aimed to ensure attendees are not just compliant but well-positioned to optimise their supply chain strategies in this evolving regulatory landscape.

Stay connected with Metro for expert-led insights, upcoming webinars, and on-the-ground support to navigate new regulatory frameworks confidently. EMAIL Andy Fitchett to register your interest.

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