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Tariffs, Complexity and Opportunity

May 27, 2025 | , , , , , , , , , , , , ,

As the United States recalibrates its tariff landscape, importers (and DDP exporters) are navigating a rapidly shifting environment. With Section 301 tariffs on Chinese goods still firmly in place, it has never been more critical to understand which tariffs apply and how to calculate them.

In mid-May 2025, the US and China agreed to a temporary 90-day pause, reducing some of the steepest retaliatory tariffs introduced earlier this year. As a result the “Liberation Day” tariffs of 145% were reduced to 30% for a limited set of goods.

However, the vast majority of Section 301 tariffs of >20%, imposed since the original US-China trade war in 2018, remain fully in effect. These apply to thousands of products, from electronics and machinery to apparel, plastics, and consumer goods.

Even with the temporary relief, many Chinese imports still face aggregate duty rates between 25% and 45%, and in some categories even higher, depending on classification.

Meanwhile, other major trading blocs continue to face pressure:

  • United Kingdom: 10% for automotives, capped at 100,000 vehicles annually 10% blanket tariff for most other goods including consumer goods, machinery, and textiles
  • Canada & Mexico: A 25% duty now applies to most goods, with energy imports from Canada also hit by an additional 10% levy.
  • European Union: Proposed 50% tariffs have been postponed until 9 July, but the delay only adds to uncertainty.
  • Rest of World: Many categories of industrial and consumer goods continue to carry elevated Most-Favoured Nation (MFN) rates, while countries without a preferential trade agreement with the US face duties ranging from 5% to 25%, depending on classification.

This fragmented tariff regime has introduced significant compliance risk, particularly for shippers working across multiple geographies.

Compliance is Complex—and Getting it Wrong is Costly
With tariffs now applied differently by origin, product type, and trade agreement status, accuracy in classification and valuation is critical. Errors can lead to underpayment (and penalties), overpayment (and lost margin), or shipment delays.

Key areas of risk include:

  • HS Codes (Harmonised System codes): A single digit variation can shift a product from a 5% duty rate to 25%. For example, a screw compressor may fall under HS code 8414.80.16 (duty-free) or 8414.80.90 (5.0%).
  • Country of Origin Rules: Manufacturing in multiple countries complicates origin determination. A shirt assembled in Vietnam from Chinese fabric may not qualify for any duty relief under existing agreements.
  • Valuation: Freight, insurance and packaging must be properly declared when calculating the dutiable value. Missteps here lead to unexpected cost and audit risk.

For exporters selling DDP, the challenge is even greater: you’re liable for these duties, meaning you absorb the cost of any errors. In today’s environment, even small misclassifications can compound across shipments, eroding profitability.

Turning Tariffs into Opportunity
While challenging, this tariff environment also presents strategic opportunities for those who are prepared:

  • Supply Chain Diversification: Shifting sourcing to countries with lower US duty rates can generate meaningful savings. Even partial shifts can de-risk exposure.
  • Tariff Engineering: By adjusting product configuration or final assembly location, shippers can legally change a product’s classification or origin. For instance, repackaging or minor reassembly in a third country may reduce duty rates.
  • Bonded Warehousing & FTZs: Storing goods in US Foreign Trade Zones or bonded facilities can defer, reduce, or eliminate duty payments, especially when re-exporting or assembling in the US before domestic release.

Amid rising costs and intense global competition, such strategies can help turn tariff exposure into a competitive advantage.

We combine trade compliance expertise, global freight execution, and strategic planning to help you manage tariff risk and unlock supply chain opportunities.

  • Expert customs brokerage teams based in the US
  • Product classification and duty calculations
  • Duty mitigation strategies, including bonded warehousing
  • Trade lane analysis and landed cost modelling
  • Supply chain rerouting and logistics reconfiguration

EMAIL Andrew Smith, Managing Director, to learn how Metro help you stay compliant, minimise supply chain risk, and unlock opportunities.

Indian port congestion looms

Cargo Rush Sparks Port Congestion and Equipment Shortages

May 26, 2025 | , , , , , , , , , , , , , , ,

The recent 90-day pause on US tariffs on Chinese imports has sparked a dramatic surge in demand, as American importers scramble to front-load shipments ahead of the 14 August deadline. The demand spike is now placing considerable pressure on supply chains across Asia and Europe, threatening to disrupt global freight flows into the traditional peak season.

Freight bookings from China to the US rocketed 300% in just one week, marking the highest volume levels of the year so far, as US importers use the temporary reprieve to push through previously delayed shipments.

While the tariff rate remains high at 30%, it is significantly lower than the 145% rates imposed earlier in the spring. Importers are moving quickly to take advantage of this limited window of cost certainty, but the consequences are already being felt far beyond China’s borders.

With ships now flooding back into Chinese ports, congestion has rapidly intensified:

  • Shanghai and Qingdao are experiencing berth waiting times of 24–72 hours.
  • Ningbo reports delays of 24–36 hours, while the congestion there is now worsening due to diverted volumes.
  • Busan is reporting 72-hour waits at the PNIT Terminal.
  • Singapore and Yokohama are also affected, with waiting times up to 36 and 24 hours, respectively.

Carriers are reporting widespread bunching and missed berths, forcing some vessels to skip port calls entirely. Simultaneously, container availability is tightening, especially in Shanghai and Ningbo, where carriers have begun rationing equipment based on rate levels and space commitments. Maersk and HMM are among those limiting container release in an attempt to balance capacity with available slots.

Further down the line, ports in southern China, Southeast Asia, and even intra-Asia trades are also reporting backlogs. Shenzhen, Hong Kong, Ho Chi Minh City, and Port Klang have all seen yard utilisation rise and service delays build.

Strain Spreads to Europe as Container Flows Disrupt
The congestion is not limited to Asia. As carriers reposition vessels and adjust service rotations to meet surging demand on eastbound transpacific routes, European ports are beginning to feel the knock-on effects.

In northern Europe:

  • Hamburg is facing 5–6½ days of berth delays,
  • Southampton and London Gateway are seeing 3-day waits,
  • Antwerp is experiencing severe disruption with delays extending to 15½ days,
  • Piraeus and Tangiers are also impacted, each facing waits of up to 4 and 3 days, respectively.

Labour shortages, reduced barge capacity on the Rhine, and tight schedules are compounding these delays. Meanwhile, rerouted vessels from Asia–Europe services are creating bunching at key transhipment hubs such as Bremerhaven and Hamburg, which in turn serve Scandinavia and the Baltic.

Equipment Shortages and Capacity Gaps Ahead of Peak Season
Container availability is expected to worsen in the coming weeks. With vessels already departing China at high utilisation levels, the return of empty containers and the repositioning of ships to Asia may not keep pace with demand.

If previously produced goods held in bonded warehouses are added to this surge in volumes during May, demand could increase by nearly 50%. A delay to June would ease the burden, but it could still be over 15%, which still represents a steep challenge ahead of the summer peak.

This front-loading of cargo to the US may lead to a sharp, compressed peak season starting now and stretching into mid-July, followed by potential equipment shortages and service volatility in August and beyond.

We are closely monitoring port performance, vessel schedules, and rate volatility across all major trade lanes, to support customers with:

  • Priority bookings and space management on transpacific and key routes
  • Equipment selection and container allocation strategies
  • Alternative routing and scheduling options to avoid bottlenecks
  • Global shipment visibility to SKU

EMAIL Managing Director Andrew Smith to discuss current conditions, risk mitigation, and booking options tailored to your business priorities.

Long Beach2

Tariff Pause Triggers Early Transpacific Peak Season

May 22, 2025 | , , , , , , , , , , ,

The 90-day suspension of US-China tariffs has delivered a sharp jolt to transpacific ocean freight, triggering an unseasonal spike in demand and pushing spot rates up significantly.

This unexpected policy reprieve has not only created a narrow window of predictability for US importers, but also accelerated peak season behaviours months ahead of the traditional schedule.

With booking volumes surging and available capacity still constrained, shippers are entering a period of extreme competition for space and elevated freight costs, especially on Asia–US West Coast lanes.

Since the announcement of the tariff pause, transpacific spot rates have climbed steeply. The Shanghai Containerised Freight Index (SCFI) rose by 14% last week, with further gains expected. This marks the largest weekly increase of 2025 so far and reflects mounting pressure on space and capacity across eastbound transpacific routes.

  • Shanghai–Los Angeles FEU rates have climbed 16% in just one week.
  • Shanghai–New York DEU rates jumped 19%.

While these levels remain well below pandemic highs, they are trending upward quickly, particularly as US importers race to bring in goods during the tariff pause window, which expires on 14 August.

Sudden and Significant Capacity Crunch
The spike in demand has exposed a capacity shortfall that many believed had stabilised. Carriers had withdrawn substantial tonnage from Far East–US West Coast services in April and May, anticipating a slower season. Now, those services are being rapidly reinstated in full as bookings rebound sharply.

Carriers have responded with unusual speed, with suspended loops returning across multiple alliances, vessels are being upsized to handle growing volumes, additional services are being announced and blanked sailings reversed.

Despite these adjustments, near-term capacity remains tight, especially due to ongoing vessel redeployments, congestion at Chinese ports, and bottlenecks at container freight stations (CFS) in China.

Adding to the live bookings, is a wave of previously manufactured cargo stored in bonded warehouses, which is expected to enter the market imminently.

If this stored cargo flows into the system during the remainder of May, demand could spike by 16% to 48% on top of normal levels. If shipments are delayed until June, the increase would ease to a more manageable 5% to 16%, but that assumes no further acceleration from early peak season orders.

Importantly, this analysis does not yet account for traditional peak season volumes, which are expected to surge in the coming weeks as US importers seek to front-load shipments ahead of the 14 August tariff deadline.

Challenges and Considerations
The rapid resurgence in volumes is pushing logistics networks to their limits. Shippers can expect tight space availability, higher rates, with ongoing volatility through June and July, possible rollovers, even on confirmed bookings, and longer dwell times, with delays at origin due to congestion

While carriers are acting quickly to rebalance networks, the sheer speed and scale of the demand rebound mean constraints are likely to persist through Q3.

As always, Metro is working closely with clients to minimise disruption and capitalise on available capacity. With robust freight forwarding capabilities, deep ocean carrier relationships, and on-the-ground presence in the United States, we’re helping customers:

  • Secure space and locked-in rates on core transpacific lanes
  • Prioritise high-value or time-sensitive cargo
  • Adjust routing strategies to reduce risk and maintain delivery schedules

With early peak season now well under way, proactive planning is essential. Space is already tightening, and costs will likely continue to climb in the lead-up to August.

If your business relies on Asia–US trade flows, EMAIL Andrew Smith today and learn how we will keep your supply chain running smoothly, despite the disruption.

COSCO appoint Metro partner

US Port Fees on Chinese-Built Vessels

May 20, 2025 | , , , , , , , , , , , , , ,

The United States Trade Representative (USTR) has finalised a revised plan to impose port fees on Chinese-built containerships calling at US ports.

This follows the reintroduction of the SHIPS for America Act, part of President Donald Trump’s broader push to revive the US shipbuilding industry and reduce reliance on Chinese maritime infrastructure.

While significantly less disruptive than the original February proposal, which threatened to add up to $1.5 million per port call and cost the industry $24 billion, the revised version will still increase shipping costs by approximately $1 million per voyage. These added costs may have ripple effects across global supply chains.

What’s Changing – and When?

USTR Port Fee

  • Start Date: Mid-October 2025
  • Escalation: Costs will increase every 180 days over a three-year period
  • Estimated Additional Costs:
    • Chinese operators (e.g. COSCO/OOCL): USD $250–$1,600 per TEU
    • Non-Chinese operators using China-built vessels: USD $100–$400 per TEU

Crucially, carriers will only be charged once per US rotation, not at every port call. Exemptions apply for:

  • Vessels under 4,000 TEUs
  • Voyages under 2,000 nautical miles
  • China-built vessels owned by US-based carriers

Carrier Reactions and Supply Chain Impacts
Most non-Chinese carriers are expected to redeploy tonnage to avoid the fees, shifting Chinese-built vessels away from US trades in favour of non-Chinese built ships. Some may elect to use transhipment hubs in the Caribbean to bypass direct calls to US ports.

Chinese carriers like COSCO and OOCL will be hardest hit. With limited ability to avoid the charges, these carriers may lean more heavily on alliance partners like CMA CGM or Evergreen, potentially distorting market dynamics and reducing competition on some transpacific routes.

Despite initial fears, widespread surcharges are currently seen as unlikely. Market competition and alternative capacity could prevent many carriers from passing costs directly onto shippers, tthough selective route-specific or carrier-specific fees may still emerge.

SHIPS for America Act
This proposed legislation, while not yet passed, aims to further penalise Chinese-built, -owned or -registered vessels. It also opens the door for other “countries of concern” to be added in future. No cost estimates have been released, but shippers should remain alert to potential follow-on impacts.

The evolving policy landscape introduces fresh uncertainty for importers and exporters, especially those with supply chains linked to Asia–US routes.

Metro is actively monitoring developments and engaging with carriers and industry bodies to stay ahead of the real-time implications. Our goal is to help customers navigate any changes smoothly and make informed decisions.

If your business could be affected by these measures, or you simply want to future-proof your supply chain with revised routing strategies and updated landed cost assessments, please EMAIL our Managing Director, Andrew Smith.

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