New US tariffs disrupt trade

The sectors most affected include electronics, machinery, plastics and furniture, where China has traditionally been a dominant supplier.

“The additional tariffs are forcing companies across industries to take strategic measures to mitigate risks,” said Stephen Dyke, principal solutions consultant manager at FourKites.

“Companies are moving away from business-as-usual purchasing patterns toward more demand-assured procurement strategies.”

Dyke says that in the near term, consumers should expect prices increases, extended lead times and a simplified product offering as companies concentrate on high-volume items.

While domestic sourcing offers a potential long-term solution for many categories, the transition requires time, investment and careful planning.

In addition, the elimination of the US$800 de minimis threshold will reshape cross-border trade, forcing importers to navigate full customs clearance for over 1.3 billion shipments annually that previously entered duty-free.

“This change would add administrative costs per shipment and create significant delays at ports of entry as customs officials process a surge of formerly exempt parcels, potentially straining border infrastructure and slowing supply chains,” he said.

Dyke predicts that e-commerce retailers and direct-to-consumer brands that relied on overseas drop-shipping items will now likely move to bulk importing, increasing their operational costs while reducing the competitive advantage of ultra-low-cost retailers.

“While proponents argue these changes level the playing field for domestic sellers, the transition will require companies to invest in advanced documentation systems, consider enrolment in trusted trader programs, and potentially redesign their distribution networks to maintain efficiency,” he concluded.