Kikomans will not be troubled. Monolithic commodity trades between continnents sill still go on.
From today’s LL
True impact of China-US trade war to be felt in next year’s peak season
Prospect of fundamental supply chain shifts in the long term if situation continues to escalate
30 Jul 2018
by Mike King
Fundamental changes could be seen in the supply chain in the long term.
ANY bump in ocean volumes ahead of the first raft of US tariffs on Chinese products implemented on July 6 may have been minimal, but one analyst believes the true impact of a Sino-US trade war will be felt in next year’s peak season.
Earlier this month, US president Donald Trump followed through on his promise that the US would enforce 25% tariffs on $50bn worth of Chinese goods, with the first batch covering some 818 product categories valued at $34bn taking effect on July 6.
Gregory Nichols, Asia principal at Tradewin, the trade consultant subsidiary of freight forwarder Expeditors, told Lloyd’s List that for the most part, the Chinese goods covered by the special import tariffs were not finished consumer goods such as apparel, footwear, toys and household goods.
As a result, the impact on the retail peak season would likely be minimal this year, unless new, expanded tariffs kicked in before October, which was unlikely.
“If the rhetoric from the Trump administration continues at the current pace and/or new tariffs are announced, then the impact on next year’s peak season could be significant as companies urgently look to source from vendors in alternate countries,” he said.
The pros and cons of a second round of tariffs on Chinese products are being discussed in the US. “There is another list of 6,000 harmonised system sub-headings, which was published on July 10, of Chinese goods that could be subject to special 10% import duties,” Mr Nichols said.
These will go through rounds of public hearings throughout August. Any new tariffs on these products would be unlikely to come into effect before mid-September.
“This list includes most categories of manufactured goods but again excludes apparel and footwear,” Mr Nichols said. “Some other consumer goods such as furniture are included.”
More long-term, Mr Nichols said fundamental supply chain shifts could be expected.
“For sure China is being thought of by US importers as a much riskier sourcing origin than it ever has been in the past,” he said. “We have seen a few examples of companies who have put planned manufacturing expansion in China on hold.
“We have also seen companies who are starting to move production of certain covered goods to alternate manufacturing sites. If this continues to play out in an ever-escalating fashion, the long-term effects could be transformational.”
He said that if the US market became cost-prohibitive for Chinese suppliers they would seek out new markets for their goods.
“This may lead to intense price competition that may in turn lead to concerns of dumping in the EU, Southeast Asia and other global markets.”