Polo 4PL Newsletter #29
Chart of the Week:
International Roadcheck took place this past week, with safety officials conducting inspection blitzes on equipment. Many operators, especially in a market where rates are suppressed, avoid driving during this week, which causes a temporary reduction in capacity. Spot rates have spiked 7% over the past week.
Shippers saw their service failure chances increase during this time. Tender rejection rates increased from 3.1% to 4.1% last week. There have been stronger jumps but shippers who have rates on the low end of the spectrum had the biggest exposure to this event.
Both spot and rejection rates remained relatively low from a historic standpoint — the market still has plenty of available capacity to recover from such an event — but that buffer is deteriorating.
Biden Administration Announces New Tariffs For China
The Biden Administration has recently announced more tariffs affecting imports from China following a review of Section 301 tariffs on Chinese imports. These tariffs will impact approximately $18 billion worth of goods, including products such as electric vehicles, advanced batteries, solar cells, steel, aluminum, and medical equipment.?
The President said that Chinese government subsidies ensure the nation's companies don’t have to turn a profit, giving them an unfair advantage in global trade, saying “American workers can outwork and outcompete anyone as long as the competition is fair,” Biden said in the White House Rose Garden. “But for too long, it hasn’t been fair. For years, the Chinese government has poured state money into Chinese companies ... it's not competition, it's cheating.”.?
Some of the increases we can expect to see:?
Battery parts (non-lithium-ion batteries) - Increase rate to 25% in 2024? Electric vehicles - Increase rate to 100% in 2024? Facemasks - Increase rate to 25% in 2024? Lithium-ion electrical vehicle batteries - Increase rate to 25% in 2024? Lithium-ion non-electrical vehicle batteries - Increase rate to 25% in 2026? Medical gloves - Increase rate to 25% in 2026? Natural graphite - Increase rate to 25% in 2026? Other critical minerals - Increase rate to 25% in 2024? Permanent magnets - Increase rate to 25% in 2026? Semiconductors - Increase rate to 50% in 2025? Ship-to-shore cranes - Increase rate to 25% in 2024? Solar cells - Increase rate to 50% in 2024? Steel and aluminum products - Increase rate to 25% in 2024? Syringes and needles - Increase rate to 50% in 2024?
These measures are introduced against the backdrop of heightened tensions between the U.S. and China and are part of ongoing efforts to address concerns over unfair trade practices and China's dominance in emerging technologies. While the tariffs are not anticipated to significantly impact overall inflation, they underscore the persistent trade tensions between the world's two largest economies.?
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We are actively monitoring developments and will provide updates as they arise. If you have any questions or concerns about how these tariffs may affect your business, feel free to contact us. For more detailed information, click the link below to view the full article.?
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