American businesses significantly boost imports from China after tariff suspension
U.S. Businesses Restocking as Tariff Pause Eases
American companies are ramping up shipments from China following President Trump's temporary tariff reduction on imports, creating a sudden increase in demand that could result in supply chain bottlenecks within the next few months.
According to Ben Tracy, vice president of strategic business development at Vizion, freight bookings from China surged this week, hitting the highest levels of the year. This comes after Trump announced a 90-day tariff reprieve while U.S.-China trade negotiations continue.
China-bound shipments had plummeted last month as companies struggled with Trump's escalated tariffs on Chinese imports, making them unaffordable for numerous enterprises. Although Chinese imports still face a 30% tariff, businesses are capitalizing on the change to catch up on delayed shipments and ship as many products to the U.S. as possible at the lower rate during this tariff pause.
"Over the past month, we saw a dramatic drop in trans-Pacific trade, especially from China, falling by 60% or more in terms of those volumes," said Jessica Dankert, vice president for supply chain at the Retail Industry Leaders Association. "Now that we have at least relative certainty for the 90-day window, we definitely expect to see those volumes ramp back up again."
However, businesses anticipate encountering difficulties in the upcoming months.
It usually takes around a month for goods to travel from China to the U.S., but the sudden increase in demand, coupled with a limited number of ships, port docking space, and trucks to transport goods, could extend that transportation time by several additional months, stated Bryan Gross, a principal at PwC who works on supply chain issues.
"There's only a certain amount of capacity in that pipe, it can only expand so far. There's only a certain number of container ships. There's only a certain number of appointments in the ports to be able to consume that capacity," he explained. "That bubble of goods is going to start flowing through the system, but it's constrained by the size of the pipe."
This imbalance between supply and demand could also lead to higher shipping rates, which have already begun to rise in recent days. Furthermore, as it can take several months for a ship to travel to the U.S. then return to China, an increase in Chinese outbound ships in the coming days and weeks could result in container shortages this summer, which is traditionally the peak season for retailers to deliver their back-to-school and holiday merchandise.
"What may be an issue is that in two months time, which would be peak season for retail, we might not have enough containers available in China to load, and not only containers, but also not enough ships there," added Tracy.
Insights: The reduction of tariffs between the U.S. and China in May 2025 provides opportunities for the shipping industry, as companies resume exports and rebuild inventory. However, this resurgence in demand could lead to supply chain bottlenecks and potential shipping rate increases due to surging demand, limited port capacity, and vessel shortages.
This temporary relief may alleviate some of the earlier drops in shipping volume, but it also creates new challenges in terms of balancing supply and demand, rerouting logistics, and managing operational complexities.
- The resurgence in exports from China due to the tariff reduction might have a significant impact on both the economy and markets, as an increase in shipping demand could lead to supply chain bottlenecks and potential rate increases.
- As the shipping industry experiences this increase in demand thanks to the tariff suspension, sports like retail businesses might have to navigate new complexities, including balancing supply and demand, rerouting logistics, and managing operational challenges, especially during peak seasons such as back-to-school and holiday seasons.
