We got our first snow of the season yesterday. Not much, but enough to turn the lawn white.
I’m a fair-weathered cyclist, so that signals the end of riding outdoors for me this year. Like a bear hibernating over winter, I’ll be riding in my basement cave until spring.
Before I head down there, here’s the supply chain and logistics news that caught my attention this week:
- Happy new year for transpac liners as shippers front-load to beat tariffs (The Loadstar)
- Descartes’ Study Reveals Tariffs and Trade Barriers as Top Concern of 48% of Supply Chain Leaders
- The Railroad on the Wrong Side of Trump’s Tariffs (WSJ – sub. req’d)
- NJ port workers’ contract talks stuck over adding automation as January deadline nears (NorthJersey.com)
- The No-Frills Service That’s Delivering More and More Packages (WSJ – sub. req’d)
- Sky-high Shipping Fees Are Hitting Earlier and Earlier (Bloomberg)
- Rubio’s Tough Stance on China Means Pressure on Importers (WSJ – sub. req’d)
- Descartes Announces Fiscal 2025 Third Quarter Financial Results
- Vooma secures $16.6m in funding to build the leading AI agents for logistics
- HappyRobot Raises $15.6 Million Series A Funding Led by a16z to Transform Logistics with Agentic AI
- MIT and Mecalux launch a groundbreaking project to accelerate logistics innovation
- ‘Italian’ purees in UK supermarkets likely to contain Chinese forced-labour tomatoes (BBC)
A Tariff for You, and a Tariff for You, and a Tariff for You Too
Since the re-election of Donald Trump as U.S. president, he has been threatening to impose tariffs on goods from China, Mexico, Canada, the EU, and everywhere else. Last week, as reported by CBS News, Trump threatened “to slap a 100% tariff on a group of nine nations — the so-called BRICS [Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran and the United Arab Emirates] — if they try to replace the U.S. dollar with another currency.”
Not surprising, tariffs have become the hot topic of conversation in supply chain and logistics circles — and a growing concern for importers.
A report published by Descartes this week highlighting the results of a survey it conducted showed that “48% of respondents identified rising tariffs and trade barriers as their top concern, closely followed by supply chain disruptions at 45% and geopolitical instability at 41%. Moreover, tariffs and trade barriers ranked as the priority issue regardless of company size, as respondents at companies with less than 250 employees, 251-500, 501-1,000, 1,001-50,000 and 50,000+ employees all cited it as the most significant issue they are currently facing.”
“Evolving tariffs and trade policies are one of a number of complex issues requiring organizations to build more resilience into their supply chains through compliance, technology and strategic planning,” said Jackson Wood, Director, Industry Strategy at Descartes. “With the potential for the incoming U.S. administration to impose new and additional tariffs on a wide variety of goods and countries of origin, U.S. importers may need to significantly re-engineer their sourcing strategies to mitigate potentially higher costs.”
Last month, we surveyed members of our Indago supply chain community — who are all supply chain and logistics executives from manufacturing, retail, and distribution companies — on the risk of a tariff war next year (Indago members can download the report from our website). We asked them if they had conducted any risk assessments or scenario planning specific to tariffs and trade restrictions in their supply chains. Only 11% of the respondents had conducted a comprehensive risk assessment or done any scenario planning.
Surprising? No. Many companies are reactive instead of proactive, so they’ll just wait for the fudge to hit the fan before taking action.
What many companies are doing, however, is importing as much as they can now before any new tariffs get implemented. “Shippers are anxious to get goods from Mexico into the US ahead of president-elect Donald Trump’s impending new tariffs, and before Chinese New Year, in January,” reports Alison Koo in The Loadstar. “Liner operators are reporting full bookings for Far East-Mexico/South America slots into the new year…South Korean exports increased 35%, to 196,300 TEU, and imports were up marginally, to 67,100 TEU. Most of the container flows were to Mexico, which took in 89,300 TEU, up 29%, with Chile, Peru and Brazil the second-, third- and fourth-largest South American trading partners.”
The Bullwhip Effect is alive and well.
And with that, I have to run. Have a meaningful weekend!
Song of the Week: “What, Me Worry?” by Portugal. The Man
