2025 Shortage of Retail Goods in the U.S.: How Trade War Tariff Policies Affect the Market in Phases

Taiwan • Business • 04/24 21:30
2025 Shortage of Retail Goods in the U.S.: How Trade War Tariff Policies Affect the Market in Phases

In the spring of 2025, the United States faced a shortage of consumer goods due to a trade war, affecting clothing, footwear, toys, and home goods. On April 2, the Trump administration imposed a 145% tariff on goods from China and an additional 10% tariff on all imports, with some tariffs deferred for 90 days. The supply chain breakdown led to empty shelves, and retailers like Target and Walmart warned of product shortages. The U.S. eliminated the duty-free threshold, affecting small and medium-sized retailers as well as e-commerce platforms. Supply chain pressures are expected to persist through the summer peak season.

Key Updates

04/25 10:02

Evergreen Marine Corporation General Manager Wu Kuang-hui: Shipping demand remains stable, making good progress in signing long-term contracts for the North American route

On April 25, 2025, Evergreen Marine's General Manager Wu Guanghui stated at a corporate briefing that despite the global economic slowdown and US-China trade tensions, the demand for maritime transport has remained steady, with only fluctuations in the growth rate. Evergreen has completed long-term contracts with major North American clients and expects to finalize contracts with small and medium-sized clients by the end of the month. First-quarter revenue increased by 24%, driven by rising freight rates and volume. The company is tackling market uncertainties by adjusting routes and controlling costs to stay competitive.

04/25 09:02

China Considers Exempting Some U.S. Goods from Tariffs: Medical Equipment and Industrial Chemicals on the List, Aviation Sector Could Benefit

The Chinese government is considering suspending the collection of retaliatory tariffs of up to 125% on certain U.S. imports, with the exemption list including medical equipment, industrial chemicals such as ethane, and aircraft leasing. This move could ease cost pressures on China's aviation and manufacturing sectors. Although the Chinese Ministry of Foreign Affairs has not yet officially confirmed this, companies have been requested to submit product customs codes, indicating that policy adjustments are in progress.

04/25 04:31

Trump temporarily halts reciprocal tariffs policy; companies like DHL and Walmart adopt strategic suspensions in response.

On April 9, President Donald Trump announced a temporary delay of the reciprocal tariff policy originally set to take effect in July, allowing a 90-day negotiation period for various countries. This move temporarily eases trade tensions, but companies like DHL, Walmart, and Caterpillar face uncertainty and are taking strategic pauses, adjusting their business models to reduce the impact. DHL is pausing high-value B2C shipments, Walmart and Target are pausing sales of Chinese-made private labels, and Caterpillar is postponing capital expenditures. Companies are seeking stability and opportunities amidst the uncertainty of the policy.

04/25 03:04

The United States is considering waiving tariffs on auto parts, opening up new export opportunities for manufacturers in Taiwan.

The White House confirmed on April 23, 2025, that President Trump is considering granting tariff exemptions on certain auto parts, covering steel and aluminum, imported parts from China, and non-American components of auto parts. This move has attracted attention from the global automotive supply chain, especially from Taiwan's auto parts industry, as it could open up opportunities to enter the U.S. market. Taiwanese businesses and government agencies stated that if the policy is enacted, it would help stabilize shipments, expand market share, and strengthen partnerships with U.S. distributors.

04/24 23:02

U.S.-China Trade War Eases: President Trump Considers Reducing Tariffs, the CBOT Agricultural Futures Rise Driven by Rising Ethanol Demand

In late April 2025, signs of easing tensions in the US-China trade war emerged. President Trump is considering reducing the high tariffs imposed on Chinese goods and possibly adopting a tiered taxation system. Chinese customs reportedly notified that some US-made chips would be exempt from the 125% retaliatory tariff. The three major agricultural futures on the Chicago Board of Trade saw an increase due to US ethanol production hitting a three-week high, an increase in corn usage, a decline in ethanol inventories, and the diversification of China's corn import sources impacting US exports.

04/24 21:30

2025 Shortage of Retail Goods in the U.S.: How Trade War Tariff Policies Affect the Market in Phases

In the spring of 2025, the United States faced a shortage of consumer goods due to a trade war, affecting clothing, footwear, toys, and home goods. On April 2, the Trump administration imposed a 145% tariff on goods from China and an additional 10% tariff on all imports, with some tariffs deferred for 90 days. The supply chain breakdown led to empty shelves, and retailers like Target and Walmart warned of product shortages. The U.S. eliminated the duty-free threshold, affecting small and medium-sized retailers as well as e-commerce platforms. Supply chain pressures are expected to persist through the summer peak season.

04/24 18:01

Impact of US Inflation and Tariff Policies on the Economy: Experts Advise Increasing Savings, Nissan Predicts Record High Net Loss for 2024

The IMF report indicates that the U.S. economic growth forecast for 2025 has been lowered to 1.8%, with inflation expected to increase to 3%. Tariff revenue might reduce the fiscal deficit in the short term, but its dampening effect on imports and consumption is causing concern. Experts suggest that people should increase their emergency savings to cover 9 to 12 months. Nissan forecasts a net loss of 750 billion yen for the 2024 fiscal year, attributed to asset impairment, restructuring expenses, and the effects of U.S. tariff policies on North American market sales.

04/24 09:02

Nestlé and Unilever Revise U.S. Market Pricing Strategy to Counter Weak Consumer Confidence

Nestlé and Unilever have adjusted their pricing strategies in the U.S. market due to weakened consumer confidence and heightened price sensitivity. Nestlé has lowered its prices by 1%, while Unilever has slightly increased prices by 2.1% to tackle competition from store brands. Data from Nielsen and McKinsey indicate that consumers are turning to lower-priced alternatives, prompting brands to rethink their pricing strategies.

04/24 09:02

Boeing's losses narrowed to USD 31 million in the first quarter of 2025, leading to a 6% rise in its stock price due to better-than-expected performance.

In Boeing's first quarter 2025 financial report, despite U.S.-China trade tensions leading to China suspending the reception of new aircraft, Boeing narrowed its losses to $31 million, a decrease of over 90% compared to the same period last year, thanks to an increase in commercial aircraft deliveries and improved operational efficiency. As a result, Boeing's stock price rose by 6.06% on April 23. Boeing CEO Dave Calhoun stated that the company is advancing its recovery plan and considers 2025 a key year for transformation.

04/24 07:04

Hong Kong's economic growth forecast for 2025 has been downgraded to 1.5% due to the impact of the US-China tariff war and geopolitical tensions.

In 2025, financial institutions such as HSBC, OCBC, and Shanghai Commercial Bank lowered Hong Kong's economic growth forecast to between 1.5% and 1.9%, mainly due to the impact of the US-China tariff war and rising geopolitical risks affecting exports and fixed investments. As an international re-export trade hub, Hong Kong faces economic pressure from intensifying global trade tensions. Some institutions, like DBS Hong Kong and Bank of East Asia, are taking a wait-and-see approach, waiting for more data to determine whether to adjust their forecasts.

Phase One: Pre-Stocking Surge and Port Congestion (January to March 2025)

Before the tariff policy officially went into effect, companies were stocking up in advance to avoid rising costs. According to data from the U.S. Census Bureau, the import volume of consumer goods in January and February 2025 increased by about 25% year-on-year. The Port of Los Angeles received 22 cargo ships in one week, a 57% year-on-year increase, indicating that companies are accelerating imports to build up inventory.

However, this wave of "panic buying" also caused port congestion and logistical pressure. HLS Group pointed out that despite the surge in early imports, starting in March, 80 cargo ships departing from China have canceled their voyages, indicating that the supply chain is entering a "hot then cold" turning point.

Phase Two: Tariff Implementation and Order Freeze (Early April 2025)

On April 2, 2025, the U.S. government officially implemented the "Reciprocal Tariff" policy, imposing tariffs of up to 145% on Chinese goods and an additional 10% general tariff on all imported goods. This move immediately triggered retaliatory tariff actions from both the U.S. and China, with China also imposing a 125% tariff on U.S. goods.

At this point, many companies decided to halt shipments. According to Taiwanese media reports, brands like HP, DELL, and Lenovo have notified their supply chains to suspend all shipments of laptops and consumer electronic components to the U.S. for at least two weeks. The U.S. customs system is not fully operational, causing confusion in the declaration and clearance processes, further delaying the flow of goods.

Phase Three: Retailer Warnings and White House Meeting (Mid-April 2025)

As inventory gradually depletes, retailers started issuing warnings. The CEOs of Target, Walmart, and Home Depot met with the President in mid-April, warning that if tariff pressures are not alleviated, significant product shortages could emerge within weeks. Axios reported that this meeting prompted the White House to consider cooling trade tensions with China.

Meanwhile, according to Sea-Intelligence data, from late April, there has been a 35% to 42% increase in "blank sailings" on routes from Asia to the U.S. East Coast, indicating that freight operators have significantly reduced capacity, reflecting frozen orders and declining demand.

Phase Four: Initial Product Shortages and Item Differentiation (Expected Early May 2025)

According to the American Apparel & Footwear Association (AAFA) data, in 2024, 37% of U.S. apparel imports came from China, and footwear was as high as 58%. After the new tariffs were implemented, the average tariff rate for these goods exceeded 160%, with some even surpassing 200%. AAFA President Steve Lamar pointed out that this is equivalent to a "de facto import ban," with many orders canceled or forced to remain in warehouses.

According to ShipBob's Chief Marketing Officer Casey Armstrong, the first shortages will appear in price-sensitive, fast-moving items such as toys, children's stationery, affordable clothing, and home goods. These products mostly rely on China's low-cost supply chain and have short inventory buffer periods, with shortages expected to begin in early May.

Phase Five: Impact on Small and Medium Retailers and E-commerce Platforms (After May 2, 2025)

On May 2, the U.S. officially ended the "de minimis" tax exemption threshold, meaning that import packages valued under $800 will no longer be exempt from taxes. This policy change impacts e-commerce platforms reliant on the Chinese supply chain, such as Shein, Temu, and Amazon third-party sellers.

According to Jonathan Gold of the National Retail Federation, this will lead to higher import costs and customs delays for small and medium-sized retailers, further squeezing profits and product selection. The Global Port Tracker report predicts that U.S. import volume will decrease by at least 20% year-on-year in the second half of 2025, indicating that supply chain pressures will continue to expand.

Phase Six: Increased Risk During Summer Peak Season (June to July 2025)

According to Michael Salerno, Vice President of FNBO International Bank, May to July will be a critical period for observing supply chain health. If the current high tariff policies persist, it is expected to affect the supply of goods for the summer and back-to-school seasons, especially children's clothing, stationery, and seasonal toys.

Additionally, according to Import Genius data, Walmart, IKEA, and Target have recently reduced orders from China, indicating that even large retailers cannot completely avoid the impact of supply chain disruptions. Although Home Depot still maintains some imports from China, the overall trend shows that companies are turning to a wait-and-see approach and risk management.

References

People Also Ask...

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