Companies in the United States do not appear to be making a concerted effort to rush in shipments from Mexico and Canada ahead of the high tariffs that President Trump has threatened to impose on Saturday.
Mr. Trump said after taking office that the United States would apply tariffs of 25 percent on imports from Canada and Mexico, contending that they were allowing “mass numbers of people to come in and fentanyl to come in.”
The tariffs would raise the cost of imports significantly, especially since tariffs are not applied to most goods under the U.S.-Mexico-Canada Agreement, the trade deal that Mr. Trump signed in 2020. Canada and Mexico together account for 30 percent of U.S. trade. Many industries could be saddled with extra costs, including the vast auto operations that straddle the U.S. borders with Mexico and Canada.
Mr. Trump could withdraw his threat or reduce the tariff if he decides Canada and Mexico are doing more to address his complaints, Howard Lutnick, the president’s nominee to lead the Commerce Department, suggested on Wednesday.
With the tariff deadline near, some data shows higher freight volumes on road and rail, but the increases are not especially large, and transportation experts say rail and trucking companies have the capacity to cope. The situation, they said, is quite different from 2021 and 2022, when a deluge of imports overwhelmed supply chains, causing shipping costs to skyrocket and helping fuel a rapid acceleration of inflation.
“The industry’s probably never been in a better spot to deal with significant changes in the marketplace,” said Scott Shannon, vice president of North America cross-border at C.H. Robinson, a freight forwarder.
Larry Gross, president of Gross Transportation Consulting, said the transportation of shipping containers by rail was up 10 percent in the first four weeks of the year across North America compared with the same period in 2024. But while efforts to bring in goods before tariffs very likely contributed to the increase, he said, other factors also played a role. A big one was a desire to get shipments in before a possible strike at the East and Gulf Coast ports that could have started in mid-January but was averted.
“Every system has its limitations,” Mr. Gross said, “But the network is far better positioned today than it was at the beginning of the post-pandemic surge.” He said regulatory data that show how many trains are not running because they lack crews or locomotives were not showing any warning signs.
And Jason Miller, a professor of supply chain management at Michigan State University, noted that storing inventory has significant costs — financing and paying for warehouse space — that may deter companies from accelerating their imports.
The U.S. also imports huge amounts of goods from China. Mr. Trump said he was going to impose 10 percent tariffs on Chinese goods on Saturday.
Imports from China arrive primarily through the ports. And while the volume of containers coming through U.S. ports has been strong in recent months, the ports — and trucks and railways that move cargo inland — have not had problems handling recent volumes.
Some businesses are concerned that applying tariffs to goods that currently lack them may slow customs processing at the Mexican and Canadian borders and cause delays. But Adam Lewis, a co-founder and the president of Clearit, an online customs broker, said he did not expect applying new tariffs to be difficult for the brokers.
While updating the brokers’ software may take a short while, he said, any new tasks relating to tariffs could be done manually without much trouble. “It’s pretty much business as usual,” Mr. Lewis said.
But there may be delays if U.S. Customs and Border Protection increases its scrutiny to ensure that businesses are complying. The agency did not comment.
With the possibility of tariffs being imposed on goods imported from Canada and Mexico, many businesses are taking a cautious approach and not rushing to bring in shipments from these countries.
The uncertainty surrounding trade relations with our neighbors to the north and south has left many companies in a state of limbo, unsure of what the future holds. As a result, some businesses are holding off on ordering goods from Canada and Mexico until there is more clarity on the situation.
While tariffs could potentially drive up costs for businesses and consumers, some are willing to wait and see how the situation plays out before making any decisions. This cautious approach is a reflection of the unpredictable nature of trade policy in today’s global economy.
In the meantime, businesses are closely monitoring the situation and staying informed on any developments that could impact their operations. By staying informed and prepared, companies can better navigate the uncertain waters of international trade.
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tariffs, trade, Canada, Mexico, imports, exports, international trade, economic impact, Trump administration, NAFTA, supply chain, goods, tariffs on imports, trade agreements
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