After weeks of mounting trade tensions, the U.S. and China have struck a deal to significantly reduce import tariffs for 90 days, offering a crucial window of relief for global supply chains.

The agreement, announced following high-level talks in Switzerland, will slash mutual tariffs by up to 115%. For many logistics and supply chain leaders, this temporary reprieve is a welcome reset after last month’s dramatic tariff spike triggered market volatility, cargo slowdowns, and operational uncertainty.

Key Takeaways from the Agreement

Tariffs Eased, Not Eliminated:

Starting May 14, both the U.S. and China will roll back major portions of their recent tariff hikes as part of a 90-day trade pause—offering critical relief to importers, exporters, and global markets. The U.S. will reduce tariffs on Chinese imports from 145% down to 30%, while China will suspend its 34% retaliatory tariff announced on April 4, 2025, and retain only a 10% baseline tariff during the pause.

Here’s what’s still in place:

• The U.S. 30% tariff will now consist of:
  • A 10% Reciprocal Tariff, negotiated as part of the mutual agreement.
  • A 20% enforcement surcharge tied to fentanyl-related trade, authorized under the International Emergency Economic Powers Act (IEEPA).
• China’s tariffs will drop to 10%, covering most categories of U.S. goods.
• Section 301 tariffs, first introduced in 2018 in response to China’s trade practices (including intellectual property violations and forced tech transfers), remain unchanged.
• Section 232 tariffs, imposed on steel, aluminum, and automotive imports on national security grounds, also remain in effect and are not part of this rollback.

Trade Will Resume, but at a Cost:

While goods will move again, the new “normal” tariff rates still represent elevated costs. U.S. businesses importing from China should expect thinner margins and price pressures.

Talks Will Continue:

Both nations have agreed to establish an ongoing trade dialogue, led by U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng. The aim: a more stable, long-term trade framework.

What This Means for Importers and Logistics Managers

Short-Term Relief, Long-Term Uncertainty

Use the 90-day pause to your advantage. Expedite shipments, lock in ocean and air freight rates, and move high-volume inventory while costs are temporarily lower.

Revisit Your Sourcing Strategy

Although trade is back on, many companies are looking beyond China to avoid future shocks. Consider alternative production hubs in Southeast Asia or Latin America, where GLC maintains reliable freight and warehousing networks.

Stay Compliant, Stay Competitive

GLC’s Customs Brokerage experts can help you navigate the new duty landscape, including classification reviews, HTS code optimization, and duty drawback opportunities for previously impacted goods.

Monitor Risk and Reevaluate Routings

The reprieve doesn’t guarantee a full recovery. If tariffs snap back in 90 days, disruption could intensify. Our supply chain consultants can model contingency plans and ensure operational agility for Q3 and Q4.

Market Alert: What to Expect in the Coming Weeks

The tariff pause may bring short-term cost relief, but capacity and pricing pressures are already intensifying across transpacific lanes. Here’s what you need to know:

• 100% space will be tight as ocean carriers determine which vessels—and how many—to bring back into service.

• 100% rates will increase. Early bookings and securing multiple routing options for all open POs will be critical to avoid delays or premium charges.

• A continued emphasis on supply chain diversification and onboarding alternative suppliers from other countries will be essential to long-term resilience.

• The General Rate Increase (GRI) is expected to take effect starting May 15, just after the U.S.–China de-escalation announcement.

• Ocean freight rates will surge during the second half of May due to limited vessel capacity and a spike in booking demand.

• The peak season for Transpacific trade is rapidly approaching. As of this afternoon, most available May sailings were already overbooked—just hours after the joint statement was released.

What Else Is in Motion Globally?

Beyond the U.S.–China tariff pause, several key geopolitical and trade developments are unfolding that could shape logistics and sourcing strategies in the weeks ahead:

• Middle East Trade Diplomacy: President Trump is expected to visit key Gulf nations this week in an effort to strengthen trade partnerships across the region. The visit has gained media attention due to reports of a luxury aircraft provided by Qatar for U.S. diplomatic use.

• India–Pakistan Trade-Linked Ceasefire: Over the weekend, a ceasefire agreement between India and Pakistan was announced. President Trump attributed the breakthrough to trade leverage, and early-stage negotiations with both countries are reportedly in motion.

• Continued Dialogue with China: Following the tariff de-escalation agreement in Geneva, further high-level talks may take place between President Trump and Chinese President Xi Jinping to build on recent momentum and potentially explore a longer-term framework.

These developments underscore how rapidly the global trade landscape is evolving—and why importers, exporters, and logistics professionals must stay agile, well-informed, and ready to pivot as opportunities and risks emerge.

Now is the time to act:

Secure space, lock in rates, and talk to your GLC representative about rerouting strategies before capacity disappears.

At GLC, we believe strategic logistics is more than shipping—it’s about planning for volatility. Whether you need support navigating evolving tariffs, realigning your global sourcing, or leveraging FTZs and bonded facilities, we’re ready to help.

With locations across the U.S., Mexico, and Colombia, and direct partnerships worldwide, we bring speed, clarity, and compliance to your entire supply chain.

Let’s Build Resilience, together
Ready to make the most of the 90-day window?

Contact our trade team at [email protected] or visit glc-inc.com to explore customized solutions.