Featured Headlines:
I-ran, You-ran, We-all Ran from (Houthi) De-mands!
A Little Bit of Pharmaceuticals (and Semiconductors) on Our Mind
Learning the Basic FAQs About US Tariffs
Ports Gone Wild: Veracruz, Mexico Edition
US Trucker Lingo Meets Duolingo?
Get Dense or Get Billed: Big NMFC Changes Ahead
The Mar-a-Lago Embargo
- We just can’t tell if nearly 200% in total tariffs on Chinese goods is slowing commerce!
- Well, let’s take a closer look, shall we?
- There are currently 40 vessels on the Pacific headed to the US from China. We typically see as many as 100!
- Well, they must be GIANT vessels, right? There are 320,000 containers on those 40 boats; we normally have 1,000,000 in motion.
- It MUST be that we are comparing volumes to surge volumes in Q1 ‘25! Well, that is partly true… Chinese exports to the US are down 60% in a month, but they are also down 54% year-over-year.
- Hey, at least the ocean carriers are doing ALL THEY CAN to provide normal services during these abnormal times. Right? Ummm, right?
- 80 blank sailings in April established a new historical record!
- Asian port call frequency is down 25%.
- An estimated half of ocean services from China are now fortnightly.
- Normal schmormal!
- Hey, Southeast Asia will save the day and absorb all the new production needed while volumes will surge from that part of the Earth!
- SE Asia was already VERY busy trying to keep up with demand. How many new companies can instantly pivot to new and existing factories?
- Global production potential for China exceeds all of SE Asia (even if you add India to the equation). For the US, trade with China roughly equals that of SE Asia plus India… so, we expect those other nations to DOUBLE production tomorrow. That is ALMOST as absurd as imagining that the US can and would even want to produce all the imports we consume here (by next Friday).
- As it turns out, cargo flows from SE Asia and India to US are up about 20%. This is positive news, but it comes nowhere near replacing that 60% decline out of China.
- For those of us who presume that China mostly produces singing rubber fish and items that go from Amazon to the porch to the landfill in 30 days, we should begin to get a real taste for what we buy from China this summer!
- And what are all the shippers, forwarders, carriers, and reporters talking about? The logistical logjam coming when trade “normalizes” with China! Oh, the sailing schedules are fortnightly now, oh 100’s of vessels will back up in LA’s harbor, oh the poor truckers, oh the clogged origin and destination ports!! OMG, ocean rates will explode!!
- From our shoes, we better get busy talking to China, so we have the LUXURY of worrying about freight rates, congestion, and the solid, steady supply chain we crave.
I-ran, You-ran, We-all Ran from (Houthi) De-mands!
- (I-ran is a pun, HON!)
- The Houthi militia, backed by Iran, has named 15 companies—including Boeing—as targets in a new Red Sea warning. The statement also threatens third parties that engage with these companies, saying their fleets could be targeted from the Red Sea to the Indian Ocean.
- Specific shipping lines weren’t confirmed, but CMA CGM and Maersk are thought to carry cargo for Boeing. Maersk declined comment, and CMA CGM hasn’t responded to press inquiries. Both companies are still too busy counting their gold coins from COVID and 2024’s Miracle on the Red Sea supply shortage.
- Despite the tough rhetoric, one industry insider suggested the threat has little practical impact. “A desperate try by the Houthis to make it into the news,” they said, noting most container vessels are already avoiding Houthi-controlled waters. We SWEAR the insider doesn’t write this newsletter…. No, seriously!
- Maersk CEO Vincent Clerc, visibly sweaty from all that counting (and counting!), previously said a Red Sea return would only be viable after a full degradation of Houthi capabilities or a negotiated deal—neither of which seem imminent.
- President Trump added his own splash to the Red Sea conversation this weekend, demanding that American ships travel “free of charge” through both the Suez and Panama Canals. (We’ll see how that goes over in Cairo and Panama City.) We sort of wish he was splashing more about the US Navy’s muscle against the Houthis, no?
- Meanwhile, a deadly explosion rocked Iran’s Shahid Rajaei port—the country’s largest container hub—killing at least 40 and injuring over 1,000. No cause was disclosed, prompting speculation ranging from tragic accident to sabotage. Oh, and it didn’t help that the cargo in question was fuel for ballistic missiles (no joke).
- Maritime analyst Lars Jensen urged calm: “Before speculation runs rampant, remember that serious industrial accidents in ports—tragic as they are—aren’t rare. Think Beirut, think Ningbo.” Does Lars now comment on ALL the news? Yes, yes he does!
A Little Bit of Pharmaceuticals (and Semiconductors) on Our Mind
- As you may already be aware, the Commerce Department’s Bureau of Industry and Security (BIS) released additional details related to the recently announced Section 232 investigations into pharmaceuticals and semiconductors.
- Importers of products potentially covered by this investigation should familiarize themselves with the purpose, scope and comment period summarized below.
- Pharmaceuticals + Pharmaceutical Ingredients
- Purpose: Determine the effects on the national security of imports of pharmaceuticals and pharmaceutical ingredients, including finished drug products, medical countermeasures, critical inputs such as active pharmaceutical ingredients, and key starting materials, and derivative products of those items.
- Scope:
- Finished generic and non-generic drug products (both);
- Medical countermeasures;
- Critical inputs – such as active pharmaceutical ingredients and key starting materials; and
- Derivative products of those items.
- FR Notice: 2025-06587 (90 FR 15951)
- Docket No.: 250414-0065
- Comments Due: May 7, 2025
- Semiconductors
- Purpose: Determine the effects on national security of imports of semiconductors, semiconductor manufacturing equipment, and their derivative products.
- Scope:
- Semiconductor substrates and bare wafers;
- Legacy chips;
- Leading-edge chips;
- Microelectronics;
- SME components; and
- Derivative products, which include downstream products that contain semiconductors – such as those that make up the electronics supply chain.
- FR Notice: 2025-06591 (90 FR 15950)
- Docket No.: 250414-0066
- Comments Due: May 7, 2025
- All comments from the trade community must be submitted within 21 days of the FR Notice’s publication date (4/16/25)—which is just a few days away.
- Time is of the essence. Don’t delay…weigh-in today!
- Learn more about these actions in our Tariff News section: Trump’s Trade Tariff Updates | Section 232 | Current Tariffs
Learning the Basic FAQs About US Tariffs
- US Customs and Border Protection (CBP) has been working in overdrive to keep up with President Trump’s ever-evolving trade announcements—but even the most seasoned professionals are facing challenges with the current churn cycle.
- Officials recently decided that the import and export communities would be better prepared to handle the upcoming changes if armed with the basics!
- Introducing…the latest and greatest array of CBP’s Frequently-Asked-Questions (FAQs)—which offer additional information as it stands today and include helpful guides that navigate the following major topics:
- Additional Resources:
Ports Gone Wild: Veracruz, Mexico Edition
- Veracruz is flexing, folks! CICE Group just wrapped phase one of a shiny new container and mixed cargo terminal. The highlights? A 550-meter dock, half-a-million TEU yard, reefer and hazmat zones, nearly 2km of rail tracks, and the coolest mini-bar in the break room.
- Oh, and they built it in just over a year, which in port development years is basically warp speed. A similar project in the US is in its 19th year; a mirror image development in China took nine days. Shrug.
- Veracruz volumes dipped 12.2% in Q1, but CICE is betting big anyway. Phase two kicks off this quarter, and the company’s got eyes on more terminals and logistics parks across Mexico. (Someone’s been eating their infrastructure Wheaties!)
- Over on the Pacific side, Hutchison Ports is in the final stretch of expanding its Lazaro Cardenas terminal—adding 28 hectares and extending the dock to a whopping 1,278 meters. In 2023, the terminal pushed 1.5 million TEUs, up 20% from the previous year.
- (The ILWU, when asked, simply yawned and shooed us away.)
- Not to be outdone, APM Terminals just dropped $14 million on 14 hybrid shuttle carriers at Lazaro Cardenas. They’re beefy (50 tons each), eco-friendly, enjoy romantic walks on the beach, and are aimed at reducing trucker wait times and port container chaos.
- Backing all this is Mexico’s government, funneling pesos into the Mexico Plan, a $1.53 billion logistics stimulus running through 2030. Want a shiny new ship or cutting-edge gear? You might qualify for a governmental assist of 73%!
- Marine industry leaders are calling it a “watershed moment.” (In port speak, that’s a love letter.) The focus? Machinery, vessels, and tech upgrades to modernize Mexico’s maritime game. Will Ocean FINALLY give Truck and Rail a literal run for their money for US trade?
US Trucker Lingo Meets Duolingo?
- President Trump has signed a new executive order requiring all commercial truck drivers operating in the U.S. to demonstrate proficiency in English.
- The goal? Improve road safety by ensuring that drivers can read traffic signs, communicate with law enforcement, and complete required documentation without confusion or delay.
- The Department of Transportation (DOT) has been tasked with revising inspection protocols to include language screening as part of compliance checks.
- Drivers who do not meet the English proficiency requirement may be placed out of service until they can demonstrate adequate literacy.
- Ironically, to date, only 3% of “American Americans” have passed the test! Gassssp! Okay, okay… that was just a silly joke, but be careful what you wish for!
- The trucking industry’s reaction has been mixed—many support safety improvements but warn that without clear implementation guidance, the rule could disrupt operations or reduce labor pool diversity.
- Critics argue the order could disproportionately affect non-native English speakers currently filling critical roles amid ongoing driver shortages.
- Expect further clarification and compliance details from DOT and CBP in the coming weeks, as stakeholders push for fairness and feasibility.
Get Dense or Get Billed: Big NMFC Changes Ahead
- The National Motor Freight Traffic Association (NMFTA) is giving the NMFC a facelift—more than 2,000 items are being reclassified into density-based LTL classes. Translation: If your freight’s taking up space but not pulling its weight, your invoice might bulk up.
- Many shippers are in analysis paralysis, lacking good dimensional or NMFC data. Pitt Ohio’s VP of pricing, Shawn Galloway, summed it up with a shrug: “I would have no idea.” (Not helpful, but honest.)
- For anyone waiting to “see how things shake out,” that’s a gamble. Expect reweighs, reclassifications, and revised freight invoices if you’re caught unprepared.
- Switching to a cheaper carrier might feel clever—until they boomerang back in three months demanding higher rates. Galloway warns carriers know what their freight actually costs.
- The NMFTA’s mission is density, density, and density. Their new Item Lookup Tool lets shippers enter or upload item numbers to see how reclassification will impact them. Use it before your sticker quote becomes a shock!
