Businesses are now bracing for a new surge of tariffs on Chinese imports promised by former President Trump during his campaign, prompting many of them to make advance purchases of foreign goods and secure additional warehouse space ahead of potential disruptions in the run-up to the election. Trump has pledged to impose a 60 percent tariff directly on Chinese products, alongside general tariffs of 10 percent to 20 percent on all imports. While these figures may fluctuate based on Trump’s decisions, he would have significant authority to implement these tariffs unilaterally, without needing congressional approval. In fact, trade and manufacturing experts note that Trump’s tariff proposals are already impacting global supply chains, creating uncertainty and prompting precautionary measures across all sectors.
Sébastien Breteau, CEO of supply chain compliance firm QIMA, reported that Chinese exports to North America have risen by 13% since the beginning of 2024, with a notable 18% increase between July and September; He also explained that the increase is due to tariffs expected from a possible second Trump administration, although he noted that it is modest compared to the increase in orders recorded during the pandemic.
“In 2021, the surge was significantly larger, but there is a fair amount of anxiety,” he noted. “Companies are preparing, though they’re cautious about overstocking. We’re not seeing panic from our clients.”
Other supply chain experts report similar adjustments by importers, distributors, and retailers in response to a possible shift in U.S. trade policy.
Trade experts pointed out that during Trump’s previous wave of tariffs, companies chose to absorb costs by reducing profit margins rather than raising prices, which would have contributed to inflation. “With Trump’s tariffs on China, most retailers did not pass on the additional costs, but simply took a hit to their profits,” explained Lori Wallach, director of Rethink Trade, a nonprofit organization that criticizes free trade agreements. Wallach noted that since tariffs are generally applied to the wholesale price of goods, companies often have sufficient flexibility to keep retail prices steady.
While Trump’s tariffs on China could be economically disruptive, potential Chinese retaliation could further amplify their impact. Such countermeasures could also have strategic political consequences, as seen during Trump’s first-term trade war with China, when Chinese tariffs targeted specific agricultural sectors in an effort to weaken Republican base support.
President Biden largely maintained the tariffs that were introduced by former President Trump, adding an additional $18 billion in tariffs on Chinese goods in May. Since this increase, core inflation in the Consumer Price Index (CPI) has fallen from 3.4 percent to 3.2 percent, while overall CPI has fallen from 3.2 percent to 2.4 percent, moving closer to the Federal Reserve’s target range of 2 percent.
After Trump’s first trade measures against China in 2018, inflation remained stabilized, holding around or below 2.5 percent until 2020 and the pandemic. By 2022, U.S.-China trade reached a total of $758.4 billion, with U.S. exports at $195.5 billion and imports at $562.9 billion.
Biden’s recent tariffs largely cover energy-related technologies, including medical products, port cranes, and raw materials such as steel and aluminum. The tariff increases include rates of 25 percent on steel and aluminum, 50 percent on semiconductors, 100 percent on electric vehicles, 25 percent on lithium-ion EV batteries, 50 percent on solar cells, and 25 percent on battery components.
Minerals and metals themselves have become a major point of focus in the economic competition between the United States and China, as many of them are critical to energy storage technologies critical to diversifying global energy sources.
Just last week, National Security Adviser Jake Sullivan announced plans for a U.S.-led critical minerals market that is intended to reduce dependence on Chinese processing capacity.
