Tariff Shock Hits Supply Chains

🤝 GREETING

Good morning, Procurement Pros!
Remember when $5 gadgets could slip through customs duty-free? Those days end this Friday. The de-minimis door that let 685 million parcels breeze into the U.S. last year —more than 2 M every day—slams shut at 12:01 a.m. EDT on May 2. Reuters
Shippers are scrambling; CBP’s IT help-desk ​says ticket volume is up 300 % since Friday. Let’s get you ahead of the rush.

📊 MARKET SNAPSHOT

🔍 IN FOCUS – “De-Minimis No More”

What Happened
The White House published its final rule ending duty-free treatment for parcels ≤ $800 from China and Hong Kong and layering 30 % tariffs (May 2) → 50 % (Jun 1) on top. The White HouseHome Furnishings Association

Details

• 400 HTS lines—including hand tools, bearings, PCBAs, neodymium magnets—now reference Column 2 rates + new adders.

• Brokers must file Section 321 entries through ACE with full data, not Section 321 (b) manifest clearance.

• CBP projects 3-day average delay as manifest systems reset. U.S. Customs and Border Protection

• Retailers Shein & Temu could see costs soar 30 %–60 %. Reuters

Why It Matters

• Hidden BOM shock: Items previously sourced under de-minimis (e.g., PCB relays, sensor harnesses) will price in new duties immediately.

• Liquidity squeeze: SMEs relying on just-in-time parcel flows face cash-flow hits and possible line-down events.

• Carrier surcharges: Expect new “De-Minimis Levy” line items on UPS/FedEx invoices this week.

Next Steps

1. Split orders today: one pre-tariff air-freight batch, one sea-freight contingency.

2. HTS scrub: Re-classify any ambiguous codes before May 1 cut-off.

3. Broker briefing: Confirm your filer can handle PGA flags for Section 321+232 overlaps.

4. Finance heads-up: Model a 1–3 pp impact on landed cost for FY25 Q2.

Further Reading

• White House tariff fact sheet The White House

• CBP operational update U.S. Customs and Border Protection

• Reuters analysis on fast-fashion impact Reuters

🏷️ TOPIC OF THE WEEK – “Tariff Shock Week”

What Happened
Global and reciprocal tariffs rise while de-minimis closes, hitting everything from EV motors to MRO spares. Trade Compliance Resource HubThe White House

Details
Tariffs escalate in three waves (May 2, Jun 1, Aug 1) and overlap with Section 232 probes on chips and cranes, creating stacking duty risk for multi-component imports. Trade Compliance Resource HubHome Furnishings Association

Tech Trends / Innovation Pressure
Importers with robust digital customs twins can scenario-model duty exposure in minutes; others still rely on spreadsheets. Expect a rush toward automated classification APIs and supplier-self-service portals.

Critical Voices
Fed officials warn higher duties could entrench inflation and delay any 2025 rate cuts. Reuters

Our Take
Treat tariffs like a new tax regime—not a one-off. Embed duty forecasting into every sourcing RFQ, and push suppliers to quote DDP so risk lives where value is created.

Next Steps

• Create a Tariff Tiger Team—sourcing, finance, customs—to review top-100 SKUs by value.

• Pilot supplier HTS attestation in your portal before Q3.

Further Reading

1. Trade Compliance Resource Hub tariff tracker Trade Compliance Resource Hub

2. WilmerHale client alert on reciprocal delays Welcome to WilmerHale

3. Fastmarkets outlook on U.S. steel post-tariffs Fastmarkets

🔄 PERSONNEL MOVES

📅 WEEKLY RECAP (Apr 22 – 28)

⚡ QUICK TAKES

• Chip 232 probe widens — legacy microcontrollers now in scope; comments due Jun 15. Trade Compliance Resource Hub

• DOE’s $425 M magnet-recycling grant window closes May 15—suppliers should prep teaming bids.

• Green HRC premium holds at $930/t as OEMs chase IRA credits. Fastmarkets

📌 JOB BOARD

🔢 NUMBER OF THE WEEK

$800 ➡ $0
That’s the overnight collapse of the U.S. de-minimis threshold for Chinese parcels—affecting ~2 million packages every day. Reuters