🔔 Tariff Turbulence & Chip Check‐In

🤝 Hello, Procurement Pros!

Last week felt like riding a tariff-powered rollercoaster. One metals buyer told us his HRC quote window shrank from a week to just 24 hours—and was still pulled. Between new trade rules, raw material volatility, and shifting chip supply dynamics, procurement leaders across manufacturing are navigating a week of whiplash. Here's your full debrief.

📈 Market Snapshot

The ISM Manufacturing PMI dipped back to 48.7 in April, reflecting fresh contraction as tariffs begin to bite. Steel and aluminum prices spiked: HRC hit $945/st in the Midwest, and aluminum premiums rose to a 2-year high. Copper reached a record $5.08/lb, driven by stockpiling ahead of policy shifts. Meanwhile, West Coast ports brace for a 35% collapse in container volumes in the coming two weeks.

Sources: PMI – Reuters, Metals – Reuters, Ports – Reuters

🔎 In Focus — The 10%+ Tariff Shock

What Happened: On May 1, President Trump declared a new 10% tariff on all imported goods, while keeping steel and aluminum duties at 25%+. The same day, ISM reported a dip in PMI to 48.7—signaling a manufacturing pullback just as input costs rise.

Details: Prices across critical metals soared. Midwest HRC jumped 37% in 60 days. Aluminum premiums surged to 41¢/lb. Copper broke the $5/lb barrier. Suppliers began canceling quotes after 24 hours or less, citing tariff risk. At the same time, US ports saw importers rush cargoes to beat the new policy, now projecting 35% fewer boxes inbound over the next two weeks.

Why It Matters: Most procurement contracts weren’t designed for this. Material cost escalations are unbudgeted. Logistics capacity will shrink fast. If you’re not diversified by region, you may be vulnerable to downstream shutdowns or margin erosion.

Next Steps:

• Re-negotiate framework contracts to include tariff escalation clauses

• Activate nearshore supplier networks within USMCA and DR-CAFTA

• Investigate HTS reclassifications for tariff engineering

• Use Foreign Trade Zones to delay or reduce duty payments

More: PMI collapse, Metals surge, Container crunch

🏗️ Topic of the Week — Chips Made in America: Hype vs. Reality

What Happened: TSMC began 4nm chip production at its Arizona fab, backed by a $6.6B CHIPS Act grant. Nvidia and AMD quickly booked capacity, banking on domestic security despite higher costs.

Details: Phoenix fab yields match Taiwan levels. AMD is using ZT Systems for US-based servers. Nvidia is targeting $500B in local AI infrastructure. But domestic chips may cost 25–30% more, warns Reuters Breakingviews, citing US labor and supply costs.

Tech Trends: Advanced packaging—not fabs—is now the supply chain bottleneck. DOE may fund new US-based packaging facilities to close the gap.

Critical Voices: Industry insiders warn that domestic cost increases could shrink margins for non-Tier-1s, unless new subsidies or tax breaks are introduced.

Our Take: Secure partial domestic chip allocation now—especially for AI or sensitive electronics. Use mixed sourcing models for resilience and cost balance.

More: TSMC launch, Nvidia strategy, Cost risks

🔄 Personnel Moves

• Anders Lange appointed CPO at DXC Technology (Link)

• James “JT” Jones joins NOVA Chemicals as Chief Supply Chain Officer (Link)

🗓️ Weekly Recap (Apr 28 – May 4)

• UPS to cut 20,000 jobs due to tariff fallout (Reuters)

• LA ports warn of 35% volume drop (Reuters)

• EPA budget faces 30% climate cut under new proposal (Reuters)

• Nucor lifts HRC prices again, hitting $945/st (Reuters)

• YPF and XtraLit announce lithium JV in Argentina (Reuters)

⚡ Quick Takes

• Drewry: Container carriers may idle ships in response to 35% volume drop (WSJ)

• DOE opens $425M Advanced Energy Grant round (DOE)

• Nucor signals more HRC hikes coming (GMK Center)

• Goldman: Copper glut likely avoided due to tariffs (Reuters)

💼 Job Board

• Cisco – Indirect Strategic Sourcing Manager | RTP, NC (Indeed)

• Reddit – Strategic Sourcing Manager (Remote) (LinkedIn)

• Rivian – Purchasing Manager, Service | Plymouth, MI (LinkedIn)

🔢 Number of the Week

$945/st – The HRC steel spot price in the Midwest as of May 1. That’s a 37% surge in just two months.