The global logistics landscape is experiencing significant shifts, marked by new tariffs, persistent ocean freight congestion, and varied air cargo market dynamics, according to a recent Flexport update. Importers and exporters are advised to reassess their strategies as Canada implements retaliatory tariffs and port disruptions continue to impact transit times and costs.
Canada is set to impose dollar-for-dollar retaliatory tariffs on $20 billion worth of U.S. exports, effective September 8. These measures will double duties on American steel and aluminum to 50% and add tariffs ranging from 15% to 50% on 874 tariff lines, including dairy, appliances, and electronics. This comes as the U.S. Customs and Border Protection (CBP) corrected initial errors in its Section 338 guidance bulletin, which had cited an incorrect Chapter 99 code range and referenced outdated Section 122 duties.
In other developments, CBP has accepted approximately $132.5 billion in potential and certified refunds for processing through the Consolidated Administration and Processing of Entries (CAPE) system as of August 21. However, the system's third phase, intended to expand eligibility, remains stalled without a new launch date, leaving questions about eligibility for liquidated entries. Additionally, CBP finalized a rule requiring rail carriers to electronically transmit export manifest data for trains departing the U.S.
Ocean freight continues to face challenges, particularly on the Trans-Pacific Eastbound (TPEB) route, where East Asia port congestion, especially around Shanghai, Ningbo, and Zhoushan, is tying up vessel capacity despite full carrier deployment. The Panama Canal Authority's decision to reduce daily transit slots starting September 3 and 15 is expected to cause longer waiting times for East Coast and Gulf cargo, with some carriers exploring Cape of Good Hope routing. Consequently, Asia-to-U.S. East Coast spot rates have climbed, reaching a four-year high for North American trade lanes by August 19.
The Far East Westbound (FEWB) lane sees soft European demand and ongoing schedule risks from East Asia typhoon disruptions. German port labor talks in Hamburg remain unresolved, potentially causing residual delays. Meanwhile, the Indian Subcontinent to North America (ISC) corridor is severely constrained by supply issues and peak season demand, with major services overwhelmed and Middle East transshipment hubs experiencing over one-week waiting times. Air freight markets show mixed signals, with demand fluctuations across various Asian origins, leading to varied rate movements and booking recommendations for shippers.