New Tariff Deal Brings Temporary Relief

Trade between the US and China is showing signs of recovery after a new 90-day tariff agreement was reached.

From 14 May, tariffs on both sides dropped to 10%, excluding the separate 20% fentanyl tariff. China is also rolling back countermeasures such as blacklisting companies and restricting rare metal exports.

What this means for trade:

• Lower tariffs could restore confidence in shipping

• Improved relations may encourage long-term agreements

• Logistics firms are watching market response closely

E-commerce takes the lead

E-commerce is expected to rebound fastest, with US demand for low-cost goods remaining strong. While high-end products have seen a slowdown, budget items are still shipping in large volumes.

Air freight trends

• Freighter capacity from China to the US is up 60%

• US to China capacity rose 35%

• Chartered freighters may see renewed demand despite high tariffs

  
  

Inventory overhang could delay growth

Many companies stocked up ahead of earlier tariff hikes, and those inventories now need to be reduced.

• Q1 saw strong trade volumes

• Q2 may see a pause before peak season ramps up

Looking ahead

Analysts suggest this 90-day deal could lead to a more permanent solution. If the US economy stays strong and tax reforms go ahead, consumer demand, and trade, could surge.

For now, e-commerce appears to be the first sector ready to take advantage of the tariff reprieve.