Room to Lower China Tariffs, Retail CEOs Meet Trump, DHL Halts Small Shipments

Big News 📣

President Trump is Willing to Lower Tariffs on China

President Donald Trump says he’s willing to lower tariffs on Chinese goods — but only if China agrees to better trade terms. Speaking from the White House, Trump said the decision to ease the 145% tariff on Chinese imports “depends on them.” His comments come as hopes amidst the trade tensions between the world’s two biggest economies.

But while Trump claims negotiations are ongoing, China denies any talks are happening and says it won’t engage unless the U.S. stops “threats and blackmail.” Chinese officials said they are ready to defend their position if needed, warning that they won’t back down from a trade fight.

• Domestic issues 🇺🇸 : A coalition of 12 U.S. states, including New York and Arizona, has filed a lawsuit challenging Donald Trump’s authority to impose such high tariffs without congressional approval. The lawsuit argues the tariffs hurt local economies and are legally questionable

• Mutual agreement 🤝: According to reports, the White House is considering slashing tariffs by 50–60% if China agrees to lower its own tariffs on U.S. goods

Trump Meets Walmart, Target, Home Depot CEOs Amid Rising Tariff Pressures

President Trump held a closed-door meeting on April 21 with the CEOs of Walmart, Target, and Home Depot to discuss how his tariff policies are affecting U.S. retailers. The executives — Doug McMillon (Walmart), Brian Cornell (Target), and Ted Decker (Home Depot) — met at the White House to share concerns about rising import costs and supply chain risks tied to Trump’s sweeping trade measures.

The meeting, not listed on Trump’s public schedule, comes as retailers brace for the impact of 145% tariffs on Chinese goods and 10% duties on most others. While all three companies described the conversation as “productive” and “constructive,” they offered no specifics on outcomes.

UPS Buys Canadian Cold Chain Firm for $1.6 Billion

UPS is doubling down on health care. The company announced a $1.6 billion all-cash deal to acquire Canada’s Andlauer Healthcare Group, a specialist in cold chain logistics for pharmaceuticals, biotech, and medical devices. The acquisition strengthens UPS Healthcare’s footprint in temperature-controlled warehousing and delivery across North America.

Andlauer offers refrigerated transport, last-mile delivery, and packaging services tailored for pharma manufacturers across Canada. UPS is paying a 31% premium over AHG’s stock price—valuing it at CA$55 a share—as it works toward its goal of doubling health care logistics revenue to $20 billion by 2026.

UPS now manages over 19 million square feet of pharma-certified warehouse space. The move is part of a broader industry trend: DHL just announced a $2.2B life sciences investment, and FedEx expects to close FY2025 with $9B in health care revenue.

Suggested Reading: The Epic Story of the American Cold Chain Industry

TLDR 🗓️

DHL Halts Shipments Over $800 to U.S. Consumers Amid Tariff Crackdown

DHL has suspended shipments of packages valued over $800 to U.S. consumers, citing customs delays triggered by President Trump’s recent tariff changes. The decision follows the administration’s move to end the de minimis exemption for Chinese and Hong Kong imports, previously allowing low-value goods to enter duty-free.

The rule change, which took effect in early April, now subjects high-value parcels to formal customs clearance, requiring more paperwork and longer inspection times. DHL said the surge in these formal entries has overwhelmed processing, leading to multi-day backlogs. While business-to-business shipments over $800 will continue, they too may face delays.

U.S. Hits Southeast Asian Solar Panels With Tariffs as High as 3,521%

The U.S. Commerce Department is planning massive new tariffs on solar panel imports from four Southeast Asian countries — Cambodia, Vietnam, Malaysia, and Thailand — following an investigation into unfair trade practices.

The new duties, ranging from 41% to a staggering 3,521%, target Chinese solar companies operating in the region.

The move comes after American manufacturers accused Chinese companies of dumping cheap, subsidized panels into the U.S. market. Tariffs will vary by company and country, with Cambodia facing the steepest penalties due to a lack of cooperation, according to reports.

China has responded with its own 125% tariffs and warned Southeast Asian countries not to “appease” Washington. President Xi Jinping’s recent visits to Vietnam, Cambodia, and Malaysia are widely seen as part of that pushback.

Companies Rush to Foreign Trade Zones to Dodge Soaring Tariffs

As President Trump’s steep new tariffs roll out, more companies are turning to workarounds such as foreign trade zones (FTZs) and bonded warehouses. These are special storage and manufacturing sites approved by U.S. Customs where goods can be held without paying duties — unless and until they enter the U.S. market.

Interest in FTZs has surged since Trump’s election win and the start of the latest trade war. Membership in the National Association of Foreign Trade Zones is now at a record high, according to a CNBC report.

For many importers, FTZs now offer crucial breathing room. “A year ago, FTZs weren’t even on the table. Now they’re a real option,” said Jackson Wood of Descartes Global Trade Intelligence to CNBC.

By storing goods in FTZs, companies can defer or even reduce tariff payments based on how and when goods leave the zone. If finished products face a lower tariff than the parts used to make them, companies can also cut costs by completing manufacturing within the FTZ.

Tariffs Drag U.S. Economy to 16-Month Low

The U.S. economy is slowing under the weight of rising tariffs. New data from S&P Global shows business activity in April fell to its lowest point since late 2023, with the flash composite PMI dropping to 51.2. While manufacturing inched up to 50.7, the services sector, which makes up the bulk of economic output, slid sharply from 54.4 to 51.4.

Confidence among businesses has cratered, hitting its second-lowest level since the height of the pandemic in 2020. Prices for goods and services surged at their fastest pace in over a year, driven largely by higher import tariffs.

S&P’s chief economist Chris Williamson warned that recent policy shifts are shaking business outlooks and adding pressure on the Federal Reserve.

US-China Shipments are Slowing Dramatically

Ocean freight between China and the U.S. is collapsing as President Trump’s 145% tariff hike slams one of the world’s busiest trade routes. Container bookings from China to the U.S. dropped 64% in the first week of April, according to Vizion, with sharp declines in apparel and textile shipments. Spot freight rates between Shanghai and Los Angeles have halved, and voyage cancellations are piling up.

With U.S. tariffs in full effect and China retaliating with 125% duties, analysts are warning of a slow-moving supply shock. It could take weeks for the impact to ripple from ports to warehouses to store shelves, but the signs are already here: trucking giant Knight-Swift has pulled back guidance, and German container giant Hapag-Lloyd reported that 30% of shipments from China to the U.S. have been cancelled.

Industry leaders say that unless a deal is struck soon, America could face COVID-era-style shortages.

U.S. Spirits Surge Abroad, but Whiskey Faces Uncertain Future

U.S. spirits exports climbed 10% in 2024 to $2.4 billion, fueled by a rush of shipments to the European Union ahead of potential new tariffs, according to the Distilled Spirits Council.

The surge came as fears mounted over a return of EU duties on American whiskey — a key battleground in the ongoing trade tensions under President Trump’s tariff-heavy policy.

Since tariffs were suspended in 2022, whiskey exports to the EU have soared nearly 60%, reaching $699 million last year. But despite the boom in Europe, total American whiskey exports fell 5.4% to $1.3 billion, as global uncertainty and tariff risks kept distillers on edge. Whiskey still made up 54% of all U.S. spirits exports, but fears of retaliatory measures and trade friction cloud the 2025 outlook.

Trump Signs Executive Order to Tap U.S. Seabed for Critical Minerals

President Donald Trump has signed a sweeping Executive Order aimed at unlocking offshore mineral wealth and countering China’s dominance in the critical minerals supply chain. The directive marks a major push to develop deep-seabed exploration and mining across the U.S. Outer Continental Shelf and beyond national waters.

The order streamlines permitting under the Deep Seabed Hard Mineral Resources Act and the Outer Continental Shelf Lands Act, directing key agencies to fast-track exploration and processing capabilities. It also mandates mapping of priority seabed zones, coordination with allies, and a feasibility report on international benefit-sharing frameworks.

The directive calls for reports from Defense, Energy, and Commerce on private sector interest, processing needs, and strategic stockpiles — linking seabed minerals to national defense, energy security, and infrastructure resilience.

Trump’s order builds on recent moves, including the revival of Alaska’s Ambler Road mining corridor and a Section 232 probe into mineral import threats.

Trump Targets Procurement Rules in Aggressive FAR Overhaul

In a sweeping new Executive Order, President Trump has called for the most significant rewrite of the Federal Acquisition Regulation (FAR) in over 40 years. Titled “Restoring Common Sense to Federal Procurement,” the order aims to simplify and accelerate the federal contracting process by cutting red tape and removing nonessential rules.

The White House has ordered the FAR Council and federal agencies to complete revisions within 180 days, keeping only clauses required by law or deemed essential for simplicity, national security, or procurement efficiency. Agency-specific FAR supplements are also under review, and a regulatory “sunset” clause could be introduced to automatically phase out non-statutory provisions every four years unless approved.

Temu and Shein Drop in US App Rankings

Temu and Shein are tumbling down U.S. app store charts ahead of the May 2nd suspension of the de minimis exemption that once allowed duty-free imports under $800. Temu has dropped from #3 to #85, while Shein has slid from #7 to #80, signaling a major pullback.

The decline reflects a calculated retreat from the U.S. market, as both Temu and Shein scale back the aggressive ad spending that had been driving their app store rankings and download volumes.

According to a Reuters report, both brands have slashed ad spending in April — Temu by 31%, Shein by 19% — and only a fraction of Temu's Meta ads remain active. Both companies have now announced price hikes starting April 25.

Tidbits 🍿

• The U.S. has launched new investigations into computer chips and pharmaceuticals under national security grounds, laying the groundwork for sector-specific tariffs

• President Trump is considering exempting automakers from some tariffs, potentially including those on steel and aluminum, but foreign vehicles would still be subject to a 25% import duty

• ​Tesla's Q1 2025 earnings were disappointing, with net income plunging 71% to $409 million and automotive revenue falling 20% year-over-year. The company attributed the downturn to declining vehicle deliveries, reduced average selling prices, and reputational challenges

• Meta’s advertising business could face a $7 billion blow this year, as President Trump’s aggressive China tariffs hit retailers

Reading List 📚 :

This week's top book picks from CrossDock 📖:

• The Big Short by Michael Lewis

• Past Due by Peter S. Goodman

Do you have recommendations? Drop us a message, and we will add it to next week’s list.

This newsletter was curated by Shyam Gowtham

Thank you for reading. We’ll see you at the next edition!