Trump signs a landmark trade deal with the UK 🤝

President Trump announced a trade agreement with the United Kingdom on May 8th, calling it a “template” for future deals. The deal lowers U.S. tariffs on 100,000 UK-made luxury vehicles — from 25% to 10% — and eliminates duties on British steel and aluminum exports, which totaled $492 million last year. In return, the UK will expand market access for U.S. beef and ethanol. However, the 10% base tariff on most UK imports remains in place.

U.S. exports have sharply declined across nearly all ports and product categories following President Trump’s sweeping tariffs, with the agriculture sector facing the brunt. Export volumes at the Port of Portland are down 51%, Tacoma 28%, and Los Angeles 17%, according to Vizion data.

Meanwhile, U.S. imports from China dropped 43% in just one week in late April. Farm goods like soybeans, corn, and beef are struggling to reach global markets, especially in Asia. With container traffic thinning and only 14 ships arriving over a recent three-day period in Southern California, experts warn of cascading job losses across the supply chain.

In a sign of possible de-escalation, U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer will meet China’s economic chief, He Lifeng, in Switzerland this week. Both countries remain locked in a high-stakes trade war, with U.S. tariffs on Chinese goods at 145% and China’s retaliatory duties at 125%.

Bessent called the tariffs “the equivalent of an embargo,” stressing the need for fair, not decoupled, trade. While Beijing has signaled openness to talks, it insists any deal must respect its core interests. Economists expect a partial rollback of tariffs, though political messaging on both sides may limit the scope of any breakthrough.

Suggested reading: Impact of US-China Trade War on Supply Chains

President Trump announced an end to the 17-month Red Sea shipping crisis, citing a ceasefire agreement with Yemen’s Houthi rebels. Brokered with help from Oman, the deal halts U.S. airstrikes and Houthi attacks on commercial vessels, restoring safe passage through the Red Sea and Bab al-Mandab Strait.

Oman’s foreign minister confirmed both sides agreed not to target each other, a move expected to revive shipping traffic, currently 50% below 2023 levels. Analysts at SEB forecast a rebound in car carrier and container volumes. The announcement follows a week of intensified violence at key ports, including Hodeidah and Port Sudan.

U.S. energy firms are urging the Trump administration to exempt LNG exports from a new rule requiring a growing share of shipments to be moved on U.S.-built vessels. The mandate starts at 1% in 2028 and rises to 15% by 2047, but only five U.S.-built LNG carriers exist—all inactive and built in the 1970s.

The American Petroleum Institute (API), a trade association representing major energy companies, including ExxonMobil, Chevron, and Cheniere Energy, warns that meeting the requirement is impossible given U.S. shipyards’ limited capacity—it takes five years to build just one carrier. With $34 billion in annual LNG exports at risk, companies say the rule could undercut Trump’s energy dominance agenda.

Suggested reading: Can America Build Great Ships?

The U.S. Postal Service has conditionally offered the role of Postmaster General to FedEx board member David Steiner following Louis DeJoy's abrupt resignation in March.

Steiner, 65, previously served as CEO of Waste Management and sits on boards including Vulcan Materials and AMP Robotics. His appointment still requires a formal board vote. DeJoy's tenure focused on cost-cutting and workforce reductions but delivered limited improvements, prompting Trump to consider privatizing USPS or folding it into the Commerce Department. The agency now works with Elon Musk’s Department of Government Efficiency to streamline operations.

India has proposed zero tariffs on U.S. steel, auto parts, and pharmaceuticals, up to a certain quantity of imports, as part of fast-tracked trade talks to avoid Trump’s steep reciprocal tariffs.

The offer, made during recent meetings in Washington, is part of efforts to finalize a deal before the U.S. tariff pause expires in July. In return, the U.S. has pushed India to relax its strict Quality Control Orders, which it views as non-tariff barriers. India has signaled its willingness to review these rules and consider mutual recognition of standards in areas like medical devices and chemicals.

Shipping giant Maersk reported stronger-than-expected Q1 2025 earnings, posting $2.71 billion in EBITDA—up 70% year over year—but warned of slowing global container growth due to escalating U.S.-China tariffs.

The company slashed its 2025 container market forecast to between -1% and +4%, down from 4% earlier, citing “prohibitive” trade duties and geopolitical volatility. China-U.S. trade volumes fell 30–40% in April, as customers delay shipments amid tariff uncertainty.

CEO Vincent Clerc said the impact remains localized for now but warned of “a lot of volatility ahead.” Maersk maintained its full-year profit guidance of $6–$9 billion

President Donald Trump plans to rescind export restrictions on advanced AI chips that were introduced during the Biden administration, a move likely to reshape the global AI landscape. The controversial rules, which were set to take effect May 15, categorized countries into three risk tiers and restricted access to high-end chips, particularly impacting countries like China.

Tech leaders — including OpenAI CEO Sam Altman, AMD's Lisa Su, and Microsoft's Brad Smith — criticized the policy during a Senate hearing, warning that it could push strategic allies to source AI infrastructure from China. Nvidia and Microsoft had previously opposed the curbs, which limited business opportunities in second-tier nations.

Trump’s rollback aligns with broader efforts to boost domestic tech manufacturing and keep the U.S. competitive in AI. The administration is also preparing tariffs on semiconductors, though smartphones and select electronics may be exempt.

Global air freight rates are tumbling following the U.S. decision to scrap the de minimis exemption on low-value Chinese imports and impose fresh tariffs. According to TAC Index data, prices dropped across major routes, with the global Baltic Air Freight Index falling 4.5% in the week to May 5.

Hong Kong outbound rates slipped 3.3%, Shanghai 2.4%, and Europe-to-U.S. lanes also declined. London Heathrow saw the sharpest weekly drop at 10.1%, led by weaker demand on Southeast Asia routes. The shake-up signals growing turbulence in global logistics as trade tensions intensify.

Ford Motor Co. is raising sticker prices by up to $2,000 on three U.S. models built in Mexico, just days after saying broader car prices weren’t likely to rise significantly this year. The hike, confirmed in a memo to dealers, applies to new builds of the Mustang Mach-E, Maverick, and Bronco Sport, which together made up 17% of Ford’s U.S. sales last quarter.

The company attributed the increase to routine mid-year adjustments and newly imposed U.S. auto tariffs of up to 25%. Ford said it has not passed the full cost on to customers and still plans to offer promotional pricing through July 4.

Despite facing $1.5 billion in tariff-related costs this year, Ford maintains that nationwide car prices will rise only modestly — by about 1% to 1.5% — in the second half of 2025.

Facing tariffs as high as 145% on goods sent directly to the U.S., Chinese exporters are increasingly disguising shipments by rerouting them through third countries and falsifying origin labels, according to a Financial Times investigation.

These tactics, known as "origin washing", involve repackaging goods, using proxy factories, and forging certificates of origin to label Chinese products as “Made in Vietnam” or “Made in South Korea.” The workaround has triggered alarms across Asian customs hubs. South Korea alone uncovered nearly $21 million worth of falsely labeled exports in Q1 2025 — nearly matching all of 2024.

Recent news reports reveal that U.S. tariffs of up to 145% on Chinese imports are straining America’s apple juice supply. Although apple pie is iconic, most of the apple juice Americans drink is imported, much of it from China. About two-thirds of America’s apple juice comes from China, in concentrate form. With China’s share now dropping due to tariffs, prices are rising fast.

The U.S. Apple Association reports a 33% spike in wholesale apple juice concentrate prices this year. Imports from Turkey are surging to fill the gap. Turkey exported twice as much juice to the U.S. as China in late April, but the supply remains tight. Domestic processors can’t ramp up quickly enough to replace imports, and major brands like Mott’s have stayed silent about passing costs to consumers.

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This newsletter was curated by Shyam Gowtham

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