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Shipping Chaos: Inside the U.S.-China Trade Conflict Industry
Experience the challenges of the shipping industry in the US-China trade war. Security and planning are critical in the face of unstable fares. Find out more about the current situation!
Shipping Chaos: Inside the U.S.-China Trade Conflict Industry
As the metal bridge is lowered, the crew begins to secure the ship to the dock - their bright orange jumpsuits seem almost minuscule compared to the huge pink container ship, the ONE Modern.
Rapid unloading and loading in Hong Kong
Once the ship is securely attached, a race against time begins as three crane operators aim to unload and reload more than 700 containers from the port of Hong Kong in less than 10 hours.
The global race against time
For the countless companies around the world that find themselves in the same position, a much bigger race is at stake: the massive operation to get goods from China to the US before the pause on higher tariffs imposed by former US President Donald Trump expires on August 12.
High uncertainty in trading
“The indices of unpredictability and chaos are actually at an all-time high,” Roberto Giannetta, chairman of the Hong Kong Liner Shipping Association, told CNN. “This instability creates a lot of chaos.”
Negotiations between the USA and China
Negotiations between the U.S. and China took place in London last week that resulted in an agreed framework for a trade standoff, according to officials from both sides.
The Impact of Trade Wars
But the companies on the front lines of these changing trade policies are taking no chances. China is America's second largest trading partner, right after Mexico. Trade between the two countries exceeded $688 billion last year, Chinese data reported.
Changing trading rules make planning difficult
“The rules change three times a week,” said Rick Woldenberg, CEO of Learning Resources, an educational toy company based in Chicago. “We have absolutely no idea what the rules will be when the product arrives.”
The Impact of Tariffs on the Global Supply Chain
When the US announced sweeping tariffs on most countries on April 2, it created chaos in the complex global supply chains that enable the free flow of goods around the globe - particularly in the shipping industry, which transports 90% of all goods consumed.
Preparing for uncertain times
Despite a separate 90-day pause on most tariffs, company leaders say they must operate as if the tariffs return.
Warehouse during trade shutdown
U.S. companies have sought to stockpile goods during the peace period, which boosted Chinese factories to meet demand and pushed shipping companies to deliver as much as possible in the current window.
Planning uncertainty and cost increase
“Companies want to pre-produce because they simply don’t know what the reality will be in just a few weeks,” said Jens Eskelund, the Beijing-based president of the EU Chamber of Commerce in China. “This makes it very difficult to plan, it creates inefficiencies and ultimately costs will increase.”