The United States and China have agreed to extend their existing tariff truce for an additional 90 days, averting the imposition of levies exceeding 100%.
Under the extension, the US will maintain the 20% tariff implemented earlier this year in connection with the fentanyl crisis, as well as the 10% tariff introduced later in 2025. China will continue applying its 10% tariff rate.
The suspension, set to last until November 10, is expected to provide companies with a critical window to import goods via ocean freight ahead of the Christmas season. Analysts note that the deadline could also sustain the trend of frontloading—seen throughout the year—where shippers accelerate shipments to avoid pending tariff hikes, often turning to air cargo for speed and reliability.
In July, data from market analytics firm Xeneta indicated that global air cargo volumes rose unexpectedly by 5% year on year. This growth was largely driven by companies frontloading shipments and shifting goods to air transport to sidestep the anticipated impact of a series of US tariffs scheduled for August.
Niall van de Wouw, Chief Airfreight Officer at Xeneta, commented:
“Air cargo is capitalizing on the disruption caused by tariffs. While July’s growth may be a welcome surprise, it is not the result of an overall increase in trade volumes. Instead, it reflects the inventive ways companies are working to mitigate the higher costs associated with tariffs.”
However, van de Wouw cautioned that this surge is temporary:
“The piggybacking will end. Economists agree that this trade climate is unsustainable for all parties involved. At some point, demand will inevitably decline. The timing of that shift is uncertain, as this is a complex political negotiation. In the meantime, air cargo continues to benefit.”
Should the truce expire without further extension, US tariffs on Chinese goods will rise to 145%, while Chinese tariffs on US goods will increase to 125%. Experts warn that such rates would effectively amount to a trade embargo between the two largest economies in the world.
According to a White House statement, the suspension was:
“Necessary to facilitate ongoing and productive discussions with China aimed at addressing trade imbalances, eliminating unfair trade practices, expanding market access for American exports, and aligning on national security and economic priorities.”
The statement concluded:
“The United States and China remain committed to sustained negotiations to resolve trade disputes and strengthen economic ties.”
Source: https://www.aircargonews.net/supply-chains/us-and-china-extend-tariff-truce-until-november/1080515.article
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