Jaguar Freight | The Weekly Roar – An U.S.-EU deal framework, the expansion of steel and aluminum tariffs, record-breaking container volumes on the West Coast, rising air cargo demand, and dropping diesel prices.

The long-awaited joint statement on the U.S.-EU trade deal was finally published. “The United States and the European Union intend this Framework Agreement to be a first step in a process that can be further expanded over time to cover additional areas and continue to improve market access and increase their trade and investment relationship,” the U.S. and EU said in the joint statement.

Here are some key highlights:

1. The EU intends to eliminate tariffs on all U.S. industrial goods and to provide preferential market access for a wide range of U.S. seafood and agricultural goods, including tree nuts, dairy products, fresh and processed fruits and vegetables, processed foods, planting seeds, soybean oil, and pork and bison meat.

2. The U.S. commits to apply the higher of either the U.S. Most Favored Nation (MFN) tariff rate or a tariff rate of 15%, comprised of the MFN tariff and a reciprocal tariff, on originating goods of the EU. Additionally, effective Sept. 1, the U.S. commits to apply only the MFN tariff to the following products of the EU: unavailable natural resources (including cork), all aircraft and aircraft parts, generic pharmaceuticals and their ingredients and chemical precursors. The U.S. and the EU agree to consider other sectors and products that are important for their economies and value chains for inclusion in the list of products for which only the MFN tariffs would apply.

3. The U.S. intends to promptly ensure that the tariff rate, comprised of the MFN tariff and the tariff imposed pursuant to Section 232 of the 1962 Trade Expansion Act, applied to originating goods of the EU subject to Section 232 actions on pharmaceuticals, semiconductors, and lumber does not exceed 15%. When the EU formally introduces the necessary legislative proposal to enact the tariff reductions set forth in Section 1 of this Framework Agreement, the U.S. will reduce tariffs on automobiles and automobile parts originating from the EU subject to Section 232 tariffs as follows: No Section 232 automobile or automobile parts tariffs will apply to covered EU goods with an MFN tariff of 15% or higher; and for covered goods with an MFN rate lower than 15%, a combined rate of 15%, comprised of the MFN tariff and Section 232 automobile tariffs, will be applied. These tariff reductions are expected to be effective from the first day of the same month in which the European Union’s legislative proposal is introduced. With respect to steel, aluminum, and their derivative products, the EU and the U.S. intend to consider the possibility to cooperate on ring-fencing their respective domestic markets from overcapacity, while ensuring secure supply chains between each other, including through tariff-rate quota solutions.

4. The U.S. and EU agree to strengthen economic security alignment to enhance supply chain resilience and innovation by taking complementary actions to address non-market policies of third parties as well as cooperating on inbound and outbound investment reviews and export controls, as well as duty evasion. This includes addressing non-market practices, unfair competition, and lack of reciprocity in public procurement with respect to third countries. The U.S. and EU will cooperate on further implementation measures.

Also, last week, President Trump dropped a bomb on importers by abruptly expanding steel and aluminum tariffs to more than 400 additional goods, including motorcycles, auto parts, tableware, and more, effective August 18. And there are no exemptions for goods that are already in transit. This has, of course, created confusion and compliance challenges as companies scrambled to figure out product compositions and tariff applicability. Experts estimate that the expanded tariffs will impact about $328 billion in imports, making compliance especially difficult for small importers. Reactions in the industry are mixed, with major steel producers praising the move for tightening up trade loopholes, while importers and customs professionals have criticized the complex, rapid rollout.

During the month of July, the ports of Los Angeles and Long Beach handled record-breaking container volumes of over 1 million TEUs without disruption to truck or rail operations. Despite front-loaded imports and the fluctuating seaport traffic from the impact of tariffs, truck dwell times averaged 2.87 days, which is on par with the previous year and reflects efficient coordination between terminal operators and their logistics partners. The dwell time for rail-bound cargo was 5.18 days, which is a slight improvement over last year and well below past congestion peaks. Port officials and the Pacific Merchant Shipping Association have highlighted how strong collaboration among terminals, railroads, and drayage providers has helped to maintain operational stability, even during unprecedented surges.

Air cargo demand from the Asia-Pacific region to the U.S. has rebounded, with China-to-U.S. volumes up 5% year-on-year in the second week of August and marking the first annual increase since mid-April. The uptick comes amid more finalized U.S. tariffs, while flows from Asia-Pacific to Europe have declined for four straight weeks. Spot rates from the region have edged up. In contrast, Asia-Pacific to Europe rates have remained stable, despite a variety of regional trends.

According to the U.S. Energy Information Administration, diesel prices fell to a national average of $3.713, giving trucking companies a chance to stabilize their fuel budgets, while gasoline rose slightly to $3.125. Regionally, diesel had the biggest drop on the Gulf Coast, down 6 cents to $3.340, but remains at the highest price on the West Coast. Gasoline prices saw the biggest increase on the Gulf Coast, up 7 cents. With crude oil prices holding steady and hurricane season approaching, trucking officials are being warned to stay alert but to expect no drastic fuel price swings for now.

For the rest of the week’s top shipping news, check out the article highlights here.

Compliments of Jaguar Freight – a member of the EACCNY.