Golden week, tariff Deadlines, and an important Supreme Court date. Let’s jump right into it in this month’s State of Freight, October 2025!
Newly Announced Tariffs
New tariffs are set to take effect on October 14. Although they do not directly affect the toy and game industry, they are worth noting. Softwood timber and lumber will have a 10% tariff. This is only for softwood, but hardwood is being considered for future tariffs. Kitchen cabinets, upholstered furniture and bathroom vanities will have a 25% tariff placed on them. There are exceptions to the tariff rate depending on what country the goods originate from.
China’s Tariff Deadline Looms
Tariffs on goods from China are currently at a 30% tariff (20% fentanyl & 10% China origin), however, that rate expires on November 10th. Negotiations with China are still under way to determine what the new rate will be. If a deal is not agreed upon by November 10th, the rate could default back to the 145% tariff we experienced earlier this year. President Trump and Chinese President Xi Jinping are scheduled to meet in late October to negotiate a deal.
Be cognizant of when your shipments are due to clear US customs. In the past, vessels already in transit have been granted a 2-week grace period to clear customs under the tariff rate they sailed on, but that has not been announced and is not guaranteed. Keep in mind that the date of arrival to port is NOT the same date that your goods clear customs. Sometimes it takes a few days after the goods arrive at port before they are cleared.
Extra Charges for Chinese Vessels
Back in April, it was announced that a service fee would be charged for all Chinese vessels, operators and ship owners entering US ports. The USTR has confirmed that this will take effect on October 14, and the service fee is $120 per container. Most ships carry an equivalent of 15,000 to 20,000 twenty-foot containers. Carriers have updated shipping routes to mitigate the service fee for the time being and will not pass those fees on to customers at this time. This may change in the future as these fees are expected to rise yearly through 2028.
A Very Important Supreme Court Case
On November 5, the Supreme Court will begin hearing oral arguments in the case against the legality of the Fentanyl and reciprocal country tariffs imposed under the International Emergency Economic Powers Act (IEEPA) put in place by President Trump earlier this year. Many believe they are illegal as IEEPA states that the president has the power to ‘regulate…importation’ but does not give the power to authorize the wide sweeping blanket tariffs which President Trump initiated on the world. Lower courts have also agreed that the tariffs to be illegal. Now the Supreme Court will hear what the plaintiffs have to say and rule as they see fit. Learning Resources Inc. and Hand2Mind Inc. from the education industry are some of the plaintiffs in the case who will argue against the legality of the tariffs. Whatever the verdict may be, the aftermath is sure to be messy and difficult. With so much at stake in this court case, we will all be watching anxiously on the edge of our seats. The countdown begins.
What’s Happening with Freight?
This year’s peak season has been weak compared to years past. This is due to the front loading of containers earlier in the year to avoid the unknown tariff rates coming on November 10.
Golden Week and the Mid-Autumn Festival in China have begun. Golden Week is a week-long holiday celebrating the founding of the People’s Republic of China and the Mid-Autumn Festival or the Moon Festival, celebrates the moon. During this time, most businesses shut down. This includes factories and ports. Between October 1 and October 7, there will be no shipping or manufacturing due to the festivities. You may experience later vessel departure dates than expected and upcoming rolling vessel schedules as freight waits for the holiday to end.
Rates and Ports
Shipping volumes are down, and demand is flat due to both Golden Week and the upcoming China tariff deadline. Freight rates are also lower than expected despite the peak shipping season. Ocean ports are not experiencing congestion in the US or China/Hong Kong, and vessel space is available.
As always, air freight rates are still extremely high, especially with the November 10th deadline looming.
I wish you all the absolute best October! There will be much to talk about in the coming month so until then, stay safe and have a freight day!
