Global Logistics & Tariff Update 3.28.25

Tariffs:

Tariff Threats Update:Tariff threats remain front and center as we continue to witness new daily announcements, including Wednesday’s announcement of 25% tariffs on imported autos and auto parts to be effective at 12:01 on April 3. For the wine and spirits industry, we await announcements on the following items:

April 2: Mexico and Canada:  Will 25% tariffs be reinstated or delayed again?   Both Mexico and Canada are expected to retaliate should tariffs be imposed.

April 2: Reciprocal tariffs: The Administration is expected to impose reciprocal tariffs on April 2, a day they are labeling “Liberation Day”. The number of countries targeted is limited and labeled the “Dirty 15”: China, EU, Vietnam, Mexico, Taiwan, Japan, South Korea, India, Thailand, Canada, Switzerland, Malaysia, Indonesia, Cambodia, and South Africa. It is not clear whether there will be a flat rate tariff inclusive of all commodities or if there will be exceptions.  

200% tariff threat on beverage alcohol from the EU:  The EU planned to implement a 50% tariff on certain USA origin beverage alcohol on April 1st, including bourbon and whiskey, as a reaction to the 25% tariff on EU steel and aluminum imposed by the Trump administration on March 12. The Trump administration then threatened 200% tariffs on EU products. The EU then decided to pause the 50% tariff planned for USA whiskey and bourbon and is continuing to review the impact of the steel and aluminum tariff imposed as well as the retaliatory threat from the USA. The steel and aluminum tariff has a wider scope than under the first Trump administration and the EU is evaluating the overall impact to potentially add additional products for retaliation on April 14.   

WSSA participates in DISCUS “Fly-in”:  WSSA’s Managing Director, Alison Leavitt, participated with hundreds of members of the wine and spirits industry in meetings with Senators and members of the House of Representatives from both parties. Together they discussed the impact of tariffs and the challenge of the uncertainty faced by small and large businesses across the country. Meetings were held with virtually every state. Ms. Leavitt advised that “We were heard, stories were shared on potential job losses and business disruption, and we can hope that our collective voices will have an impact”. Ms. Leavitt also brought up the SHIPS Act and potential 1.5-million-dollar penalty per port call and explained how this could negatively impact businesses, disrupt the supply chain, and derail sustainability efforts due to the reduction of port calls and longer distances to travel via truck.

Trade and Tariff panel at DISCUS:  Meredith Melody, VP Public Affairs America for Brown Forman moderated a panel that included Peter Young, Minister-Counselor EU Delegation to the US, Carlos Vazquez, Minister for Agricultural Affairs, Embassy of Mexico and Jason Hafemeister, Acting Undersecretary of Trade and Agricultural Affairs, USDA. Mr. Young expressed the strong interest the EU has in continuing to work toward a positive outcome and hopes to find areas of common interest, but they are finding it challenging to form a relationship with the current Administration. Mr. Hafemeister commented that this is a “clarifying moment in international trade" as the USA goes through a process to reassess what fairness means. He did comment that the beverage alcohol sector could be considered a model for free and fair trade. Mr. Vazquez commented that trust and a rule-based system for trade policy are key. Both Mr. Vazquez and Mr. Young confirmed that Mexico and the EU will have a firm and reciprocal response to any USA actions. Challenging times will continue.

Congratulations to Lynn Olmie: Lynn received the “Lifetime Achievement Award” from DISCUS at the annual conference held this week in Washington DC.  Lynn was Chief Legal Counsel at DISCUS for many years and retired in 2020. Lynn was instrumental in achieving many positive changes for the industry, and at WSSA we greatly appreciated her input during the implementation of CBMA.  

Global port/logistics disruptions:

Antwerp Strike: The PSA and MPET terminals in Antwerp have advised of a potential trade union strike in protest of the plans of the new federal government. The protest is set to take place on March 31st. The terminals plan to remain operational but do not know the exact impacts the strike will have on the terminals. We will continue to monitor the situation and provide updates.

Rotterdam Port Issues: As reported earlier this month, the port of Rotterdam was facing some operational challenges. Unfortunately, the challenges remain and, in some cases, become even more critical. The changes in schedules and port calls by the new deepsea alliances are causing overlaps and volume uncertainty. With increasing demand and capacity issues from staffing to equipment the effects are longer waiting times, fixed time windows that may be adjusted or suspended on short notice as well as some other minor effects. The terminal is working to address these issues and working to get back to normal operations, but the short-term adjustments and delays will still occur. We recommend finding alternative routes to avoid delays and uncertainties.

Strikes in France: The Fédération Nationale des Ports et Docks C.G.T. met with the Ministries of Transport, Labor, Matignon and the employers in mid-March. As a result of the meeting the Federation put forth three proposals to the French Government concerning taxing working conditions and asbestos. The government has a week to reply to the proposal. A general meeting held on March 25th approved the following strike notice:

→ A halt to overtime and exceptional shifts from 1 April 2025.

→ 72-hour work stoppage on 2, 3 and 4 April with ‘Ports Morts’ operation on 2 April.

→ 48 hours off work every week thereafter. We will inform on the Thursday preceding each week of the dates chosen

Please expect potential delays due to the work stoppage next week. If you have concerns about any of product delays, please contact your freight forwarder.