| Your weekly All-Ways round-up of Supply Chain news.
 The United States has reduced its reliance on China for low-value-added goods like furniture, but struggles to diversify away from China for high-value-added goods such as smartphones, computers, and batteries.
These products made up 27% of U.S. imports from China in 2023, and dependency has remained consistent since 2017, with China's share even increasing for some goods like batteries.
Efforts to diversify imports, often by shifting to countries like Vietnam, have limited impact. Many Vietnamese exports rely on Chinese intermediate goods, and some goods are misclassified as Vietnamese to avoid tariffs. This complicates reducing U.S. dependence on Chinese industries.
Chinese exporters are less reliant on the U.S. market, and broad tariffs on high-value goods could hurt U.S. consumers more through price hikes.
While new tariffs are likely, targeting goods with limited U.S. consumer impact, such as Chinese EVs, may be prioritized.
The Trump administration previously avoided targeting consumer goods to minimize direct impacts, particularly during the holiday season. Inflation concerns today make imposing tariffs even riskier, as public attention would focus on price increases for popular electronics.
President-elect Donald Trump plans to include crude oil in his proposed 25% import tariffs on Canada and Mexico, a move that has raised concerns across the oil industry.
Canada and Mexico account for about a quarter of U.S. crude imports, essential for U.S. refineries configured to process their heavy oil. Industry groups, including the American Fuel and Petrochemical Manufacturers (AFPM) and the American Petroleum Institute (API), warned the tariffs could disrupt energy supplies, raise fuel costs, and harm North American energy security.
Analysts predict higher gasoline prices, particularly in the Midwest, which relies heavily on Canadian crude.
The U.S., though the world's largest oil producer at 13.5 million barrels per day (bpd), primarily produces light crude that is incompatible with many domestic refineries without costly upgrades. U.S. refiners process over 18 million bpd but depend on imports to meet their needs.
Critics, including analysts and trade groups, view the tariffs as counterproductive, while the Trump transition team argued the policy aligns with broader goals of reshoring jobs and boosting domestic energy.
However, industry leaders continue to urge the administration to reconsider policies that could undermine America’s energy advantage.
Maritime employers at the Port of Montreal and dockworkers, represented by CUPE Local 375, have agreed to a 90-day mediation process to negotiate a new collective bargaining agreement for 1,300 longshore workers.
This effort aims to avoid a government-imposed arbitration process ordered by Labor Minister Steve MacKinnon, who previously mandated the end of a lockout and work stoppages at the port.
The mediation, led by experienced mediator Gilles Charland, follows 35 unsuccessful mediation sessions since mid-2023.
The port reopened on November 16 after MacKinnon’s back-to-work order, which also impacted ports in British Columbia. Longshore foremen there, represented by Local 514 of the International Longshore and Warehouse Union, are challenging the constitutionality of MacKinnon’s order but have complied, allowing operations to resume at Vancouver and Prince Rupert ports.
Success in the current mediation process remains uncertain. |
