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News March 24, 2025

Reports: Trump Could Narrow Reciprocal Tariff Focus; Public Hearings On $1M+ Port Fees Begin

Both the new tariffs that could be announced as early as April 2, as well as fees proposed on shipping companies that come to port in the U.S., stand to impact the promo products market.

By  Christopher Ruvo

Key Takeaways

• Reported: Trump may scale back or hold off on threatened tariffs on certain sectors and countries, but key promo product sourcing nations appear to remain targeted by “reciprocal tariffs” that could hit April 2.

• Focus on Important Trading Partners: Reciprocal tariffs could focus on nations that include Australia, Brazil, Canada, China, the European Union, India, Japan, South Korea, Mexico, Russia and Vietnam.

• Underway: Public hearings have begun on proposed fees of up to $1.5M the U.S. is considering charging Chinese shipping companies and ocean transport companies based in other nations that use China-built cargo ships.

• Promo Impacts: The potential additional tariffs and proposed port fees, if implemented, could contribute to price increases in the promo products industry, complicate sourcing for the market and negatively impact the economy.

President Donald Trump could scale back the scope of tariffs he looks to implement on April 2, according to press reports from The Wall Street Journal and Bloomberg News, but countries important to promo products sourcing appear to still be in the levy crosshairs.

Citing unnamed officials within the Trump administration, the reports stated that Trump could hold off on implementing tariffs on certain sectors that he’s previously pledged to slap with import levies, including automobiles, pharmaceuticals and semiconductors. That could, potentially, be good news for print and promo firms that do any business with those sectors, as they’ll get a temporary reprieve.

Meanwhile, the president could also narrow the focus of so-called reciprocal tariffs to be announced – levies intended to match current tariffs and trade barriers that other countries around the world place on American exports. Instead of hitting essentially all countries with new or heightened tariffs, Trump could instead focus reciprocal levies on about 15% of nations that have what the administration believes to be glaring trade imbalances with the U.S., according to WSJ.

Treasury Secretary Scott Bessent has referred to these countries as a “dirty 15.” While the administration hasn’t identified them, reports indicate that it’s likely that major trading partners like Australia, Brazil, Canada, China, the European Union, India, Japan, South Korea, Mexico, Russia, Vietnam and others are among them. As such, even if reciprocal tariffs were limited to these nations, the majority of U.S. foreign trade would be affected by the new levies if they were to take effect.

Promo Pricing Pressure

So far in 2025, Trump has implemented additional tariffs of 20% on imports from China, as well levies of 25% on steel and aluminum imports. Merch industry executives have said those tariffs alone will drive price increases on promotional products sold in North America, with hikes likely to intensify in the second and third quarters of this year. While some branded merch suppliers have pledged to hold pricing, the word from executives around promo is that, overall, widespread price increases should be expected if the already-in-effect new tariffs stay in place.

Pricing pressure on promo would stand to intensify if the new reciprocal tariffs took effect on the so-called dirty 15. For instance, Vietnam and India have emerged as destinations to which some apparel-making firms in promo and beyond have increasingly moved manufacturing. Jumped-up tariffs on those countries would mean it would cost American suppliers more to bring garments produced there to the U.S. Depending on how steep the increases are, suppliers could have to pass some of the costs along to distributors, who then would have to decide how much of the increase they could eat and how much they would pass on to end-clients.

Trump has declared April 2 “Liberation Day,” a signal of his stated belief that tariffs will ultimately strengthen domestic manufacturing and the U.S. economy by correcting trade imbalances and getting nations around the world to “play fair” with the U.S. when it comes to international business.

Of course, it’s important to note that much remains fluid and just how things will play out next week may change dramatically, as has been the case with tariff announcements during Trump’s first couple months in office.

Trump, for instance, in early February placed import tariffs of 25% on Canada and Mexico, but then suspended them until March 4. Those tariffs took effect on March 4, prompting countermeasures. But then, on March 6, Trump suspended tariffs on imports coming from Mexico and Canada that are covered under the United States-Mexico-Canada Agreement until April 2, leaving it unclear whether the full brunt of tariffs on Canada and Mexico will take effect on “Liberation Day.”

While some press reports quoting unnamed administration sources had also previously indicated that April 2 would see an announcement on reciprocal tariffs – perhaps an outline of how they could work – it was unlikely that the administration would announce any immediate implementation because the timeframe was simply too short given all the complexities. Subsequently, however, there were indications from the administration that the actual reciprocal tariffs, not just a plan for them, would be coming April 2.

Bottom line: It’s TBD.

Public Hearing on Proposed Port Fees

As tariff uncertainty and concern persist, promo companies and importers across industries are facing another significant supply chain worry.

The Office of the United States Trade Representative is holding public hearings on Monday, March 24, and Wednesday, March 26, to discuss imposing million-dollar-plus fees on Chinese shipping companies and ocean transport companies based in other nations that use China-built cargo ships – a move that, if enacted, could send shipping and freight costs soaring and escalate prices on a host of imported goods, including promotional products.

“If this does indeed go through, we can certainly expect to see prices increase for imported goods,” George Morgan, director of marketing for Houston-based supplier HIRSCH (asi/61005), told ASI Media. “How severe or how quickly is still unknown.”

Under the plan, the U.S. would charge impacted shipping companies up to $1.5 million every time one of their ships visited an American port. John McCown, a maritime expert and former U.S.-flag container shipping CEO, said in an analysis submitted to USTR that the fee plan, if implemented, could cost the container shipping sector more than $106.9 billion annually and intensely disrupt global supply chains.

“If the [port fees do] indeed go through, we can certainly expect to see prices increase for imported goods.” George Morgan, HIRSCH (asi/61005)

Certain opponents of the proposed port fees commissioned a study by the Trade Partnership Worldwide, an economic analysis firm, that scrutinized how things could go if the fees come into effect, ultimately concluding that they “would have a net negative impact on the U.S. economy. For every remedy option examined, U.S. exports would decline, potentially contributing to a worsening of the U.S. trade deficit.”

The report added: “As the impacts of the remedies filter still further along supply chains, U.S. manufacturers, importers and retailers would feel the effects. Wholesale and retail trade, hospitality, and consumer services industries and other supply chain stakeholders would all experience declines in output.”

The Trump administration and USTR are considering the port fees to counteract what they believe to be unfair trade practices by China that have allowed it to dominate the global maritime, logistics and shipbuilding sectors. Still, nearly 300 business groups in the U.S. have banded together to oppose the port fees, saying they will cripple industries and hurt the domestic economy.

“We support scrutiny of China’s efforts to dominate the maritime industry,” the National Retail Federation and other groups said in a letter to U.S. Trade Representative Jamieson Greer. “However, USTR proposed actions will not deter China’s broader maritime ambitions and will instead directly hurt American businesses and consumers.”

The USTR plan would also require that U.S.-flagged and U.S.-built vessels carry a particular percentage of exports, with the percentage increasing in the coming years. For instance, U.S. operators would be required to carry at least 1% of American exports this year. The rate would rise so that seven years from now, 15% of exports would need to ship out on U.S.-flagged vessels, including 5% on U.S.-built vessels. Trade business groups believe that’s unrealistic.

“The U.S. cannot build a vibrant shipbuilding industry from its current capacity in seven years,” they wrote in their letter. “Holding firm to USTR’s proposal would force a reduction in U.S. exports, since the capacity does not exist nor will exist under USTR’s timelines.”