The US Court of International Trade has ruled President Trump did not have the authority to implement retaliatory tariffs on countries around the world, according to global news reports.

However, Trump’s administration has already lodged an appeal following the ruling, with a White House spokesperson stating: “It is not for unelected judges to decide how to properly address a national emergency”.

The case will need to go through an appeals process, but The White House is expected to have 10 days to complete the process of stopping the tariffs, although most are currently on pause.

For example, on 14 May the US and China agreed to a temporary de-escalation in reciprocal tariffs. The US reduced its 125% reciprocal tariffs on Chinese goods to 10% for 90-days and China also reduced its retaliatory tariffs from 120% to 10%.

Customs and freight transportation company Alba Wheels Up says: “There is still much to digest about how this affects tariffs already collected, and there are still other avenues the Trump Administration can use to enforce certain tariffs – Section 301 or Section 232 for example.”

Alba Wheels Up adds that for now, it is planning no changes in operations until it gets further direction from US Customs and Border Protection (CBP) and additional legal guidance.

During the appeals process tariffs will still need to be paid and fashion sourcing executives will need to plan on the basis that higher tariffs could be reinstated once the 90-day pause ends.

During a recent webinar titled ‘Tariff talk: What the 90-day US-China tariff pause means for your supply chain,’ Michael Starr, the VP of growth and expansion for global freight forwarder Zencargo explains that if tariffs do remain in place “mid-July is the last time you have to get goods away and to enjoy the 90-day pause”.

He continues: “Of course, there is always the chance the pause will be extended or a trade deal will be made during the pause, so given what’s going on in the world and with the volatility that is a risk.”

How can the fashion supply chain use the tariff pause and US trade court block to its advantage?

Starr points out there some strategies importers are already employing to mitigate some risk.

Plus, he says there are some “clear opportunities” for importers to put their best foot forward through this volatile and difficult time.

1 Clear purchase order forecasts per port pair through to mid-July

He shares it starts with having as much transparency as possible around forecasts: “We know this is a moving target for many companies at the moment and you’re also speaking to factories to see what they can produce in the time-frame they have to bring things forward.”

However, he suggests that having a clear forecast, ideally per port pair through to mid-July will be critical for lead-times.

2 Book early to secure capacity

Ideally, Starr suggests you should “be booking very early to try and secure capacity”. He adds even when you take the context of the ocean freight market and the cost of moving the goods, “the risk of paying 125% versus paying 10% is incredibly dramatic, so booking early to secure capacity, even at rates that are unfavourable or are difficult to look at compared to a month or two ago is is also quite important”.

3 Stay close to your partners to monitor changes in the market

His next tip is to stay close to your partners, whoever they are, whether it’s in cargo or another freight forwarder or a carrier direct relationship that you might have to monitor changes in the marketplace.

He believes this is especially important for capacity changes and being able to think about what alliances you have access to and what carriers you have access to through this time.

He adds: “It’s not just for a port pair. It’s also what alliances are the best on those port pairs and who has the extra capacity compared to others? That, of course, goes in line with building flexibility into those plans.”

4 Build flexibility into transport plans

Zencargo’s VP of global ocean freight, Anne-Sophie Fribourg takes Starr’s mention of flexibility and asserts that building flexibility into transport plans is more vital than ever.

She clarifies that you could be on the US East Coast route and find there’s an opportunity to use the West Coast, either via Vancouver or via LA and you can track the cargo.

Fribourg states: “You have to remain flexible because there has been a lot of capacity cut on the East Coast and but there are always alternative options, which can be very helpful.”

Starr agrees, adding: “If my warehouse is in New York, and I typically use an East Coast routing, I already need to be planning that some of my POs in July are going to go by the West Coast. I’m going to truck those in, and I might be double or triple booking for that to make sure that I’m not stuck with that cargo.”

5 Develop long and short-term rate strategies

For Starr, having a long and short-term strategy is also critical.

He explains: “What makes sense for the 90-day pause might not make sense for the entire year, or it might. But, it’s paramount to sit down and go through that with your partners to develop short, medium and long-term strategies, as it relates to the ocean market and transportation in general.”

How Zencargo is preparing for a shifting market

Fribourg explains Zencargo believes it’s important to secure availability for its customers in this tightening market so it has already been preparing for what’s to come.

She notes that “of course we have our contracts with our long-term and historical partners in the trade and I want to tell you that we’re negotiating all our contracts at the HQ level directly with the trade management. It helps a lot when you have tension on space to have direct access to trade management”.

She continues: “We have pre-booked capacity up to mid-July, and will continue until the end of July to be able to offer the space to all our customers and new customers that ship with us.

“Having the pre-book capacity on the major port pairs is key, either it’s China or also Southeast Asia, because we know that Southeast Asia, especially Vietnam, Thailand and the Philippines enjoyed sustainable volumes since the beginning of the year, or even the middle of last year and we are seeing increasing volumes from these countries and spaces are being booked.”

Another key strategy is to diversify the carrier base to ensure greater flexibility and to unlock more options, with Fribourg sharing: “We have a portfolio of suppliers, but we constantly diversify and take every opportunity.”

She says there are also niche and new commerce options available, so Zencargo takes any opportunity to secure space with these carriers.

It is incredibly important to stay in constant dialogue with the carriers to understand how the market is evolving.

Fribourg points out that she deals directly with the carriers and works on monitoring the bookings and the way bookings are allocated with every port of origin in Asia each day.

She believes it’s very important to have a local contact with the origin operations team that are dealing with your factory or warehouse in China, and are also dealing locally with the shipping line.

She adds that secure long-term contracts provide price stability and guaranteed space: “Being proactive is key to being competitive as the more you plan ahead, the better deals you will get in terms of rates”.

For Fribourg proactive planning is all about staying ahead of global trade disruptions.

She highlights that preparation means you will face less disruptions than if you had not planned anything and have to react at very short notice, so her advice is to keep planning to stay resilient because, unfortunately, she believes the uncertainty is likely to continue “in the coming months and in the future months as well”.