International Transportation
Trade Compliance

The Year Ahead in Global Transportation & U.S. Import Compliance

This blog shares a couple of predictions, as well as things to look out for in the 2021 global trade landscape. Read on for some of the subjects you’ll need to have on your radar!

Dan Gardner

Solutions Consultant, 3rdwave

This blog shares a couple of predictions, as well as things to look out for in the 2021 global trade landscape. Goodness only knows how the year will pan out, but below are just some of the subjects you’ll need to have on your radar!

The Section 301 Tariffs Aren’t Going Anywhere: My prediction is that the Section 301 Tariffs will remain in place for the foreseeable future, albeit for two totally different reasons. First, and even though import duty revenues are paltry compared to the U.S. budget deficit, the U.S. Treasury needs the money. Governments collect money from two sources, import duties and taxes, and we need both, big time.

Second, and this is more politically oriented, the optics of removing the Trump Tariffs would be bad for the new Administration. In other words, if the Biden White House were to remove the Section 301 Tariffs, the other side of the aisle would paint “Beijing Biden” as a China sympathizer. With the U.S. Treasury tapped out and no need for an unforced error from the new President, the Trump Tariffs stay in 2021.

Uncertainty for Type 86 Entries: Ever since CBP introduced Type 86 Customs Entries and raised the corresponding de minimis value to $800, the U.S. Treasury has lost considerable amounts of money in import duties. Coupled with the fact that advantage seekers have figured out how to game the Type 86 system, CBP could very well lower, or totally eliminate de minimis. 

Demand for Trans-Load services will Increase: Due to the cost of repositioning empty ocean containers, the steamship lines were never real keen on sending containers into the interior of the U.S. Especially applicable to 40’ High Cube and 45’ units, the insistence on terminating bills of lading at the Port of Discharge will only increase. As such, trans-load costs at major ports like Los Angeles/Long Beach will go up considerably, and demand for these services at alternative locations like Houston or Savannah will also expand. 

Don’t be surprised if the TPP Resurfaces: Remember the Trans-Pacific Partnership? The TPP was nixed early on in the Trump Administration, but don’t be surprised if you see it make a comeback during the Biden Era. Commercially, the TPP was designed to gain free market access to Japan, as well as a number of countries in SE Asia. Strategically, it was meant to serve as a bulwark against Chinese domination of those markets. Given China’s continued expansion from both a commercial and geo-political perspective, the term “TPP” might become almost as bantered about as “PPE” in the coming years. 

The Market for supply chain visibility software will expand: We all know that the pandemic exposed the gaps, inefficiencies and blind spots that exist across almost any global supply chain. And while the digitization of supply chains was expanding at an impressive rate pre-Coronavirus, the hard lessons learned during the crisis have compelled many companies to seek greater visibility into their global operations. While executives acknowledged the need for visibility in 2020, many of the investments they’ll make to achieve this goal will take place in 2021, so strap yourselves in for what will be a year of unprecedented technology adoption and continued innovation.