Hey guess what happens to prices when the Supply become Scarce and there are fewer and fewer of those resources available. PRICES are about to skyrocket Folks
Product shortages and empty store shelves loom with falling shipments from China
Retailers are warning that U.S. consumers could once again be faced with empty store shelves and the kind of supply chain snarls that marked the Covid era if President Donald Trump's tariffs on China remain at their current levels.
Companies have been canceling their shipments of goods from China and halting new orders after Trump put a 145% tariff on nearly all Chinese imports this month. As a result, the number of freight vessels scheduled to arrive at the Port of Los Angeles is on track to be down 33% year-over-year for the week ending May 10,
according to ship tracking data from Port Optimizer.
Typically, U.S. retailers would be ramping up their orders for two critical periods later this year: the fall back-to-school shopping season and the winter holidays. And the pullback is creating uncertainty about whether U.S. shoppers will have the selection of goods they've grown accustomed to in the coming months.
"They're making their holiday buying decisions now," said Jonathan Gold, vice president of supply chain and customs policy for the National Retail Federation. "It's a challenge for folks to figure out how to properly order and price with all the uncertainty that's out there on the tariffs."
At the current tariff rate, a U.S.-based company would have to pay at least $145 in tariff fees to Customs and Border Protection to import an item valued at $100, except for electronics and pharmaceuticals, which are levied at a lower rate. That fee could wipe out any profit a company would be making and force it to sell its products at a loss or raise prices to levels that consumers might not be willing to pay.
Chinese vendors
told NBC News this month that American companies, including Target, have halted orders. A vendor who sells press-on nails to U.S. retailers said that her products are ready to ship but that they have been sitting in China. She doesn’t expect to be sending any products to the United States in the first half of the year.
The National Retail Federation
expects imports to drop by 20% in the second half of the year if the tariffs continue at their current rate.
Some of the products likeliest to go missing from store shelves in the coming months will be lower-cost footwear, apparel, toys and electronics, for which manufacturing is heavily concentrated in China, Gold said. Other perishable items coming from China, like apple juice and fish, have limited shelf lives and were more difficult for retailers to stockpile.
“Like back during Covid where we had shortages of toilet paper, we are going to start seeing that in more and more goods,” said Sean Stein, president of the U.S.-China Business Council. “Starting in a couple of weeks, we are just going to start running out of stuff, and if the administration waits to resolve the problem until we have shortages and hoarding, that is just too late.”
The threat of empty store shelves has appeared to raise alarm bells inside the White House, more so than months of warnings from businesses about rising prices, said a person familiar with business lobbying efforts around tariffs. Trump administration officials seemed particularly concerned about a shortage of products around holidays, like the Fourth of July and Christmas, the person said.
After a meeting with major retailers this week,
Trump said Wednesday that he was considering reducing the tariffs on China, though he hasn’t taken any formal action. He said Thursday that his administration met with Chinese officials, but earlier in the day,
Chinese officials denied there had been any formal trade talks with the United States.
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