American Retailers On A Buying Spree Because Of US Trade War With China

There is hardly any free space left in American warehouses as traders and retailers are filling them up with Chinese products of all kinds – microwaves, vacuum cleaner filters, swimwear, furniture, said Amy Magnus, head of the National Customs Brokers & Forwarders Association of America. The members of this trade body have business relations with more than 250,000 importers and exporters.

Magnus says that such stockpiling of inventory is unprecedented in the 40 tears that she has been in this business.

“My office is right on a land border and I can see the trucks just coming across non-stop from my window,” Magnus said. she was referring to the trade on the border between Canada and the United States.

“Even with Christmas, it’s been notably busier this week and last week than it’s ever been before.”

Despite the 90 day truce and the chance of it being extended further in case of positive discussion between the US and China, retailers are busy hoarding up supplies before the additional tariffs are set into motion next year.

In October, there was an increase of 13.6 percent to touch a record 2.04 million containers in imports at the major US retail container ports, according to data from the National Retail Federation (NRF) and Hackett Associates, which clearly indicates the buying binge among US retailers. This import spree from China was the reasons of the record trade deficit between US and China in October.

Sources have said that a race to buy Chinese products in September was seen among retailers including Walmart Inc, Target Corp, TJX Companies Inc and Macy’s Inc because it was in that month that the increasing of import tariffs on $200 billion worth of Chinese goods into the US from 10 per cent to 40 per cent from January 1 next year was announced by US president Donald Trump.

And despite the 90 day trade war truce reached between Trump and Chinese president Xi Jinping on December 1, the rush to stockpile as much Chinese goods as possible by retailers has continued unabated because of fears over uncertainty of the situation. .

“We have been tactical and pulled some orders forward,” Walmart spokeswoman Marilee McInnis told Reuters in an emailed statement. There has however been no comment on the issue from the other major retailers such as Target, TJX and Macy’s.

This stockpiling could however come to the advantage of consumers as they can get heavy discounts next year in the eventuality of the retailers getting stuck with a large inventory of unsold goods. And according to reports, retailers’ quarterly results are already being impacted because this stockpiling has increased costs of warehousing and transportation.

The question remains that whether these additional costs would be passed on to the customers by the retailers.

“More likely than not, the retailer will take them so the consumer doesn’t have to,” Jonathan Gold, the NRF’s head of Supply Chain and Customs Policy. Gold said he “definitely” anticipated a higher than normal inventory and increased logistics costs to affect the retailers into the first quarter of next year as there would be a rush among retailers to sell off their products before the March 2 deadline of the end of the 90 day truce period. The NRF works with about 18,000 member retailers.

“A lot of people are competing for space right now so you’re going to have some retailers hurt as a result.”

(Adapted from


Categories: Economy & Finance, Geopolitics, Regulations & Legal, Strategy, Sustainability, Uncategorized

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