This month we cover new trade deals, early peak season pressure, Middle East volatility, and a key infrastructure bill—plus a quick note from our team in Houston.
Industry Watch: U.S.–U.K. deal reached, Canada aims for trade pact, retail sales dip, and early peak season begins.
Trade Trends: China deal highlights rare earth leverage; Vietnam and Cambodia push for tariff relief.
Drayage & Final Mile: EV mandate paused in California, inland hubs see early peak surges, and parts delays return.
Global Hotspots: Rising tensions in the Middle East renew concerns around the Strait of Hormuz and Red Sea.
Infrastructure: House passes bill to secure ports and phase out Chinese-made cranes.
Recognition: CPG is a finalist for the 2025 Top Companies for Women to Work For in Transportation.
Network Update: Houston roundtable highlights regional growth and strategy alignment.
Industry Watch
📜 U.S. and U.K. Enact Bilateral Trade Deal
The two countries have formally implemented a trade agreement that sets new tariff quotas across several key sectors. Highlights include a 10% tariff on up to 100,000 U.K. car imports annually, with a steep 25% rate beyond that cap, and reduced tariffs on U.K. auto parts. The deal also exempts certain aerospace products from reciprocal tariffs and establishes new quotas on beef, steel, and aluminum. Talks on pharmaceuticals remain ongoing. Read more →
🍁 Canada and U.S. Target Trade Deal
In a surprise announcement at the G7 summit, Canadian Prime Minister Mark Carney and President Trump agreed to pursue a new economic and security deal within 30 days. While key issues, especially tariffs on steel, aluminum, and autos, remain unresolved, both leaders signaled willingness to negotiate. Canadian officials emphasize that Ottawa has not accepted the permanence of U.S. tariffs, and reprisals are on the table if talks stall.Read more →
📦 Shippers Brace for Early Peak as Rates Surge
Container rates from Asia to the U.S. have more than doubled year-over-year, prompting many shippers to fast-track peak season orders. Analysts point to a mix of trade uncertainty, capacity constraints, and early buying as the cause. With transpacific rates climbing rapidly, the market appears headed for an early and intense peak season. Read more →
🛒 Retail Sales Dip 0.9% in May After Tariff-Driven Surge
U.S. retail sales fell sharply in May, down 0.9% overall and 0.3% excluding autos, as consumers pulled back after a March spending spike aimed at beating incoming tariffs. Auto sales saw the steepest decline following a rush to buy ahead of Trump’s 25% import duty on cars and parts. Despite the slowdown, online, clothing, and furniture retailers posted modest gains. Analysts note that with inflation easing and job growth holding, consumer spending could rebound later this summer.Read more →
📦 Transpacific Trade: Tariff Update
Trump Announces Framework for New China Trade Deal
President Trump declared that a new trade deal has been reached with China, aimed at stabilizing the ongoing tariff disputes. While details remain limited, the announcement brings temporary relief to markets, which had been rattled by fluctuating tariffs and retaliatory measures. The logistics sector is watching closely for implementation specifics.
Rare Earths and Strategic Trade Leverage Now in the Spotlight
A key component of the emerging China deal appears to involve rare earth materials, critical inputs for high-performance electronics, electric vehicles, and defense systems. Trump emphasized that China would continue to supply rare earth magnets “up front,” suggesting that rare earths are no longer merely commodities, but central to trade diplomacy.
This development comes amid heightened tension over China’s rare earth export restrictions, which have impacted global manufacturing. In recent months, export controls on magnet-grade materials like neodymium and dysprosium have driven up prices by over 200%, triggering production delays across the auto and electronics sectors. U.S. and EU manufacturers, already reeling from chip shortages, are now facing a new layer of supply chain risk.
China currently dominates over 90% of the global rare earth refining market and has shown a growing willingness to weaponize its position. Recent enforcement crackdowns and tightened customs controls signal Beijing's commitment to using rare earths as a strategic counterweight to Western tariffs and tech restrictions.
What to Watch Next
Implementation details of the new trade framework, especially around tariff rollbacks and rare earth commitments.
Supply chain responses from major Western manufacturers, who are racing to diversify away from Chinese inputs.
Regulatory moves from the EU and U.S., both of which are exploring legislation and subsidies to bolster domestic rare earth production.
While markets may welcome the promise of a deal, the underlying geopolitics remain unresolved. The rare earth squeeze has turned into a key pressure point in the broader trade landscape, with lasting implications for sourcing strategies, industrial policy, and global logistics planning.
Vietnam Trade & Resilience Amid Tariff Pressures
With a 46% U.S. tariff set to resume on July 9, Vietnam is moving quickly to stabilize its economy and finalize a trade agreement. Talks with U.S. officials have advanced, with Vietnam seeking a reduced tariff rate of 20 to 25 percent in exchange for stricter enforcement on origin labeling and transshipment of Chinese goods. At the same time, Vietnam is pursuing new free trade agreements with countries like India and Brazil to reduce its reliance on the U.S. market.
Cambodia Trade Talks Amid Tariff Threats
Cambodia is negotiating with the U.S. after Washington imposed a steep 49% tariff on key exports, mainly garments and footwear, which account for nearly 38% of its $10 billion in annual shipments to America. Cambodian officials, including Deputy PM Sun Chanthol and Commerce Minister Cham Nimul, have engaged in “frank and constructive” discussions with U.S. trade representatives, and a second round of talks took place in early June. To sweeten the deal, Cambodia has offered to reduce its own tariffs on 19 categories of U.S. imports—from as high as 35% down to 5%—in exchange for relief.
With the country’s garment sector providing employment to hundreds of thousands, the stakes are high: Moody’s has already downgraded Cambodia’s outlook to negative, warning of a “serious risk” to growth and jobs. The government is emphasizing its willingness to cooperate, urging calm while seeking a breakthrough before U.S. tariffs bite deeper.
🚛 Drayage & Intermodal Snapshot
📉 Truckers Score Short‑Term Relief as EV Mandate Paused in California
The Trump administration has revoked California’s waivers for zero-emission vehicle mandatesunder the Clean Air Act, including the rule requiring 75% of Class 8 drayage trucks to be zero-emission by 2035 and stricter NOₓ standards for heavy-duty trucks. The American Trucking Associations and Owner‑Operator Independent Drivers Association cheered the move, citing high EV costs and a lack of charging infrastructure, especially critical at ports.
📦 Final-Mile Pressure Builds as Peak Pull-Forward Begins Retailers are fast-tracking peak season shipments before the August tariff reprieve expiry, leading to unexpected final-mile volume spikes in inland hubs like Memphis, Kansas City, and Columbus. This shift is requiring tighter coordination between drayage carriers and long-haul providers, with growing value on flexible, hybrid-capable trucking networks.
🔧 Parts Delays Return for Key Equipment Parts shortages are creeping back into the conversation. Carriers are reporting extended lead times for brake components, emissions systems, and DEF sensors. As more tariff action looms over auto parts, fleets are being urged to plan ahead and secure inventory now to avoid downtime during the Q3 volume rush.
🌍 Geopolitics: Middle East Tensions Spark New Fears for Global Container Shipping
Geopolitical tensions continue to cast a shadow over global supply chains following Israeli and US airstrikes on Iranian military and nuclear targets. While commercial vessels have not been attacked, the UK Maritime Trade Operations has warned of a “rapid escalation” risk, particularly in the Strait of Hormuz, a narrow passage that sees roughly 20% of global oil and a significant share of container traffic.
Iran’s retaliatory strikes on Israel and the ongoing detention of the MSC Aries, a ship with Israeli ties, have already rattled the industry. The region’s fragile security environment has many recalling how just a handful of incidents in the Red Sea in late 2023 led major carriers to abandon routes en masse. According to Vespucci Maritime CEO Lars Jensen, “Hormuz could follow the same pattern.”
In response to the US and Israeli attacks, Iran’s parliament has approved a measure to close the Strait of Hormuz, a chokepoint for roughly 20% of global oil and a major share of container traffic. While the measure remains symbolic unless enacted by Iran’s top leadership, global markets and shipping stakeholders are bracing for possible disruptions. Analysts warn Iran could attempt to mine the narrow shipping lanes or deploy small vessel attacks to threaten transit—tactics that would likely draw immediate US military reprisal.
Peter Sand, Chief Analyst at Xeneta, noted that rerouted traffic would strain Indian ports and send container rates upward. “We’d likely see rising congestion, oil price hikes, and new security surcharges from carriers,” he warned. Moreover, the instability could further delay a return to the Red Sea corridor, where Iran-backed Houthi forces remain active.
Data from the Joint Maritime Information Centre shows reported ship transits plunged ahead of the fragile ceasefire reached on June 23. Eastbound traffic fell from an average ~114/day to just 49 vessels, with westbound down to 42—its lowest level since the onset of conflict.
🏗️ Infrastructure Update
U.S. Port Infrastructure and Security Bill Clears House
The Maritime Supply Chain Security Act (H.R. 2390) has passed the U.S. House of Representatives, aiming to modernize port infrastructure and reduce national security risks linked to Chinese-made equipment. Introduced by Rep. David Rouzer of North Carolina, the bill permits federal Port Infrastructure Development Program funds to be used for replacing ship-to-shore cranes and related software produced by Chinese firms.
Rouzer emphasized that modern and secure ports are essential for both economic stability and military readiness. He warned that many cranes operating at U.S. ports today contain Chinese hardware or software that could be vulnerable to espionage or disruption. The legislation passed by voice vote and now moves to the Senate Committee on Commerce, Science, and Transportation.
CPG is a Finalist for the 2025 Top Companies for Women to Work in Transportation
We’re proud to support and elevate the women driving change in the trucking industry, on the road, in the office, and at every link in the supply chain.
ContainerPort Group has been nominated for this year’s Women In Trucking Top Companies for Women to Work For in Transportation award, and we’d be honored to have your vote.
Voting is open now through June 27th! Click below to vote for CPG.
Every vote helps us spotlight the incredible women of CPG and the inclusive culture we continue to build together. Thank you for your support!
🚛 CPG Network: Houston Event Recap
Our Houston roundtable event in early June brought together a dynamic group of supply chain leaders for meaningful conversations focused on the future of drayage and regional logistics. Despite challenging weather, engagement remained high as attendees discussed key topics including network strategy and the evolving outlook for the Gulf market.
These in-person conversations continue to offer valuable insight, and underscore the importance of partnership as the industry adapts to change.
We look forward to hosting more regional roundtables in the months ahead to continue driving progress together. Stay tuned, we may be visiting your market next!
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