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International Emergency Economic Powers Act (IEEPA) Tariff Case: Tomorrow (January 9), the U.S. Supreme Court is scheduled to issue rulings on one or more pending cases. Although the Court does not announce in advance which cases it will decide on, one possibility is the IEEPA tariff case, for which the Court heard oral arguments back in early November. |
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If the Supreme Court rules against the Trump administration’s IEEPA tariffs, U.S. Customs and Border Protection (CBP) would likely stop collecting tariff revenue immediately while implementing a refund process. The Trump administration could potentially leverage other statutes—including Sections 301, 232, 122, and 338—to re-implement those tariffs or introduce new ones. |
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If the Supreme Court upholds the tariffs, on the other hand, the case could return to the lower courts for another review. Another broad possibility is a ruling that provides partial relief: for example, the Court could uphold some IEEPA tariffs while striking down others. |
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During November’s oral arguments, several justices challenged the Trump administration’s assertion that the tariffs aim to “regulate importation” in response to rising trade deficits and a fentanyl-induced public health crisis, and questioned whether the tariffs ultimately serve as taxes that generate revenue from American citizens. The Court also raised concerns over the complexity of refunding already-collected duties, should the Court rule against the tariffs. |
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Check out our live blog for the latest developments. |
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Consumer Product Safety Commission (CPSC) eFiling Mandate: On July 8, 2026, the CPSC will implement electronic filing requirements for CPSC-regulated consumer products at the time of entry. For CPSC-regulated products imported into a foreign trade zone, the eFiling requirement will take effect on January 8, 2027. |
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These upcoming regulatory changes will impact a wide range of businesses, especially those importing multiple distinct products. Impacted businesses face new compliance requirements, filing procedures, and potential penalties. |
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Importers are advised to start the registration process on the CPSC eFiling portal, which is currently in the voluntary stage, as soon as possible. Flexport is actively testing eFiling with our customers who have Business Accounts set up in the CPSC’s portal. |
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Check out our blog for more details, including how to get started on eFiling registration. |
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Delayed Tariff Increases on Upholstered Furniture, Kitchen Cabinets, and Vanities: Last week, President Trump issued a proclamation that postpones tariff increases on upholstered furniture, kitchen cabinets, and vanities from January 1, 2026 to January 1, 2027. The existing 25% duty on certain upholstered furniture will rise to 30% on that date, while the 25% duty on kitchen cabinets and vanities will rise to 50%. |
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These duties remain eligible for some drawback methods. Additionally, goods subject to these tariffs remain exempt from reciprocal tariffs, the additional 40% tariff on Brazil, and the 25% “oil” tariff on India. |
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U.S.-Indonesia Trade Agreement Near Completion: On December 23, 2025, the Indonesian government announced that it had reached an agreement with the U.S. on “all substantial issues,” just weeks after the two nations’ previous trade agreement reportedly neared collapse. The U.S. and Indonesia are now on track to sign a trade agreement by the end of January, according to Indonesia’s Coordinating Minister for Economic Affairs. |
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The U.S. has agreed to eliminate tariffs on certain Indonesian goods that cannot be produced in the U.S., including palm oil, cocoa, and coffee. Recent talks have also focused on digital trade, U.S. access to Indonesian critical minerals, and “balanced” bilateral market access. |
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U.S. to Raise Tariffs on Chinese Semiconductors in 2027: The U.S. intends to implement new tariffs on Chinese-origin semiconductors beginning June 23, 2027, and will announce the exact duty rate at least 30 days before implementation. |
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In the meantime, the existing 50% tariff on Chinese semiconductors will remain in place. The new duty will stack on top of the existing duty. |
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This announcement follows the conclusion of a Section 301 probe into the Chinese semiconductor industry. The U.S. Trade Representative (USTR) concluded that Chinese non-market policies “burden or restrict U.S. commerce and thus is actionable.” |
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Mexico Implements New Tariffs on China and Other Nations: On January 1, the Mexican government officially implemented levies as steep as 50% on China and other nations without a trade agreement with Mexico. |
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These duties impact a wide range of products, but some of the highest rates apply to Chinese-origin vehicles. In 2024, about 13% of total auto sales in Mexico consisted of automobiles and auto parts originating from China. |
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President Trump has repeatedly pressured Mexico’s President Claudia Sheinbaum to minimize Mexico’s reliance on China, and has raised concerns that Mexico is a “backdoor” for Chinese goods entering the U.S. under United States-Mexico-Canada Agreement (USMCA) trade terms. Mexico’s recently implemented tariffs come ahead of the USMCA review and re-negotiation process, scheduled to take place in July. |
TRANS-PACIFIC EASTBOUND (TPEB)
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January capacity remains high, with levels at 83-90% (vs. 75-80% in 2025). |
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Volumes saw an upsurge before the Christmas and New Year holidays, but demand has since stabilized at steady levels. Capacity is open and remains in an oversupply state, except for certain strings with tightening space. |
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Carriers have begun mitigating the January 1 General Rate Increase (GRI) to encourage more volume. Space remains open and is not being fully utilized, although loadings have improved since early December. |
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Carriers have announced a January 15 GRI in preparation for the pre-Chinese-New-Year rush. This push-pull of rate validity is expected to continue through the Lunar New Year period. |
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With some carriers postponing their Peak Season Surcharge (PSS) to February 1, it is likely the PSS will be eliminated for January. |
FAR EAST WESTBOUND (FEWB)
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Ahead of Lunar New Year on February 17, the market is experiencing a traditional pre-holiday cargo rush. Shippers are aggressively front-loading bookings to secure space before factory closures, driving strong utilization across all main loops. |
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Far East: Shanghai and Ningbo face growing pressure, with vessel bunching and wait times reaching 2 to 4 days due to dense fog and high export volumes. Equipment shortages (particularly affecting 40′ HC containers) have reappeared in key North Chinese ports. |
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Europe: Hamburg and Rotterdam face ongoing winter weather disruptions and high yard density, leading to berthing delays of up to 5 to 7 days for some services. Inland barge and rail connections remain strained. |
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To sustain rate levels post-holiday, carriers have announced a fresh wave of blank sailings for late January and early February. This proactive capacity management, combined with “sliding schedules” related to weather delays, has resulted in a tight space situation for late-month departures. |
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Recent changes to the EU Emissions Trading System (ETS) have impacted operations, with carriers now subject to 100% of the EU ETS’s compliance costs as of January 1. Carriers are strictly enforcing new surcharge mechanisms, further complicating cost structures for shippers. |
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Spot rates continued to rise into the first week of 2026, driven by a supply-demand imbalance. Indices show that Asia-North Europe rates are maintaining upward momentum. |
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Carriers have successfully implemented a Freight All Kinds (FAK) increase for the first half of January. Carriers have announced a second round of hikes for the second half of January, aiming to push spot rates higher to set a strong baseline for the 2026 market. |
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Carrier leverage is peaking in the strong spot market. Shippers are facing resistance when it comes to rate cuts, with limited capacity and strong pre-holiday demand supporting the current rate environment. |
TRANS-ATLANTIC WESTBOUND (TAWB)
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North Europe and West Mediterranean: Demand remains weak, prompting carriers to blank 5-10% of sailings for capacity control into early 2026. |
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East Mediterranean: Demand is stronger, supporting planned General Rate Increases (GRIs) and Peak Season Surcharges (PSSs). Some carriers applied these rate increases earlier this month. |
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Overall, space remains widely available. Blank sailings have seen an uptick due to the holidays, but are lighter than on other trades. |
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Critical container and chassis shortages persist in Austria, Slovakia, Hungary, Southern and Eastern Germany, and Portugal, resulting in inland delays of 2 to 4 days. These issues stem from congestion and driver constraints. |
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Southern European ports face fewer problems. |
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Equipment remains balanced at the main ports in North Europe, but tight inland. |
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North Europe and West Mediterranean: Rates are holding stable at low levels, with no PSSs or GRIs amid weak demand. |
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East Mediterranean: Carriers are applying PSSs, GRIs, and emergency operation surcharges (EOSs) in January due to firm demand. |
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Spot rates are gradually trending downward into Q1 2026 across the TAWB. |
INDIAN SUBCONTINENT TO NORTH AMERICA
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Demand from the Indian subcontinent to the U.S. remains soft, related to last August’s tariff escalation. Activity remains positive from other countries in the region, such as Pakistan, Bangladesh, and Sri Lanka. |
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To the U.S. East Coast: Structural blanks are ongoing, related to routings around the Cape of Good Hope and an idle fleet near 1%. CMA CGM is planning to route its INDAMEX service string vessels through the Suez this month, starting first with backhaul and then incorporating headhaul routings. |
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To the U.S. West Coast: Capacity remains available, related to supply dynamics on the TPEB into the U.S. West Coast and reduced demand from India post-tariff-escalation. |
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To the U.S. East Coast: Rates are holding steady into January. The market situation remains the same. |
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To the U.S. West Coast: Last August’s tariff increases and oversupply on core TPEB lanes continue to maintain low rate levels. |
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The market remains quiet following the holiday season. While ecommerce and general cargo volumes are currently low, we expect pricing to stabilize in the coming days as booking activity returns to normal levels. |
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As the year begins, demand is currently trending downward. |
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Although some flight schedules were adjusted over the holidays, regular service is expected to resume shortly. |
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Current rates to the U.S. East and West Coasts remain competitive, but are subject to change as capacity shifts. |
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The market has cooled in recent weeks, leading to a general decrease in freight rates. |
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While space to the U.S. West Coast has opened up, capacity to the U.S. East Coast remains relatively tight. |
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The market is stable, though demand has softened post-holiday. Many providers are offering adjusted rates to encourage shipping volumes, particularly for North American routes. |
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Rates have decreased across all major routes due to lower demand. |
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Interest in transshipment (indirect) options has also dipped, and current pricing reflects a more balanced market for both East and West Coast destinations. |
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Soft market conditions have led to lower rates for major trade lanes to North America and Europe. |
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Shippers are encouraged to submit bookings 3 to 5 days before their preferred departure. |
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Operations are slowly resuming as factories return to full production. We anticipate a full market recovery in the second half of January, and recommend booking 3 to 5 days in advance. |
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Demand is beginning to steady as we enter mid-January. High interest remains for cargo moving out of Dhaka and Colombo. |
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While base rates have not decreased as quickly as expected, shippers should be aware that transit times through major hubs may be longer than usual due to shifting priority levels for cargo in this region. |
(Source: Flexport)
Please reach out to your account representative for details on any impacts on your shipments.
Transit time increased from China to the U.S. West Coast and China to the U.S. East Coast, and decreased from China to North Europe.
Week to January 5, 2026
Transit time increased from 31.4 to 32.5 days from China to the U.S. West Coast; increased from 54.6 to 57 days from China to the U.S. East Coast; and decreased slightly from 56.6 to 56.5 days from China to North Europe.
Stay in the loop—read past newsletters here. For more information, connect with one of our logistics experts here.
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