One Month In: No Supply Chain Can Keep Pace

In the leadup to President Donald Trump taking office, I wrote an article asking, "How Nimble Is Your Supply Chain?" He has now been president for four weeks. Let's recap the actions that have most directly affected supply chains:

• On his first day in office, he issued a presidential memorandum titled "America First Trade Policy."
• On the seventh day, he announced on Truth Social five immediate, urgent and decisive measures against Columbia, including emergency tariffs of 25 percent that would escalate to 50 percent in one week, which were called off the next day.
• On his 13th day, he announced 25 percent tariffs on imports from Canada and Mexico. Two days later, these tariffs were postponed for 30 days.
• Also on the 13th day, he announced a 10 percent tariff on Chinese imports and suspended the de minimis exemption.
  • China responded with 10 percent and 15 percent retaliatory tariffs on select U.S. natural resources and machinery and tightened trade measures by expanding export controls on critical minerals, adding two U.S. companies to its Unreliable Entity List and launching an antitrust investigation into Google.
  • The suspension of the de minimis exemption caused the U.S. Postal Service to temporarily stop accepting parcels from China and Hong Kong before allowing them again.
• On his 19th day, President Trump amended his previous order to continue to allow the de minimis exception until the U.S. Department of Commerce can set up a system to process these shipments.
• On the 22nd day, a 25 percent tariff on imported steel and aluminum was imposed.
• On the 25th day, he ordered a study of reciprocal tariffs, which, if implemented, would increase tariffs to varying degrees on countries around the world.
• Interspersed have been statements about taking back the Panama Canal and buying Greenland and unlocking its mineral resources.

That's a lot to keep up with. And the details are critical for the items that stick. But no company can adjust its supply chain to keep up with every twist and turn.

These actions have been focused on tariffs and trade policy. From a legal perspective, we associate this with international trade, which is indeed essential. But with respect to a supply chain, tariffs are not the end – they are the beginning. Tariffs may animate a desire to adjust a supply chain, but the supply chain itself involves obtaining materials, manufacturing products, buying, selling, moving and storing those products around the world and financing it all. Alongside supply chain management professionals, these elements involve multidisciplinary legal and policy considerations.

The upshot of this first month is that there will be volatility – or at least the threat of volatility and, thus, uncertainty – in U.S. trade policy for the foreseeable future, which will fundamentally impact supply chains. A potentially volatile future calls for a strategic approach.