“But since his return from the stay on the moon, He listens like spring and he talks like June, ay ay Ay A…”

Port of Savannah

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This week, the U.S. Court of International Trade issued a decision to strike down on several broad-based import tariffs imposed in recent years, ruling they exceeded the legal limits set by the International Emergency Economic Powers Act. While the Trump administration is preparing to appeal the decision, it’s already sending ripples across the logistics landscape. With a temporary tariff pause in effect, importers are watching vessel bookings and port volumes for signs of a summer surge. As the weeks go on, we will continue to break down what the ruling means for ocean freight, how TEU flows are responding, and what forwarders and shippers should prepare for next. To stay connected: Don’t forget to follow our LinkedIn page to see other company news and industry related topics and to get on the list for this weekly Market Update Newsletter and future industry related news sent directly to your inbox email marketing@portxlogistics.com.

As discussed in the newsletter opening, on May 28th the U.S. Court of International Trade struck down a significant portion of President Donald Trump’s tariff policies, ruling that he exceeded his authority under the International Emergency Economic Powers Act (IEEPA) of 1977. This decision has major implications for U.S. trade policy and executive power. The court invalidated Trump’s “Liberation Day” tariffs, which included a 10% flat tariff on most imports and additional tariffs of 25% on Canadian and Mexican goods and 20% on Chinese goods. These tariffs were imposed under Executive Order 14257, citing national emergencies related to trade imbalances and drug trafficking. However, the court found that these justifications did not meet the statutory threshold under IEEPA and that the act does not grant the president unchecked authority to impose such broad tariffs without congressional approval.

The ruling emphasized that the power to impose tariffs lies primarily with Congress and that the president cannot unilaterally enact widespread tariffs under IEEPA. This decision reinforces the constitutional separation of powers and limits the executive branch’s ability to use emergency powers for trade policy. Economically, the ruling led to a positive response in financial markets, with stock futures rising as investors anticipated reduced trade tensions. The Trump administration criticized the court’s decision, arguing that trade deficits constitute a national emergency that justifies the tariffs. White House spokesperson Kush Desai stated that the administration would appeal the ruling, potentially to the Supreme Court. The outcome of this appeal could further define the limits of presidential authority in trade matters.

This ruling marks a significant judicial check on executive power and underscores the importance of congressional oversight in trade policy. It also introduces uncertainty into ongoing trade negotiations and the future direction of U.S. trade relations.

Further to an appeal, the Trump administration is also seeking a pause on the court’s ruling during the appeal process. The Justice Department contends that allowing the ruling to take effect would harm U.S. foreign policy and national security by weakening the president’s negotiating leverage with other countries. If the court denies the request to pause the ruling, the administration plans to escalate the appeal to a federal appeals court and, if necessary, to the Supreme Court.

An appeal still introduces significant uncertainty for U.S. importers. While the court’s decision temporarily halts the enforcement of the tariffs, the ongoing legal proceedings create ambiguity regarding future trade policies. Importers are left uncertain about potential reinstatement of tariffs or the introduction of new trade measures, making it challenging to plan for inventory, pricing, and supply chain logistics. The uncertainty surrounding tariff policies has disrupted supply chain operations, importers are hesitant to place orders without clarity on potential costs, leading to delays and inventory shortages. This hesitancy affects not only the importers, but also domestic businesses that rely on imported components for manufacturing, potentially leading to production slowdowns and increased operational costs. While some businesses may benefit from reduced tariffs, others face challenges in supply chain planning and pricing strategies. The fluctuating import volumes underscore the broader economic adjustments underway as markets respond to the evolving trade policies.

In summary, while the immediate aftermath of the court ruling saw a surge in imports due to preemptive actions by businesses, the longer-term effects are manifesting as a decline in import volumes, reflecting the complexities and uncertainties introduced by the changing trade environment.

Import TEUs are up 0.11% this week from last week – with the highest volumes coming into Long Beach 24.3%, Los Angeles 15.8% and Newark 10.7%.