Mutual Tariff Concessions Between China and the US Unleash Cooperation Dividends, Trade Recovery Drives Surge in Shipping Export Demand

On Monday this week, after China and the US announced significant mutual tariff concessions, global concerns over trade tensions eased, reigniting trade enthusiasm between enterprises of the two countries.

This positive news triggered a rebound in global stock markets this week and drove a sharp increase in bilateral international trade and shipping volumes in the short term. The market has expressed strong approval through actions for China and the US's willingness to resolve trade disputes through negotiations, with some evaluations in US society also being quite positive.

Justin Wolfers, an economist at the University of Michigan, pointed out that reducing tariffs from prohibitively high levels to their current state is, in itself, excellent news.

Jim Reid, head of Global Macro and Thematic Research at Deutsche Bank, also believes that although the tariff relief period is 90 days, in terms of the market, people now believe that the worst period of the trade war has passed. The current trend is one of increasing easing, and the positive significance of this news is undeniable.

More conciliatory, more respectful

A key signal conveyed by China and the US's mutual tariff concessions is that neither side believes that high tariffs will have a positive impact on international trade. This tacit consensus has laid the foundation for market confidence and implies that the two major powers will adopt a more cooperative attitude in negotiations.

George Saravelos, a strategist at Deutsche Bank, pointed out that this carefully orchestrated mutual tariff concession agreement has attracted global attention, but US President Trump did not preemptively leak the news on social media. This clearly indicates that negotiations between China and the US are entering a phase of greater mutual respect.

Former US Treasury Secretary Lawrence Summers stated that it is evident that the US has made concessions to China, but this is not a bad thing. The best approach after making a mistake is to correct it and take a step back, even if it may sometimes be embarrassing.

Scott Kennedy, a China expert at the Center for Strategic and International Studies in Washington, added that if China had not taken strong countermeasures this time, Trump would not have abandoned hefty tariffs.

Gerard DiPippo, deputy director of the RAND Corporation's China Center, further explained that the consensus reached between China and the US this time indirectly proves the correctness of China's long-standing economic strategy. Emphasizing manufacturing and economic independence has helped safeguard China's economic security.

A golden period for trade

For US enterprises, China and the US returning to the negotiating table means that enterprises can seize this opportunity to get back on track and utilize the 90-day window period for business preparations and planning.

According to media reports, Jay Foreman, CEO of US toy company Basic Fun, jumped out of bed and called his Chinese suppliers as soon as he received the news in the early hours of Monday in the US, urging them to arrange the long-delayed shipments.

Companies such as SharkNinja, which sources coffee makers and frozen beverage machines from China, and Hightail Hair, a hair care products company, also took swift action in the early hours of Monday local time. Goldman Sachs' latest research report directly expects that US importers will "ignite" China's exports within the next three-month window.

Goldman Sachs analysts also suspect that in the short term, retail giants may not only stockpile goods for 2025 demand but even stockpile in advance for 2026, as business owners are skeptical about whether the Trump administration can continue the current favorable atmosphere after 90 days.

According to a reporter's understanding, a US-route business executive from a Chinese freight forwarding company pointed out that from the moment China-US tariffs were reduced, the demand for US-route shipping capacity from China surged rapidly, and freight rates rose across the board. For example, the quotes for the US West Coast route in the next seven days increased by at least 30% WoW.

A person from another Shanghai-based freight forwarding company revealed that currently, there are still remaining slots for May routes in the US-route market, but they are basically only available after the 25th.

He expects that by the end of May, the freight rate for the US West Coast will rise to around $3,000/TEU, nearly doubling WoW. And the freight rate for the US West Coast in June may even rise above $5,000.

Optimistic yet cautious

The "rush for exports" by US enterprises in China also reflects a reality on the other side, that is, the "flip-flopping" of the Trump administration has plunged US society into the aftermath of the "boy who cried wolf" syndrome.

Jeremy Denson, president and co-founder of US refrigeration equipment supplier Bison Coolers, expressed his helplessness to the media, saying that he had never thought that a 30% tariff could make him excited. Although the tariff remains high, it still ensures that he can ship containers from China to the US to keep his supply chain intact and have products available for sale. He expects that this year will still be a difficult one.

Other small business owners have expressed concerns about the potential changes in US trade policies after 90 days, which has also prompted many Wall Street figures to issue warnings.

Prominent figures such as Roger Altman, founder of Evercore, and Mohamed El-Erian, chief economist of Allianz Group, have warned that tariffs remain a drag on the US economy, as they will raise prices and reduce consumption, pushing inflation back up.

However, some analysts have offered new insights. Ed Yardeni, president of research firm Yardeni, said that the latest trade agreement between China and the US may imply that Trump will remain shackled by political pressure and face questions about the legitimacy of launching a trade war from a legal perspective until the midterm elections next year. This will significantly limit the White House's arbitrary tariff actions.

On the other hand, for Chinese enterprises, it is urgent to establish a more diversified sales system.

Hu Jianlong, CEO of Brand Factory, a Chinese cross-border e-commerce consulting company, told the media that enterprises participating in the cross-border business boom in China will continue to diversify their businesses as much as possible, as everyone realizes that the risks of relying on the US market are too great.