Breakthrough 90-Day Tariff Reduction Agreement
In a rare easing of trade tensions, the U.S. and China have agreed to temporarily reduce tariffs for a 90-day period. Under this agreement, the U.S. reduced tariffs on Chinese imports from 145% to 30%, while China cut its duties on U.S. goods from 125% to 10%, according to Invezz.
The deal, enacted in mid-May 2025, has triggered a surge in cross-border shipping activity, particularly among major retailers like Walmart.
Retailers are using the temporary reprieve to import high-margin seasonal goods, including summer apparel, back-to-school supplies, electronics and outdoor products. The move was designed to front-load inventory ahead of key retail events such as Prime Day and Labor Day, while hedging against a potential reversion to higher tariffs after the grace period expires.
Walmart's Strategic Response
Walmart, with its extensive global sourcing network, has rapidly mobilized to take advantage of the reduced tariffs. Procurement teams have accelerated orders from key Chinese suppliers, prioritizing categories most affected by past tariff hikes. According to Reuters, the result has been a noticeable uptick in port activity, inland freight movement, and supply chain labor demand.
While the 30% tariff is still higher than pre-trade war levels, it represents significant savings compared to the 145% peak that strained sourcing budgets earlier in the year. These savings enable Walmart to better manage product margins, pricing strategies and promotional planning through the third quarter.
Industry-Wide Impact and Caution
The short-term tariff truce has sparked widespread logistics activity across the retail sector, leading to temporary congestion at West Coast ports and higher trucking spot rates. Analysts said that while the current deal offers cost relief, it does not resolve the long-standing structural issues of U.S.-China trade policy.
Retailers like Walmart are treating the truce as a tactical window rather than a long-term solution. Inventory strategies are being retooled to balance agility with risk, including nearshoring, diversification of suppliers and expanded use of bonded warehouses.
As the countdown to the tariff snapback continues, Walmart and its peers are lobbying for an extension or permanent renegotiation. In the meantime, consumers may see modest price stabilization for some goods, particularly in discretionary categories.
