While Wall Street frets about potential volatility from President Trump’s April 2 “Liberation Day” plans, another part of America is also bracing for more possible chaos: US ports.
If the president next week imposes sweeping new duties on America’s top trading partners, that could place a significant new burden on ports of entry from coast to coast, which act as conduits for a wide variety of goods critical to the global economy.
One person trying to raise the alarm with policymakers this week is Cindy Allen, CEO of an international trade consulting company called Trade Force Multiplier.
There comes a point, she told Yahoo Finance in between meetings, when “you’re stacking all of the duty rates together” to such an extent that “the custom system can’t handle that.”
At issue is what is known as the Harmonized Tariff Schedule of the United States — also known as the tariff book. It’s a 99-chapter-long guide with somewhere around 18,000 different numbers that serves as the go-to guide for duty collectors and importers about what tariffs to apply to what products.
President Trump speaks to the press before boarding Air Force One earlier this month. (Brendan Smialowski/AFP via Getty Images) ·BRENDAN SMIALOWSKI via Getty Images
Trump has already added multitudes to this complicated arrangement with actions that so far include new 20% tariffs on China, 25% tariffs on many imports from Canada and Mexico, and 25% tariffs on steel and aluminum imports since taking office.
But his reciprocal tariff plans could take things to another level and apply to a wider array of goods and trading partners. As the president told reporters this week, “friend has often been much worse than foe” and that next week’s actions will apply to both.
A White House official added to Yahoo Finance that the administration has been listening to the business world feedback and “a lot of that has been taken into consideration.” The White House official expected the still-being finalized plans for next week to focus on country-by-country tariffs with the overall view being “the status quo, as we see it, cannot stand.”
Read more: The latest news and updates on Trump’s tariffs
As Trump’s reciprocal tariff plans began to take shape, the administration first signaled that reciprocal tariffs could be a sort of mirror on US trading partners, where the US would calibrate its actions to reflect the duties other countries currently have in place.
This week, Allen called that the “absolute nightmare scenario” in her view because of the complexity it would add.
More recently, the Trump administration has said that a somewhat more straightforward plan is now likely in part to reflect so-called non-tariff barriers that other countries impose such as value-added and digital taxes. That expected rollout would mean — as Treasury Secretary Scott Bessent recently put it — “each country will receive a number that we believe … represents their tariffs.”
But even that will likely add a new and complex layer to the tariff book.
“That can also be really complicated,” said Greta Peisch, who served as general counsel for the US Trade Representative’s (USTR) office during the Biden administration.
Inside the Port of Los Angeles in San Pedro, Calif. (Apu Gomes/AFP via Getty Images) ·APU GOMES via Getty Images
Peisch noted this week that a plan where a range of countries have different duties means that even goods that in the past could largely move quickly across the border must now be more closely scrutinized to determine their country of origin.
“When you have different tariffs on products from different countries that vary widely, that just increases the logistical and compliance complexity,” she added.
As Allen put it, perhaps more bluntly, about these two scenarios: “They’re both nightmares.”
That’s because for importers, even in the latter scenario, many goods will be subject to a greater array of levies.
One example might be an aluminum baseball bat from Canada that could soon be subject to at least three new Trump 2.0 duties — one specific to the aluminum, one imposed on Canada over illegal drugs and migration, and then these incoming reciprocal tariffs.
Read more: What Trump’s tariffs mean for the economy and your wallet
Imports from China are even more complex, with some imports facing a network of overlapping duties that, in some cases, are already near 100% tariff levels — even before Trump’s additional reciprocal actions next week that are expected to include China.
Trump’s country-by-country tariff plans could be even further complicated by new sector duties that could also come into force at the same time.
On Wednesday, Trump announced that new 25% tariffs on foreign-made automobiles and “certain auto parts” will begin coming into effect on April 2, with the first duties on cars felt on April 3.
As will a new plan for secondary tariffs on any country that buys oil from Venezuela. That also comes into force on April 2, when Trump will be able to levy new duties.
“Many processes today are automated, although far fewer than one might think. There’s still a lot of paper involved in customs,” noted Mary Lovely, a trade expert and senior fellow at the Peterson Institute, in a recent episode of Yahoo Finance’s Capitol Gains podcast.
She added that Trump’s auto tariff announced this week could add yet another layer as the Trump administration is promising to look for American content in the auto parts supply chain and exempt them from tariffs.
“That’s definitely something we’re not doing,” Lovely added, saying, “It’s going to cause an enormous headache for companies and then for customs.”
The president also has issued a range of other sector-specific threats — from pharmaceuticals to semiconductors to lumber to dairy — with many likely to be formally unveiled in the coming days and in force soon thereafter.
Trump’s plans have been the subject of intense lobbying in recent weeks. Some CEOs, like Ford’s (F) Jim Farley, have gotten the president on the phone to express their worries. Trump’s economic team has also been speaking to CEOs. Others have gone through the more formal process.
“There’s been a lot of businesses that have been successful in meeting with USTR and with the different levels in the administration to communicate,” Allen noted.
“They want to comply regardless of where they fall on the political spectrum, but they need the ability to do that,” she added, noting that much of the challenge is in planning for tariffs when details are not yet announced but could be in place within days.
Overall, as Peisch noted of the worries, “I don’t know that that will dissuade them from going down this path, which they have made a big part of the president’s agenda during those first couple months.”
Ben Werschkul is a Washington correspondent for Yahoo Finance.
Every Friday, Yahoo Finance’s Madison Mills, Rick Newman, and Ben Werschkul bring you a unique look at how US policy and government affect your bottom line on Capitol Gains. Watch or listen to Capitol Gains on Apple Podcasts, Spotify, or wherever you find your favorite podcasts.
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