China Factories Up and Running, Import Demand Drops, Duty Deferrals on Hold
China Factories Up and Running Again But Demand Drops Drastically
While factories in China struggled to get back up to capacity after the COVID19 virus spread in China it appears all was for naught. Factories are reporting a huge drop in demand and we are receiving word of many cancelled bookings for ocean containers coming to the U.S. Obviously the impact of the virus has not peaked yet and it may be later in 2020 before we see some rebound in US import demand.
Companies looking to import now should closely communicate with their suppliers and freight forwarders to help ensure that their products are available and that ocean container space is available too. Carriers continue to report blank sailings (cancelled sailings) so space can be an issue. Rates have shown some decline week over week though much uncertainty remains.
U.S. Customs Plan to Offer Duty Deferrals Has Been Put on Hold Indefinitely
U.S. Customs had sent out a message on March 20th advising importers that they could file a written request via email to defer their Customs duties due to the economic impact of COVID19 virus but we just received word that this duty deferral program has been put on hold. Importers who applied for and received permission to defer duty must now pay that duty immediately with the deadline to pay on Friday, March 27th (today).
While Customs indicated that the offer to defer duty may be considered in the future I would not hold my breath waiting for it.
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