Tariffs, often in the headlines, are more than just a political talking point – they are a fundamental aspect of global trade with tangible effects that reach far and wide. Continue reading to learn more about the impact of tariffs, what they mean for our operations, and, most importantly, for those we serve.
What Are Tariffs?
A tariff is a tax or duty levied by a government on goods imported from another country. Essentially, it functions as a fee imposed on products as they enter a nation’s borders. Unlike other forms of taxation, such as sales or income tax, tariffs are specifically designed to target imported goods.
The US Tariff Impact & Wire-Mesh Products
The current tariff environment presents both significant challenges and unique opportunities for our business. We understand that with the changes happening, current clients and potential customers are curious about the US tariff impact and how it affects Wire Mesh Products specifically. Below, we’ve broken down the details of the impact of tariffs on our products and customer base.
The Impact of Tariffs on Our Products
A large portion of our wire products are directly impacted by the Section 232 tariff. The belt components we procure – wire, chain, flat products, etc – are all subject to different tariff layers. These added costs are unfortunately necessitating an increase in our belt prices.
The unpredictable nature of these tariffs—with rates and durations subject to sudden and unannounced changes, such as the recent increase from 25% to 50% for steel imports (and their derivatives) imported from all countries except the UK—creates considerable uncertainty for our planning and purchasing. We continually evaluate the amount of inventory to secure and the optimal price level to mitigate these conditions.
The Impact of Tariffs on Our Customer Base
Beyond the direct impact on our product costs, these tariffs are also reshaping our customer base. We’re observing a growing trend among US-based customers to “reshore” their supply chains, and this shift is leading to an increased market share for Wire Mesh Products.
In response, we are actively scaling our operations to meet this surge in business. While we work diligently to ramp up our production capabilities, we are prioritizing our existing customers to ensure their needs are met during this transition.
It’s essential to recognize that while the Section 232 tariffs have a significant impact on us, reciprocal tariffs from other countries also play a substantial role. The fluidity of these tariff amounts and their potential to change without warning underscores the highly unpredictable nature of the current trade landscape.
The upcoming August 1st deadline for reciprocal tariffs is a key milestone, but we anticipate continued market volatility. Despite these complexities, our business is expanding as more companies choose to bring their supply chains back to the United States. While prices are indeed increasing due to these tariffs, we are committed to minimizing the impact on our customers both in terms of pricing and ensuring a consistent supply and production.
Have questions? We’ve got you covered! For more information regarding the impact of tariffs on Wire-Mesh Products, send us a message or give us a call at 717-848-3620.