The US-Kita Trading War has pushed the supply chain to the break point, show data

The trading truce reached between the US and China, came just as the same as President Donald TrumpTariffs on the bite from the production of North America and Asian, with the help of a sharp retreat in April purchasing activities after the storage supply, reports the Global Index supply chain.

“Pause on tariffs is the main relief for manufacturers in the US and China,” said John Piatte, Vice President on Consulting by GEP. “Our supply chain volatility index shows that the production demand in China is steeply decreasing, and US manufacturers aggressively reserves key data in buffers against tariffs.”

But, according to Piatek, the trade transaction will not quickly implement the anxiety of American manufacturers about how to reduce the risk associated with China in the long run. “As they maneuver to risk and restrict the impact of China, the landscape and uncertainty are rapidly changing the manufacturers’ views and the weakening of their capital investments and the supply chain,” he said.

The GEP Glo -GEP index is monitors for demand, deficiencies, transportation costs, stocks and lagging on a monthly poll 27,000 enterprises.

“The first strikes of the tariff war landed on world manufacturers,” Piatte said. The volatility of the supply chain volatility should be a warning about what will happen if the temporary pause in the US and China will not constantly continue after a 90-day pause and re-escalation of the trade war.

According to Piatek, the data showed a “hockey wand” similar to the rise, and the North American companies aggressively accumulate inventory that he called “relatively”. At the same time, “the first signs of manufacturers who are waiting for slow demand and lack of supply appeared,” he said.

The purchase of manufacturers in Asia has been in the weakest since December 2023.

One of the bright spots to compensate for production is Europe where the industrial recession goes. The UK, the first nation that has signed a previous trade transaction with the United States, has recorded considerable production weakness, and the activity of suppliers to a speed consisting of a low record based on the last two decades of data. But the potential of the supply chain in Germany and France, which has not been enough over the last year, reflects growth. Piatek warned it could change if global trading conditions deteriorate.

GEP data also shows an increase in spare capacity in Asian supplies in April led by China, Taiwan and South Korea.

Stephen Edwards, CEO of Virginia’s port, said CNBC’s An interview published this week That if the future of supply chain is less China and more southeast Asia, South Asia and Europe, the US port is located for this growth.

“Our fastest growth in the last four years has been an Indian subcontinent, then in Vietnam, then Europe,” Edwards said.

Trade from China has been flat in the last four years in the port of Virginia.

“This is our second largest trade block after the European Union. So, it’s still a big block,” he said. “But if it migrates over time, regardless of the new trading environment, we have not seen trade agreements yet, but we believe it will be less China and more from Southeast Asia and Europe. I think we are in a pretty good place,” Edwards said.