Apple CEO Tim Cook downplayed the impact of a potential hit from tariffs slated for Dec. 15 on smartphones and other devices during the company’s fiscal Q4 earnings call on Oct. 30 The company was already paying some tariffs prior to September and after Sept. 15 when List 4A Section 301 tariffs took effect. Cook’s view of potential December tariffs is “very positive in terms of how things are going,” he said, saying Apple’s guidance reflects that optimism. The tone of trade talks “has changed significantly, and I have long thought that it was in both countries’ best interests to get to an agreement that maybe initially doesn't solve everything but solves some things that each party may want,” he said: “I'm hopeful that that's where we're headed.”

Timing of List 4B Section 301 tariffs, due to take effect Dec. 15 on smartphones, laptops, tablets and other goods, “could not have been worse" for a consumer tech sector already facing product innovation and demand pressures, blogged Futuresource Tuesday. Tech companies need to be agile and resilient as global trade and geopolitical tensions have disrupted technology supply chains that were optimized for long-term cost efficiencies, said the researcher. Companies have to optimize for the disruptions, while using trade uncertainties as an opportunity to create a strategic competitive advantage, it said. Global CE supply chains are at increased risk of “fracturing” as a result of the U.S.-China trade dispute, said Futuresource, which sees a “short-term fix” as a survival strategy, allowing companies to re-evaluate classification and product routing of key components. Long term, tech firms should consider a “China Plus One” strategy whereby companies active in China augment existing investments with a second facility to diversify risk, cut costs and reduce over-reliance on China, it said. That’s beginning to happen, with some companies announcing they’re transferring production facilities to Vietnam, for example, it said: Trade disruptions also offer opportunities for digitization initiatives in the supply chain.

Timing of List 4B Section 301 tariffs, due to take effect Dec. 15 on smartphones, laptops, tablets and other goods, “could not have been worse" for a consumer tech sector already facing product innovation and demand pressures, Futuresource Consulting blogged. Tech companies need to be agile and resilient as global trade and geopolitical tensions have disrupted technology supply chains that were optimized for long-term cost efficiencies, the researcher said. Companies have to optimize for the disruptions, while using trade uncertainties as an opportunity to create a strategic competitive advantage, it said. Global consumer electronics supply chains are at increased risk of “fracturing” as a result of the U.S.-China trade dispute, said Futuresource, which sees a “short-term fix” as a survival strategy, allowing companies to re-evaluate classification and product routing of key components. Long term, tech firms should consider a “China Plus One” strategy whereby companies active in China augment existing investments with a second facility to diversify risk, cut costs and reduce over-reliance on China. That’s beginning to happen, with some companies announcing they’re transferring production facilities to Vietnam, for example, it said.

The Office of the U.S. Trade Representative could be even tougher in its review of extension requests for Section 301 tariff exclusions (see 1910280059) than it had been previously, Sidley Austin lawyer Ted Murphy said in a blog post. "Any company that is relying on an approved product exclusion from the first batch of approvals should consider filing comments with the USTR," he said. "We expect that the bar for securing a renewal/extension may well be higher than it was to secure the original approval (i.e., the need to answer the question why you still need the exclusion a year later). Companies relying on other approved product exclusions (those not from the first batch) also should watch this process closely." Although the possibility of exclusions is welcome news, " it also means that the Administration believes that there is at least a meaningful chance that the U.S.-China trade war will carry on and that the Section 301 duties will remain in place well into 2020," he said.

CBP issued the following releases on commercial trade and related matters:​

International Trade Today is providing readers with some of the top stories for Oct. 21-25 in case they were missed.

In a sign that tariff negotiations with China will continue into 2020, the Office of the U.S. Trade Representative will publish a notice in the Federal Register this week asking for comments on whether the first set of tariff exclusions on Chinese imports on List 1, set to expire Dec. 28, should last another year. The Docket Number is USTR-2019-0019.

Retailers are expected to import “near-record volumes of merchandise” before List 4B Section 301 tariffs take effect Dec. 15 on a wide range of consumers goods from China, said the National Retail Federation Thursday. Shoppers appear ready to buy, with an NRF-Prosper Insights survey saying consumers plan to spend an average $1,047.83 this holiday season, up 4 percent from what they said they would spend last year. The biggest spenders appear to be 35-44-year-olds at $1,158.63. “Consumers are in good financial shape” and are willing to spend more this season, said CEO Matthew Shay. NRF forecasts a 3.8-4.2 percent hike in holiday retail spending vs. 2018 to between $727.9 billion and $730.7 billion. More than half (56 percent) of consumers say they will shop online, with 92 percent planning to take advantage of free shipping; 48 percent will use buy online, pick up in store or ship to store services, and 16 percent plan to use same-day delivery, said NRF. Shoppers 18-24 are the most likely to say they plan to use same-day delivery at 32 percent; same-day delivery has doubled since 2015, said NRF. Department stores lead planned shopping venues at 53 percent, followed by discount stores (51 percent), grocery (44 percent), clothing and accessories (34 percent), and electronics stores and local businesses at 23 percent each, NRF said. Thirty-nine percent of holiday shoppers said they will start holiday shopping before November, 43 percent will wait until at least November and 18 percent until December, NRF said. Sales and discounts remain the biggest factor in choosing a retailer during the holidays for 70 percent of survey respondents. Other factors are quality merchandise (59 percent), merchandise selection (57 percent), free shipping and shipping promotions (46 percent) and convenient location (44 percent), said NRF. Electronics are the fourth-most popular items on wish lists (29 percent), behind gift cards (59 percent), clothing and accessories (52 percent), and books, movies, music and videogames (35 percent). The survey of 7,782 adult consumers was Oct. 1-10, with a margin of error of plus or minus 1.2 points.

The International Trade Commission has issued Revision 15 to the 2019 Harmonized Tariff Schedule. The only substantive change from the previous HTS edition is the removal of an exemption from solar cells safeguard duties for double-sided solar panels, as announced by the Office of the U.S. Trade Representative in early October (see 1910080054).

A domestic manufacturer and labor union filed petitions on Oct. 22 with the Commerce Department and the International Trade Commission requesting new antidumping duty investigations on forged steel fittings from India and South Korea, and new countervailing duties on the same product from India. Commerce will now decide whether to begin AD/CVD investigations on forged steel fittings that could eventually result in the assessment of AD/CV duties. The petition was filed by Bonney Forge Corporation and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union (USW).