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Mattel not playing around with tariffs; Urban Outfitters fills the stockroom

The Supply Chain Daily provides a curated overview of Panjiva's research and insights covering global trade policy, the logistics sector and industrial supply chains and draws from global shipping and freight data.

Hasbro, Mattel not playing around with rapid inventory build
U.S. toy importing season is overshadowed this year by the threat of tariffs on imports from Chinese, which represented 84.7% of seaborne shipments to the U.S. in the 12 months to Aug. 31. Most brands have reacted to the threat — even though it is now postponed to Dec. 15 — with accelerating imports.

Hasbro Inc. already noted changing suppliers can take years while Funko indicated small prices may also be applied. Total U.S. seaborne toy imports jumped 17.3% year over year in August, with shipments associated with Hasbro and Mattel Inc. climbing 13.9% and 66.8% respectively. Niche brands have followed a similar strategy with Vtech Holdings Ltd.'s rising by 73.3% and Funko Inc.'s by 59.9%.

(Panjiva Research - Consumer Durables)

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Guess, Urban Outfitters fill the stockroom ahead of tariffs
The National Retail Federation is projecting a surge of imports from retailers ahead of potential tariffs in December. Many apparel retailers are likely to be stockpiling ahead of the tariffs that have been applied to some products since Sept. 1 and all remaining categories in December.

Panjiva's data, retrieved via S&P Global Xpressfeed, shows that U.S. seaborne imports from China associated with specialty retailers Guess? Inc. and Urban Outfitters Inc. climbed 48.1% and 70.2% year over year respectively in the three months to Aug. 31. Not all apparel retailers are taking such extreme measures, for example The Cato Corp. increased its shipments by just 2.5%.

Multiline retailers (department and general merchandise stores) face ongoing tariff pressures as the Trump administration may widen the application of duties to include all consumer goods by Dec. 15, while furniture has been covered since last September.

Big box retailers Target Corp. and Burlington Stores Inc. have likely already cut their imports from China in part due to the earlier tariffs with a 39.7% and 29.0% year over year decline respectively. A similar pattern can be seen from department store operators such as Ascena Retail Group Inc. which declined by 27.7%.

(Panjiva Research - Retail)

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Heineken fills up with beer kegs, Constellation cuts back
The U.S. International Trade Commission has ruled that Mexican exports of steel beer kegs to America have inhibited the development of U.S. industry, though retroactive tariffs won't be applied. The case has already led to lower shipments from Mexico to the U.S., with July seeing a 43.8% year over year decline.

Mexican exporters have few alternative markets, leading to a total drop of 22.0% in shipments globally. Among the major beer firms Constellation Brands Inc. slashed its shipments of kegs to the U.S. from Mexico by 49.6% while Heineken NV's have increased 1.8%.

(Panjiva Research - Food & Beverages)

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Trade war winter sees pullovers pulled forward, ski wear head downhill
The start of the peak U.S. import season for winter apparel and sports equipment has been complicated by the phasing in of tariffs on Chinese exports. Suppliers from China accounted for 43.3% of U.S. seaborne imports of sweaters and growth reached 11.6% year over year in August.

Shipments of ski gear meanwhile — where China represented 55.3% of the total — declined by 8.7%. At the product level imports of ski goggles, including those made by EssilorLuxottica Société anonyme's Oakley, fell 18.0% year over year. At the other end of the scale imports of skis and equipment, such as those supplied by K2-MDV Holdings LP and Skis Rossignol SAS, surged 38.6% higher.

(Panjiva Research - Consumer Discretionary)

India's export woes could become Walmart, Costco's gain
India's exports fell 6.0% year over year in August, bringing the country inline with the situation across Asia, which is seeing declining exports. The slowdown has led the Indian government to implement a new export support scheme worth as much as $6.97 billion, though only a fraction of that money is new programs as opposed to reprofiling of older plans.

One such program involves increased export subsidies for textiles, where Panjiva's data shows India's exports slumped 27.7% year over year in the second quarter after a 30.9% slide in the first quarter. Indian exporters may use the subsidies in part to increase their market share in the U.S. at the expense of Chinese suppliers who already face rising tariffs.

That could put progress on the Regional Comprehensive Economic Partnership, or RCEP, trade deal, which includes India and China, at risk. Panjiva's seaborne shipping data showed the largest importers in the U.S. that relied on Chinese textile supplies in the 12 months to Aug. 31 included Walmart Inc., Target Corp. and Costco Wholesale Corp.

(Panjiva Research - Retail)

Christopher Rogers is a senior researcher at Panjiva, which is a business line of S&P Global Market Intelligence, a division of S&P Global Inc. This content does not constitute investment advice, and the views and opinions expressed in this piece are those of the author and do not necessarily represent the views of S&P Global Market Intelligence.

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