US and Chinese officials will reportedly meet in London to ease their escalating trade dispute, which has expanded from tariffs to export controls affecting global supply chains.
Reuters reports that senior US and Chinese officials will meet at a confidential venue in London on 9 June to revive last month’s preliminary agreement from Geneva, which briefly eased tensions and calmed markets after a prolonged period of US tariff measures under President Trump.
Despite some progress following a recent call between Presidents Trump and Xi Jinping, major disputes—ranging from geopolitical tensions to deeper economic policy differences—remain unresolved.
The talks are being closely watched for their potential impact on global trade flows and market stability, according to Reuters.
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Trade analyst Lars Jensen, CEO of Vespucci Maritime, notes that the talks come at a critical time: “We are now exactly one month away from 9 July, which marks the end of the 90-day pause on US reciprocal tariffs from all origins except China.
“This also means we are rapidly approaching the point where any frontloading ahead of the deadline will taper off—likely triggering a decline in demand to the extent frontloading has occurred.”
Jensen outlines that the expectation is a three-step development in relation to cargo from China:
- Recent cargo surge – A spike in shipments over recent weeks has strained capacity and driven up spot rates. This is largely due to delayed cargo that was held back by importers awaiting a tariff pause.
- Frontloading before the deadline – With the tariff pause on Chinese goods set to expire on 12 August, some frontloading may still occur. However, Jensen notes that May’s Purchasing Managers Index (PMI) showed factory contraction, suggesting limited momentum, though this could be skewed by timing and lag in production responses.
- Post-pause impact – If tariffs resume at full scale, container demand could drop sharply. Even if a deal is reached with modest tariff levels, a dip in demand is still likely as a result of frontloading in step 2.
The last-minute agreement between the US and China to sharply reduce tariffs for 90 days has taken shipping lines by surprise, prompting a scramble to adjust Transpacific capacity ahead of peak season demand. Analysts at Sea-Intelligence recently warned that the market could see short-term volatility as carriers and shippers race to respond to these sudden changes.
