Today's newsletter was written by the WSJ Logistics Report's Jennifer Smith.

The Trump administration’s tough line on trade is reshaping economic alliances around the globe. Japan is finding common ground with China after years of skirmishes over territory and security, the WSJ’s Peter Landers writes, as U.S. tariffs threaten Japanese firms that export semiconductors and other high-tech electronics to Chinese factories. During a visit last month Chinese Premier Li Keqiang highlighted how Japan complements China as an export powerhouse, resulting in what he called “strong competitiveness in third-country markets” such as the U.S. Japan, which exported roughly $137 billion of goods to China in the most recent fiscal year, needs “a hedge against Trump,” says one expert, while Beijing is looking to Japan for investment and expertise in advanced manufacturing as its economy slows. Meanwhile, the European Union and Australia launched free-trade talks Monday as other U.S. allies seek to strengthen economic ties in the wake of tit-for-tat tariffs.

An e-commerce alliance between Alphabet Inc.’s Google and online retailer JD.com Inc. could help both reach broader markets. Google is investing $550 million in Beijing-based JD, giving the American tech giant a roughly 1% stake in the number-two player in China’s online shopping market, the WSJ’s Liza Lin writes. The deal will help Google expand its e-commerce business in Asia and could strengthen its ties to China, while potentially bolstering advertising revenue even as more businesses move ads to competitor Amazon.com Inc. JD in turn gets access to U.S. and European consumers through the Google Shopping platform, which offers a chance to gain traction outside the competitive Chinese e-commerce market. Google and JD plan to work jointly on retail and infrastructure systems to help traditional merchants go digital, leveraging JD’s logistics know-how as the e-tailer seeks to gain an edge over rival Alibaba Group Holding Ltd.

Apple Inc.’s decision to produce more iPhones with cheaper screens could end up costing some suppliers. The leading U.S. smartphone maker is delaying its transition to a newer, more costly type of screen called organic light-emitting diode, or OLED, whose main producer is a division of rival Samsung Electronics Co. That’s welcome news for companies that make cheaper liquid-crystal displays, the WSJ’s Jacky Wong writes in Heard on the Street. But the short-term benefit could hurt LCD producers that have invested in the new technology by pushing back the time frame for companies such as LG Electronics Inc., whose display unit is making some $4.5 billion in OLED investments, to earn a return on their outlay. And while most Apple handsets this year will probably stick with LCD displays, intense competition between suppliers means prices are headed downward. 

Soaring lumber prices have U.S. home builders feeling down in the dumps. Homebuilder sentiment sank this month to match its lowest level this year, as tariffs on lumber and other imported materials make construction more expensive, Bloomberg reports. That reduces affordability for prospective buyers, with elevated materials costs adding nearly $9,000 to the price of a new single-family home since the beginning of last year, according to a report from the National Association of Home Builders. Wood prices hit an all-time high last month, propelled by limited rail capacity, a trade dispute with Canada and forest fires. Late last year, the U.S. locked in tariffs of 20% or more on Canadian lumber. While prices have eased some, earlier this month plywood was selling for 43% more than it did last year as U.S. buyers contending with a shortage of domestic supply pony up for Canadian softwood.
 

The global economy is on track to grow 3.9% this year, the fastest pace since 2011, according to the International Monetary Fund. (WSJ)

Consumer confidence is rising among lower-income Americans. (WSJ)

Pres­i­dent Don­ald Trump directed aides to identify $200 billion in Chinese goods for 10% levies in case China matches recent U.S. tariffs. (WSJ)

The Senate passed a bill to reinstate a ban on selling U.S. components to Chinese telecommunications company ZTE Corp., rejecting the president's deal with Beijing to save the firm. (WSJ)

The chief executive of Volkswagen AG’s Audi brand was arrested as investigators probe his role in the car maker’s diesel emissions-cheating scandal. (WSJ)

Fujifilm Holdings Corp. is suing Xerox Corp. for more than $1 billion over a canceled merger. (WSJ)

Rent-A-Center Inc. has agreed to sell itself to an affiliate of Vintage Capital Management LLC amid investor pressure and poor financial results. (WSJ)

Walmart Inc. is doubling down in Central America, adding more than 100 stores since 2014. (Bloomberg)

BJ’s Wholesale Club Holdings Inc. expects to raise about $600 million from its planned initial public offering. (MarketWatch)  

Taiwan’s Foxconn Technology Group will establish its North American corporate headquarters in Milwaukee, Wisc. (Reuters) 

Japan’s Nippon Cargo Airlines grounded its fleet of 747 freighters over problems with maintenance records. (Air Cargo World)

Surging fuel prices will eat into container lines’ profits this year, according to Drewry Shipping Consultants Ltd. (Lloyd’s Loading List)

The Port of Antwerp is testing the use of blockchain to digitize safety certificates for fruit and vegetable imports. (Port Technology)

Shipping rates for refrigerated trucks out of Mexico and California are soaring as produce season kicks into high gear. (Journal of Commerce)

The Equal Employment Opportunity Commission is suing Springfield, Mo.-based New Prime Trucking Inc. over alleged sexual harassment of a female team driver. (Land Line) 

XPO Logistics Inc. and Nestle SA are building a 638,000-square-foot high-tech warehouse in the U.K.’s Midlands region. (The Loadstar)

General Motors Co. is investing $175 million to retool its Lansing, Mich., assembly plant. (Lansing State Journal)
 

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ, @EEPhillips_WSJ. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.