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Mexico Plans Tariff Hike; Prices for Building Materials Rise; Europe Targets Fashion Waste

By Mark R. Long | WSJ Logistics Report

 

Mexico has become a major destination for vehicles made by BYD and other Chinese manufacturers. PHOTO: LI MUZI / ZUMA PRESS

Mexico plans to raise tariffs on key goods from countries with which it doesn’t have a trade agreement, to bolster domestic industry and substitute imports from Asia.

The Wall Street Journal’s Anthony Harrup writes that vehicles and auto parts, steel, textiles, toys, home appliances and footwear are among the nearly 1,500 products that would be affected. The bill, submitted this week to Congress, would impact some $52 billion worth of imports, according to the Economy Ministry.

Mexico has trade agreements with more than 50 countries. China is the principal exporter to Mexico that doesn’t, along with South Korea, India and Russia. Mexico has become a major destination for Chinese-made cars, which accounted for around a fifth of Mexico’s new car sales.

  • President Trump asked the European Union to impose tariffs of up to 100% on some Chinese and Indian goods to ratchet up pressure on Russia over its war in Ukraine, two EU officials said. (WSJ)
  • Trump will pick projects to be funded by Japanese financial institutions and could raise tariffs on the country if it refuses to provide the money, according to the pact signed this month. (WSJ)
  • The Supreme Court could hand Trump sweeping fiscal authority long the purview of Congress if it sides with the president in his appeal of a lower-court ruling against his tariffs. (WSJ)
  • Canada’s prime minister said the government will identify an initial list of major infrastructure projects that it wants to pursue as part of a revamp of the economy. (WSJ)
 
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Quotable

“The Mexican auto industry is 23% of national manufacturing, so we have to protect it.”

— Mexican Economy Minister Marcelo Ebrard
 

Construction Materials

Softwood lumber prices rose, though lately prices for two-by-fours have tumbled. PHOTO: JUSTIN SULLIVAN / GETTY IMAGES

Prices for construction materials continued to climb in August, even as the latest reading of wholesale prices unexpectedly fell. The Journal’s Ryan Dezember writes that construction-material prices rose 0.2% last month from July, bringing the year-over-year increase to 2.3%, adding pressure to a sector where activity has waned amid persistently high borrowing costs and import taxes.

Declines in oil and natural gas prices, as well as a 3.8% drop in copper wire and cable—the result of tariff-related market turbulence—helped to offset gains in asphalt, steel, plumbing fixtures and lumber. Steel-mill products are now up 13.1% year-over-year, copper products have risen 13.8% and softwood lumber is up 5.8%, though lately prices for two-by-fours have tumbled.

Construction spending has declined 3.4% from its peak in May 2024 and residential building permits in July dropped to their lowest level since the Covid lockdown in June 2020.

 
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Recycling

Activists piled up textile waste in front of Berlin's Brandenburg gate, in February of 2024. PHOTO: ANNEGRET HILSE / REUTERS

Producers that sell textiles in Europe will have to cover the cost of collecting, sorting and recycling those materials under a new rule to cut waste in the fashion industry. The Journal’s Yusuf Khan writes that the European Parliament will adopt a new law requiring textile makers to manage waste from clothing to blankets to curtains.

The European Parliament is looking to reduce the environmental impact of the fast-fashion industry. Some 12.6 million metric tons of textile waste are generated in the EU each year, according to the European Commission. It estimates that just 1% of textiles are recycled worldwide. The rule will apply to all producers, whether they are established in or outside an EU country.

 

Number of the Day

$2,163

Spot-market rate to ship a 40-foot container from Asia to the U.S. West Coast in the week ended Sept. 9, up 25% from the previous week, according to Freightos

 

In Other News

Over 300 South Koreans were released from detention in Georgia after an immigration raid at a Hyundai Motor battery plant. (WSJ)

China’s producer-price index dropped 2.9% on the year in August, narrowing from a 3.6% fall in July, while a gauge of consumer prices slipped back into contraction. (WSJ)

The EU plans to propose a partial suspension of the bloc’s trade agreement with Israel amid pressure to take a harder line on Gaza. (WSJ)

The European Commission will make $2.11 billion available for battery technology investment and an initiative to offer “Made in Europe” electric cars. (WSJ)

CMA CGM doesn't plan to implement a surcharge to cover new fees on China-built or Chinese-owned ships calling at U.S. ports scheduled to take effect on Oct. 14. (Dow Jones Newswires)

Lyft is launching one of its first autonomous vehicle services in the U.S. in Atlanta, in partnership with May Mobility. (WSJ)

Mitsui Chemicals, Idemitsu Kosan and Sumitomo Chemical agreed to combine some of their businesses to strengthen their competitiveness. (WSJ)

Amazon Air Cargo launched a new service between Miami and the Dominican Republic using Boeing 767 freighters. (Air Cargo News)

The U.S. Coast Guard and National Transportation Safety Board are investigating the cause of an incident that led to about 75 containers falling off a ship at the Port of Long Beach. (gCaptain)

Arc Boats signed a $160 million contract with Curtin Maritime to deliver eight hybrid-electric ship-assist tugboats in partnership with Snow & Co. (WorkBoat)

 

About Us

Mark R. Long is editor of WSJ Logistics Report. Reach him at mark.long@wsj.com.

Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long, Liz Young and Paul Berger.

 
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