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Retailers Stockpile Chinese Goods Ahead of Increased Tariffs, Report Says

In anticipation of higher tariffs in 2019, companies around the country are stockpiling goods from China, their warehouses stuffed to capacity, Reuters reports.

Dozens of companies including retailers, vendors, customs brokers, and supply chain experts told the news agency that they have been on a buying binge building up inventory from China, a move meant to avoid paying higher taxes on goods such as air conditioners, microwaves, and furniture.

Container ports in October hit a record of more than 2 million imported containers, according to the National Retail Federation.

Since March, President Trump has imposed a series of escalating tariffs on goods from China, and has made threats to enact even more. The temporary truce between the two countries, however, came after the rampant ordering of goods.

“President Trump has declared a temporary truce in the trade war, but these imports came in before that announcement was made,” Jonathan Gold, the National Retail Federation’s VP for Supply Chain and Customs Policy. said in a statement. “We hope that the temporary stand-down becomes permanent, but in the meantime there has been a rush to bring merchandise in before existing tariffs go up or new ones can be imposed. China’s abuses of trade policy need to be addressed, but tariffs that drive up prices for American families and costs for U.S. businesses are not the answer.”

While businesses are in a holding pattern as to what will happen next with the international tariff feud, there is one potential effect that could benefit customers: Should the stockpile leave retailers languishing with unsold inventory, that could mean lower prices on Chinese goods next year.