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You're reading the Supply Lines newsletter.
Trade wars, tariff threats and logistics shocks are upending businesses and spreading volatility. Understand the new order of global commerce.
Trade wars, tariff threats and logistics shocks are upending businesses and spreading volatility. Understand the new order of global commerce.
Trade wars, tariff threats and logistics shocks are upending businesses and spreading volatility. Understand the new order of global commerce.
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In downtown Guangzhou, long a bustling hub of Chinese trade, dozens of middle-aged day laborers wait for agents from nearby factories to offer work. Some people are unable to earn a paycheck for months.
China's exports surged in the first two months of 2026, but ordinary workers in Guangdong province have seen a sharp decline in their living standards. Jobs are disappearing and salaries are falling, according to Bloomberg News reporting.
The boom in automation and artificial intelligence in China's manufacturing sector is expected to lead to even tighter household strains, with Citigroup economists forecasting that almost a third of jobs in China could be impacted by AI.
Official data on Tuesday showed Chinese exports surged almost 22% from a year earlier in the first two months of 2026. Setting aside an 11% drop in the value of goods to the US, shipments were strong most everywhere else, including places worried about a China shock like the European Union and the UK.
Imports jumped nearly 20%, according to a statement released by the General Administration of Customs, leaving a surplus of $214 billion -- an all-time high for the period.
Some workers in Guangdong blamed the wreckage on US tariffs that peaked at 145% last year, along with President Donald Trump's elimination of duty-free perks on small parcels. Others cited domestic price wars as driving wage decline. Few expected things to improve anytime soon.
Perhaps more notable for global trade in China and elsewhere, the trend appears set to intensify in the short term as the explosion of AI and robotics spawn so-called dark factories that require no human workers.
Modern Factories
In the US, Trump's economic program is geared around reshoring employment in manufacturing from places like China, but the world's largest economy lost 120,000 factory jobs since the start of 2025.
So Guangdong provides a cautionary tale of the bumpy path to the next era -- one that brings either productivity gains and economic abundance, or a more dystopian future like the one outlined last month in the Citrini Research report that rocked global markets.
Apple Shift: China's exports are powering ahead, even as Apple increased iPhone production in India by about 53% last year and now makes a quarter of its marquee devices there, reflecting the US company's efforts to avoid tariffs on China.
-- Brendan Murray in London
Bloomberg's tariff tracker follows all the twists and turns of global trade wars.
Charted Territory
- Parcel rivalry | FedEx has eclipsed rival UPS as the largest US parcel carrier by market value for the first time, underscoring the couriers' diverging paths in the volatile package-delivery business. The milestone punctuates a multiyear stock slide for UPS, which has faced pressure from labor costs, declining volume and questions about its relationship with Amazon.com. For FedEx, it's the latest sign that management has won investors over with plans to trim costs, boost margins and spin off its freight business.
Today's Must Reads
- G-7 finance ministers said they were ready to take any steps needed to support global energy supply, including releasing strategic oil reserves -- although the group isn't at the point of doing so yet. Meanwhile, French President Emmanuel Macron is seeking to launch a joint maritime mission to escort container ships in an effort to reopen the Strait of Hormuz once the initial phase of the war has calmed down.
- The US-Mexico-Canada free trade deal shouldn't undergo a major renegotiation but instead be improved and strengthened, according to consultations with key economic sectors overseen by the Mexican government.
- A widening supply crunch is forcing Asian governments to put more restrictions on fuel use and instruct citizens to avoid panic-buying, as the war in the Middle East limits the availability of energy.
- Mercedes-Benz is considering sharing its manufacturing plant in South Africa with Great Wall Motor to boost the facility's viability as US tariffs take effect. Meanwhile, Volkswagen is targeting more cost reductions amid pressures from competition, tariffs and developing electric vehicles.
- South Korea's industry minister said the US signaled it will refrain from raising tariffs on Korean goods if Seoul swiftly passes draft legislation aimed at facilitating investment in the US.
On the Bloomberg Terminal
- Sustained conflict in Iran could snap air freight out of its nearly year-long price decline as Middle East hub disruptions and the rising cost of marine shipping boost air cargo's competitiveness against other transport modes, Bloomberg Intelligence says.
- Cosco, Maersk, Ocean Network Express and other major transpacific container liners are set to pivot to intra-Asia trade as US-China decoupling reshapes global shipping, according to Bloomberg Intelligence.
- For Bloomberg Economics trade analysis: BECO MODELS TRADE.
- Click here for Bloomberg Intelligence's Tariff Matrix.
- Run SPLC after an equity ticker on Bloomberg to show critical data about a company's suppliers, customers and peers.
- Use the AHOY function to track global commodities trade flows.
- See DSET CHOKE for a dataset to monitor shipping chokepoints.
- For freight dashboards, see BI RAIL, BI TRCK and BI SHIP and BI 3PLS
- Click HERE for automated stories about supply chains.
- On the Bloomberg Terminal, type NH FWV for FreightWaves content.
- See BNEF for BloombergNEF's analysis of clean energy, advanced transport, digital industry, innovative materials,and commodities.
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