Reshaping Supply Chains Newsletter – September 2025

The Trump administration’s latest trade and security moves continues his push for economic coercion, with wide-ranging implications for global supply chains and investments. Tariffs on EU and Indian goods, paired with stricter tech export controls on China, risk triggering retaliatory measures that could fragment trade flows further. Meanwhile, Red Sea disruptions and heightened U.S.-China frictions compound pressures on energy, logistics, and high-tech industries, raising the likelihood of sustained geopolitical and economic volatility.

• The Trump administration is now implementing the July 2025 EU-US trade agreement: The US is now imposing a 15% tariff EU goods but also recently threatened to impose a 100% rate for branded or innovative drugs from October 1 unless companies have started building manufacturing plants in the US . 

• The Trump administration revoked “validated end user” status for US chip manufacturing equipment export for Taiwanese TSMC’s main China plant, as well as for South Korean chipmaker Samsung. This tightens US tech controls on China, likely slowing China’s chip output. China responded by launching an internal anti-dumping and discrimination investigations into US semiconductor trade policies, raising the risk of retaliatory trade barriers on electronics.

• Washington imposed a 25% tariff on nearly all imports from India, a sanction aimed at curbing India’s re-export of Russian oil. This hikes costs on dozens of product lines (metals, textiles, vehicles), potentially forcing US companies to re-source goods or face inflation. The Indian government has been working through September with the Trump administration to find a mutually beneficial agreement. 

• Yemen’s Iran-backed Houthis continued Red Sea attacks on Israel-linked ships and Israel response operations threaten the key Asia–Europe route, driving up insurance prices and forcing ships to reroute around Africa, squeezing already tight global logistics.

• The US has tightened export controls on Chinese companies to combat the circumvention of restrictions in place against China’s ability to develop advanced semiconductors.

September has brought more trade, regulatory, and labor developments with direct implications for global supply chains. The EU fully deployed its new import control system, the US locked in new tariffs on Japanese goods, and Mexico announced sweeping protective duties, while the EU also tightened export controls on advanced technologies. At the same time, OPEC+ modestly raised oil output, sanctions and labor disruptions in Europe and North America intensified logistics pressures, and sanctions on Russian energy continue to reshape fuel markets—all requiring companies to reassess sourcing strategies, compliance, and cost structures.

• The EU’s import control system (ICS2) was fully deployed on September 1, requiring advanced electronic data reporting for all incoming goods through the Entry Summary Declarations (ENS). This new customs regime raises compliance burdens across all sectors. 

• On September 5, US President Trump signed an Executive Order cementing the US–Japan trade framework. Most Japanese imports now face a 15% tariff, while generic pharmaceuticals (and their ingredients) and chemical precursors can benefit from duty-free. This set a lower tariff base line from 25% to 15%.  

• On September 7, OPEC+ agreed to modestly boost oil output by 137,000 barrels/day from October. Saudi Arabia led this surprise unwinding of extra cuts (over 1.65 mbd lifted early) to reclaim market share, and should lead to lower oil prices. 

• On September 8, the EU updated its Dual-Use Export Control List, adding advanced tech (quantum and semiconductor components, computing chips) and certain chemicals (e.g. anti-corrosion coatings, peptide synthesizers) to control. Exporters of these items now need licenses, which will tighten supply of high-tech and biotech equipment. 

• Mexico announced sweeping protective tariffs on September 10. Car import duties on Chinese and other Asian countries’ vehicles will rise to 50%, and levies of 35% were set on steel, motorcycles and toys (10–50% on textiles). This move (affecting ~$52 billion of imports) was announced to “protect jobs” but is widely seen as bowing to US pressure. The tariff immediately disrupted supply chains for automotive and consumer goods as carmakers relying on Chinese parts now face sharp cost increases. Similarly steel- and textile-using industries must seek alternate suppliers or absorb higher input costs.

• On September 12, the UK expanded sanctions on Russia’s oil shipping fleet, banning about 70 vessels. This further restricts Russian oil deliveries to Europe, stepping up pressure on Russia to put an end to the war in Ukraine, whilst squeezing fuel and petrochemical feedstock availability. 

• In India, transport unions around Gujarat’s Kandla and Mundra ports launched an indefinite “No Road, No Toll” on September 12, which was called off after 1 day following the fulfillment of the unions’ demands. These ports play an important role in the shipment of electronics, raw materials and agricultural exports through India’s west coast.

• On September 16, Reuters reported that the US has launched a major effort to reduce China’s control of overseas ports. Washington is encouraging Western investment in key terminals (e.g. Panama Canal zone, Greece’s Port of Piraeus) to dilute Chinese stakes, which could ultimately impact maritime shipment.

• Large-scale labor actions in Europe also disrupted logistics. On September 18, France saw nationwide strikes against pension and spending reforms. Transport workers blockaded rails, buses and airports while hospitals and pharmacists joined walkouts. 

• On September 25, the EU’s new 19th sanctions package closed a loophole on Russian LPG by banning imports of high-purity LPG feedstocks (e.g. butane/isobutane). European petrochemical and aerosol industries losing Russian butane must find alternate LPG sources, raising costs and risking short-term fuel shortages.

• Workers launched a nationwide strike at Canada Post on September 25, following a decision from the federal government that would shut some post offices and end certain types of deliveries. This also shut down cross-border letter and small-parcel deliveries, highlighting the fragility of North American just-in-time networks.

Taken together, September’s trade, tariff, and security shifts continue to point toward a more fragmented and protectionist global trade environment. For companies, the combination of new tariffs, regulatory compliance burdens, energy policy shifts, and logistics disruptions requires proactive risk management—ranging from supplier diversification and compliance monitoring to contingency planning for transport and energy costs. The volatility across multiple regions underscores that supply chains can no longer be optimized solely for efficiency; resilience and adaptability are now central to long-term strategy.