A potential gap between temporary and permanent U.S. tariffs could create a short window of lower import duties this summer. Fastmarkets analyst Antonio Gallotta says that scenario could trigger a surge of imports, driving higher demand for palletized freight across ports, warehouses, and distribution networks.
Recent developments in U.S. trade policy could create a short-term surge in imports that may ripple through logistics networks and increase demand for palletized handling.
According to a recent analysis from Antonio Gallotta, Economic Analyst for Wood Products at Fastmarkets, a timing mismatch between different tariff authorities could create a temporary window where import tariffs fall significantly before new duties are implemented.
If that scenario unfolds, even briefly, importers could move quickly to accelerate shipments into the United States.
For supply chains already operating at high volumes, that outcome could translate into increased container flows through ports, higher warehouse activity, and stronger demand for palletized freight movement.
In a recent LinkedIn post shared with permission, Gallotta outlined how the timing of U.S. tariff mechanisms could create what he describes as a “gap scenario” in which tariffs are temporarily reduced.
A Potential Tariff Gap
The U.S. Supreme Court ruled recently that tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were unlawful. Gallotta noted that while the decision received significant attention, a related issue may have received less scrutiny: the timing of replacement tariffs.
“Something I think has been a little overlooked is the potential for a scenario where, because Section 301 tariffs take some time to put in place, we could have at least a couple of months where tariff rates are greatly reduced,” Gallotta wrote. That situation could create an incentive for importers to move shipments forward into the U.S. market while tariffs remain temporarily lower.
Section 122 as a Temporary Bridge
Following the Supreme Court ruling, the administration moved quickly to impose tariffs under Section 122 of the Trade Act at a rate of 15%.
However, Gallotta notes that Section 122 is only intended as a temporary measure.
The authority is limited to 150 days, meaning the current tariffs would expire on July 24, 2026.
The measure effectively serves as a short-term bridge while the government pursues longer-term tariffs under Section 301 of the Trade Act.
Why Section 301 Takes Time
Unlike emergency tariff mechanisms, Section 301 actions require formal investigations before tariffs can be imposed.
These investigations are typically country-specific and involve an extensive regulatory process.
Gallotta pointed to historical examples showing how long the process can take.
The Section 301 investigation into China, launched during the first Trump administration, began in August 2017 and lasted seven months before reaching the report stage in March 2018. Tariffs were not fully implemented until September 2018.
More recently, the Office of the U.S. Trade Representative launched Section 301 investigations into ten countries in 2020 related to digital services taxes. Each of those investigations also took more than seven months to complete.
There are currently active investigations also underway, including a Section 301 investigation into Brazil launched in July 2025 and another examining whether China fulfilled obligations under the 2020 Phase One trade agreement.
Taken together, Gallotta said these timelines illustrate the possibility that new tariffs may not be ready when the temporary Section 122 tariffs expire.
The “Gap Scenario”
Gallotta outlined a potential sequence of events that could produce a short-term tariff gap.
The scenario would unfold if:
The Section 122 surcharge expires on July 24, 2026.
The relevant Section 301 investigations are still unfinished or not yet implemented.
No other tariff authority is used in the interim, such as Section 232 or a congressional extension of Section 122.
If those conditions align, tariffs on certain imports could drop sharply for a period of time.
Even a short window could change importer behavior.
“You would not need a long window for behavior to change,” Gallotta noted. “Even a short gap could be enough to trigger a meaningful burst of summer frontloading.”
What It Could Mean for Pallet Demand
A surge of imports could have direct implications for logistics activity across the United States. Increased container traffic through ports typically drives higher demand for warehouse space, distribution activity, and palletized freight movement.
“For pallets, a summer import surge would mean more containerized freight moving inland, more warehouse activity, and more demand for palletized handling across ports, distribution, and retail supply chains,” Gallotta wrote. For pallet manufacturers, recyclers, and logistics providers, the timing of tariff policy could therefore influence short-term demand patterns during the summer months.
Gallotta emphasized that the scenario is not a certainty. “It is still only a scenario, not a base case,” he wrote.
However, the timing mismatch between temporary and permanent tariff authorities could become a significant factor in supply chain activity if it leads importers to accelerate shipments ahead of potential tariff increases. For pallet markets, where demand often tracks freight flows and warehouse throughput, even a temporary import surge could produce noticeable spikes in pallet usage.
Source: Antonio Gallotta, Fastmarkets. Used with permission.
Original analysis posted on LinkedIn.
More market insights available at Fastmarkets: https://www.fastmarkets.com
Rick LeBlanc, EMBA, is the founder and editor of Reusable Packaging News (subscribe to the free newsletter) and editor of Western Pallet Magazine. A supply chain journalist with more than 30 years of experience, he specializes in pallets, reusable packaging, material handling and related operations. Rick is co-author of Pallets: A North American Perspective and Pallets & Progress: A Collected History of Pallets and Palletized Handling 1922–1945. He is also an advisory board member of the Virginia Tech Center for Packaging and Unit Load Design. Read Rick’s full bio.
