>> Warehouses across the country at record capacity this winter with Chinese-made goods like microwaves, swimwear, furniture, you name it, stacked to the ceiling, in anticipation of higher US tariffs on imports from China. Reuters correspondent Richa Naidu recently visited the warehouse of Chicago-based Abt Electronics.>> I saw a very active 450,000 square foot warehouse, with products piled up on racks all the way to the ceiling.
Abt's co-president told me many of the boxes piled up were air conditioners and microwaves that Abt had ordered from China to get ahead of the tariffs. I'm told by logistic specialists that it's incredibly rare to pack a warehouse all the way to the roof.>> Sources tell Reuters that some of the country's biggest retailers, like Walmart, Target, and Macy's, began scrambling to buy Chinese products in September.
>> It's gotta be a two-way street.>> The same month President Trump imposed tariffs on an additional $200 billion worth of Chinese goods, and announced they'd go up from 10% to 25% on New Year's Day. The US and China have since agreed to a 90-day trade war truce until March 2nd.
>> Great for China and great for the United States.>> But supply chain firms and vendors said that this has not slowed the buying spree, as fears remain over the possibility of US-China trade talks falling apart. Retailers have for years have been struggling with declining holiday foot traffic.
And larger inventories could further weigh on their balance sheets. And inventory holding has also triggered a race for space.>> Some vendors and retailers have had a hard time finding warehousing to store the added product, especially as rents for many warehouses have gone up.>> On the plus side, holding Chinese goods could mean heavy discounts for US shoppers next year.
If retailers aren't able to move their mountain of merchandise.