What next after a week of renewed US tariff chaos?

Any hopes exporters had of 2026 ushering in greater US trade stability have been dashed over the past week.

The US Supreme Court dramatically struck down Donald Trump’s global ‘Liberation Day’ tariffs last Friday, in a seemingly positive move for exporters.

In a so-far rare rebuke to Trump’s executive powers, the court ruled by a majority in favour of an appeal by US businesses to overturn the policy.

However, the decision has plunged global trade into even more uncertainty, raising the prospect of potentially huge compensation claims against the US government from companies that had already paid significant duties.

Then came the expected outcry from the US president, who slammed the decision as “ridiculous” and “nonsensical”, before swiftly imposing a new set of 10% temporary tariffs on all global imports.

But that’s only half the story. A flurry of chaotic amendments to the policy have since raised more questions than answers.

So, what has unfolded in the wake of the Supreme Court decision, and where does it leave now UK exporters?

Trump had argued the US was facing a “national emergency” over its trade deficit when he introduced the controversial package of reciprocal levies last April, under the International Emergency Economic Powers Act (IEEPA).

The tariffs and global negotiations that followed ultimately led to free trade deals with a number of countries – including the UK’s ‘Economic Prosperity Deal’ with the US, signed last May.

A 10% ‘baseline’ tariff remained on many goods though, including the majority of US food and drink imports from the UK and elsewhere.

But last week, six of the Supreme Court’s nine justices (including three conservatives) found Trump had exceeded his presidential authority by imposing the emergency IEEPA levies in the first place, and required congressional authorisation instead.

They were unconvinced by testimony of Trump loyalist and Supreme Court justice Brett Kavanaugh, who voted against the decision and warned striking down the tariffs “could generate uncertainty regarding various trade agreements”.

The US may even “be required to refund billions of dollars to importers who paid the tariffs, even though some may have already passed on costs to consumers or others”, Kavanaugh added in his argument.

And it looks like he had a point. FedEx, for one, has already filed a lawsuit for a “full refund” of the tariffs it has paid since last spring.

Mixed messages

Undettered, Trump’s response was a pivot to the Trade Act of 1974, invoking separate statutory powers to impose his new 10% tariff on Friday evening, for a period of 150 days.

Just hours later, Trump took to his Truth Social platform to announce the rate would increase to 15% – as the Trade Act allows for.

The White House insisted tariffs “will continue to be a critical tool in president Trump’s toolbox for protecting American businesses and workers, reshoring domestic production, lowering costs, and raising wages”.

But by the time US Customs had published the new levies on Tuesday, they were back to 10%.

As confusion reigned over what exactly the tariff would be, Reuters quoted a White House official on Tuesday stressing Trump had not had a “change of heart” on the 15% levy, and his team was working to increase the rate.

The turmoil comes just a month after Trump’s eventual rowback on threats of up to a 25% tariff on eight European countries, including the UK, over their opposition to his designs on Greenland.

And this week’s announcements have only unleashed “fresh uncertainty” for UK firms exporting to the US, says William Bain, head of trade policy at the British Chambers of Commerce.

Despite the “immediate reprieve” of the 10% tariff, “it’s far from clear what will happen next, and whether a higher tariff rate is still on the way”, he adds.

“This makes it very difficult for firms to understand the Prices and margins they’ll be able to secure for their goods currently in production, for export in several months’ time. Inevitably this will have an impact on their sales and hit the Economy.”

Bain’s fears are shared by a “deeply concerned” Food & Drink Export Association chair Barney Mauleverer, who says the developments are “undoubtedly a setback for our sector, adding real pressure on costs and competitiveness”.

As the world awaits the Trump administration’s next move, 10 Downing Street this week said reciprocal action was not “off the table” if the US did not honour its trade deal with the UK, while stressing “no one wants a trade war”.

Business and trade secretary Peter Kyle said he had “raised my concerns about further uncertainty for businesses here and the need to honour our existing deal” with his US counterpart Jamieson Greer.

Even before this week, several exporters had told The Grocer the US was becoming an increasingly less attractive partner in the wake of the Greenland debacle – if only it wasn’t a £2.7bn market for UK food and drink [FDF/HMRC].

Now, it looks as though the difficulties for exporters are far from over. As the BCC’s Bain sums up: “The risk of further tariff pain to come is still real and the government must do everything it can to prepare for the worst.”