Importers slowed their buying frenzy that occurred prior to the ‘Liberation Day’ tariffs and now April’s trade figures show a not-surprising 16.3% drop for the month to $351 billion. The monthly goods and services deficit also unsurprisingly fell, this time by 55% down to $61.6 billion. That’s a good $12 billion below the usual monthly deficit figures, and half the values that have been reported each month this year so far, based on trade data released on Thursday by the Bureau of Economic Analysis (BEA).
The goods and services deficit for the first four months of 2025 stood at $452.2 billion, a massive difference versus the same period in the last two years, where it was around $272 billion. This is all due to frontrunning tariffs. Companies loaded up their warehouses early before the tariffs hit.
On the goods-only side, April’s deficit was $87.4 billion. That number is much lower than the $162 billion recorded in March, and the $147 billion recorded in February, but it is not much different from monthly goods deficit averages in 2023. Recall that 2023 saw a record $1.1 trillion goods trade deficit.
As it is, companies large and small just imported more than half a year’s worth of goods within four months. The goods gap is $553.7 billion as of April, up from $377 billion in the Jan-April period of 2024, and $359.1 billion in the Jan-April period of 2023. So we are up by around $200 billion at this time. Barring a total collapse of goods transit into the U.S. over the next four months, the U.S. is on par yet again to crack the one trillion dollar trade deficit barrier.
With the U.S. trade deficit again on track to eclipse the $1 trillion mark, policymakers need to get serious about fixing the structural imbalances in the global trading system, addressing our overreliance on foreign production, and rebuilding our domestic manufacturing sector.
Top 10 Trade Deficits
China: $19.7 billion
European Union: $17.9 billion
Vietnam: $14.5 billion
Mexico: $13.5 billion
Taiwan: $9.7 billion
Ireland: $9.5 billion
Japan: $5.8 billion
Germany: $5.4 billion
India: $5.3 billion
South Korea: $3.3 billion
China is the unstoppable first place source of the goods deficit, but this number is much lower than it usually is – which tends to fall between $22 billion and $28 billion.
Vietnam’s figures are surprisingly high. Those usually run between $9 billion and $11 billion, proving that despite the tariff – currently at 10% after a brief tariff rate of 46% – Vietnam’s weak currency and low wages keep it at the best Asian alternative to mainland China.
The deficit with South Korea is not much different than the $3.6 billion recorded in February, when Korea was enjoying free trade with the U.S. This number is on par with 2023 and 2022 values, inflation notwithstanding.
Biggest Import Declines
Some of the biggest import declines were in items facing Section 232 tariffs. All told, the category for industrial supplies and materials fell $23.3 billion to $51.9 billion in April.
Metal goods products went from $21 billion in imports in March, to $4.1 billion in April. Steel and iron mill product values were flat, however, on account of Section 232 tariffs already in effect in February. April imports fell by around $400 million to $1.4 billion, the BEA said.
Passenger car imports were down from March values, but well within previous norms from 2024 and 2023, coming in at $13 billion. Mexico and Canada still enjoy duty free shipments of cars so long as the majority of the vehicle is made with parts sourced in the U.S., Canada, or Mexico. If not, then the car will be hit with a 25% Section 232 tariff. It is unclear how many USMCA cars do not meet the content requirements for duty free, but it seems apparent that a lot of the Asian and German automakers were importing key components like engines and slipping cars into the country duty free, or simply paying the Most Favored Nation rate of 3.4%. Auto parts export values were relatively unscathed month over month – $11.5 billion.
Thankfully, the biggest drop in trade was in pharmaceutical imports, which is a positive trend as Americans are dangerously dependent on foreign-made generic drugs. Those values fell $25.9 billion in April for a total of $24.1 billion of imported drugs. To date, pharmaceuticals are exempt from all new tariffs. A Section 232 investigation is underway, however, as CPA has warned of the national security and the health care patient dangers from these pharmaceuticals coming from lesser-developed nations, or those lacking regulatory oversight or allowing for little quality control, which includes China and India.
Lastly, as far as fears over tariff retaliation goes – the U.S. exported $436.7 billion worth of manufactured goods in Jan-April 2025. That’s not much different from the $432.7 billion in Jan-April 2024, when Biden was still running as the incumbent president.
And what about retaliation against American farmers? The U.S. exported $58.4 billion worth of agricultural commodities in Jan-April 2025, down around $2 billion from the same period last year.
MADE IN AMERICA.
CPA is the leading national, bipartisan organization exclusively representing domestic producers and workers across many industries and sectors of the U.S. economy.
Importers No Longer Loading Up on Goods as Tariff Reality Sinks In; April Imports Fall 16.3%
Importers slowed their buying frenzy that occurred prior to the ‘Liberation Day’ tariffs and now April’s trade figures show a not-surprising 16.3% drop for the month to $351 billion. The monthly goods and services deficit also unsurprisingly fell, this time by 55% down to $61.6 billion. That’s a good $12 billion below the usual monthly deficit figures, and half the values that have been reported each month this year so far, based on trade data released on Thursday by the Bureau of Economic Analysis (BEA).
The goods and services deficit for the first four months of 2025 stood at $452.2 billion, a massive difference versus the same period in the last two years, where it was around $272 billion. This is all due to frontrunning tariffs. Companies loaded up their warehouses early before the tariffs hit.
On the goods-only side, April’s deficit was $87.4 billion. That number is much lower than the $162 billion recorded in March, and the $147 billion recorded in February, but it is not much different from monthly goods deficit averages in 2023. Recall that 2023 saw a record $1.1 trillion goods trade deficit.
As it is, companies large and small just imported more than half a year’s worth of goods within four months. The goods gap is $553.7 billion as of April, up from $377 billion in the Jan-April period of 2024, and $359.1 billion in the Jan-April period of 2023. So we are up by around $200 billion at this time. Barring a total collapse of goods transit into the U.S. over the next four months, the U.S. is on par yet again to crack the one trillion dollar trade deficit barrier.
Top 10 Trade Deficits
China is the unstoppable first place source of the goods deficit, but this number is much lower than it usually is – which tends to fall between $22 billion and $28 billion.
Vietnam’s figures are surprisingly high. Those usually run between $9 billion and $11 billion, proving that despite the tariff – currently at 10% after a brief tariff rate of 46% – Vietnam’s weak currency and low wages keep it at the best Asian alternative to mainland China.
The deficit with South Korea is not much different than the $3.6 billion recorded in February, when Korea was enjoying free trade with the U.S. This number is on par with 2023 and 2022 values, inflation notwithstanding.
Biggest Import Declines
Some of the biggest import declines were in items facing Section 232 tariffs. All told, the category for industrial supplies and materials fell $23.3 billion to $51.9 billion in April.
Metal goods products went from $21 billion in imports in March, to $4.1 billion in April. Steel and iron mill product values were flat, however, on account of Section 232 tariffs already in effect in February. April imports fell by around $400 million to $1.4 billion, the BEA said.
Passenger car imports were down from March values, but well within previous norms from 2024 and 2023, coming in at $13 billion. Mexico and Canada still enjoy duty free shipments of cars so long as the majority of the vehicle is made with parts sourced in the U.S., Canada, or Mexico. If not, then the car will be hit with a 25% Section 232 tariff. It is unclear how many USMCA cars do not meet the content requirements for duty free, but it seems apparent that a lot of the Asian and German automakers were importing key components like engines and slipping cars into the country duty free, or simply paying the Most Favored Nation rate of 3.4%. Auto parts export values were relatively unscathed month over month – $11.5 billion.
Thankfully, the biggest drop in trade was in pharmaceutical imports, which is a positive trend as Americans are dangerously dependent on foreign-made generic drugs. Those values fell $25.9 billion in April for a total of $24.1 billion of imported drugs. To date, pharmaceuticals are exempt from all new tariffs. A Section 232 investigation is underway, however, as CPA has warned of the national security and the health care patient dangers from these pharmaceuticals coming from lesser-developed nations, or those lacking regulatory oversight or allowing for little quality control, which includes China and India.
Lastly, as far as fears over tariff retaliation goes – the U.S. exported $436.7 billion worth of manufactured goods in Jan-April 2025. That’s not much different from the $432.7 billion in Jan-April 2024, when Biden was still running as the incumbent president.
And what about retaliation against American farmers? The U.S. exported $58.4 billion worth of agricultural commodities in Jan-April 2025, down around $2 billion from the same period last year.
MADE IN AMERICA.
CPA is the leading national, bipartisan organization exclusively representing domestic producers and workers across many industries and sectors of the U.S. economy.
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