At Regal Fabrics, a family-owned business in Middleton, Andy Kahan showed off a room filled with hundreds of books of samples and fabric swatches stacked on tables.
“Some of the things that we can do in India and Indonesia are, you know, really cool velvets,” he said, pulling out swatches of richly colored velvet patterned with lions.
But new U.S. tariffs on imports mean that fabric like that from India and Indonesia will now cost more, Kahan said. Many of their fabrics come from China, which already had a 25% tariff before President Donald Trump’s second term.
“A $4 cost from China was $5 to us in January, was $5.80 two weeks ago, last week became $7.16 and could be something else tomorrow,” Kahan said on Tuesday.
And the next day, when the U.S. tariffs on China hit an eye-popping 125%, Regal Fabrics hit pause on new shipments from China into the United States.
“It makes things a little difficult to plan around. However, it’s the world we’re all living in,” said Kahan, who said they’re weighing where they might need new suppliers.
Regal’s warehouse is filled with more than 50,000 rolls of fabric they design for customers and then produce in 10 different countries, Kahan says. Some production is in the United States but also in countries like Mexico, Italy and Turkey — all facing new tariffs.
From fabric to seafood to semiconductors, tariffs are hitting goods from every major trade partner — and local companies are scrambling to assess the impacts on their imports. Some countries may yet negotiate away their tariffs: As of Wednesday, most countries will now have a 10% tariff levied on them instead of rates above 20, 30 or even 40%. But one of the state’s biggest trading partners China, is retaliating with tariffs of their own, meaning exports — like chemicals, electronic products and medical equipment — could also suffer.
“Every industry in Massachusetts is going to be affected,” said Paula Connelly, a Boston-based trade lawyer with Sandler, Travis & Rosenberg, a firm focused on international trade.
Connelly, a veteran trade law specialist, says her office has been deluged with calls from clients trying to understand the new regulations, which arrived with unprecedented speed.
Ultimately, she says importers like Kahan will have to find a way to address the new costs.
“The importers have to make the decision: Do they pass this cost on to the customer? Or do they just accept the cost as part of doing business and not raise their prices?” she said, adding they may also try to negotiate with suppliers to share the costs.
Kahan says his family will try to negotiate on price with suppliers and “absorb” as much financial pain as they can. But, he says, prices to his customers — U.S. furniture manufacturers, and retail and commercial fabric distributors — will have to go up.
And if one goal of the U.S. tariffs is to bring more manufacturing home, Kahan says the family business founded by his grandparents shows the answer is more complicated.
“Certain capabilities that the mill partners we’ve built in various countries are particular to what those countries do well, what those companies do well,” he said. “It’s not so simple to just move production from one place to the other.”
Some companies, Connelly said, already moved away from China after the first Trump administration imposed 25% tariffs on Chinese imports. But even those companies that successfully moved their manufacturing just a few years ago are feeling new financial pain anyway under widespread tariffs — from electronics to apparel and footwear.
Local exporters are holding their breath as they watch negotiations play out. On a recent day at the Chelsea warehouse of the global shipping company OCEANAIR, workers readied boxes of lobsters from Maine and life science products from Massachusetts to head to customers overseas.
Kristen Morneau, compliance director at OCEANAIR, said exporters are watching to see how countries retaliate and keeping “fingers crossed for those negotiations.”
She said Massachusetts’ tech companies might face a double hit, importing components that carry a new tariff and then re-exporting a finished product to face retaliatory tariffs elsewhere.
Morneau helps customers follow import/export regulations for more than 70 countries, including China, Italy, Spain and the Netherlands. She describes this current period as the “craziest” she’s seen since the pandemic created mayhem for international supply chains in 2020.
“We learned some lessons from that. But this time around, what we’re seeing is things at an increased speed,” she said. “It’s a lot to absorb.”
