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Canada Abides as U.S. Talks Progress; Car Carrier Burns; Globalization Endures Trade War By Mark R. Long

Canada's prime minister said President Trump's doubling to 50% of tariffs on steel and aluminum imports was illegal and unjustified, but the biggest foreign supplier to the U.S. of both metals would wait before retaliating further.

Mark Carney said Canadian officials were readying reprisals in case trade talks fall apart, the WSJ's Paul Vieira reports. But officials were holding fire as intensive discussions with American counterparts were under way . Across the Atlantic, the European Union likewise said trade talks were progressing in the right direction, though EU Trade Commissioner Maroš efčovič said the tariff doubling wasn't helping. Meanwhile, U.S. Trade Representative Jamieson Greer called an EU offer made last week a "credible starting point" for talks, with discussions advancing quickly. One concern the U.S. and EU share is China's stranglehold on rare earths , with European industry facing an "alarming situation" over access to the crucial materials. Tensions between the U.S. and China over rare-earth export controls have ratcheted up amid auto industry alarm .

With both sides accusing each other of undermining the truce, the White House said a talk would come soon between the president and Chinese leader Xi Jinping, whom Trump called "very tough," and "extremely hard to make a deal with" in a social meda post. Beijing hasn't commented on repeated administration statements that the two are set to speak.

China is considering placing an order for hundreds of Airbus aircraft as soon as next month. (Bloomberg) The U.K. was temporarily spared from Trump's executive order that doubled steel and aluminium tariffs. $(BBC.AU)$ Mexico's president called the doubling of steel and aluminum tariffs unfair and said her country would announce measures in response next week if no deal with the U.S. is announced. (Reuters) CONTENT FROM: PENSKE LOGISTICS Gain X-Ray Vision. Gain Ground with Penske Logistics.

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Maritime Mishap

All 22 crew members were safely rescued from a large cargo ship adrift in the Pacific Ocean after a deck carrying electric vehicles caught fire. The 600-foot-long Morning Midas was carrying about 3,000 cars, including about 800 EVs, according to the ship's operator, London-based Zodiac Maritime. The WSJ's Gareth Vipers and Costas Paris write that most of the vehicles, including the electric ones, were made in China and bound for Mexico . U.S. Coast Guard aircrews and a cutter were dispatched to tackle the blaze, about 300 miles southwest of Alaska's Adak Island. While lithium-ion batteries used in EVs are highly flammable, no ship fires to date have been directly blamed on EVs. The fire is just the latest incident for the international shipping industry, with several big cargo ships crippled by fire at sea in recent years, killing seafarers and costing hundreds of millions of dollars in damages.

Geely Auto took a newly built, 7,000-unit car carrier on long-term charter from Zodiac Maritime, becoming the latest Chinese EV maker to operate its own vessels . (The Loadstar) Number of the Day Global Trade

Tariffs and trade war are rewiring supply chains, but as much as tensions may disrupt global trade flows, it won't stop them, a top DHL Express executive says. The Journal's Kimberly Kao and Fabiana Negrin Ochoa write that a recent report from the logistics giant showed no signs of a retreat in global flows this year. Uncertainty remains high, however, to the point of sparking talk of "deglobalization." But past periods of disruption haven't led to a sustained drop in trade volumes, said Ken Lee, DHL Express's chief executive of Asia Pacific , who started his role before the pandemic. Trade between the U.S. and China accounts for a relatively small portion of total international flows, so fraying relations still leave room for growth, Lee said. DHL has identified 20 markets it expects to benefit from rising domestic or foreign investment, or nearshoring. Seven of these are in Asia, where the company is expanding to capture tariff-redirected demand.

Quotable In Other News

U.S. employers further dialed down their hiring in May, the monthly ADP report showed, in a sign the labor market may be weakening, prompting Trump to call for interest-rate cuts. (WSJ)

Activity among U.S. services firms sank unexpectedly in May , the Institute for Supply Management's index showed, amid uncertainty and price pressures prompted by tariffs. (WSJ)

Some economists are starting to question the accuracy of recent U.S. inflation data after staffing shortages hampered the federal government's ability to conduct a massive monthly survey. (WSJ)

Australia's economy slowed sharply in the first three months of 2025, leaving it vulnerable to emerging weakness in world growth. (WSJ)

Five-and-dime chains such as Dollar General and Dollar Tree are bucking the trend of declining retail sales as richer consumers seek discounts in a contracting economy. (WSJ)

A rising number of lawsuits accuse household brands of misleading consumers when they said their products were made in the U.S. (WSJ)

Boeing will pay $1.1 billion to avoid prosecution for two crashes of its 737 MAX jets in an agreement with the Justice Department. (WSJ)

Amazon plans to invest an estimated $10 billion in North Carolina to expand its data-center infrastructure to support AI and cloud computing. (WSJ)

Chart Industries, a maker of equipment for the clean-energy and industrial-gas markets, struck a $19 billion merger deal with Flowserve, which provides fluid-motion and control products and services. (WSJ)

The CEO of chipmaker STMicroelectronics said the Tesla and Apple supplier would hit guidance for the current quarter as demand for its semiconductors is picking up. (WSJ)

BlueOval SK's CEO said production of batteries for EVs from one of two new Ford-backed Kentucky plants would start in the second half of 2025 , but didn't commit to a definitive start date. (WDRB)

The North Korean warship that capsized last month during a botched launch has been returned to an upright position , satellite imagery shows. (WSJ)

Congestion at Rotterdam, Hamburg and other Northern European container ports shows little sign of easing , prompting carriers to reroute vessels as the peak shipping season approaches. (Lloyd's List)

A.P. Moeller-Maersk's contract logistics business has leased the 1.2 million-square-foot Box Park Logistics Center about 10 miles from the Port of Philadelphia. (Journal of Commerce)

DHL Express Canada workers could strike as soon as Sunday , the last day of the current round of negotiations with union Unifor, whose members voted in favor of a strike last month. (Supply Chain Dive)

The Supreme Court ruled in favor of a group of Utah counties seeking to build a new rail line from the oil-rich Uinta Basin that was sued over downstream environmental-impact concerns. (KHOL)

About Us

Mark R. Long is editor of WSJ Logistics Report. Reach him at [mark.long@wsj.com]. Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long , Liz Young and Paul Berger .

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

June 05, 2025 07:04 ET (11:04 GMT)

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