THE SECTION 122 TARIFF EXPIRES JULY 24 — WHAT IMPORTERS MUST DO NOW TO PROTECT THEIR Q2 DRAYAGE AND INTERMODAL CAPACITY
The clock started February 24. On July 24, 2026 — 150 days later — the Section 122 tariff expires. No extension by executive order. No automatic renewal. Either Congress votes to keep it, or the 10% global import surcharge drops to zero on everything not already covered by Section 232 or Section 301.
The next 111 days are the most consequential planning window your import supply chain has seen in two years. Here is what the expiration means, why front-loading is already compressing drayage capacity, and the three specific actions importers should take before April 15.
What Happens to Section 122 on July 24
Section 122 of the Trade Act of 1974 authorizes a temporary import surcharge with a hard statutory limit of 150 days. The President signed the 10% surcharge on February 24, 2026. The math is fixed: 150 days from February 24 is July 24. Congress cannot extend it without a vote. The President cannot unilaterally renew it.
The administration's public strategy is to use Section 122 as a bridge to Section 301 investigations, which the USTR launched on March 11 targeting 16 trading partners: China, the EU, Vietnam, Taiwan, Cambodia, Korea, Singapore, Switzerland, Norway, Indonesia, Malaysia, Thailand, Bangladesh, Mexico, Japan, and India. Section 301 carries no rate cap and no expiration clock — it is a permanent authority.
The two scenarios importers should model:
Scenario A: Section 301 rates land below 10%. Imports recover in late 2026. Q3 could see a volume rebound as shippers release deferred orders. The Q2 front-loading reverses, and drayage demand softens.
Scenario B: Section 301 rates match or exceed current levels. Importers who front-loaded in Q2 are protected — they moved goods under a known, lower rate. Importers who waited face the same or higher duty environment under a permanent authority with no expiration date.
Two legal challenges are active — a 24-state coalition and a separate business coalition — both filed in the U.S. Court of International Trade. Neither pauses compliance obligations. The tariff is live until a court says otherwise.
Why Q2 Front-Loading Is Already Happening — and What It Means for Drayage
This is not speculation. LA/Long Beach processed 824,000 TEUs in February 2026 — the second busiest February on record. Importers are placing orders now to receive goods before July 24, banking on the known 10% rate versus the risk of a higher Section 301 rate.
The industries most exposed are the same ones that drive the bulk of U.S. container imports from Asia: furniture, electronics, apparel, building materials, and auto parts. Vietnam, Cambodia, Taiwan, and China — all under Section 301 investigation — represent the core of consumer goods sourcing for U.S. importers.
What front-loading means for drayage: Port drayage volumes at LA/Long Beach and Seattle/Tacoma will remain elevated through Q2. Chassis availability, terminal wait times, and carrier capacity will tighten as volume concentrates into a compressed window. This is not a gradual ramp — it is a pull-forward of Q3 demand into Q2.
Diesel is at $5.40/gallon nationally. Carrier tender rejections are running at approximately 14%. Carriers have optionality right now — they are choosing higher-paying loads and rejecting contract freight that was priced before the March fuel spike. Importers with unmanaged drayage exposure face service gaps during the exact months when they need reliability the most.
April 15 is the recommended review date. Assess which of your SKUs and product categories are most exposed to a rate change after July 24. Lock drayage and intermodal capacity for Q2 shipments before the rest of the market competes for the same trucks and chassis.
The Intermodal Opportunity in This Window
Intermodal spot rates are currently running at roughly half of truckload spot — approximately $1.39/mile versus $2.80/mile nationally. Truckload spot is up 23% year-over-year. Intermodal is up low single digits. The spread between the two modes is the widest it has been in years.
For importers running higher-than-normal volumes through LA/Long Beach destined for inland distribution centers — Chicago, Dallas, Memphis, Atlanta, Denver — the cost argument for intermodal conversion is stronger in Q2 2026 than it has been in several years. Front-loading amplifies this: every additional container you move by rail instead of truck saves over $1,000 per move on lanes over 500 miles.
The critical consideration is drayage coordination on both ends of the intermodal move. Port-to-ramp drayage at origin, plus ramp-to-DC drayage at destination. A non-asset freight broker who coordinates both legs eliminates the handoff gap that asset carriers cannot solve. When you are moving elevated volume under a tariff deadline, a missed connection between drayage and rail is not an inconvenience — it is a per diem charge that compounds daily.
Houston intermodal update: UP on-dock rail service to Denver, LA, and El Paso is now active at Barbours Cut. For Gulf Coast importers, this creates an additional intermodal routing option that did not exist six months ago.
Three Things Importers Should Do Before April 15
1. Map your Section 122-exposed SKUs
Identify which products by HTS code are imported from the 16 countries under Section 301 investigation. Vietnam, Cambodia, and Taiwan are highest-risk — any product currently entering at 10% Section 122 could face a higher, permanent rate after July 24. This is the analysis to complete by April 15.
USMCA-qualifying goods from Canada and Mexico are exempt from Section 122. If you source from North American partners, confirm your USMCA certification is current — it is your primary tariff shield.
2. Lock Q2 drayage capacity at your primary ports
Front-loading is already compressing capacity at LA/Long Beach, Seattle/Tacoma, Houston, and Newark. Carriers are rejecting contract freight at 14% nationally. If you are moving elevated volume in May through July, do not assume spot availability will be there when you need it.
Capacity committed now at current rates is protection against both diesel-driven price increases and supply constraints. A drayage quote locked in April at $5.40/gallon diesel beats a spot call in June at whatever diesel costs then — and whatever premium the carrier adds for knowing you need the truck today.
3. Model both tariff scenarios in your landed cost
If Section 301 rates land at or below 10%, imports recover in Q3–Q4 and you may want flexibility to ease Q2 commitments. If they land above 10%, the freight committed under Q2 contracts is your cheapest inventory window of 2026.
Either way, knowing your drayage and intermodal cost per move at current diesel prices gives you the landed cost visibility to make the right sourcing call. Without that number, you are making tariff decisions without freight data.
How Alliance Coordinates Drayage and Intermodal During High-Volume Windows
Alliance Freight Solutions is a licensed non-asset freight broker (MC-1607949, DOT-4177688) specializing in port drayage and intermodal for U.S. importers.
We focus on the ports most directly exposed to Section 122 front-loading volume: LA/Long Beach, Houston, Savannah, Newark, Chicago intermodal, and Seattle/Tacoma. Our non-asset model means we coordinate carrier capacity without owning trucks — selecting the right carrier for each lane rather than routing to available fleet.
For importers navigating the Section 122 expiration window, we provide:
- Q2 capacity positioning with carrier partners at major port gateways
- Drayage and intermodal coordination on both ends of the rail move
- Fuel surcharge monitoring against the current diesel index
- Single-point coordination so you are not managing four vendors for one container
Published by Alliance Freight Solutions | April 4, 2026
Sources: Federal Register — Section 122 Proclamation, PMSA — February 2026 Container Traffic, Kelley Drye — Section 122 Overview, Freight Flow Advisor — Section 301 as the New IEEPA, EIA Diesel Fuel Index