Tariff policy has been moving fast in 2025 and 2026. Here's what that actually means for your packaging costs, and why your manufacturer relationship matters more than ever.

The rules of the game have changed, and it’s safe to assume they will keep changing. For brands that depend on custom packaging, 2026 has been a year of compounding pressure: sustained tariffs, geopolitical conflicts raising the price of raw goods, and extended producer responsibility (EPR) mandates entering force. In this environment, your packaging partner isn't just a vendor. In this climate, they're one of your most consequential strategic decisions that help you flex in real time.

Where things currently stand with tariffs

The tariff landscape has shifted significantly in early 2026, and unfortunately we believe uncertainty will continue to prevail in the coming months. Here is where the tariffs currently stand:

Following a Supreme Court ruling that IEEPA does not authorize the President to impose tariffs, all IEEPA-based tariffs were terminated February 24, 2026. In their place, the administration invoked Section 122 of the Trade Expansion Act to impose a global 10% tariff on most imported products from all countries for 150 days, or rather July 24, 2026, and may be overturned if Congress doesn’t approve.

May 7, 2026 update: Section 122 tariffs face new legal challenge. On May 7, the U.S. Court of International Trade issued a 2-1 ruling striking down the Section 122 global 10% tariffs, finding that the administration's use of the statute was legally unsupportable. The DOJ appealed immediately, and the ruling currently applies only to the specific plaintiffs in that case: so the tariffs remain in effect for most importers while the legal challenge works its way to the Court of Appeals for the Federal Circuit. That said, the Section 122 tariffs are already set to expire July 24, 2026 unless Congress acts, and the administration has signaled it may introduce replacement tariffs before that deadline. The practical implication: another round of legal and policy uncertainty is likely before summer is over.

Section 232 tariffs on metals remain, however they were just restructured. Think of it like a sliding scale based on metal content: articles made entirely or almost entirely of steel, aluminum, or copper (like steel coils and aluminum sheets) pay a flat 50% tariff on their full value. Derivative articles substantially made of those metals pay 25%. And products made with 15% or less steel, aluminum, or copper are no longer subject to Section 232 metal tariffs at all. These changes seek to simplify tariffs on derivative products and ensure they reflect the full value of imported materials, but have continued to receive opposition. 

As of early April 2026, the U.S. average effective tariff rate stands at 11% (the highest since 1943, excluding 2025). If the Section 122 tariffs expire as scheduled after 150 days, that rate would fall to 8.2% (highest since 1946).

In exciting news, starting Monday, April 20th, there is a new portal to submit for IEEPA tariff refund claims. A few things worth knowing: refunds are not automatic, you must opt-in and file a claim; not everyone qualifies; and only certain tariff types will be considered. Here is a helpful article with more details.

The bottom line for packaging procurement: costs are still elevated, the legal framework keeps changing, and agility in your supply chain is not optional.

In a volatile tariff environment, the brands that are best positioned are the ones with genuine manufacturing relationships — not just vendor lists.

Why the manufacturing partner relationship is the variable that matters

A vendor list is a list of prices. A manufacturing partner is a relationship with a supply chain.

The distinction matters most in moments exactly like this one. When tariff exposure changes a cost structure overnight, a vendor quote goes stale immediately. A manufacturing partner who knows your specifications, understands your volume, and has existing relationships across a diversified supplier base can do something more useful: they can help you find the path that minimizes cost impact while preserving quality and compliance.

That looks like a few different things in practice:

Geographic diversification. The most straightforward mitigation for country-specific tariff exposure (like China) is sourcing from alternate manufacturing regions (think: Vietnam, India, Mexico, or even domestic US production). Shifting production requires knowing which manufacturers in which regions can actually meet your specifications and budget, at your volumes, with the lead times your production calendar requires. That's supply chain knowledge and in-market expertise built through years of experience and relationship-management.

Specification-level cost analysis. Tariff exposure hits materials differently. For example, a weight reduction of 10% on an HDPE bottle can be somewhat invisible to the consumer, but may translate into tangible savings for the producer. This type of reduction can lower material cost, EPR fee exposure, which allows a component to ship at a lower declared value. These are the kinds of adjustments that require someone who knows your packaging at the spec level, not just the SKU level.

Tariff classification review. The Harmonized Tariff Schedule is complex, and misclassification is more common than you would think. In some cases, a component part may be classified at a higher rate and may be able to be correctly reclassified at a lower one. This is a compliance conversation, not a workaround: but it requires someone who knows both your product and the tariff code landscape.

What sourceM's approach looks like

We bring more fifteen years of global manufacturing relationships to every packaging project. When tariff exposure shifts the cost structure, we're not starting from scratch, we're working from an existing network of vetted manufacturers across regions, with knowledge of their capabilities, minimums, and lead time windows. 

Our experience and relationships benefit our clients in three key ways:

The hidden benefits of strong supplier relationships. Most suppliers that we work with stockpile materials for the items they manufacture most. As price increases hit materials, especially plastic resins recently, our strong relationships have allowed us to maintain costs for our clients, thereby cushioning the impact for a few weeks. As those inventories thin, we continue to monitor oil prices and work closely with our partners to purchase smaller volumes, in hopes that resin and oil prices normalize and they can reset pricing quickly.

Shared financial impact. The reality is that the changes in tariffs and regulations are impacting all players across the board. From our perspective, the most effective approach is shared accountability across the supply chain. We’re working with clients to absorb a portion of the increase at the partner level, where we can, rather than passing through the full impact all at once. It’s about smoothing volatility, not eliminating it.

Rapid Prototyping. As we consider new packaging formats or designs for clients, it becomes more critical than ever to be able to make decisions quickly. For this reason, we’ve developed rapid prototyping capabilities for our clients. Now, we’re able to use advanced printing capabilities to deliver prototypes in days, not months. 

Tariff policy is unpredictable right now. What's stable is having a manufacturing partner who can move with it. If you'd like to talk through your specific exposure — by material, by region, by SKU — we're happy to do that.