At the June Valve World Americas Expo & Conference 2025, Jack McCarthy, MRC Global’s Senior Vice President, Supply Chain, Quality and Technical Sales, presented a keynote address titled, Navigating Tariffs and Trade Restrictions in the Industrial PVF Sector: A New Era for the Global Supply Chain. This article is a summary of McCarthy’s presentation.
In the ever-evolving landscape of global trade, the industrial pipe, valves, and fittings (PVF) distribution sector finds itself at the intersection of policy, politics, and economic strategy.
Recent developments in U.S. trade policy—particularly those involving tariffs, trade remedies, and maritime regulations—are reshaping the way distributors source, price, and deliver critical infrastructure components.
As global supply chains become increasingly complex and politically charged, PVF distributors must adapt to a new reality where trade policy is as influential as market demand.
The Expanding Scope of Trade Remedies
Historically, tariffs have been the most visible tool for regulating international trade. However, the U.S. government has increasingly relied on a broader arsenal of trade remedies, including antidumping and countervailing duties.
These measures target foreign producers who sell goods below market value or benefit from government subsidies. For PVF distributors, this has meant increased scrutiny and cost on imports of steel products, pipe, flanges, and fittings.
The Department of Commerce and the U.S. International Trade Commission (USITC) play pivotal roles in these determinations. When both agencies find evidence of unfair trade practices and material injury to U.S. industry, duties are imposed. These actions have led to a surge in antidumping and countervailing orders on steel products, directly impacting raw materials and finished goods in the PVF supply chain. Distributors must now factor in these duties when calculating landed costs, which can significantly affect pricing strategies and customer relationships.
Section 232 and National Security
Under Section 232 of the Trade Expansion Act of 1962, the U.S. has investigated the impact of imports on national security. This provision has been used to justify tariffs on steel and aluminum—key materials in PVF manufacturing. As of June 2025, tariffs on these metals have increased from 25% to 50% with products such as line pipe, OCTG, and mechanical tubing also affected.
The implications are significant. Distributors must now navigate a landscape where sourcing decisions are not only economic but also geopolitical. The unpredictability of exemptions and quota arrangements adds complexity to procurement strategies.
Moreover, the increased cost of raw materials has a cascading effect on the entire supply chain – from manufacturers to end-users. Companies are increasingly exploring domestic sourcing options, but capacity constraints and higher domestic prices present additional challenges.
Section 301 and Retaliatory Measures
Section 301 of the Trade Act of 1974 empowers the U.S. to enforce trade agreements and retaliate against unfair practices. Since 2018, this authority has been used extensively against China, resulting in multiple rounds of tariffs—some reaching up to 25% on PVF-related products.
For PVF distributors, this means staying informed about geopolitical developments and anticipating how new enforcement actions might affect their product lines and sourcing strategies.
Maritime Policy and the Jones Act
The Merchant Marine Act of 1920, commonly known as the Jones Act, mandates that goods transported between U.S. ports must be carried on U.S.-built, -owned, -flagged, and -crewed vessels.
Recent executive actions, such as Executive Order 14269, aim to restore America’s maritime dominance. Proposed fees on Chinese vessels and mandates for U.S.-built LNG carriers threaten to further disrupt supply chains. With no U.S.-built LNG carriers currently in operation—and build times stretching up to five years—compliance is virtually impossible, raising concerns across the energy and industrial sectors. Industrial PVF distributors involved in energy infrastructure projects must now account for potential delays and cost overruns stemming from maritime policy changes.
IEEPA and Judicial Pushback
The International Emergency Economic Powers Act (IEEPA) has been invoked to impose sweeping tariffs, including a peak rate of 145% on Chinese and Hong Kong goods. However, in May 2025, the U.S. Court of International Trade ruled these tariffs exceeded presidential authority, setting them aside. The appeal process is ongoing, but the ruling signals a potential shift in how trade powers are interpreted and applied.
This legal uncertainty adds another layer of complexity for PVF distributors. Companies must now consider not only current tariff rates but also the possibility of retroactive changes. Legal counsel and trade compliance teams are becoming essential partners in navigating this volatile environment.
Who Bears the Cost?
Ultimately, the burden of tariffs and trade restrictions falls on the consumer. Distributors, importers, and retailers may absorb initial costs, but price increases ripple through the supply chain. Research confirms that tariff hikes correlate with declines in domestic output, productivity, and employment, highlighting the broader economic consequences.*
“Recent developments in U.S. trade policy—particularly those involving tariffs, trade remedies, and maritime regulations—are reshaping the way distributors source, price, and deliver critical infrastructure components.”
In the PVF sector, where margins are often tight and competition fierce, the ability to pass on costs is limited. Distributors must balance profitability with customer retention, often absorbing a portion of the increased costs. These dynamics underscore the importance of strategic sourcing, inventory management, and long-term supplier relationships.
Strategic Implications for PVF Distributors
For industrial PVF distributors, these developments necessitate a strategic recalibration. Key considerations include:
- Diversifying supply sources to mitigate exposure to high-tariff regions.
- Strengthening domestic partnerships to mitigate risk of international trade.
- Monitoring regulatory changes and legal rulings that may alter tariff structures.
- Investing in compliance and trade advisory services to stay ahead of enforcement actions.
Additionally, distributors are increasingly leveraging technology to enhance supply chain visibility and responsiveness. Digital platforms for procurement, logistics, and compliance tracking are becoming indispensable tools. Scenario planning and risk modeling are also gaining traction as companies seek to anticipate and prepare for future disruptions.
Conclusion
As the global supply chain enters a new era defined by protectionism and policy-driven disruption, agility and foresight will be the hallmarks of successful PVF distribution strategies. By understanding the evolving trade landscape and proactively adapting to its challenges, distributors cannot only survive but thrive in this complex environment.
The road ahead may be uncertain, but with the right strategies and relationships, the PVF distribution sector is well-positioned to navigate the turbulence and seize new opportunities.
References
*(Furceri, Hannan, Ostry, & Rose. “Are tariffs bad for growth? Yes, say five decades of data from 150 countries.” Journal of Policy Modeling, vol. 42, no. 4, 2020)
The views and opinions expressed in this article are those of Jack McCarthy and do not necessarily reflect the position of Valve World Americas.