Quota
Also known as: Import Quota, Trade Quota, Tariff-Rate Quota
Definition
Import quotas restrict how much of a product can enter a country. Once the quota is filled, additional imports face higher duties or are blocked entirely until the next quota period.
Types of Quotas
| Type | Description |
|---|---|
| Absolute quota | Hard limit, no more imports allowed |
| Tariff-rate quota (TRQ) | Low duty up to limit, higher duty after |
| Country-specific | Limits from particular nations |
| Global quota | Total from all countries |
How Quotas Work
Tariff-Rate Quota Example:
- First 10,000 tons of sugar: 5% duty
- Beyond 10,000 tons: 50% duty
- Incentivizes staying within quota
Quota Administration
- First-come, first-served
- License allocation
- Historical import basis
- Auction system
- Country allocation
Products Commonly Under Quota
- Sugar
- Dairy products
- Textiles and apparel
- Steel and aluminum
- Agricultural products
- Certain meats
Quota Strategy
For importers:
- Monitor quota fill levels
- Ship early in quota period
- Use bonded warehouses to wait
- Apply for licenses if required
- Diversify sourcing countries
Quota Information
- CBP quota status reports
- USDA quota announcements
- Trade association updates
- Customs broker monitoring
- Published fill dates
Impact on Shipping
- Rush to ship before quota fills
- Higher rates during quota season
- Bonded warehouse demand
- Timing of purchase orders critical
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