Monthly tariff payments by midsize companies, those generating $10 million to $1 billion in revenue and employing 500 or fewer people, climbed to more than triple their 2025 levels, according to figures released February 19 by JPMorgan Chase. The findings indicate a widening gap between tariff liabilities and the underlying volume of goods entering the United States, a pattern noted in multiple trade reports in early 2026. Import levels held largely steady throughout the year, yet firms’ effective tariff rates rose sharply, magnifying the financial impact on existing trade relationships.
Higher Rates, Not Higher Volumes, Drove the Spike
The analysis points to a clear dynamic: companies were not expanding their sourcing footprints but were instead paying far more on established lanes. “That’s a big change in their cost of doing business,” said Chi Mac, director of business research at the JPMorgan Chase Institute. As tariffs climbed, midsize firms faced a narrower set of adjustments, pricing changes, cost reductions, or accepting slimmer margins, while avoiding major shifts in import patterns unless absolutely necessary.
Supplier changes did occur in select cases, and some importers experimented with rerouting freight through alternative countries. But according to the data, the bulk of the tariff burden remained concentrated among businesses that were already active in cross-border trade. The result was a year of operational trade-offs rather than sweeping supply chain redesigns.
Most of the Burden Still Lands on U.S. Companies
A separate February 12 study by the Federal Reserve Bank of New York reinforced this picture, concluding that roughly 90% of the economic cost of U.S. tariffs continues to fall on American businesses and consumers. The assessment contradicts assertions by former President Donald Trump that foreign exporters would absorb a significant share of the levies. Following publication, National Economic Council Director Kevin Hassett criticized the research as partisan, though most current analyses have echoed the FRBNY’s findings: U.S. importers are still absorbing the lion’s share of tariff-related costs, passing them along as higher prices to downstream buyers and households.
Trade economists note that this pattern has held since the first wave of tariff shifts several years ago. The 2025 data highlights the difficulty midsize firms face when tariffs rise faster than they can adjust contract terms, hedging positions, or supplier diversification strategies.
A New Pressure Point in Contract Cycles
One development drawing closer attention from trade analysts is the timing mismatch between tariff resets and supplier contract renewals. Many midsize importers are locked into annual or multi-year agreements that outlast tariff updates, limiting their ability to reprice or renegotiate until renewal windows open. As this gap widens, firms may find that the most durable risk lever isn’t rerouting freight but structuring contracts to absorb policy volatility with fewer delays, a shift that could influence how sourcing teams evaluate flexibility, term length, and escalation clauses in the year ahead.
