AI in the Chain

Introduction

Global trade is facing its most complex era yet. New tariffs, shifting regulations, ESG compliance, and geopolitical disruptions are increasing the pressure on procurement and trade compliance leaders. At the same time, duty spend has become a significant cost component for globally active companies—yet many still struggle to assess the immediate effect of regulatory changes on their supply chain and finances.

To respond effectively, companies need more than ERP systems and spreadsheets. They need AI-driven intelligence, automation, and harmonized master data to navigate today’s global trade environment. This article outlines how AI can support smarter decision-making in areas such as duty spend transparency, HS code classification, and scenario modeling.

The Growing Complexity of Global Trade

Whether it’s carbon border adjustment mechanisms (CBAM), retaliatory tariffs, or new trade agreements, companies are increasingly affected by fast-changing trade landscapes:

• Multilateral trade fragmentation has increased the number of country-specific duties and rules.
• ESG regulations and green tariffs now require transparency on product origin, emissions, and material sourcing.
• New trade lanes and reshoring policies are creating new customs requirements almost monthly.

Yet many procurement teams rely on siloed systems and manual processes to manage classification, compliance, and tariff risk—a strategy that is no longer sustainable.

Why AI Is a Game Changer for Trade Compliance and Duty Optimization

AI doesn’t replace your systems—it enhances them. By embedding AI into existing trade compliance and procurement workflows, companies can:

• Improve master data accuracy and classification
• Detect risk exposure to new tariffs or duties
• Automate the review and cleansing of trade-critical data fields
• Simulate future duty spend under different trade policy scenarios

These capabilities turn reactive trade operations into proactive, insight-led decision centers.

Key Use Cases: AI in Action for Global Trade

1. Foundational Data Quality

Trade compliance starts with clean data. AI can automate:

• Profiling and cleansing of trade master data
• Validation of fields like Country of Origin, Incoterms, and vendor declarations
• Detection of inconsistent or missing classification codes

2. HS-Code Classification Automation

Manual HS classification is time-consuming and error-prone. AI models trained on historical classification data and customs rulings can:

• Recommend the most appropriate tariff codes
• Provide confidence scores for auditing purposes
• Ensure consistency across products, regions, and business units

3. Duty Cockpit for Impact Transparency

A centralized dashboard—or “duty cockpit”—allows companies to:

• Visualize duty spend by country, supplier, and product
• Track fluctuations caused by regulatory updates
• Set up alerts for new duty risks or exposure thresholds

4. Scenario Modeling and Simulation

AI models can simulate trade policy changes, such as:

• The impact of reinstated tariffs on steel from specific regions
• The effect of CBAM on emission-intensive SKUs
• Cost exposure in nearshoring scenarios

This supports proactive planning rather than reactive firefighting.

Strategic Benefits of AI-Enhanced Trade Compliance

Prompts for Generative AI in Trade Operations

Here are examples of how trade professionals can use AI assistants like GPT or Claude:

• “List the top 10 suppliers most exposed to new CBAM tariffs.”
• “What alternative tariff codes exist for our solar panel products in NAFTA countries?”
• “Summarize changes to EU green import regulations and their effect on steel sourcing.”
• “Draft an email to request missing origin documentation from Supplier X.”
• “Simulate duty cost impact if we shift sourcing of electrical components from China to Vietnam.”

Expanding the AI Toolkit: Cross-Functional Integration for Better Outcomes

To unlock the full benefits of AI in global trade, companies must go beyond procurement and compliance silos. Integration with finance, legal, logistics, and sustainability teams ensures that duty planning and trade classification aren’t isolated efforts, but part of a broader business strategy.

For instance, AI can help finance teams model cash flow implications of changing duty rates or advise treasury on currency fluctuation exposure linked to new sourcing geographies. Legal teams can benefit from automated contract review that flags outdated trade terms and non-compliance risk. Meanwhile, sustainability teams gain visibility into ESG-related data fields, enabling better compliance with carbon border adjustment mechanisms and green regulations.

By aligning AI capabilities across business functions, organizations turn global trade from a risk-prone cost center into a value-adding strategic capability.

Final Thoughts: Smarter Trade for a Smarter Supply Chain

Managing global trade today requires agility, transparency, and intelligence. AI provides the foundation for this shift—not by replacing human expertise, but by enhancing it with better data, faster analysis, and more consistent compliance.

As trade regulations continue to evolve, those organizations that invest in AI-enabled trade processes will move from compliance checklists to strategic value creation.

Sources

• Netstock (2025). 2025 Tariff Impact Report by Lora Cecere