Tariffs spark uncertainty for Texas fireworks sellers this Fourth of July

At fireworks stores across Texas, shoppers stocking up for celebrations this weekend probably aren’t noticing the impact of President Donald Trump’s trade war with China — the source of virtually all fireworks sold in the U.S. Behind the counter, though, sellers already are absorbing higher costs and bracing for next year, when higher tariffs appear increasingly likely.

Julie Heckman, executive director of the American Pyrotechnics Association, said it’s ironic that one of America’s most “patriotic” industries could be hard hit.

“The fireworks industry is President Trump’s base,” she said. “There isn’t anything more patriotic than a big fireworks celebration on the Fourth of July.”

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Earlier this year, tariffs on Chinese imports — including fireworks — briefly jumped to 145% amid an escalating trade war. They now face a 30% import tax but fireworks sellers say the damage for this year is already done. Next year’s impact on the $2.7 billion industry is still unclear.

This year’s import tax spike and uncertainty came at the worst possible time for the industry. The months after Chinese New Year in late January and February are peak shipping season for July 4 fireworks imports. But when Trump levied big reciprocal tariffs against China in early April, Heckman said, most U.S. importers told suppliers to halt shipping.

“All of the warehouses in China, then, were full,” she said. “They had to halt production.”

Trump said this week he was not planning to extend the current 90-day pause on tariffs on most nations beyond July 9, when the negotiating period he set would expire.

“China’s going to be paying a lot of tariffs,” he said.

Delays, higher prices

Charles Wald, president of Wald Fireworks, was among those who canceled planned shipments when tariffs hit triple digits.

“When they moved (tariffs) down to 30% we went ahead and told them to ship those, so we got those in,” said Wald, who does business in Texas and Missouri. “Those containers will have higher prices starting next year.”

At Liberty Fireworks, only four shipments were affected by tariffs. President Michael Rios said imports came to a halt when tariffs first started climbing. That means shipments needed for Independence Day sales were delayed.

“A lot of the businesses that got impacted by the tariffs are mainly the smaller businesses like ourselves, family businesses,” he said. “Our fireworks are coming in later than others so we’re at the tail end of it.”

Because large companies typically receive their shipments earlier, they were mostly spared both higher prices and delays. Celina Montoya of Alamo Fireworks, one of the biggest retailers in the region, said the company anticipates little impact on prices because it orders inventory from 18 to 24 months in advance. Alamo has more than 150 retail locations across Texas and New Mexico.

Some smaller businesses were proactive as well, with many saying they began stockpiling soon after the November election in anticipation of potential tariffs on Chinese imports. Deanna Valdez, owner of Action V Fireworks, said the industry always demands preparation.

“It’s an unsure business to begin with and there are a lot of risks,” she said. “You just prepare yourself for the storm.”

Next year’s anticipated higher tariff costs could price some families out of the celebration. Fireworks are not necessities, and if family budgets won’t reach, fireworks purchases are likely to be reduced.

Montoya said Alamo’s main priority is cultivating a loyal customer base. And because it builds inventory early, Alamo is able to offer better prices to customers this season than some other retaialers.

“The fireworks that we have for the Fourth of July, we’ve been able to keep at a steady price,” he said. “We’re really committed to being able to provide a product that’s going to be affordable to families.”

Holding the line

Many retailers held off on passing tariff costs to backyard buyers of roman candles, sparklers and bottle rockets, meaning the hit is more on sellers’ margins than consumers. Display fireworks, those used in the big shows put on by cities and organizations, are feeling the brunt of price increases.

Rios said about 80% of his professional display inventory this year came in with higher tariff costs. Still, longtime clients who signed contracts months ago weren’t charged more.

“We honor those contracts,” he said. “But we did raise prices for new customers who came in late. That helped us cover some of the increased costs.”

Professional fireworks shows are more insulated from price swings than consumers. Cities often pay tens of thousands of dollars for displays, costs that include licensing, insurance and labor in addition to the fireworks themselves. As a result, those new customers only saw increases of about 10%, according to Rios.

“If I really need to raise prices, it’s a lot easier to raise the price for a city, who’s paying with tax dollars, than it is for a retail customer,” he said.

2026 looms large

With this July 4 nearly in the books for retailers, the 2026 season looms large. A big part of their concern is uncertainty of how Trump’s trade war will impact import taxes.

“We lost two months of critical manufacturing for the 2026 season,” the trade association’s Heckman said of Chinese factories slowing production when U.S. sales slid. “2026 is supposed to be the biggest celebration ever because of America’s 250th.”

If the tariffs remain or increase, she said it’s going to be challenging to make those celebrations occur nationwide, especially in small towns that may be hard-pressed to pay higher prices.

When tariffs on China were imposed during the first Trump administration, Heckman said there were processes for the association to request exemptions. It did, and succeeded. This time, there have been no public hearings, no opportunities to submit exemption requests and little information about what to expect. That uncertainty has retailers wondering what to expect — and how they should be preparing.

Tariffs are intended to reshore manufacturing industries to the U.S., but fireworks manufacturing is a special case. Acreage requirements, heavy manufacturing regulations and high hazard levels make the prospect of reshoring fireworks to the U.S. “impossible,” Heckman said.

The association successfully argued this in 2019, and she said the argument still stands.

A 90-day tariff pause has kept costs at 30%, but its unclear what will happen when that window closes. Even if the 30% rate stays flat, Heckman said it’s not sustainable.

“You can’t build a business when you don’t know if the tariff will be 5%, 30%, or 145%,” she said. “You can’t contract out a fireworks show if you don’t know what your costs will be.”