Global shipping navigates Trump tariffs uncertainty

By Admin

23 Apr, 2025

In a world where international commerce hinges on policy shifts, global shipping now finds itself caught in the wake of President Donald Trump’s renewed tariff storm. Since returning to the White House in January, Trump has reignited trade tensions, leaving shipping lines, cargo owners, and freight forwarders scrambling to adapt.

Volatility on the High Seas

Recent weeks have seen unprecedented volatility as the U.S. administration announced and then walked back several tariffs, sparing none but China from its trade offensive. These rapid changes have resulted in unpredictable shipping patterns. Cargo vessels are sometimes departing half empty, freight rates are swinging, and shippers are reconsidering traditional routes.

“During the three weeks leading up to the latest tariff announcements, trade slowed significantly. On major transatlantic and transpacific routes, ships were sailing only 50 percent full,” said Alexandre Charpentier, transport expert at Roland Berger. In this period of hesitation, many companies chose to hold on to their inventories, causing sea freight prices to decline.

From Caution to Rush

However, with the announcement of a 90-day pause on certain levies (excluding those on Chinese goods), the scenario reversed rapidly. Companies began destocking aggressively, eager to ship goods to the United States before the window closes. “There’s been a rush for space and prices have started to rise again,” Charpentier added.

Complicating matters further are newly imposed U.S. port fees specifically targeting Chinese-built and operated vessels. These fees, effective from mid-October, accompany steep tariffs that now reach up to 245 percent on some Chinese imports. Notably, China remains the leading shipbuilder globally, followed by South Korea and Japan.

Long-Term Concerns

Industry veterans recall a similar scene during Trump’s first term when overcapacity, falling rates, and rising costs eroded revenue across shipping lines. “We’re likely to see a slowing on key routes and perhaps a redirection towards countries in Southeast Asia or India,” Charpentier predicted.

Anne-Sophie Fribourg of Zencargo foresees the China-US route becoming increasingly unprofitable, prompting shipowners to reroute vessels toward emerging markets like Latin America, where trade volumes are on the rise. Although big players such as Maersk, CMA CGM, and MSC have yet to make drastic shifts, analysts expect that day to come.

Changing Routes and Global Impacts

German shipping company Hapag-Lloyd has already observed a massive decline in demand from China, counterbalanced by growing volumes from Southeast Asia. According to Boston Consulting Group, the “Global South” could benefit from this redirection of trade, while China-US flows may experience a sharp drop.

The WTO has forecasted an overall decline in global goods trade by as much as 1.5% in 2025 due to tariff impacts, with China-US merchandise trade potentially plummeting by a staggering 81%.

Disruption is the New Normal

Sandy Gosling from McKinsey underscores that such tariff-induced shocks are merely the latest in a long list of disruptions faced by the industry. “According to a 2020 McKinsey Global Institute report, industries have encountered material disruptions every 3.7 years on average,” she said.

From COVID-19 to geopolitical unrest, such as Houthi attacks in the Red Sea diverting ships via the Cape of Good Hope, the sector has had no choice but to become agile. “But rerouting entire supply chains takes time,” Charpentier concluded.

Final Thoughts

As uncertainty looms large, the shipping industry once again finds itself at the crossroads of politics and logistics. While short-term spikes and slumps in demand continue, the long-term reconfiguration of global trade lanes could redefine maritime commerce as we know it.