Here we go again. Donald Trump’s decisive re-election on November 5 just threw another wrench into the global supply chain. As if shippers weren’t already dealing with enough—carrier bankruptcies, labor strikes, climate change, pandemics, and regional conflicts—now they have to prepare for a potential trade war. If history is any guide, things are about to get messy.
Déjà Vu for Shippers
Remember late 2018? If you were in the business back then, you probably still have nightmares about the chaos at U.S. ports as companies scrambled to get their goods in before Trump’s tariffs on China took effect. It was a mad dash, with shippers front-loading cargo like there was no tomorrow. And guess what? We’re on track for a repeat performance.
If a new round of tariffs is announced, companies will rush to beat the deadlines, flooding ports and stretching capacity to its limits. Expect congestion, delays, and—of course—skyrocketing freight rates. For shippers hoping that 2025 would bring stability, well, think again.
The Tariff Tsunami Begins
As we speak, tariff discussions are already heating up. The U.S. is expected to impose higher import duties on Chinese goods, and retaliation is almost certain. China could respond with its own countermeasures, further escalating tensions.
For industries that rely on international supply chains, this is a disaster in the making. Higher tariffs mean increased costs for raw materials and finished products, which will inevitably trickle down to consumers. But in the short term, the real headache will be the scramble to import as much as possible before the tariffs hit.
This front-loading will push the container market into overdrive, leading to shortages in capacity, congestion at ports, and a repeat of the painful supply chain disruptions we saw during previous rounds of trade wars. And just like last time, carriers will be the biggest winners, leveraging the turmoil to drive up rates and pad their profits.
The Worst of Both Worlds
For years, shippers have been stuck in a vicious cycle: unreliable schedules and ridiculously high rates. And every time they think relief is on the horizon, something else throws the industry into disarray. Covid-19 was bad enough, but now trade tensions could make 2025 just as painful as the past few years.
What’s worse? Ocean carriers aren’t exactly unhappy about it. Let’s be honest—when things ran smoothly, many carriers struggled to turn a profit. But when the supply chain clogged up, they made money hand over fist. When ports were jammed and ships were sitting idle offshore, it wasn’t shippers who benefited. It was the carriers.
Overcapacity? What Overcapacity?
Heading into 2024, many industry experts predicted a glut of new container ships would push rates down. The plan was simple: more ships, more capacity, lower prices. But it didn’t happen. Now, with a possible trade war looming, those predictions are out the window. Instead of easing pressure on shippers, we could be looking at another round of painful rate hikes—the exact opposite of what was supposed to happen.
Global Ripple Effects
The impact of this trade war won’t be limited to just the U.S. and China. Countries in Europe, Latin America, and Southeast Asia will feel the pressure as global trade routes shift.
Many companies had already started diversifying supply chains to avoid tariffs in recent years. Vietnam, India, and Mexico have seen booming manufacturing sectors as companies look for alternatives to China. But now, even those moves might not be enough if tariffs expand beyond just China and hit other key trade partners.
What Can Shippers Do?
Unfortunately, not much. The reality is that when geopolitics collide with logistics, shippers are often left scrambling for solutions. The best approach? Stay ahead of the game. If you’re in the industry, start planning now. Expect front-loading to kick off sooner rather than later. Keep a close eye on carrier reliability, and if you haven’t locked in long-term contracts yet, now might be the time. Flexibility will be key.
The hope was that 2025 would be a return to normal. But hope doesn’t move cargo. And if Trump’s trade policies unfold the way many expect, it’s going to be another long, turbulent year for global shipping.
