Tariff threats and Red Sea instability to keep shipping costs elevated in 2025

Posted on December 2, 2024   |  

Global shipping costs will stay high in 2025, with freight rates continuing to rise due to ongoing challenges in the industry.

US President-elect Donald Trump’s tariff threats will push China to find new markets and shift trade routes to Europe, South-East Asia, and other areas.

China faces overcapacity and wants to grow its GDP, which keeps its exports low-cost.

On November 26, Trump pledged heavy tariffs on Canada, Mexico, and China.

Trump will impose an additional 10% tariff on Chinese imports and revoke China’s special trade status, raising tariffs above 60%.

Geopolitical tensions in the Red Sea will lengthen shipping routes as ships avoid the Suez Canal, adding 1.2 million TEUs to the supply.

Attacks on vessels in the Red Sea will reduce traffic through the Suez Canal, impacting one of the shortest shipping routes between Asia and Europe.