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Shipping costs are rising as companies rush to import goods ahead of higher tariffs promised by U.S. President-elect Donald Trump on Chinese and European goods.
Xeneta, a Norwegian freight and ocean freight rate benchmarking platform, has warned that spot rates for container shipping could rise due to the recent re-election of Donald Trump as the next US president.
“Trump has promised blanket tariffs of up to 20% on all imports into the United States and additional tariffs of 60% to 100% on goods from China,” the company said in a statement. “Data from Xeneta — the ocean and air cargo intelligence platform — shows that the last time Trump raised tariffs on Chinese imports during the trade war in 2018, ocean container shipping freight rates soared by more than 70%.”
Xeneta said companies are rushing imports to avoid higher tariffs as U.S. importers and exporters brace for rising ocean container shipping rates. The company notes that a repeat of 2018 is unlikely, with advance distribution of imports expected to play a bigger role this time around.
“Risk management has been a huge element to manage for container shipping supply chain professionals in recent months,” the company’s chief analyst Peter Sand told pv magazine . “First there was the strike at US East and Gulf Coast ports, and a month later the US presidential election. As the uncertainty surrounding the election results quickly dissipated, attention can now turn to executing the contingency plans drawn up to manage the transition from the current tariff regime to the next.”
Sand said U.S. retailers have spent the year stockpiling in response to disruptions in the Red Sea, leaving importers in a position to act strategically. He noted that there is little evidence of a significant increase in activity at the moment.
“Spot container freight rates to the US from the Far East/China, in particular, have risen by $150 per [40-foot equivalent unit] on the East Coast, while rates on the West Coast have fallen by the same amount over the past three months,” he added.
Transport costs rose sharply in the first half of 2024 due to the Red Sea crisis.
"There is an upward trend related to frontloading and potential port strikes at the US East Coast and Gulf ports," Sand said.
Xeneta warned that tariffs imposed by other nations and trading blocs, including the European Union, could push up prices.
“It is important to monitor container shipping data on return routes, as they could also be affected if a trade war with the US escalates on a more general global level,” the company said. “An escalation of the trade war could cause some carriers to shift their supply chains and import goods to the US via other trade routes. First, they could open factories in other Far Eastern countries, but this takes time and comes at a cost.” |
