The global ocean shipping industry, responsible for moving 80% of world trade, is bracing for intensified uncertainty as President Donald Trump escalates trade tensions with allies and rivals alike.

Read also: The Impact of Tariffs on American Consumers & Businesses

This comes as major players in the container shipping and supply chain industries gather at the S&P Global TPM conference in Long Beach, California, where carriers like MSC, Maersk, and Hapag-Lloyd—alongside logistics firms such as DSV and DHL—are set to navigate a shifting trade landscape. With protectionist measures on the rise, these companies face potential disruptions that could weaken container ship owners’ negotiating power and dent long-standing profit margins.

Tariffs and Trade Barriers Reshape Global Logistics

Trump has already imposed a 10% tariff on Chinese imports and is pushing for a steep $1.5 million entry fee on Chinese-built vessels docking at U.S. ports. Further trade restrictions loom, including:

• A potential 25% tariff on Mexican and Canadian exports such as avocados, tequila, beef, lumber, and oil.
• Additional tariffs on steel and aluminum.
• Proposed 25% duties on select European Union imports.

Such moves have heightened concerns over trade flow disruptions, impacting businesses reliant on global supply chains. According to Peter Sand, chief analyst at Xeneta, “Unprecedented uncertainty is all around.”

Geopolitical Risks, Climate Challenges, and Inflationary Pressures

The world’s largest importer, the U.S., is shifting away from free trade at a time when global supply chains are already contending with higher costs due to extreme weather events and geopolitical instability. Attacks on commercial vessels in the Red Sea by Iran-backed Houthi militants have forced carriers to reroute away from the Suez Canal, adding further strain to global shipping.

While U.S. container imports have surged ahead of expected tariff hikes, analysts warn of a looming slowdown once higher import taxes take effect, retaliation from trade partners ensues, and inflation-hit consumers absorb the rising costs. The Drewry World Container Index, a key freight rate benchmark, stood at $2,629 for a 40-foot container as of Thursday—75% below its pandemic-era peak of $10,377 in September 2021 and at its lowest level since May 2024.

“The geopolitical landscape has of course become more complex, which could lead to wild swings for freight rates in either direction, but our base case is for a moderation throughout 2025,” noted Jefferies analysts.

Shipping Fee Proposals Shake the Industry

Adding to the uncertainty, the U.S. Trade Representative has proposed significant entry fees on Chinese-built vessels. Under this plan:

• Chinese maritime operators, including state-owned COSCO, could face fees of up to $1 million per vessel.
• Non-Chinese operators using Chinese-built ships could see port entry fees as high as $1.5 million.

While this measure may benefit South Korean and Taiwanese shipping firms, experts warn it could have far-reaching consequences for global supply chains and U.S. consumers, potentially driving up prices for everything from clothing and electronics to food and fuel.

“The economic burden on U.S. exporters and importers will be huge,” said container shipping expert Lars Jensen.

As the Biden administration’s protectionist trade agenda unfolds, the shipping industry is left navigating uncharted waters, with the potential for significant disruptions in global trade and logistics.