The global shipping industry is grappling with heightened uncertainty following further tariff announcements from president Donald Trump.
Initially set for July 9, the deadline for implementing increased tariffs for most of the world bar China, Mexico and Canada has been extended to August 1. This extension aims to provide additional time for negotiations with countries yet to finalise trade deals with the US, the White House has said with just the UK and Vietnam resolving their trade issues with the Trump administration thus far.
Talks with big trading areas such as the European Union and India are still in progress. The uncertainty surrounding these negotiations is causing importers to reassess their supply chains and inventory strategies with potential tariffs reaching up to 70% on imports from countries lacking new trade agreements with the US come the start of next month.
In response to the looming tariffs, many importers are exploring alternative strategies to mitigate potential cost increases. One such approach involves rerouting Chinese exports through Southeast Asian countries like Vietnam and Indonesia. However, the US has imposed a 40% levy on goods moved through Vietnam to counteract such practices. Additionally, importers are increasingly utilising bonded warehouses within the US to delay duty payments until merchandise is sold, allowing for better cash flow management amidst unpredictable trade policies.
The uncertainty surrounding tariff implementations has led to fluctuations in shipping rates and alterations in trade routes.
“For the first time in 2025, it is now more expensive to ship a 40-foot container from Asia to North Europe than to the US West Coast. Spot rates on Asia-US routes have declined for the third consecutive week while rates on the Asia to North Europe route have improved, driven by tighter capacity and successful rate increases,” broker Braemar noted in a container report published today.
China-US west coast rates are now down to $2,089 per feu, a steep drop from the spike of $5,606 per feu just four weeks ago.
“In an industry, where the duration of the supply chain is measured in months, long-term planning is critical. Yet the regulatory uncertainty makes such planning de facto impossible, presently,” analysts at Sea-Intelligence noted in their latest weekly report, adding: “In this unpredictable environment, US importers are likely to tread with caution.”
Mediterranean Shipping Co (MSC), the world’s largest container line, has made the first move to withdraw excess capacity on the transpacific route with Linerlytica, another container shipping consultancy, reporting on the suspension of MSC’s Pearl service that connects Cai Mep, Haiphong, Nansha, Hong Kong, Yantian, Xiamen, Long Beach.
