Shipping analyst Lars Jensen has stated that Trump Tariffs 2.0 could result in a "yo-yo effect," meaning that U.S. container import demand may fluctuate dramatically, similar to a yo-yo, sharply declining this fall and rebounding again in 2026.
In fact, as we enter 2025, the trends in the container shipping market do not seem to be following the "script" that analysts generally expected. Fortunately, the most pressing challenge—the risk of strikes at East Coast ports—has been averted. On January 8, the International Longshoremen's Association (ILA) and the U.S. Maritime Alliance (USMX) announced a preliminary agreement. Regardless, this is indeed good news for stability in the container shipping market in 2025.
Meanwhile, the phased deployment of capacity by Premier Alliance, the "Gemini" collaboration, and the standalone Mediterranean Shipping Company (MSC) in early February may lead to some short-term turbulence, but once capacity deployment is completed, a more stable and reliable market environment can be anticipated for 2025, which is also good news for supply chain managers.
However, the impact of Trump Tariffs 2.0 still warrants further consideration, particularly in the context of supply-demand imbalances in the U.S. market. In fact, the mere threat of tariffs has already affected the market, with some U.S. importers preemptively "rushing shipments" to mitigate risks. But what happens in 2025 and 2026 will depend on the scale and scope of the tariffs ultimately implemented.
It remains unclear the extent and timing of Trump Tariffs 2.0. However, if relatively stringent tariffs are enacted, the yo-yo effect will come into play.
Meanwhile, Adam Lewis, president of Clearit Customs Brokers in the U.S., warns that Trump appears determined, and the pace of implementation may be much quicker than expected, urging preparedness.
He cautioned, "The timeline for implementation could be just weeks."
He indicated that Trump might leverage special legislation to expedite the implementation, bypassing the lengthy negotiations in Congress.
Legislation from 1977 authorizes the U.S. president to intervene in international trade after declaring a national emergency to address any unusual threats facing the U.S. This was first used during the Iran hostage crisis under the Carter administration.
Reports suggest that members of Trump's economic team are discussing a plan to gradually increase tariffs by about 2-5% monthly.
Brandon Fried, executive director of the Air Freight Association (AfA), shares similar concerns. He noted, "I think we need to take Trump's comments on tariffs seriously."
The AfA opposes tariff barriers, as they typically raise costs and may provoke retaliatory actions that further hinder trade. However, he remarked, "This is a fast train, and it’s not easy to dodge."
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Post time: Jan-18-2025
