Is it possible tariffs will have one positive impact?

We are all hearing and reading of the approaching dark tariff clouds coming our way from the United States of America. There are lots of scare stories about new custom tariffs reigning havoc on our exports, with some catastrophic impacts on our currently thriving economy.

It is hard to find any short- or medium-term positives being discussed by the economic and serious political commentators.

However, for importers and some exporters, there may be signs of container shipping costs falling. One reason that container freight rates are starting to dip is that the Red Sea threats have ease considerably, resulting in more traffic in the Suez Canal.

And with the US-China trade war escalating with new import duties, one of the possible upsides of the tariff dispute could be lower container demand, resulting in prices falling.

The existing and impending tariffs have broad implications for all economies and the global market. With all the new trade policies emerging from Washington, it will be important to keep a close eye on Far East export levels in 2025.

After a very strong December, in early January, Deepsea container carriers, led by Maersk and MSC, started cutting Asia-Europe rates in the hope of filling their ships during the usual post-Chinese New Year lull. That resulted in the Shanghai Containerised Freight Index showed a 4 per cent drop in Shanghai-North Europe rates, to $2,851 per teu.

Theloadstar.com portal reports some interesting background related to the CTS global price index, which records both contract and spot rates paid over the course of last year. It “saw a modest increase of 2 points in December, continuing a steady upward trend since October, now standing at 96 points.

“Notably, the index is 25 points higher than it was in December 2023, yet 25 points lower than December 2022, highlighting ongoing market fluctuations and price adjustments,” CTS said.

There were some wild fluctuations between trades, however. The price index for Far East-Europe trade was at 128 in December, over double that of December 2023’s level of 62, while the Far East-North America price index for December was 42.3 per cent higher than the year before.

And after trailing 2023 pricing for most of the year, the price index on the transatlantic headhaul Europe-North America route finished December 2024, some 37.4 per cent higher than the year before.