Panelists at the Journal of Commerce’s TPM25 conference indicated that the container market is facing a downturn in 2025, warning that it could be worse than previous declines. Parash Jain, the global head of Transport and Logistics Research at HSBC, stated that the market’s decline is already underway and identified several key variables driving this trend.

One key issue is oversupply; fleet capacity has surged by 33%, while trade growth was only 9% in 2024. Disruptions have absorbed some excess capacity, but rates are likely to fall further if these disruptions are alleviated. Another risk is uneven demand across trade routes. While Asia-North America volumes grew by 28% between 2019 to 2024, North America-Asia trade decreased by -15%, and Europe-Asia trade fell by -23%.

Consumer demand is also weakening, and rising tariffs could exacerbate the situation. Chris Rogers, head of supply chain research at S&P Global, noted that aggressive trade policies through tariffs might push inflation higher, putting additional pressure on consumer spending. “That’s likely to prove inflationary, which could start to hit consumer spending in a way maybe we didn’t see last time around,” Rogers remarked.

Furthermore, a U.S. proposal to tax Chinese shipping could disrupt trade as early as April. According to Platts, Eastbound Trans-Pacific spot rates to the U.S. West Coast spot rates have already fallen by -53% this year.

Source: Journal of Commerce