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Much like 2024, next year will be another challenging year in ocean container shipping
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The Red Sea conflict is expected to linger, with no clear political resolution on the horizon
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The report warns of heightened danger for container shipping ‘because there is little slack in the system to deal with another supply chain shock’
Much like 2024, next year will be another challenging year in ocean container shipping, according to the Xeneta Ocean Market Outlook 2025.
The Red Sea conflict is expected to linger, with no clear political resolution on the horizon. Thus, there will be no large-scale return of container ships to the region, said Xeneta.
The report warned of heightened danger for container shipping “because there is little slack in the system to deal with another supply chain shock.”
The impact that diversions around Africa on TEU-mile demand and available capacity in the market will be great. And while new deliveries of ships and slowing TEU-volume growth will ease some of the burden, it will not be sufficient to mitigate another major incident.
There are other red flags the industry faces, including the possibility of military escalation in the Taiwan Strait, the unrest in Bangladesh which could lead to regime change, and the potential for a worsening of the Middle East situation.
There is also the potential of new US tariffs on Chinese goods, which would spur a rise in freight rates and shippers rushing to frontload imports.
Then there is the continued demand growth from China to Mexico as a back door to the US. There may even be further strike threats at ports in the US and Gulf Coast in January, which were averted recently.
The Xeneta report asked how shippers, freight forwarders, and carriers react to new alliances as they are rolled in in the first quarter of next year.
There is at least some good news for shippers ahead of long-term contract negotiations as spot markets have been softening on major fronthauls out of the Far East since peaking in July.
Xeneta said one factor in shippers’ favor us their access to more data than ever before. “This means they can closely monitor freight spend on individual corridors and benchmark carriers against scheduled reliability, capacity, transit times, and CO2 emissions.”
The report concludes by saying that while this has been a bruising year for shippers, hopes remain that next year will see some relief.
“But it is important to be realistic and prepare for further disruptions,” the report said.
READ: Shipping spot market rates falling, long-term rates rising
