FACTBOX: Shipping rates under pressure from ongoing tariff turmoil

Global shipping rates are falling across multiple segments as escalating trade tensions and new US tariff threats weigh on maritime trade flows, according to industry analysts and shipping data.

The downturn follows several rounds of tit-for-tat measures between Washington and Beijing in recent weeks, which has seen US levies on most goods from China surge to 145%. China in the week ended April 12 imposed fresh tariffs on US imports of up to 125%.

Container ships, in particular, must brace for a pronounced decrease in demand once the rush to ship cargoes ahead of the tariffs taking effect recedes, Fotios Katsoulas, a shipping analyst at S&P Global Commodity Insights, said.

The following are key facts about the impact of trade tensions on global shipping markets:

Trade flows

In the agricultural sector, Chinese buyers are likely to source lower volumes of products, such as soybeans, from the US and more from Brazil, according to traders. As for tankers, there has been an unseasonal shift amid both tariffs and changes in Nigeria's refining landscape and in European gasoline exports to West Africa instead of the US Atlantic Coast

Tankers:

• China is the top export destination for US propane and ethane, having received 17.5% and 46%, respectively, of all such exports in 2024, according to the US Energy Information Administration.
• A projected 4 million mt of gasoline is to be delivered into West Africa from all locations over the 30-day period to April 27, a two-year high. This compares with 1.6 million mt to the USAC over the same period, reaching an 11-month high but well within normal seasonal trends, S&P Global Commodities at Sea data showed.
• China needs to find ways to swap or resell its over 4 million mt/year US LNG supply in the market in 2025.

Dry bulk:

• The US-bound market share of finished aluminum product exports has remained steady about 16% even as China's exports have risen by 52% from 2017 to 2024, according to data from S&P Global Market Intelligence's Global Trade Analytics Suite.
• Mexico's market share in China's semi-finished exports has gone up to 10% in 2025 from 3.8% in 2017, while Canada's has gone up to 4% from 2.3%. Asian countries including Vietnam, Thailand and South Korea have also seen a jump in market share.
• Buying activity for Brazilian soybeans will likely remain supported as Chinese buyers continue to seek coverage for May and June shipments, traders said.

Containers:

• Customers have accelerated imports to the US ahead of the tariffs taking effect and will likely be more cautious about their inventory levels pending further clarity, A.P. Moller-Maersk told Platts, part of Commodity Insights.
• The US petrochemicals industry, which is heavily reliant on exports, faces challenges as key markets, including China, reduce their reliance on US products. In 2024, US primary polymer resin exports to China were approximately 2.7 million mt, according to analysts at Commodity Insights.

Prices

There is still uncertainty about tariff policies across jurisdictions. Amid this, key freight rates have dipped:

• Platts assessed the rate to carry a 66,000 mt cargo of grains on a Panamax from Louisiana to Qingdao at $38.50.75/mt April 16, down 10% from the start of the month.
• The Platts Container Rate from North Asia to the East Coast of North America was $3,100/forty foot-equivalent unit April 16, down 11% from the start of the month.
• The Platts dry bulk index on a time charter equivalent basis for non-scrubber fitted ships was $11,986/d April 16, down 28% from the start of the month.
• The Platts container index fell 6% from the start of the month to $2,273/FEU April 16.
• The Platts crude tanker VLCC TCE index fell 6% from the start of the month to $34,677/d April 16.

Infrastructure

Adjusting trade flows implies reorganization through the supply chain and some ports will see changes in demand for certain products:

• Declines in soybeans futures reflect an estimated loss in the value of unsold 2024 crop of nearly $300 million, costing US farmers almost $1.4 billion on the 2025 crop, Senate Democrats said to the US Trade Representative in a letter about the impact of tariffs on US farmers.
• The US imported 40.76 million twenty-foot equivalent units of assorted goods in containers through 2023 and 2024, of which over half came from China, according to data from Market Intelligence.
• The EU's excess petrochemicals capacity and underutilized production capabilities for polyethylene suggest it can replace a significant portion of US polymer exports, further reducing US market share.
• A USTR proposal unveiled in February would levy fees of up to $1 million per docking on Chinese-operated ships that access US ports, fees of up to $1.5 million per docking on Chinese-built ships based on their share of the operator's total fleet, and charges on operators with future ship orders pending with Chinese shipyards.