DHL Global Freight says demand for container shipping in the final months of 2024 will be stronger than expected.

In its December 2024 Maritime Market Outlook, the company noted that Chinese exports will exceed expectations due to the expected tariff hikes by incoming U.S. President Donald Trump.

From day one of his presidency, Trump promised to impose a 25 percent tariff on imports from Canada and Mexico, along with a minimum 10 percent tariff on imports from China. But it remains to be seen how quickly the Trump administration can actually implement these increased tariffs.

Demand for container shipping is expected to remain strong until the Lunar New Year, at least driven by pre-holiday demand and potential tariff increases in the United States.

Niki Frank, CEO of DHL Global Freight Asia Pacific, said: "Given the strong demand this year, we expect demand to drop significantly at the end of the year. However, cargo volumes in November were comparable to those in October and September."

"We are seeing stable demand, although the market reaction has been slower than many expected because of the interference on the radar. But if typical seasonal trends hold, we expect to see a small uptick in December and January."

Although container rates have fallen, they are still much higher than a year ago. The Shanghai Container Freight Index (SCFI) from Asia to Europe is up 255 percent from a year ago, while freight rates to the West Coast of the United States are up 147 percent.

In the first few months of 2025, shippers of container shipping lines could face two other major disruptions - the U.S. East Coast port strike and alliance restructuring.

If longshoremen, represented by the International Longshoremen's Association (ILA), and their employers, represented by the United States Maritime Union (USMX), fail to reach an agreement by January 15, ports on the U.S. East Coast and Gulf Coast could shut down again following a three-day strike in early October.

"East Coast ports account for nearly 50 percent of incoming cargo to the United States," noted Praveen Gregory, senior vice president of maritime, Asia Pacific, DHL Global Freight.

"If east coast ports are closed, then all incoming vessels will be stuck waiting for berthing Windows, further delaying their voyage back to ports in Asia and Europe, thereby disrupting capacity for major trade."

The current outlook is not optimistic, as the ILA abandoned negotiations in November on the key issues of port automation and semi-automation. Last week, Trump sided with unions in the automation dispute.

The strike has left a large number of ships stranded outside U.S. ports, which could further affect Gemina Cooperation, a new container line alliance launched by Maersk and Hapag-Lloyd in early February. DHL's Gregory said the possibility of a strike at U.S. East Coast ports could also hold up ships coming into Gemini, delaying its launch.

"In ocean-going trade, problems arise only when any unexpected situation arises. We know alliance realignment is coming. Carriers and freight services have planned and are ready for this. Shippers should experience some disruption while the new alliance stabilizes, but barring any exceptions, we ultimately expect the new network to deliver the higher level of service promised by carriers, "Frank commented.