04/11/2025
Market report - October 2025. TOEPFER TRANSPORT GMBH Hamburg I Shanghai
To be or not to be
This famous line from Shakespear’s Hamlet expresses nicely the situation concerning tariffs and ports fees. US threats to impose tariffs and port fees – the latter applying only to China – have clearly prompted China to introduce countermeasures against US companies. The consequences of each measure extends to granular issues such as who financed a vessel (e.g., a Chinese lessor as ultimate owner) and where the operating company is registered (e.g., US-listed Greek shipowners). For liner companies, deciding how to deploy ships with such varied ownership and registration profiles across their services is a nightmare. Although the US and China have now agreed to a one-year pause, it remains far from certain that Trump will keep even a single element unchanged for long. While Trump usually always calls victory, we did not hear much of that last week. As someone put it, if the one side has rare earths as a negotiation tool and the other a widely available bean (soyabeans), there is no question as to who holds the upper hand in the negotiation.
While we all know that geopolitics are playing a significant role in shipping, we have had to learn quite a lot in the last few months about how US fiscal policy can really influence shipping. In liner services, it becomes far harder to optimise fleet employment when a vessel’s type – or the relationships attached to it – suddenly drive the economics of the trade. So far it is not fully clear when the introduced port fee measures will actually stop and what will happen to the those already paid. The only official US statement on the agreement between the US and China in this regard has been a casual Trump press conference on board Air Force One. The question for us now is, how much inefficiency in the liner networks have these port fee struggles created in the last few weeks, and how quickly will they now be diminished. Also, in addition, the current ‘tariff truce’, i.e. the postponement of tariff implementation between China and the US, only lasts till 9 November. Hence, this coming week we expect a lot of news from China and the US with regard to port fees and tariffs.
There is never a dull moment since Trump moved into the White House. The other main conflict Trump was occupied with before meeting President Xi was the Israel–Hamas conflict. There, the peace agreement and the various steps that need to be implemented by both sides are not progressing. Israel has not retreated to the agreed lines in Gaza, nor has Hamas laid down its weapons. Currently, many diplomatic discussions are taking place as to which independent party is actually controlling and forcing Hamas to lay down its weapons. Hamas has not agreed to this point in Trump’s peace deal and, if this is not going to happen voluntarily, who, as a third party, wants to start a military conflict with Hamas to actually do that. It is hard to believe that UN troops can do this or that the Arab world would put together a force to go into Gaza. Most likely only Isreal has the willingness to face casualties by fighting Hamas. Why do we mention this here? Well, the peace agreement for Gaza is far from being implemented and hence safe passage through the Suez Canal and the Houthis giving up their struggle seems far off now. Even if a peace agreement holds in Gaza, it is unclear if the Houthis would rest their case. The ‘opening’ of the Suez Canal for international shipping seems not to be around the corner and hence any ‘crashing’ of the container market due to this also does not seem on the cards for now. We assume that few budgets for liner companies and tramp ship owners will not assume a container market crash in 2026 as yet."
Until then, happy drinking during Eisbein"🍻🍺🍺
