Ship Angel February Newsletter
This month's newsletter features Ship Angel's new Comparison Guide, insights on global trade developments, and highlights from our recent Roundtable Dinner in New York City.
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The Cargo Compass
Ship Angel shorts on what is affecting the world of shipping this month.
Global trade faces a turbulent landscape as 2025 approaches. From shifting ocean rates to evolving tariff battles, markets are bracing for uncertainty and change.
Global Ocean Rate Trends (February 1)
Global spot market rates are dropping across all tradelanes, as shown by Ship Angel data. This typical post-Chinese New Year dip contrasts with stable long-term rates on the Asia-Europe route, down only 4% since December 1. This delay in contract season signals market uncertainty. If spot rates continue declining into March, it may forecast a difficult 2025.
Key Spot Rate Changes (February 1):
North America Trade Update
Tariff escalations in North America have paused for the past 30 days. The U.S. tariffs on Mexico and Canada prompted a cooperative effort among the three North American partners to address border security concerns. While it’s uncertain what will unfold in the coming month, this collaboration is a positive development toward easing trade tensions.
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European Union Trade Developments
A similar trade standoff between the U.S. and the EU is anticipated in February. Notably, the EU's strong pharmaceutical exports to the U.S. could become a point of contention. Although automotive tariffs may increase on German vehicles, the global slowdown in car purchases makes this less impactful. Higher tariffs on German cars could, in fact, benefit the U.S. automotive sector.
China Trade Landscape
The current 10% tariffs on Chinese goods have had a modest but tangible impact on trade. While unlikely to cause fundamental shifts in importer behavior, they may lead to a slowdown in discretionary Q1 shipments. More significant is the removal of De Minimis Section 321 rules for shipments from China and Hong Kong. This change could profoundly affect companies like Temu and Shein, which collectively generate about $100 billion in revenue and heavily influence Trans-Pacific air freight. A 25% increase in costs might drastically alter American consumer purchasing patterns on these platforms.
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?? Discover valuable insights in 'Embracing AI in Supply Chains', exploring the most transformative advancement in supply chains over the past century: AI.
Ship Angel Roundtable Dinner
Thank you to all who attended Ship Angel's very first Executive Roundtable Dinner in New York City.?
We gathered supply chain leaders to discuss 2024 challenges, AI adoption, and strategizing for 2025 ??
Get in touch with us if you would like to register your interest for our next event in the coming months!