Deciphering America’s election result

All indications are that trade will be affected, but exactly how remains the key question. Most analysts expect a rapid increase in tariffs after the US presidential handover on 20 January, and that is likely to spark an equally rapid rise in demand as shippers seek to beat the new tariff regime.

Xeneta chief analyst Peter Sand warned on the day of the election that a Trump victory poses the greatest threat to trade due to the imposition of tariffs on imports from Europe and Asia, with particularly high import tariffs on Chinese goods.

Linerlytica argues: “Total US laden container imports outnumber laden exports by a factor of 2.4 times in 2024 compared to 1.8 times in 2018. Over the same period, average monthly imports have risen by 18% while exports have decreased by 10%, with the number of empty containers repositioned out from US rising by 39%.”

Trump’s 2018 tariffs failed to decrease the container trade deficit, with US exports hovering around 750,000 teu/month, while imports increased from around 2m teu to just under 2.5m teu/month.

One difference in 2025 compared to seven years ago is that the scope of the tariffs is no longer focusing on China; in his pre-election rhetoric, the president elect has promised to broaden the geographical scope as well as deepen the impacts with much higher tariff rates.

Related:‘Drill baby drill’ – Trump and the tanker market

Tariffs on US imports will necessarily be met by reciprocal tariffs on US goods, said Sand, so a trade war will ensue.

Another school of thought is that Trump’s rhetoric is being used to leverage his bargaining position when the time comes.

James Hookham, director at the Global Shippers’ Forum, pointed to pre-election speculation by financial markets of a major stimulus package by Beijing to boost its flagging growth. Delays to the announcement saw Kamala Harris’s poll lead erode. When the stimulus was announced just after the election it was far smaller than expected.

“Was this a coincidence?” Asked Hookham, “or did the Chinese government have a variable stimulus that they waited until after the election to announce?”

In addition, Hookham pointed out that China had significantly devalued the renminbi “to an unusually low rate.” Currency devaluations are seen as a method of boosting exports, and that could be a temporary measure that will boost China’s economy in the short term, perhaps up to the run up of Chinese New Year on 29 January.

Chinese New Year, coincidentally, is also the earliest date Hookham believes new tariffs could be enforced by.

The coming weeks will be telling, if shippers believe that tariffs could rise to levels that mean “the viability of their goods are affected”, then we can expect to see a spike in demand on the Pacific to both east and west coasts, notwithstanding the threat of a January strike on the US eastern seaboard.

One week after the election results maybe too early for these signs to be seen.

Freight forwarder Dimerco, using Drewry Shipping Consultant data, said that from the end of October through November, weeks 43-47, some 70 blank sailings have been announced, from 692 services. Significantly higher than the 46 blanked sailings in weeks 30-34, from 691 services.

Alvin Fuh, VP Ocean Freight at Dimerco Express Group said: “We anticipate that ocean freight rates, whether for long-haul or intra-Asia, will experience significant fluctuations, swinging dramatically between highs and lows as we approach Christmas and New Year.”

The global purchase managers’ index (PMI) dipped below 50 in July, meaning a contraction in output, and has continued to slide up to September. In the US the PMI is below the global average at 47.3 compared to 48.8 points.

Nevertheless, Dimerco reports: “The National Retail Federation [in the US] continues to forecast that retail sales for FY 2024, excluding automobiles, gasoline, and restaurants, will grow between 2.5% and 3.5% compared to 2023. This would bring total sales to approximately 24.9m teu, just shy of the peaks of 25.8m teu in 2021 and 25.5m teu in 2022.