- Strong Shipping Volumes Continue Amid Trade Uncertainty.
- Ocean Alliance Remains Stable Despite U.S. Policy Shifts.
- Market Risks Grow as Red Sea Disruptions Ease.
The office of the U.S. Trade Representative has suggested charging port fees of up to $1.5 million on Chinese-built ships arriving in U.S. ports. The action is part of an ongoing probe into China’s presence in the shipbuilding, maritime, and logistics industries, reports Reuters.
CMA CGM’s U.S. Presence and Strategic Partnerships
CMA CGM, the world’s third-largest container shipping line, has expressed concerns about the potential consequences of these tariffs. Chief Financial Officer Ramon Fernandez highlighted the widespread impact on the shipping industry, stating, “China builds more than half of all container ships in the world, so this would have a significant effect on all shipping firms.”
The company is a part of the Ocean Alliance, a vessel-sharing agreement that includes China’s COSCO and other Asian partners. When asked whether U.S. policy could affect this partnership, Fernandez responded that CMA CGM has not received any indications that the alliance could be called into question. He declined to comment further on the USTR proposals, as a decision is expected in April.
Tariffs and the Reversal of Trade Routes
CMA CGM already sees some effects on shipping coming from new tariffs proposed by U.S. President Donald Trump. Fernandez mentioned that such tariffs have the potential to further increase the reversal of trade routes, one which has commenced with the implementation of tariffs against China by the Trump administration when it started implementing them.
A scramble to send shipments prior to new tariffs coming into force pushed container volumes last year, and the practice has carried over into early 2025. “A scramble to pre-empt new tariffs drove strong shipping volumes last year, a trend which has carried over into the start of 2025,” Fernandez said.
Market Outlook and the Red Sea Disruption
Though it posted robust performance in 2024, where shipped volume grew by 7.8% and group sales expanded 18% to $55.48 billion, CMA CGM has been guarded about the prospects of the market for 2025. Fernandez cited geopolitical uncertainty and the danger of overcapacity in vessels as major concerns.
Red Sea disruptions brought on by Yemeni Houthi militant attacks had soaked up last year’s surplus shipping capacity as ships were compelled to go the longer route around the Southern Africa coast. A return to regular shipping through the Red Sea after the Gaza ceasefire could, however, turn market balances around. “A return to regular traffic through the Red Sea following the ceasefire in Gaza would change that balance, and might lead firms to scrap older vessels,” Fernandez added.
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Source: Reuters
