US-China Tariff Truce May Trigger Early Peak Season for Container Shipping: Xeneta

Xeneta says the 90-day easing of US-China tariffs brings relief to businesses. File Image / Pixabay

The 90-day tariff reprieve between the US and China is set to revive trade volumes and bring an early start to peak season for container shipping, according to ocean freight analytics firm Xeneta.

"Politicians on all sides will argue over who has won, who has lost and who has the better deal, but the most important point is that we will now see goods flowing more easily between the world's biggest trading nations," Peter Sand, chief analyst at Xeneta, said.

The US and China agreed to slash tariffs for at least 90 days. Under the temporary agreement, the US will reduce its tariffs on Chinese imports from 145% to 30%, while China will cut its duties on US goods from 125% to 10%.

"The spiralling trade war was catastrophic for businesses, so there will be huge relief that diplomacy appears to be returning," Sand noted.

With a 22-day average transit time from China to the US, shippers are expected to act quickly.

"Shippers will take the 90-day window of opportunity to ship as many goods as possible into the US, and this will put upward pressure on freight rates."

"Q3 is traditionally the peak season for ocean container shipping, but that may arrive earlier in 2025 if there is now a rush to import goods into the US from China."

Sand warned, however, that "there is still a 30% tariff on imports from China to the US and this will be prohibitive for some businesses with lower-margin goods."

Looking ahead, Sand said, "there will be relief over the easing of tariffs, but shippers cannot carry on as if nothing has happened because, if we have learned anything in the past few months, it is to expect the unexpected and further volatility."

"Businesses do not want to be under the thumb of geo-politics any longer."

Increased shipping activity in both countries could also potentially result in higher bunker demand.