Peter Sand, Xeneta Chief analyst spoke to CGTN Europe about the impact of Trump’s tariffs on shipping industry.
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00:00Shipping giant Maersk says it's expecting global cargo to increase this year
00:05despite US tariffs. The Danish firm has reported its third strongest year with
00:10operating profits up 65% in 2024 to six and a half billion dollars. However Maersk
00:17says it has plans to return to shipping in the Red Sea due to the threat of Houthi
00:22fighters in Yemen. It said President Trump's policy of imposing import
00:27tariffs would not have a massive impact on business. Well Peter Sand is chief
00:33analyst at the freight market analytics firm Zaneta. Good to see you Peter. What
00:41do you think then Maersk seeing resilience in global trade despite the
00:46tariff threat but what happens if all of these threatened tariffs do go ahead?
00:53Global shippers are constantly challenged with new risks coming to them
00:59left right and center. If it's not the Red Sea disruption it's it's new
01:03tariffs walls around US right. So so one thing that that shippers are looking for
01:09is retaining their options and ensuring that they can still provide the goods to
01:15their consumers in the end in the way that they used to and well they can't do
01:20it as usual so so they need to find other ways and and that it's basically
01:25bringing a strain on everyone working in global shipping supply chains. Okay yeah
01:30supply chains is what I was going to come on to next. So they're always
01:33looking you say for other ways to find this stability. What about the increasing
01:38costs on Chinese imports? Could we see some effect on those supply chains? If we
01:46if history is anything to go by in the first trade war we definitely saw
01:51American investments being made in Vietnam and some other places in
01:55Southeast Asia also and a lot of goods also being transported directly out of
01:59China into the likes of Canada and Mexico and then finding its way to the
02:04end consumers in US. So if shippers will draw on that experience and we expect
02:12they will do so to to a large extent this time around going to what they hope
02:17is a safe haven in the wider South East Asian region maybe also to India to
02:24source their products in order to to basically avoid the the tariff hikes on
02:29Chinese goods. Okay so perhaps going to India and Maersk reported is mentioning
02:36some sort of cost-cutting that they might need to bring in. So what could
02:41this mean for global shipping firms? Global shipping firms and the main
02:47carriers are really good at moving large volumes on main hauls. So what this means
02:53may actually be a little bit of say a bitter taste to the carriers but a nice
02:59sweeter taste to it to the forwarders that that tends to be more agile that
03:03tend to to offer services to shippers when it becomes a little bit more niche
03:09a little bit more troublesome. So someone may benefit someone may get
03:14more challenge but but for sure a lot of investments needs to be done in order to
03:19find ways around tariff walls. Yeah and in general then on a global front how
03:26concerning do you think companies are shipping companies are concerned about
03:30Donald Trump's tariffs? I think they are rightly very concerned but but it's not
03:38the only risk coming about these years right. If we only dial back a few years
03:42we we have learned the effect of Russia's invasion into Ukraine. We have
03:47learned the effect of Houthi rebels closing the Red Sea and we have seen in
03:52the first tenure of Trump in the White House how shippers and shipping lines
03:58could react to a trade war. So so it's another day another risk to manage and
04:04I'm pretty sure they got plenty of contingency plans everyone out there but
04:08it's not getting easier by the day and it's not getting less expensive so so
04:12you need to be able to benchmark your performance in the market right ensure
04:16that that you work with the right suppliers and you pay the right money
04:20for that service. Okay as you say another day another risk to manage. Thank you
04:24very much Peter San, Chief Analyst at the freight market analytics firm Zenasia.