In 2025, the ocean freight market has been defined by politically driven cargo front-loading ahead of potential tariff changes, the ongoing disruption of the Red Sea crisis and a historically large vessel orderbook entering the water. Demand surged early, carriers capitalised on scarcity, and shippers scrambled to keep pace with shifting routings and longer transit times. In 2026, however, the picture flips. The global trade landscape is heading into a sharp reversal a payback slowdown in trade volumes is set to collide with a heavy wave of new vessel deliveries, creating a real risk of structural overcapacity. If the Red Sea reopens, even temporarily, more capacity will flood the market, first causing short-term congestion and then triggering intense price competition as carriers fight for volume. According to Trine Nielsen, VP and global head of ocean freight at Flexport, it will be another year of significant market events, and supply chains will need to remain resilient. Expect continued geopolitical challenges, including trade war tensions and demand whiplash. Tariffs are increasingly becoming the new norm, so its critical to understand your total cost and compliance exposure, she said. Speaking during a recent online event, Nielsen said the impact of US tariff uncertainty had been hesitation importers are only ordering what they absolutely need. You are basically flying blind. Tariffs can change while your cargo is at sea, she said, indicating this unpredictability had amplified the long-running shift away from China. Nielsen said globally, trade had grown around 7, but US imports remained depressed due to tariff-driven behaviour. When North America is removed from the data, global demand is closer to 8, revealing a two-speed market. Inventory levels are balanced for now, but any rebound in the US economy could trigger sudden restocking surges, adding another shock layer to 2026. Carriers expect a weak 2026 as 1.4 million TEUs of new capacity around 5 of the global fleet enters service. Scrapping remains low, and many of the oldest vessels are still operational. Combined with the potential Suez reopening, effective capacity could jump sharply, just as demand softens. Our recommendation to industry is to plan for volatility build contingency routings and Suez-reopening scenarios, while also looking at diversifying carriers and alliances to mitigate blank sailings and operational risk, said Nielsen. It is advisable to use technology and visibility tools to reduce cost and respond faster, mix fixed, floating and index-linked contracts, while keeping the focus on true landed cost, not just base ocean rates. LV
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The PRSAs 7.57 tariff hike has divided industry players, who warn that rising port costs need to be supported by better service delivery.
