Asian container liners set for profit drop as tariff truce ends

Asian container liners' profits might have just peaked. A sharp drop in shipping rates could be on the cards later in 2025 after tariff-driven demand in the second quarter pulled forward volumes from the traditional third-quarter peak season.

- BLOOMBERG

HONG KONG -

Trans-Pacific trade picked up during the US-China tariff truce, with freight prices up sharply in June.

As capacity recovered, smaller players such as China United Lines even resumed trans-Pacific services after a period of absence.

Bloomberg Intelligence analyst Kenneth Loh said: "Container volume data seems to suggest that Chinese liners saw the greatest increase in demand during the tariff truce, compared with peers in Japan and South Korea, which suggests the former could potentially see a more robust quarter."

Mr Philip Damas, managing director and head of Supply Chain Advisors at Drewry Group, said that the rest of the year could be dampened by weaker trade growth as sentiment remains soft, while volumes brought forward could trigger deeper rate corrections.

Earnings from Japanese liners are showing the peak might be over, with Mitsui OSK Lines failing to impress investors as US tariff threats impacted its container shipping business and Nippon Yusen KK cutting full-year guidance on currency fluctuations and tariff turmoil.