‘Tariff shockwave’ leads to collapse in ocean container bookings
‘Tariff shockwave’ leads to collapse in ocean container bookings
edit: oops I thought I was linking to the article: https://www.freightwaves.com/news/tariff-shockwave-leads-to-collapse-in-ocean-container-bookings
I once met a guy who was in sales for a shipping container company. He said it was the easiest, most lucrative sales job in the world. There really wasn't any sales at all, he just processed the orders that flowed in all day long. He got a fat commission on each one, and earned several commissions every single day. He was making BANK. He said it was nearly impossible to get a job doing that, it would require somebody to die to get their position.
I guess he's going to have a bad year, for a change.
Just think of all the fat bonuses he can get though once this craziness is done if he still has the job. The backlog will be huuuuuge.
Pretty unrealistically upbeat of you to think our shipping infrastructure will survive this fucking child king
You're acting like this is a pause and things will go back to normal.
I think that's unrealistically optimistic
I read something that some people experienced the collapse of the Roman Empire as their local bridge going out and no one ever coming to fix it.
I think a lot of Americans are going to experience the collapse of the American empire as their favorite treats never getting to the store shelves.
My town’s bridge is in need of repair, which was to start this year but is now delayed because federal funding for it was cut. We’ll see…
Don't American bridges fall down already? I guess the wait won't be too long.
Your thinking of London bridges. 🥁 (I'll see myself out).
Thankfully infrastructure week is just around the corner!...
Or they'll just argue those failing bridges are okay because aren't used that much
I think it's highly optimistic to expect that, if anything it's going to be more like the collapse of the Soviet empire, with weird successor state nonsense, some civil war, guns and violent crime everywhere, and those already in power going on a free for all kill each other and loot everything spree.
It's going to be a Rwandan style civil war. Your MAGA neighbor will kick in your door and shoot you and your wife in the face when told to do so by Fox.
I mean to say, for most Americans who are not news aware, the first signs will be that they simply can't get their treats anymore.
Even then, many of the more rural Americans will only ever have that experience. There's not going to be guns and tanks rolling through Westboro, Wisconsin.
On the plus side, it'll be good circumstances to create new anarchist structures to pick up the pieces.
Favorite treats? Who the fuck can afford treats in this economy...
Trump definitely did not intent to do that - but this is a good thing for the environment. If we end up in a global shrinkflation, this might berge worst way to reduce our carbon footprint, but it will probably be the long term consequence.
Hurray for Trump's idiocy!
Seriously though. I'll sacrifice this capitalistic nonsense to save a habitable environment.
Goddang that gif makes me laugh
But what if, now hear me out, we tow the entire thing OUTSIDE the environment?
Yeah, I live in Korea and usually this time of year the air quality is absolutely shit. However, due to the trade war, some factories in eastern China have closed and this apparently led to the great aqi forecast the past week or so.
Shrinkflation is when somebody sells you less of a product for the same price.
What you mean is stagflation. That when you have high inflation and a shrinking economy.
At any rate this is really great news for the environment.
Kind of like when COVID cleared up the air for weeks. Of course that was also awful for the economy, but it's almost like our normal way of overconsumption is killing the environment...
I want to agree, but this does not bode well for food trade. Less shipping overall means less economy of scale, which hurts everyones access to food.
I was gonna say - is Trump accidentally helping the environment??
This is exactly what I was about to say.
This could be the best thing the current administration did for the planet. No more shipping boats. It's going to be really interesting in the next two months.
Isn't shipping via boat one of the most energy efficient forms of goods transport we have as a species?
Efficiency doesn't matter if you're shipping material for production halfway round the world and shipping those products halfway back just because rich people wanted to outsource to cheap labour, and overproduce cheap crap that falls apart way too fast so they can sell us the same cheap crap again a couple years later. It's mostly waste. Some shipping is necessary, but I'd say a vast majority we could do without.
Like I don't believe for a second that these tarrifs will actually fix this problem because they're just a big tantrum with zero strategy involved, but in an ideal world we would make a lot more locally and spend a lot less energy sending things all over the planet to make a handful of shareholders slightly higher margins.
I went looking and found this: https://en.m.wikipedia.org/wiki/Energy_efficiency_in_transport
And yep transport via boat is the most energy efficient.
That said I'm going to assume that OP in this thread is not talking about logistics efficiency, but rather a downturn in a demand for goods.
Spoken like a rich asshole that doesn't have to worry about 300% inflation on food
I'm just a poor smart person. As I understand, and probably all of us should....this is the time to go to the stores and buy up shit. Toilet paper, plastic bags and straws, Christmas toys and everything else that usually says made in China. From what I understand we had around 60 days a few weeks ago for the real shit show to begin. So I would expect stuff to get real interesting soon. That's all. It's a worst possible scenario...shit runs out and all heck breaks lose. I sincerely don't know what to do. Should I just buy a good half a year worth of canned food? Should I do nothing? In don't know. Its a cautious wait and see sort of feeling.
Now China won't be able to destroy the US with their uh... affordable consumer goods! That'll show 'em!
Oh look, trump did something good! accidentally good, I'm sure he didn't intended that, but still
naive child
Wait till you see your food bill next month
I'm not an American, I'll be fine
Is it me, or does this look absolutely scary for world trade as a whole?
There's still a lot going on globally:
https://www.marinetraffic.com/
But I don't expect the US to have a fun ride
This economist says there’s a 90% chance of a recession. Here’s the math.
During the 2018 trade war with China, the U.S. average tariff rate increased from 2% to 3%. Studies show that the impact on gross domestic product was between 0.25% and 0.7%.
Using the low end of the estimated impact, and Trump’s plan that at the moment calls for double-digit tariff rates, Slok says the negative impact on GDP in 2025 could be almost 4 percentage points — and that doesn’t even include the negative impact from uncertainty for consumer spending decisions and business planning.
So a 4% hit to GDP when GDP last year in the US increase by 2.8% does not sound good
I told friends and relatives in February that we'd be in a recession by the end of the year. I expected 3 quarters for it, not his first 2. 2 consecutive quarters of economic contraction are needed by the modern definition of a recession.
A nearly 50% drop in booked global TEUs?
TEU means Twenty Foot Equivalent Units, your basic standard shipping container.
Yes, yes, this is astoundingly, apocalyptically bad.
America will be more fucked than others, but this is Great Depression 2.0.
If this persists, and you end up with a the rest of the year of roughly half the TEU... well you'd go from about 900m TEU to about 550m TEU.
The last time global sea trade clocked in at about 550m TEU was 2010.
So... yeah, just wipe out the last 15 years worth of volume of world trade, and economic activity/growth enabled by that, and oh also you have about 1 billion more mouths to feed than in 2010.
Or... if you look at it in terms of % change.... its hard to find detailed, historical, week by week figures without paying for the data, but the entirety of the GFC hitting the global economy in 2009 resulted in an 8.5% decrease in global TEU from 2008.
So... it remains to be seen how long and strong the current downturn in TEU will persist...
But, if you say 2025 TEU drops by 30% in aggregate for the rest of this year... that is a 2025 that has a -22.5% 'growth' in total world trade volume, almost 3x as bad as the 07 08 09 GFC, the impact of which was seen in the -8.5% of 2009.
These are spitball guess numbers, I can't predict the future... but I do have a degree in Econ and I used to work as an executive level data analyst for a large mulinational, US based import export firm... so its moderately informed spitball guess.
This is Great Depression 2.0, this will make the GFC look like childs play. This is tens or hundreds of millions of people (globally) going broke, becoming homeless, starving to death levels of bad.
The only way to prevent that at this point is ... well basically step one is America needs to impeach and imprison every Trump administration member... but that is uh... not guaranteed, to say the least.
Yeah, one problem here is that global container circulation needs to, well, circulate. People don't ship empty containers, that's stupid expensive. So container hire is going to get way more expensive as global shipping needs to rebalance. Happened under covid, too.
I work in international freight and my department focuses on the U.S. - Canadian border. We've been bracing for a decline but so far our volume has been steadily increasing.
I see the documents for every shipment crossing my assigned gateway and it looks like consumer goods are staying at the same volume, but B2B is increasing. So while Canadian consumers are boycotting American goods, industry is reliant on American parts to continue functioning.
I'm assuming the increased volume is a result of companies buying things that they know they will need in the future before the trade war intensifies and those same parts cost them even more.
Yeah, that seems like the boom before the bust. I know even personally I've been buying some things before they become hard to get.
Note, that data is from April 8th, which is before the 90 day tariff pause was announced.
From what my friends working in retail have told me, the trend is (temporarily) reversed. Every freight container going to the US is getting booked solid at inflated rates as brands try to bring in merchandise from non-Chinese factories into the US in case the tariffs resume.
Link to the image is still up, so we have to remove this as an image post.
If you replace the image with the link to the article, we can restore it.
Is Trump working on Making America Great Again, by turning it into a European colony again? A massive trade war with China, is obviously going to hurt both countries and Europe is the largest economy left.
Honestly he idolizes Russia, so .... Their economy is barely an international one right now. Also one of the worst internationally for a "major" country.
Wait is Trump actually doing something good for the environment even if by mistake??!?
The main reason he is doing this is only because his Hero did it.
And trump really likes doing ANYTHING Hitler did.
As of Aprill 8.
I guess MAGA people will see this as a win? Since imports are down 2x much as imports. If the value of the goods in these containers are roughly equal, that should mean smaller trade deficits?
oh no the economy is collapsing. But at least we have racism!