The Captain’s 2025 Predictions

Strictly MY opinion and does not reflect the positions of anyone I am associated with. 

Disclaimer-If I could tell the future, I would be sitting on my mega yacht right now with a 25-year-old scotch in hand…

1.        Container Rates- These should remain stable plus or minus 10% for most of 2025 at the current worldwide average of around $4,000 per 40-foot box. Subject to change at a moment’s notice with any new world conflicts.

2.        Port Growth- Consumer demand remains strong and despite some route issues, we should see ports average around 6-7% container growth in 2025 at North American ports. LA/LB, New York, Seattle-Tacoma, Charleston, Savannah, Jacksonville, Norfolk, Prince Rupert and Halifax should remain strong with import volumes.

3.        Cruise- New ships with a lot of “wow” continue to come out and the number of first time and repeat cruisers will continue to increase. River and small ship cruising will continue to increase in popularity, particularly for older consumers who like being closer to home.

4.        Bulk Cargo- Agri-cargo exports will remain strong particularly in the U.S., energy exports particularly oil and gas will also see strong increases from the U.S.  Industrial mineral exports, including those from China, will remain strong.

5.        Seaway Issues- A number of nations have sent military ships to the Red Sea area which has reduced attacks on merchant ships. These will most likely continue by the Houthis, but traffic is slowly rebounding as carrier pendulum services continue to address demand on routes. The Chinese Belt and Road Initiative will continue to drive investment worldwide. Issues in the South China Sea will continue despite positioning by the U.S. to expand the military presence in Subic Bay. All these shifts will drive carriers to continue to diversify port connections.

6.        Vessel Deployment- Carriers have taken delivery of a number of handy size container ships.  This will open additional North American ports with ships under 18,000 TEU’s calling on more ports.  The larger ships over 18,000 TEU’s will continue to be built. While there is great desire to expand marine highway connections, this will continue to remain stagnant outside of areas where it already exists.

7.        East Asian Trade- This should remain strong, but sources will be more diversified from additional nations in Asia such as Vietnam, Indonesia, Malaysia and South Korea. Chinese manufacturing has slowed to a growth rate of 5% but other countries will continue to expand. Intra-Asia trade continues to grow with Singapore topping 40 million TEU’s in 2024. Much of this is Chinese-made goods transshipped through and/or “completed” in other countries to avoid U.S. tariffs. 

8.        Tariffs- The new administration I believe will use this more as a potential threat more than anything else.  Some manufacturers are shifting factories to North and South America and the Canada-Mexico trade should not see a lot of disruptions despite potential tariffs.

9.        Comprehensive National Transportation Policy- Since nothing has been done since Harry Truman was president; I am not seeing a radical shift in the new administration developing a comprehensive intermodal transportation policy. New legislation directed at the U.S. shipping industry, introduced by Democratic Senator Kelly (and others), most likely early in the next Congress, will linger. The marine world remains a low priority for both parties.

10.  MARAD- The administrator will be new but not much will change unless the new administrator is in the new DOT Secretary’s face regarding the weak maritime policies of the U.S. The new multi-use training ships were a big win and the proposed replacement vessels for the reserve fleet would be also a win. MARAD is the only agency under DOT with no regulatory responsibilities and it is greatly underutilized. Expect the next Navy Secretary to continue the current push for greater shipbuilding and ship repair capacity (which would tie in with Sen. Kelly’s proposed bill).

11.  U.S. Merchant Marine- Workforce issues will remain but could be turned around if the new administrator focuses on bringing careers in the merchant marine to the forefront of educators. The schools need to add curriculum related to port management: many mariners eventually gravitate ashore and career opportunities beyond the deck plates would make sailing more attractive. While the international fleet will remain stagnant, the largest part of the U.S. fleet which is on the inland rivers, will remain the largest segment of the U.S. fleet. 

12.  Labor- We saw the ILA flex their muscle but there is a reality that USMX and the ILA must find a path to allow appropriate and needed automation into marine terminals. Norfolk proved that these transitions are practical and desirable with union personnel. They settled their issues, and a new six-year contract is now in place. Once details are released, we will see how much it will cost the USMX to address labor issues and what it will eventually cost consumers. It’s also a matter of the unions or support companies being able to provide skilled, willing, and available labor to address terminal demands and logistics services. Interesting enough, after a few national news stories, toilet paper began to fly off the shelves which has nothing to do with foreign trade but puts a smile on the face of paper manufacturers all over the U.S. It is a commodity with consistent demand. Expect labor unrest in various places around the world at terminals to continue including Europe, South America and Australia.

13.  Supply Chains- Nothing has been done to really address the supply chain disruptions we saw during COVID once volumes dropped off and the pressure on the domestic supply chain eased. While volumes are being absorbed currently, if things were to change with new significant demand, the same issues would once again hamper cargo moves. Worldwide issues continue but certainly the industry has enough insight to adjust cargo flow when supply chains are impacted. Ports may get congested again but if the domestic supply chain gets overwhelmed, the entire system will break down. The Administration needs to address this proactively, but I don’t think it will be a priority until the system breaks down again.

14.  OSRA 22- The impacts of the Ocean Shipping Reform Act have been positive for shippers. The lines are paying closer attention to shipper needs, well mostly. Beyond the ports however, supply chain pipeline issues have not been resolved and if volumes increase substantially, we will be back with delays like we were during COVID. The issues remain throughout the entire system. I do not believe we will see a substantial shift in how the FMC addresses OSRA 22 even with new commissioners.

15.  Worldwide Terminal Acquisitions in the International Supply Chain- The practice by the larger ocean carriers, particular the Chinese carriers (and Chinese state government), to control or develop more terminals integral to the supply chain will continue. Ocean carriers are looking for better access to markets where they control the ships and the properties. This subtle trend will continue over the next several years. Common use terminals will still develop and expand for the carriers who are not unable to undertake these investments.

16.  Carrier Alliances- some shifts and a few acquisitions but not dramatic changes beyond the 2M alliance. Congress will not focus on anti-trust issues associated with carrier alliances.

17.  Emerging Markets for Carriers- That’s easy: Africa, South America, South Asia, and India.

18.  Port Infrastructure- Major focuses on bridges and protection of supports structures, at least in the short run.  States will continue to lack the funds needed to address all the issues related to allisions.  Grant funding will most likely slow down due to other Washington priorities.

19.  SULCS- While more will be built, the prime focus is on handy size ships that can actually fit into average ports which will see an expansion of calls with larger ships deployed to the U.S. East Coast.  The pendulum service between Asia and Europe will continue to expand despite Middle East issues.  MSC will remain the largest carrier in 2025.

20.  Alternative Fuels- As technology improves, there will be less concern about alternatives to fuel oil such as ammonia, biofuels, methanol or similar types. European CO2 emission standards will start to have an impact on engine technology. Terminals in warm weather climates will continue to find electric equipment effective but less so in northern climates where recharge time and power are limited in electric equipment. Hydrogen should emerge as an alternative if sources can be made available.

So, those are my predictions for 2025. I am wrong on occasion, but the inclusive 365 days will tell the tale. As always, we will continue to track the industry at the IAMPE and expand our course offerings (www.iampe.org). If you think my predictions are off or right on, let me know Jeffrey.monroe@iampe.org. I love a good discussion and learn much from all your feedback.

We hope all of you had a great and productive 2024 and we wish you the same in 2025.