Sea-Intelligence (Aug 14th, 2025) – Analysis of potential 2025 trade whiplash

In issue 727 of the Sea-Intelligence Sunday Spotlight, we analysed the "trade whiplash" effect — a violent boom-bust cycle in US imports — and quantify the potential downside risk of escalating trade tensions. This potential risk was raised by the IMF in their latest World Economic Outlook (WEO) report.

Our analysis first established that the whiplash effect is already underway. Driven by an artificial boom from importers front-loading cargo to avoid tariffs, US ports experienced exceptionally strong growth in early 2025, which was immediately followed by a sharp bust, as shown in Figure 1.

Total laden imports through the top 10 US ports were up +15.6% Y/Y in the first four months (Jan-April) of 2025, compared to a pre-pandemic (2015-2019) high of 8.0% growth, and a pre-pandemic average of 4.8% Y/Y growth. This boom was quickly followed with a bust, as laden inbound volumes contracted sharply by -4.1% Y/Y in May and by -8.2% Y/Y in June. To put this into context, the average May-June growth pre-pandemic (2015-2019) was +4.0%, while the June 2025 contraction is -7.5%.

The IMF, in their latest WEO report stated that global GDP would contract by -0.2 percentage points if trade escalations continue. To quantify this, we calculated a “TEU/GDP” multiplier based on historical data, which shows the sensitivity of container demand to economic growth.

Applying this multiplier translates the IMF's warning into a tangible figure for the container industry: a -0.23% reduction in container volume growth. Based on 2024's global volume of 184.4M TEU, this seemingly small percentage results in a loss of approximately 424,000 TEU from the global market in 2025.

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All quotes can be attributed to: Alan Murphy, CEO, Sea-Intelligence.