A New Spin on Corporate Piracy

In this week’s Roar: Extortion in the Red Sea, trade tensions, the end of the de minimis rule, Vietnam’s surge in imports, and addressing supply chain challenges with automation.

The Red Sea ceasefire may not be exactly what it appears. It seems the Houthis have turned to what feels like maritime extortion. They’re now offering a “safe passage fee” for ships using a negotiation system that includes a customer service email. And presumably, if the fee isn’t paid, further demands for payment are made. Even with the ceasefire in place, insurance premiums remain high, and carriers continue rerouting vessels to avoid the region as security concerns persist. The promise of peace comes with a cost.

The most recent development in the “trade war” between the US, Canada, and Mexico has the US postponing tariffs after both countries have enhanced their border security measures. Canada has pledged a C$1.3 billion (US$900 million) plan to bolster the border with additional personnel, technology, and resources, including nearly 10,000 frontline staff and the appointment of a ‘fentanyl czar’. Mexico agreed to deploy 10,000 soldiers to patrol its border. And not to be ignored, China has responded to a 10% increase in tariffs by imposing its own 15% tariff on American coal and liquefied natural gas, plus 10% on crude oil, agricultural machinery, and certain vehicles, all effective February 10.

President Trump’s new policy eliminates the de minimis rule, a rule that previously allowed duty-free imports of goods valued under $800 into the United States. Removing the exemption means all imports, regardless of value, are now subject to tariffs. To put that in perspective, all parcels coming into the US from low-cost retailers like Temu and Shein or anywhere else—whether they’re worth $5 or $799—will be hit by tariffs. Bargain shopping won’t be much of a bargain anymore. And this will likely impact small US businesses that rely on low-value international shipments for affordable goods. Expect disruptions and increased costs if your company is dependent on cross-border trade.

In 2024, Vietnam’s exports surged by 14.3% compared to the previous year, generating $405.5 billion in revenue. For the most part, growth was driven by high demand for electronics, garments, and smartphones, many of which were shipped express to Europe and North America. But growth has led to challenges—a strain on their infrastructure, labor shortages, and increased competition among carriers. In response, airlines are expanding their services into Southeast Asia, hoping to capitalize on the demand.

In more of the same old, same old, the supply chain continues to grapple with challenges like labor shortages, rising operational costs, and unpredictable demand. It’s become clear that traditional methods are often inadequate, prompting businesses to explore innovative solutions. For example, autonomous robotics powered by artificial intelligence (AI) are becoming ever more popular as a way to enhance efficiency. They can automate repetitive and physically demanding tasks such as sorting, picking, and inventory management, leading to increased speed, accuracy, and cost savings. This means human workers can focus on higher-value, strategic activities, thereby maximizing workforce potential.

For the rest of the week’s top shipping news, check out the article highlights below.