Where’s the Money?

In this week’s Roar: A U.S. manufacturing revival, Asia-Europe spot rates are up, air cargo demand skyrockets, U.S. freight volumes are tanking (further), and Europe’s shipping emissions woes.

It’s been over six months since the latest tariff war started. U.S. trade deficits are shrinking, and there’s been a surge in manufacturing investment announcements. But does this mean that we’re seeing the beginning of a true manufacturing revival? Not yet, and any future prospects could be a long way off. The persistent challenges of high labor and energy costs, a significant skills gap, and thin domestic supplier networks remain. In reality, most reshoring and other meaningful investments are still on paper, held up by the need for automation, modern workforce training, and stronger supplier ecosystems. How the U.S. adapts to overcome these limitations will be key to its long-term success in reviving its manufacturing base.

Global demand shifts continue for ocean freight, primarily as a result of the trade war. One result has been that spot rates from Asia to Europe are up again, signaling strong demand even as capacity increased. But Asia–U.S. spot rates are flat thanks to less demand. Rates into Northern Europe climbed 5.6% and into the Mediterranean by 4.1%. Analysts expect Europe to remain a stronger destination for Far East exports into 2026, based on U.S. trade policy and weaker consumer demand.

Demand shifts are affecting air cargo, too, but the impact has been different. Demand from Southeast Asia to the U.S. continues its ascent, driven by manufacturing shifts away from China and Taiwan’s current semiconductor exports. In October, Southeast Asia–U.S. volumes jumped 40% year-on-year, while Taiwan’s airfreight rose by over 40%. Meanwhile, what is the same is that air cargo from China and Hong Kong to the U.S. declined, reflecting shifting sourcing trends.

U.S. freight volumes continue to drop, another result of the ongoing trade war and tariffs. Major ports are seeing fewer containers, with imports from China down 16% and India hit even harder by steep U.S. tariffs. The slowdown has triggered rate declines across trucking segments and is impacting jobs at ports and throughout the supply chain. According to analysts, weak global trade, inventory buildup, and shifting consumer demand are driving a reset in freight. Unfortunately, this is now a multi-year trend and not just a seasonal dip.

Even in the face of slowing trade, Europe’s shipping emissions hit a new record in 2024, up 13%, due to disruptions in the Red Sea, forcing ships to take longer routes. That alone increased emissions by 46%. This highlights how quickly operational changes can impact maritime pollution. Analysts are saying that stricter EU carbon market rules are more important than ever, and that cutting fossil fuel shipments alone won’t solve the sector’s climate impact.

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