Sinking shipper shares miss plain-sailing outcome

Zim Integrated Shipping Services

11/04/2025 11:48

The author is a Reuters Breakingviews columnist.  The opinions expressed are her own. Updates to add graphic.

By Yawen Chen

LONDON, April 11 (Reuters Breakingviews) - Investors in shipping giants are braced for choppy waters. Exhibit A: $23 billion Maersk’s MAERSKb.CO shares have fallen 20% since U.S. President Donald Trump’s tariff bombshell on April 2. Investors are understandably concerned about the effects of a maelstrom that could disrupt trade in the same way it did in the 2008 financial crisis. But if Trump keeps his focus on China, shippers could actually win out.

Shipping companies aren’t directly affected by tariffs, but they are usually one of the first casualties if trade collapses. During the financial crisis in 2008, global trade by sea dropped 8% as economies plunged into recession, hitting demand for the kinds of goods that are shifted around the world in containers. This had a knock-on effect on the shipping giant’s stock prices. By 2009, Maersk’s share price had plummeted by nearly 50% from its peak in 2007.

The current discount on shipping stocks suggests investors are preparing for a repeat of that pain. In that scenario Trump, after a 90-day reprieve, would reimpose tariffs across the board. Such a move is likely to choke off trades from major export hubs as a 46% tariff on Vietnam, for example, would hit consumer goods groups like Puma PUMG.DE and Nike NKE.N and make their manufacturing businesses there prohibitively expensive. This would dent demand for shipping services. And if shippers are forced to fight for diminishing cargo, they may also opt for a self-destructive price war.

Still, there’s a less stormy scenario. When Trump paused his “reciprocal” tariffs for the rest of the world except China, for example, Israel-based Zim Integrated Shipping's 2SV.F stock jumped 15% on the day. The sector may hope it can dust off its 2019 playbook – then, the first Trump administration raised tariffs on Beijing, which sparked re-export trades to Southeast Asian countries like Vietnam. That actually helped expand shipping demand – exporters re-route manufactured goods in China to lower tariff countries before sending them to the U.S. There is also a possibility that Trump backs down from his tariff spat with Chinese President Xi Jinping.

Shippers could absorb increased demand fast. Companies like Maersk and Hapag-Lloyd HLAG.DE are now operating larger fleets of vessels due to record orders made during the pandemic. In 2024, new deliveries of container ships added record capacity of nearly 3 million 20-foot equivalent containers (TEU), and they are forecast to hit another 2 million this year, according to AXSMarine analysts. Shipping giants also have the means to weather prolonged tariff difficulties as many are sitting on at least $35 billion of net cash, per Bernstein analysts.

For now, the share price declines suggest investors are bracing for the worse of the two outcomes. That’s understandable: it’s difficult to know what Trump will do next. But there’s at least a hope that the sector can steer a safe path through newly perilous waters.

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CONTEXT NEWS

U.S. President Donald Trump on April 9 delayed by 90 days many of the new tariffs that he had unveiled on countries around the world on April 2, except for China.

On April 9, the U.S. raised new tariffs on Chinese goods to 125%.

China on April 11 retaliated by raising its levies on U.S. goods to 125%.

Shipping stocks have sunk despite tariff reprieve https://reut.rs/3RKbE2d

 (Editing by Aimee Donnellan and Streisand Neto)

 ((For previous columns by the author, Reuters customers can click on CHEN/
yawen.chen@thomsonreuters.com))