Forecasts for global growth in 2026 are relatively optimistic, but the picture within the global freight market presents reason for caution, with analysis of supply chain data showing that the actual volume of goods shipments being moved do not provide solid support for a rosy outlook. President Donald Trump‘s global trade war is one reason for the disconnect in the data as it continues to have ripple effects across the freight market, according to Alan Murphy, CEO and founder of Sea-Intelligence.
His analysis of the latest World Economic Outlook report by the International Monetary Fund, which headlined a “steady” global economy and global GDP growth at 3.3% for 2026 and 3.2% for 2027, is a picture of stability that he says “masks that world trade growth is expected to slow down significantly.”
“This decrease appears to be a direct consequence of the ‘front-loading’ phenomenon seen throughout 2025, where shippers accelerated imports to pre‑empt anticipated trade policy shifts,” according to a new Sea-Intelligence analysis. As a result, Sea-Intelligence projects the freight market and freight rates will remain under pressure, with freight volume growth struggling to absorb new vessel capacity.”
Murphy warned the IMF trade outlook is skewed because it is based on the higher-valued technology exports.
“IMF’s trade projections are based on monetary value rather than TEU [twenty-foot equivalent unit shipping containers],” Murphy said. “This creates a challenging scenario for container shipping stakeholders. The headline growth is largely value‑driven by the technology sector, obscuring the reality of weaker physical demand for volume‑dense goods,” he said.
He referred to the situation as an economic “mirage” in relation to actual cargo volumes for shipping lines, which he expects will be down in 2026. Ocean carriers, trucking, rail companies, and warehouses all make money by the volume of containers they move or freight stored.
With no surge of freight on the horizon and more ocean carriers starting to return to the Red Sea after years of Houthi rebel attacks made the waterway too risky to transit, fewer vessels will be needed. The Red Sea is a faster trade route from Asia to Europe, so the vessels that were once added to the longer trade route around the Horn of Africa will no longer be needed. This overcapacity was referenced as one of the reasons behind A.P. Moller-Maersk’s recent announcement of 1,000 job cuts. The integrated logistics provider cited vessel overcapacity that has pushed average freight rates lower by 23 percent across all shipping routes in the fourth quarter. This rate decline led to a $153 million earnings loss at the company’s main shipping business.
U.S. ports including the Port of Long Beach recorded record container volumes as a result of the front-loading in 2025. Helping drive the port volume growth was trade out of Southeast Asia.
“Just a few years ago, in 2019, China, by itself, accounted for about 70% of our total volumes inbound and outbound,” said Noel Hacegaba, CEO of the Port of Long Beach. “Today, that’s down to 60%. We have seen a 10 percentage point swing of trade shifting to Southeast Asia countries like Vietnam, Thailand, Cambodia, and Malaysia.”
With the tariff uncertainty continuing this year – Trump has announced new deals in recent days, such as with India, but at the same time has threatened more aggressive tariffs in other recent instances, and a Supreme Court decision on Trump’s IEEPA tariffs potentially coming on Feb. 20 — the world of trade and the supply chain will be navigating what some maritime experts are calling a “double‑squeeze.”
“This is the payback period of suppressed volumes following 2025’s front-loading, combined with the reality that trade policy shifts where the higher U.S. tariff cost base is approximately 18.5 percent,” Murphy said. “In this environment, a ‘steady’ economy will not provide the booming consumer demand required to absorb these higher costs,” he added.
U.S. freight market in expansion mode, but inflation reason for worry
The U.S. freight market is currently in expansion, but there is reason to be concerned about the influence of tariff inflation. Higher costs are still working their way through the supply chain, according to the January data from the Logistics Managers’ Index. Warehousing prices in January versus December were close to flat, which reflects the “bleeding down” of inventories going into December, according to Dale Rogers, a professor in the supply chain management department at Arizona State University and one of the authors of the LMI.
The LMI score is a combination of eight key metrics in the logistics supply chain covering warehousing, transportation, and inventory. Any reading above 50.0 indicates that logistics is expanding; a reading below 50.0 is indicative of a shrinking logistics industry. The January Logistics Managers’ Index was at 59.6, up (+5.2) from December’s reading of 54.2, for the fastest level of expansion since May of last year. Year over year versus January 2025, it is down (-2.4) from a reading of 62.0.
“The overall rate of expansion is largely due to a shift back towards milder restocking to start the year,” Rogers said. “This suggests that respondents kept with their future predictions from last year and running inventories relatively lean to start the year. This is possibly reflective of the continued high costs,” he added.
Inventory costs in January were up (+8.4) at 71.3, pushing them back above the significant expansion threshold of 70.0. The expansion in inventory is reflected in warehousing capacity dropping (-11.2) to the baseline rate of 50.0. Warehousing utilization bounced back (+11.6) from contraction to expansion, at 54.4.
Transportation prices have increased, with this supply chain indicator expanding more quickly than at any time since April of 2022.
On Capitol Hill, Treasury Secretary Scott Bessent said this week that the tariffs are not inflationary, but Rogers says, “The fact that transportation and inventory prices are higher but warehouse prices didn’t really move indicates to me that probably we are seeing inflation that has not yet been picked up at the consumer tier of the supply chain.”
“This poses an interesting question: are the higher transportation prices and inventory costs happening because the economy is getting better, or is it inflation due to the tariffs?” he said. “Sometimes, inflation signifies an improving economy, but these increases have to be at least partially about the tariffs,” he added.