Stormy seas for global shipping: UNCTAD warns of uncertainty, volatility and rising costs

Summary

UNCTAD’s Review of Maritime Transport 2025 warns that global shipping — which moves over 80% of world merchandise trade — faces fragile growth, higher costs and growing uncertainty. After strong growth in 2024 (driven by rerouting and a nearly 6% jump in ton-miles), seaborne trade volumes are expected to nearly stall in 2025 (+0.5%). Geopolitical tensions, new tariffs and port restrictions are reshaping routes, lengthening voyages and pushing up costs.

The report flags volatile freight rates (notably the 2024 Red Sea spike and 2025 Strait of Hormuz risks), rising environmental compliance costs, and the substantial investment required to decarbonise the fleet and ports. Ports need efficiency upgrades and digitalisation, while many developing economies lag behind. Shipping GHGs rose 5% in 2024; only about 8% of world tonnage can use alternative fuels. IMO’s Net-Zero Framework (considered Oct 2025) would set a fuel standard and introduce a GHG pricing mechanism from 2028. The human dimension is also stressed: seafarer abandonment hit record levels in 2024, and stronger enforcement of labour rules is needed.

Key Points

Seaborne trade volume growth is forecast to be almost flat in 2025 (+0.5%) after robust 2024 gains driven by rerouting.
Geopolitical tensions, tariffs and port restrictions are rerouting traffic, increasing voyage lengths and raising costs.
Freight rates are more volatile — crises like the Red Sea disruption pushed rates up sharply in 2024.
Environmental compliance and decarbonisation (fleet renewal, alternative fuels, port adaptation) will drive major costs for the sector.
Only ~8% of fleet tonnage can currently use alternative fuels; ship recycling and infrastructure investment need scaling up.
Ports face congestion, longer waits and must invest in digital systems, automation and cybersecurity to improve efficiency.
Developing countries, especially small island and least developed states, are most exposed to rising transport costs.
Seafarers’ welfare is under strain: abandonment cases rose to record levels in 2024, prompting calls for better enforcement of rights.

Context and relevance

This UNCTAD review matters to shipowners, ports, shippers, policy-makers and supply-chain managers. It ties together three big trends: geopolitics reshaping routes, regulatory and market pressure to decarbonise, and accelerating digitalisation of port and logistics operations. The combined effect raises operational risk, capital needs and the likelihood of higher transport costs that will filter through global supply chains — with poorest economies suffering the most.

Why should I read this?

Quick and blunt: if you work in shipping, ports, logistics, trade policy or rely on global supply chains, this explains why costs and headaches are about to rise. It flags where the pressure points are — rerouting, emissions rules, ports and seafarers — so you can plan, budget and manage risk. We read the long report so you don’t have to — here are the bits that matter.

Author style

Punchy. This is important reading for industry and policy folk — UNCTAD’s take bundles the commercial, regulatory and human angles into a single warning: the transition to greener, safer shipping won’t be smooth or cheap. Read the detail if you need to act or advise others.