After the Storm: What Supply Chain Leaders Should Focus on in 2025

The consensus?  While the chaos of 2021–2022 has subsided, a new wave of challenges is cresting. This time, supply chain leaders are determined to get ahead of the curve. Let’s break down the major supply chain challenges of 2025 and, more importantly, the strategies that can build resilience for whatever comes next.

Crisis to Control: 

Priorities in 2025

1. The Red Sea Crisis Prolongs Ocean Freight Disruptions

The ongoing Red Sea crisis continues to impact global shipping. Attacks on vessels have forced carriers to reroute ships around the Cape of Good Hope, adding 10–20 days to transit times on Asia–Europe and Asia–US East Coast lanes.

What this means for shippers:

• Delays – Longer lead times on imports from China, India, and Southeast Asia.
• Higher costs – Ocean freight rates have more than doubled in some cases.
• Equipment shortages – Fewer containers returning to Asia, worsening imbalances.

Resilience Strategies:

✅ Order earlier than usual – Factor in an extra 3–4 weeks of buffer stock.
✅ Diversify shipping routes – Consider transhipment hubs or rail freight.
✅ Negotiate contracts early – Lock in rates to avoid peak-season price hikes

2. Container Shortages & Equipment Imbalances

Longer voyage times via the Cape of Good Hope have trapped reefer containers in transit, leading to a 73% reefer container deficit in South America and a 19% shortfall in Europe by late 2024. Trade shifts and disruptions continue to create mismatches between container supply and demand.

What this means for shippers:

• Exporters – Finding specialized containers (reefer, high cube, flat rack) may be difficult.
• Importers – Delays in equipment availability could disrupt shipping schedules.
• Cost implications – Repositioning fees and extra surcharges may increase.

Resilience Strategies:

✅ Book shipments early to secure container space.
✅ Use alternative depots to locate available containers.
✅ Maximize container efficiency – Reduce empty space to lower costs.
✅ Monitor carrier surcharges – Prepare for repositioning fees.

3. Rising Freight Costs & New EU Environmental Charges

Freight rates are rising due to longer transit times, fuel surcharges, and the EU’s Emissions Trading System (ETS), which introduces carbon taxes on vessels departing European ports.

Several carriers introduced ETS surcharges in 2024, and those fees are increasing in 2025. For example, Ocean Network Express implemented a “Europe Environment Surcharge (EES)” in January 2025 to offset EU ETS and FuelEU Maritime compliance costs.

The magnitude of these green charges remains uncertain—Hapag-Lloyd estimates an ETS cost of €12 per TEU, while Maersk projects €70 per TEU, underscoring the unpredictability of carbon compliance costs.

What this means for shippers:

• Importers – Freight costs will impact pricing and profit margins.
• Exporters – European goods may become less competitive due to rising logistics costs.
• Uncertainty – The variance in carrier charges makes long-term planning difficult.

Resilience Strategies:

✅ Incorporate EU ETS costs into freight budgets & contracts.
✅ Work with carriers using greener fuels to reduce surcharges.
✅ Consider nearshoring – Shift sourcing to Turkey, Eastern Europe, or North Africa.

4. Extreme Weather and Climate Disruptions

Mother Nature remains an unpredictable disruptor. In its 2024 risk outlook, Everstream Analytics ranked extreme weather as the No.1 risk for supply chains—a trend that continues into 2025.

What this means for shippers:

• Unpredictable delays – Floods, storms, and wildfires cause port closures.
• Infrastructure damage – Bridges, roads, and railways face growing climate stress.
• Higher costs – Insurance premiums and recovery expenses are increasing.

Resilience Strategies:

✅ Assess climate risks for key supply chain routes.
✅ Diversify warehousing locations to prevent stockouts.
✅ Plan shipments around seasonal weather disruptions.

5. Geopolitical & Trade Policy Risks

No supply chain outlook in 2025 would be complete without considering the geopolitical chessboard. Trade policy and political conflict continue to inject uncertainty into global commerce. The U.S.–China trade war that began in 2018 is simmering again – in fact, the U.S. administration has floated plans for new “action-oriented” tariffs, including a possible broader 60% tariff on Chinese goods later this year

• US tariffs on European goods (e.g., steel, cars, food) could increase.
• EU–China trade tensions may lead to new import/export restrictions on key products.
• Sanctions on Russia continue to disrupt supply chains, affecting raw materials and energy costs.

Resilience Strategies:

✅ Monitor trade policy changes and adjust sourcing/sales strategies.  

✅ Diversify suppliers & customers to reduce reliance on a single market. 

✅ Leverage Free Trade Agreements (FTAs) e.g. Canada, Japan, and Latin America to optimize costs.

6. Shifting Ocean and Air Freight Market Dynamics

The year 2025 marks a significant period of transition in global freight markets. Both ocean and air freight sectors are undergoing substantial changes that will impact procurement decisions, requiring supply chain professionals to remain agile and well-informed.

One of the most significant developments in ocean shipping is the realignment of carrier alliances. The long-standing 2M alliance between Maersk and MSC dissolved, leading to new vessel-sharing agreements. In February 2025, the Gemini Cooperation between Maersk and Hapag-Lloyd launched, replacing elements of previous networks. Meanwhile, other major alliances—THE Alliance and Ocean Alliance—are restructuring, which is reshaping container services, port rotations, and transit schedules. 

In the short term, these shifts create potential service gaps and schedule disruptions as networks adjust. Industry expert Lars Jensen has cautioned that early 2025 could see "complete disarray" in container services as new operational structures settle into place. Shippers may need to trans-ship cargo or reroute shipments while the system stabilizes.

At the same time, the market is absorbing a massive influx of newly built container vessels. Carriers placed record orders during the 2021-2022 boom, and those mega-ships are now hitting the water. Under normal circumstances, this surge in capacity would drive rates down, but the situation remains volatile. Several factors—including geopolitical tensions, trade disruptions, and carriers' strategic capacity management (such as blank sailings to artificially tighten supply)—are influencing rate fluctuations. 

Analysts predict that while excess capacity may suppress rates in the long run, short-term unpredictability will persist. As one Xeneta analyst put it: "Don't be fooled into thinking the storm has passed"—the industry still faces a series of unpredictable domino effects, from alliances shifting to potential labour strikes and evolving trade policies.

This volatility is already evident in the freight rate indices. In January 2025, Asia–North Europe spot rates dropped by 11% within a week, stabilizing at around $3,667 per FEU. Meanwhile, transpacific rates climbed 3% on pre-tariff demand, reaching $5,078 per FEU. According to Freight waves. These fluctuations highlight the delicate balance between supply, demand, and external pressures. According to Freight waves. 

Supply chain managers should lock in capacity early for critical lanes and time periods . Carriers seem more willing to negotiate long-term rates now than they were at the height of the capacity crunch. Leverage that to secure space at a reasonable cost, but be mindful of the spread between contract and spot rates. If the market swings wildly, you don’t want to be caught paying above-market rates for too long, nor relying on spot when it spikes. As Xeneta’s chief analyst Peter Sand advised, “If you’re considering shipping more than your contracted allowance, be aware of the long-short market spread”, because when the gap is large, carrier behaviour can shift in unexpected ways.   If spot rates soar far above your contract, don’t be surprised if carriers prioritize higher-paying spot cargo unless you’ve secured commitments; if the reverse, you might find forwarders begging for extra volumes.

Some shippers are also exploring index-linked contracts that adjust rates quarterly based on an agreed index – this can be a fair way to share risk with carriers. The overall strategy is to avoid the extremes: don’t get locked into sky-high rates at the peak, but also don’t find yourself with no contract cushion if the market tightens suddenly. Balance and foresight in freight procurement will be crucial in 2025’s unpredictable environment.  

Air freight, which played a crucial role as a fallback option during the pandemic, is also entering a new phase. With passenger flights largely restored and belly cargo space returning to pre-pandemic levels, airfreight rates have declined from their peaks. However, demand patterns remain uneven. By late 2024, transpacific and transatlantic air cargo rates trended downward, though China–Europe air rates remained relatively elevated at around $5/kg. 

The 2025 outlook for air cargo is mixed—while some sectors will see weaker demand, there may be a surge in expedited shipments due to pre-emptive tariff adjustments or to bypass ocean shipping delays. Additionally, regulatory changes, such as modifications to de minimis customs rules, could increase costs for e-commerce air parcels, potentially dampening volumes in certain lanes.

What This Means for Shippers:

• Uncertainty in ocean schedules due to shifting carrier alliances may impact transit times.
• Freight rate volatility will require procurement teams to monitor markets closely.
• Excess ocean shipping capacity may offer opportunities for cost savings, but blank sailings could counteract rate declines.
• Air cargo’s role is evolving, with a softer rate environment but potential demand spikes driven by regulatory changes and supply chain disruptions.

Resilience Strategies:

✅ Diversify carrier relationships to mitigate the impact of shifting alliances.

✅ Closely track market trends and use data-driven forecasting to anticipate rate fluctuations.

✅ Leverage multimodal solutions—consider a mix of ocean, rail, and air transport to adapt to demand shifts.

✅ Evaluate long-term freight contracts carefully, balancing fixed agreements with flexible spot market opportunities.

In summary, 2025 will be a year of freight market turbulence. While excess capacity and evolving carrier partnerships may improve service reliability in the long run, short-term disruptions will require shippers to stay agile, adapt procurement strategies, and utilize real-time market intelligence. The days of 'set-it-and-forget-it' annual freight contracts are over—today, success depends on agility, data-driven decisions, and strategic supplier collaboration.

7. Buffer Stock and Inventory Cushioning

The days of relying purely on just-in-time (JIT) inventory strategies are over. The unpredictability of transit times, port disruptions, and extreme weather events has reinforced the need for just-in-case (JIC) inventory planning. Many businesses are reassessing their safety stock levels to ensure continuity in the face of unforeseen disruptions.

Carrying strategic buffer stock doesn’t mean reverting to outdated warehouse-heavy models but rather targeting inventory for high-risk SKUs—products with long lead times, single-source suppliers, or volatile demand patterns. Recent trends confirm that companies with available cash and storage space are increasing inventory reserves to hedge against potential disruptions. For example, in response to tariff uncertainty, many importers stockpiled goods in late 2024 to mitigate exposure to cost spikes. Similarly, businesses preparing for potential port strikes or geopolitical risks have begun pre-positioning inventory at alternate entry points to prevent stockouts.

What this means for shippers:

• More businesses are adopting a hybrid inventory strategy—balancing lean operations with targeted buffer stock.
• Carrying extra stock has costs, so companies must carefully analyze which products justify higher safety stock levels.
• Warehouse space and distribution flexibility are now critical components of a resilient supply chain.

Resilience Strategies:

✅ Identify high-risk SKUs—Ensure buffer stock for essential components.

✅ Use demand forecasting models—AI-driven insights can optimize safety stock levels dynamically.

✅ Distribute inventory across multiple locations—Avoid concentration risk in a single region.

✅ Monitor storage costs vs. disruption risks—Find the right balance between cost and preparedness.

In 2025, inventory is no longer just a cost factor—it’s a strategic asset. Well-placed buffer stock can be the difference between fulfilling customer commitments and issuing apologies. By using AI-driven demand forecasting and adaptive warehousing, businesses can optimize inventory while maintaining flexibility and cost control.