Why 2026 Is Poised to Be Another Rocky Year for Global Trade

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The first change would be a return of the world’s cargo fleet to using the Red Sea, rather than the longer route around southern Africa that vessels have had to resort to for the past two years. Houthi attacks in the Red Sea have largely subsided since the Gaza peace plan took effect in October, making the old route more appealing. Carriers including France’s CMA CGM SA and Denmark’s A.P. Moller-Maersk A/S are already sending a small number of ships through.

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But a full return to the Red Sea and the Suez Canal shortcut between Asia and Europe will “flood the market with a lot more capacity” and create “massive port congestion issues in Europe,” Jensen said during a Flexport webinar in November.

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The second blow could be more demand driven, according to Jensen. If the US economy accelerates as quickly in 2026 as Trump administration officials predict — fueled by an investment boom and lower interest rates — the resulting inventory restocking could swamp the shipping industry’s ability to cope.

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Shaky Deals

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High on the White House’s list of 2025 accomplishments are trade deals with several major economies, most of which bent to Trump’s demands ranging from investment pledges to better market access for US exports. In exchange for their submissiveness, their goods were smacked with a tariff rate that was lower than the duty they would’ve gotten if they retaliated.

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But these aren’t traditional, binding trade deals with enforcement provisions and fine print spelling out the rules, and there’s only a one-year truce with China rather than a full agreement — leaving out the US’s most unbalanced trading relationship.

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That’s left concern that pacts could yet come undone, especially given the potential for pressure from Beijing against any nation open to working with Washington at China’s expense.

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Developments within the past month have showcased the risks. Since the White House announced its “landmark trade deal” in July, Indonesia has been resisting US trade demands that it feared would restrain its independence and now sees an agreement being signed in late January. China complained to Malaysia and Cambodia about the trade deals those two nations signed with Washington, warning them against measures that undermine Beijing’s interest.

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Even the UK has seen fresh difficulties crop up.

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Last week, Greer singled out the European Union and India, saying that contentious talks aimed their respective trade deals are set to spill into the new year. Greer’s office, in a social media post last week, threatened retaliation against the EU for what Washington considers to be excessive regulation of American tech companies.

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The Supreme Court

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Among the biggest unknowns in trade circles heading into 2026 is a pending US Supreme Court ruling on the legality of Trump’s so-called reciprocal tariffs — the broad levies he imposed on most major trading partners. 

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If Trump does lose the case, one of the most consequential questions for the economy and the country’s fiscal outlook will be whether the government will have to refund the money that American importers paid in tariffs. It’s not clear cut that’ll happen in a timely or organized way.

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Kevin Hassett, director of the National Economic Council, told CBS’s Face the Nation that even if the high court doesn’t rule in the administration’s favor, it would be “pretty unlikely that they’re going to call for widespread refunds, because it would be an administrative problem” to distribute those.

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Betting markets have put about a 75% chance on a Trump loss, which means the administration will have to use other authorities at the president’s disposal to impose tariffs. 

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Asked at the Atlantic Council earlier this month whether 2026 will be quieter on the tariff front than this year, Greer declined to offer a forecast. “That’s a question for President Trump,” he said.

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