From trade to ports Russell Group managing director Suki Basi highlights the five core and interconnected risks he believe will shape the landscape in the coming year.

The 2025 Trade Landscape

The nexus of US superpower consolidation in the Trump 2.0 era and China’s political and economic aspirations will cause global threats and ripple effects that can be observed and quantified from Russell connected scenarios. Russell’s goal in 2025 is to provide analysis insights and recommendations to associations, policymakers, businesses, and other stakeholders to help navigate and mitigate these threats.

China appears to be stockpiling materials at a rapid pace. Policymakers in Beijing are worried about new geopolitical threats, such as a hawkish American president choking crucial trade routes to China. There is a need to assess the potential impacts of a supply chain choke by the US.

Energy and Food

Although it is the world’s refining centre for many metals, China imports much of the raw material required – 70% of the bauxite and 97% of cobalt, according to The Economist magazine. China has coal, but must import 40% of its natural gas and 70% of its crude oil. China’s real Achilles heel is food. In 2000 nearly everything citizens ate was farmed locally; today less than two-thirds is.

America could restrict its own food exports to China, requesting suppliers such as Argentina and Brazil to do the same. It could influence countries that sell metals to China, including Australia and Chile. Most Chinese commodity imports are shipped through a few straits and canals that America could seek to block for Chinese vessels.

Critical Minerals

Demand for critical minerals such as copper, cobalt, lithium and nickel is soaring. This trend is set to accelerate. Global cobalt, graphite and lithium mining are set to increase nearly six-fold between now and 2050 (World Bank). Data  published by the United Nations Conference on Trade and Development (UNCTAD) shows that China accounts for around two-thirds of the world’s processing/refining capacity for critical minerals. But the United States and Australia have increased their production of rare earths from 2010 onwards.

Manganese is an irreplaceable metal resource for steelmakers. The special properties of the metal make its vulnerability to supply a real worry for policymakers. China, South Africa, Australia, Brazil, Gabon, the USA, India, Japan and Germany are, reportedly, the nine most important members of the global manganese trade flow community. High supply concentration of manganese refining and manufacturing stage is dominated by China.

Investment in Ports

Chinese investments in European seaports has increased rapidly in the 21^st century. This increase is part of China’s Maritime Silk Road (MSR). Among the world’s top -20 ports in terms of global trade throughput, or the respective list of the leading container ports in terms of throughput mainland 13 ports are Chinese. What could this mean for policymakers if European ports are forced to close in a dispute with China?

U.S. lawmakers are scrambling to weaken China’s grip on the critical mineral supply chains that are key to the global energy transition. To reduce its reliance on Beijing in the coming decades, Washington is focusing on aligning with allies, including through the Mineral Security Partnership (MSP), an initiative that is designed to bolster supply chain security with Australia, Canada, the United Kingdom, France, Germany, Japan, South Korea, and other members.

Net Zero Transition

China’s role in the global clean energy revolution will be huge, and will influence supply chains around the world, according to Sustainability magazine. The country leads in global investment, channelling money into renewable energy projects, including solar and wind power, electric vehicles (EVs), battery technology and large-scale energy storage. In 2022, China’s investment reached $546 billion in these areas.

The pandemic, Russia’s war on Ukraine and the green revolution in motoring has devastated Germany’s economic model. What is the outlook for the German economic model. What does it mean for external European trade relations, particularly as they relate to China which is Germany’s biggest export market? Germany’s car exports to China have reportedly declined 9% in the last year, reports MSN. China’s EV cars, however, threaten to destroy Germany’s traditional approach to car making, so is there a way out of this complex bind for the German policy makers?

Russell’s goal in 2025 is to give a range of outcomes to a range of scenarios for each global threat that may impact the US/Chinese nexus of risk and the wider geopolitical landscape.