RHB Research said it is maintaining a cautious outlook on exports as the impact of US tariffs set in.
PETALING JAYA: The positive effects from the revision of port tariffs earlier this year is likely to be seen in the second half of this year (2H25) but it won’t be at full force yet, says RHB Research.
According to a report by the research house, the impact may vary between gateway and transshipment containers.
Both export and import gateway customers are billed on tariffs with a percentage-based rebate, so when the tariff increases, the effective revenue collected from gateway cargo rises proportionally.
RHB Research said, in contrast, transshipment involves contracted rates negotiated directly with shipping lines, so should the gazetted tariffs be revised, it will not reflect the changes.
“In light of the ongoing Israel-Iran tensions, we are cognisant of the uncertainties on regional seaborne trade.
“Key trade passages near flashpoints may be affected, leading to port congestion across various regions,” the research house said.
It added US reciprocal tariffs could drive inflation, resulting in slower economic activity that would affect containerised trade.
As for exports, RHB Research said it is maintaining a cautious outlook, as the impact of US tariffs set in.
“Our economics team forecasts Malaysia’s full-year export growth at 3.4%, with growth easing to 3.1% in 2H25. This is as frontloading activity fades, especially for shipments to the United States, which indicates more subdued export momentum heading into the year-end,” the research house said.
However, there are elements that could support exports like clearer US tariff guidance, gradual easing in US-China tensions and Malaysia’s diversified product and market mix.
On the geopolitical front, RHB Research said risk remains, as shipping lines continue to bypass the Red Sea, instead opting for routes around the Cape of Good Hope.
“Major carriers remain reluctant to transit through the affected zone. As a result, the longer route via Africa’s southern tip remains the preferred option, for now,” it said.
Furthermore, China’s recent announcement of sweeping restrictions on rare earth exports prompted tariff threats from Washington, which, if escalated, could disrupt critical supply chains and dampen trade flows between the world’s two largest economies.
Meanwhile, the research house said, of the three transport and logistics stocks it covers, two reported results between April and June that met expectations, while one fell short of estimates.
It added that Tasco Bhd
is its top pick, amid high freight rates stemming from route disruptions across the globe.
The research house also said it preferred logistics players, as their earnings stability should be underpinned by a diversified client base.
“Our ‘neutral’ weighting aligns with our stock recommendation for sector heavyweight Westports Holdings Bhd. The Bursa Malaysia Transportation Index is trading at about 15.3 times price-earnings, about minus one standard deviation from its 10-year mean of 17.6 times,” it said.
RHB Research said this reflects the muted near-term earnings visibility.
“Downside risks include continued slowing in global economic growth that will paralyse trade flows and a further weakening of freight rates.”
