Global goods trade picked up pace in the first quarter of 2025 as importers rushed to stockpile goods ahead of expected tariff increases, the World Trade Organisation said in its latest report.
The WTO’s Goods Trade Barometer rose to 103.5, up from 102.8 in March. The reading indicates that merchandise trade volumes remained above recent trends. However, the trade body warned that the momentum might not last, pointing to a drop in new export orders, which could signal weaker trade growth in the coming months.
“While the barometer suggests strong trade activity in early 2025, this is largely due to frontloading by businesses that are worried about rising tariffs,” the WTO said in an email. “The decline in forward-looking indicators such as new export orders reflects concerns about future demand and growing policy uncertainty.”
The Goods Trade Barometer serves as a real-time measure of world trade conditions, tracking the movement of goods such as vehicles, electronics, and raw materials.
A reading above 100 indicates stronger-than-trend trade growth, while a reading below that level suggests a slowdown.
According to the WTO, the recent surge in trade was driven mainly by increased shipping and air freight activity. The container shipping index climbed to 107.1, while air freight reached 104.3, signalling robust global logistics operations. The automotive products index also rose to 105.3, reflecting resilient demand for vehicles.
The electronics sector, which struggled through much of 2023 and 2024, showed signs of recovery. The electronic components index rose to 102.0, boosted by stabilising semiconductor supply chains and renewed consumer demand.
However, not all sectors recorded strong growth. The new export orders index, a key predictor of future trade, fell to 97.9, dropping below the neutral 100 mark for the first time in months. This decline suggests that manufacturers are facing fewer orders from overseas buyers, raising concerns about a possible trade slowdown in the second half of the year.
The raw materials index inched up to 100.8, reflecting only modest growth, just above the baseline.
According to the WTO, global merchandise trade volume growth had moderated towards the end of 2024 but appeared to rebound in early 2025, largely because of the rush to beat potential tariffs.
The organisation’s Global Trade Outlook and Statistics report, published in April, projected a 2.7 per cent growth in global trade for 2025 under a low-tariff scenario. However, under actual policies as of mid-April, including newly announced tariffs, the WTO warned of a possible 0.2 per cent contraction.
Since then, developments such as new US-China and US-UK trade agreements and increased duties on steel and aluminium have kept forecasts uncertain. The WTO currently estimates global trade will grow by just 0.1 per cent this year.
The outlook could worsen further if major economies reintroduce reciprocal tariffs or if trade policy uncertainty continues to spread.
“Trade policy risks remain elevated,” the WTO added. “If businesses pull back on investment and orders due to these uncertainties, global trade could slip back into contraction.”
