KUALA LUMPUR (March 12): Malaysia’s seaport and logistics sector is facing a cloudy outlook for 2026 amid unclear tariff policies and heightened geopolitical risks, despite some wins from trade diversion and e-commerce resilience.

While the recently concluded fourth quarter of 2025 (4Q2025) showed a mix of hits and misses, indications are pointing towards a challenging year ahead for seaport and logistics players.

In a note on Thursday, Kenanga Research, citing the World Trade Organization, said global merchandise trade volume growth is expected to slow to 0.5% (from 1.8%) amid the escalation of Middle East conflict.

It noted the temporary 10% universal baseline tariff introduced by the Trump administration in February 2026 could also be a near-term hurdle.

“The final tariff rates and scopes are being adjusted through ongoing trade talks,” said Kenanga.

Furthermore, the industry is bracing for a structural shift that began on Jan 1, 2026, with the implementation of the International Maritime Organization and European Union’s Carbon Border Adjustment Mechanism. 

These regulations require vessels to reduce carbon intensity by 2% annually, a move likely to increase operational costs as companies transition to low-carbon fuels.

In its sector wrap-up for 4Q2025, Kenanga noted that Westports Holdings Bhd (KL:WPRTS) beat expectations, boosted by a port tariff hike.

Meanwhile, Bintulu Port Holdings Bhd's (KL:BIPORT) results came in within expectations as the PETRONAS MLNG complex returns to full operations.

Kenanga noted that Swift Haulage Bhd (KL:SWIFT) had disappointing 4Q2025 results, likely due to intensifying competition that eroded its sales and margin.

Meanwhile, Pos Malaysia Bhd's (KL:POS) results fell short of expectations after it struggled with logistics services and marine vessel downtime, suggesting a longer road to recovery.

Kenanga has no top picks for the sector.