Transpacific ocean rates increased slightly last week and are about 15% higher than at the start of December on successful mid-month General Rate Increases (GRIs).
Rate increases and reports of full vessels this far ahead of the Lunar New Year probably reflect shippers continuing to pull forward volumes ahead of President-elect Trump’s promises of tariff increases next year – with Trump this week proposing the US should reclaim the Panama Canal in response to growing Chinese influence there.
Carriers are hoping the addition of pre-LNY demand in January will support further rate hikes to start the new year on GRIs of US$1,000 – US$3,000/FEU. Despite strong volumes and some signs of strain on rail, operations at US ports remain smooth and operators report being prepared for further volume increases.
Transatlantic rates, which have been stable since about mid-October, may also increase in January as some carriers have announced disruption surcharges for mid-month in anticipation of an ILA port worker strike. Some are also expecting the February alliance reshuffle to cause some disruptions, with MSC announcing a US$2,000/FEU disruption charge starting January 18th for Transatlantic containers.
Asia – Europe and Mediterranean container rates have eased 3% – 7% from levels reached on early December GRIs, with no noticeable mid-month increases despite schedule disruptions from recent bad weather leading to some moderate congestion at some European hubs.
For all these lanes though, Red Sea diversions are still the biggest contributor to rates that remain at least double their level a year ago. And though no military intervention has succeeded in restoring security for passing vessels yet, both Israel and the US have increased direct strikes on Houthi positions in recent days.
In air cargo, Freightos Air Index data show that Transpacific and Transatlantic rates have started to ease from highs earlier in the month as the end of peak season approaches, with China – Europe prices still elevated last week at almost US$5/kg.
Some observers expect frontloading ahead of US tariffs to help keep air cargo demand and rates up into the new year. Significant tariffs on Chinese goods could also contribute to stronger overall global air cargo volumes as intra-Asia shipments of Chinese components may increase significantly.
The article was written by Judah Levine, Head of Research at Freightos
The post Frontloading continues to put pressure on Transpacific rates appeared first on Container News.
Frontloading continues to put pressure on Transpacific rates
