Recent data from analyst Freightos indicates a consistent decline in rates for containers originating from Asia, reaching values below the lowest points of 2024.
This downward trend can be attributed to several factors, including the diminished demand following the Lunar New Year, restructuring within new carrier alliances and increased capacity.
Specifically, the Asia-Europe market has experienced an 11% decline in rates, down to $2,740 per forty-foot equivalent unit, which is 14% beneath their previous 2024 minimum. Similarly, rates from Asia to the Mediterranean have shrunk by 9%, now below $3,800 per FEU. These figures underscore an unusually strong post-holiday demand slump, potentially exacerbated by anticipatory stocking before the holidays to mitigate any delays caused by diversions away from the Red Sea.
Despite the overall market congestion, particularly at European hubs, carriers have attempted to introduce general rate increases for April. However, those efforts in March saw little success. On the trans-Pacific routes, the story is similarly complex. Although there are signs of stronger demand triggered by frontloading, the anticipation of eventual tariffs and sufficient inventory levels suggest a possibly weaker-than-usual performance in the latter half of the year.
The trans-Pacific rates have also followed a downward trajectory, with prices on westbound routes to the United States standing at approximately $2,400 per FEU. Eastern routes are slightly higher at $3,500, yet both reflect a notable decrease, 18% below the 2024 figures. Contributing to this decline are alliance reshuffles and a capacity-driven oversupply initially noted in 2023, despite temporary absorption due to Red Sea diversions.
Freightos’ analysis anticipates further market volatility as the global economy faces uncertainties, including potential tariff increases on Chinese goods and prospective reinstatements of tariffs on Canadian and Mexican products. The ongoing inquiry by the Federal Maritime Commission into international influences on container choke points further complicates the outlook.
Find more articles by Stuart Chirls here.
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