Container spot freight rates on the main east-west trades saw another week of declines, although, in contrast to most of January and February, the falls this week were led by the Asia-North America trades.
Whereas the weekly falls in spot freight rates so far this year have largely taken place on the Asia-North Europe and Asia-Mediterranean routes, this week saw the steepest declines occur ex-Asia, to the US west and east coasts.
Drewry’s World Container Index’s (WCI) Shanghai-Los Angeles leg saw the spot rate decline 11% week on week, to end at $3,477 per 40ft, while the WCI’s Shanghai-New York leg dropped 10% week on week, to end at $4,593 per 40ft.
In contrast, the WCI’s Shanghai-Rotterdam leg saw spot rates slip just 1% this week, to $2,586 per 40ft, while the Shanghai-Genoa leg was down 2% week on week, to £3,747 per 40ft, providing carriers with some optimism that the spot declines on both trades – ongoing since the beginning of December – may have hit some kind of floor.
Liner analysts largely believe the spot rate declines will continue, given the large amount of new capacity that continues to hit the water on a weekly basis.
“We expect freight rates will continue to soften as vessel supply growth outpaces demand, an end to front-loading, and a return to Suez transits will catalyse this trend,” analysts at MSI wrote this week.
Indeed, they added: “Barring no major black swan event, we believe freight rates will drop substantially over 2025, meaning that GRIs scheduled for March are unlikely to hold, putting the market in a very different position to the highs seen in 2024.”
However, carriers are clearly hoping the GRIs will stick, if quotes for China-UK from the beginning of March are a proxy for the main Asia-North Europe trade. ONE, Hapag-Lloyd, and HMM are offering rates around $4,100 per 40ft, which is bang in line with Hapag-Lloyd’s published 1 March FAK announcement.
At the other end of the scale, however, Maersk is offering $2,500 per 40ft on a pre-paid spot basis, and Yang Ming $3,050 per 40ft, and the expectation among many customers is that rates will continue to come down.
“Carriers are being very bullish – even as rates slide, they deny it and advise they have control and the market is congested,” one forwarder said.
“We will see how long it is before the greasy slope drops rates down to the bottom of the hill.
“Hopefully it won’t – but I can’t see how it can be avoided,” they added.
Container hauliers serving terminals at India’s Nhava Sheva port (JNPA) continue to voice concerns over lengthy vehicle turn times and low productivity.
The pressure on them seems in large part rooted in a mismatch of ocean and landside capacity at the port, which, along with Mundra, accounts for roughly 60% of India’s containerised trade.
Thanks to carriers’ expanding networks and ever-larger box ships, plus exporters trying to maximise shipments before the fiscal year-end on 31 March, Nhava Sheva has seen unusual volume growth of 23% last month, year on year, according to the latest data.
Sporadic vessel-bunching, due to the Red Sea-linked diversions, have also been a factor testing JNPA’s previously seamless port flow, say industry sources.
Despite intermodal rail service enhancements, over-the-road freight accounts for the majority of volumes passing through Nhava Sheva, making quicker vehicle turnarounds critical to its supply chain fluidity.
Truckers mainly blame BMCT, or PSA Mumbai, the newest concessionaire at Nhava Sheva, for the gate slowdown, rejecting its claims that the congestion had been resolved.
“The traffic congestion is causing significant inconvenience to our members, drivers, and the trade community,” said the Nhava Sheva Container Operators’ Welfare Association, which represents truck owners involved in container moves in the harbour.
But PSA told trade stakeholders the “off-and-on congestion” had been a result of volume changes across terminals, rather than through a single terminal.
The Singapore-based operator said: “We will continue to focus on the efficiency of our gates and yard, but there will always be a limit to how much we can handle within a given period of time, and we therefore ask again that we collectively try to avoid the surging which will definitely assist in minimising truck waiting time.”
“We have added the capacity required to handle the expected trade growth and additional demand, but there will always be an issue when trucks swarm to any one of the JNP terminals,” it added.
But the association said that as the trucking delays persist, containers for loading ran the risk of being shut out.
BMCT saw 870 containership calls from April through January, substantially more than the 704 in the period a year prior, and container volumes soared to 1.84m teu, from 1.7m teu, data shows.
Meanwhile, also due to the Red Sea crisis, Nhava Sheva has reported a meteoric rise in transhipment handling, another factor driving the port throughput.
Additionally, major carriers, Maersk in particular, are now using ultra-large container vessels on services out of India, which typically involve more container exchanges per call.
Meanwhile, PSA is close to opening phase 2 of its development at Nhava Sheva, providing a further 2.4m teu of capacity, meaning port capacity is expected to be adequate for near-term cargo volume projections.
But the landside pressure could challenge this if volumes continue to build.
MSC has returned to Zhoushan Changhong International Shipyard for up to eight 21,700 teu LNG dual-fuelled ships, as the Swiss-Italian carrier consolidates its pole position among liner operators.
The yard announced the order on Friday, when it also clarified earlier reports that Greek shipping magnate George Economou’s TMS Dry had commissioned six 11,400 teu LNG dual-fuelled ships – in fact there are 10 firm orders.
MSC’s order is for four vessels, with options for four more, and TMS Dry also has options for four more ships.
MSC has ordered ten 11,500 teu, ten 10,300 teu and a dozen 19,000 teu ships from Zhoushan Changhong over the past three years. The yard said: “We have become MSC’s largest shipbuilding partner. It’s a testament to our skills in constructing LNG-powered boxships.”
The price of the latest order was not disclosed, but according to VesselsValue, the ships are estimated at $220m each. MB Shipbrokers reported that delivery of the first three will be in 2027, the rest the following year.
The vessels commissioned by MSC and TMS Dry will be built according to designs from CIMC ORIC, a unit of China International Marine Containers, the world’s largest container maker.
With the latest order, MSC’s orderbook now stands at more than 2.06m teu, equating to 32% of its in-service fleet. Interestingly, MSC’s orderbook now exceeds ONE’s whole operating fleet, of 1.97m teu.
Meanwhile, CMA CGM, which with an orderbook of 1.32m teu could overtake Maersk Line in the carrier ranks in due course, commissioned up to a dozen (eight firm orders and four options) 18,000 teu ships for $2.5bn at China’s Jiangnan Shipyard two weeks ago, following its order for 12 15,500 teu vessels from HD Hyundai Heavy Industries.
However, Maersk, with an orderbook at 758,622 teu, is reportedly not sitting back and is said to be looking to order another 30 containerships. The Danish carrier has approached to Chinese shipbuilders for up to a dozen 15,000 teu LNG dual-fuelled ships, and shipowner Seaspan is said to be in discussions on newbuilds for long-term charter to Maersk.
Turkey is making further inroads in its efforts to become the main link in Asia-Europe rail freight, as more Chinese volumes pivot away from Russia towards the Middle Corridor.
China was eyeing investing $60bn to help Turkey, straddling Asia and Europe, modernise its rail infrastructure – including plans to further electrify the network, build new domestic routes, and extend its high-speed network.
As part of that transformation, Turkey’s transport ministry confirmed completion of a tunnel in Istanbul, with Railfreight reporting it would form part of a high-speed link with Bulgaria, which when complete would halve freight transit times between the two countries, from eight hours to three and a half, with annual throughput of 33.5m tonnes.
Late last year, minister of transport Abdulkadir Uraloglu said the intention was to add 8,554 km to Turkey’s high-speed network by 2053.
The government is also aiming to bolster the number of logistics facilities – ports and warehousing and industrial sites – in an effort to expedite deliveries across Europe.
However, with more and more China-Europe volumes flowing through the Middle Corridor, at the expense of Russian rail freight, Turkey wants to position itself as a gateway within the Middle Corridor.
Central in this effort has been the participation of Kazakh national carrier KTZ, one of the main beneficiaries of the huge loss of business suffered by its opposite number in Russia, RZD.
Announcing a 13% uptick in volumes, KTZ said yesterday that, together with China’s Urumqi Railway, it would be doubling cross-border services.
KTZ said: “The parties agreed to double the number of trains from Kazakhstan to China via the Altynkol-Khorgos border crossing from eight to 15 trains a day from 1 March and, via the Dostyk-Alashankou border crossing, from 14 to 28 trains a day from 1 July.”
It added that this would “significantly increase export potential and open up additional opportunities for domestic producers”.
And, following a $660m injection from the World Bank, hopes are high that Turkey will be able to hoover-up some of volumes destined for Europe via its looming new high-speed network, set to reduce transit times and better compete with th higher-polluting airfreight options.
While spot rates across the major deepsea trades have been on the decline since the turn of the year, long-term contract rates appear to be heading in the other direction, according to new analysis from freight rates benchmarking platform Xeneta.
It found that contract rates on the Asia-Europe trade recorded on its platform on 1 January were 57% higher than at the same point the year before.
While spot rates are heading towards worrying territory for carriers, anecdotal evidence suggests that, in contract rate negotiations, carriers have managed to maintain pricing discipline.
“Despite the spot rate drops, long-term rates have maintained at a decent level,” Zencargo’s VP of global ocean freight, Anne-Sophie Fribourg told.
“2025 long-term rates on the Asia-Europe trades are being agreed at quite light levels,” she added.
And it would appear that the falling spot rates, in combination with continued geopolitical uncertainty, has led shippers to be far more tentative in the tender process, with forwarders reporting that many Asia-Europe shippers are only launching annual tenders “now that Chinese New Year is out of the way”.
Traditionally, Asia-Europe annual contracts ran from January to December, but many were delayed last year when low spot rate levels in early 2024 saw many contract rate negotiations extended by several months.
According to Xeneta data, while spot rates have continued to slide in the first months of the year, from a peak in the autumn, carriers have, understandably, attempted to capture greater volumes under contract, and are offering big discounts – said to be as much as 28% on Asia-North Europe, provided “shippers agreed to a contract greater than six months”.
“This is a fascinating negotiating dynamic between the seller and buyer,” writes Xeneta analyst Emily Stausboll.
“On the one hand, you have the seller trying to incentivise longer-term agreements to manage risk and protect market share. On the other, you have the buyer doing everything possible to keep their options open for as long as possible while not spending more than necessary,” she adds.
The situation is similar on the Asia-North America trades, where Xeneta reports 1 January contract rate levels were 64% up year on year into west coast ports, and 44% up on shipments to the east coast. Ms Stausboll notes that, although the transpacific trades are still warming up for their annual rate negotiations, ‘early bird’ discounts are already being made available.
“From the Far East to US east coast and west coast, the discounts [on six month-plus contracts] were 13% and 2% respectively – it should be noted that US shippers aren’t as far into tender season, so this figure could rise,” she says.
The European Commission (EC) has branded the latest US “reciprocal tariffs” as “a step in the wrong direction”.
After the past few weeks of tariff-pandemonium, the Trump administration has released yet another plan to boost the US trade deficit.
With its Reciprocal Trade and Tariffs Plan, the administration will examine the arrangements with all the US trading partners and determine an equivalent “reciprocal tariff” for each.
A White House statement yesterday said: “The plan shall ensure comprehensive fairness and balance across the international trading system by factoring-in losses as a result of measures that disadvantage the United States as applied, regardless of what they are called or whether they are written or unwritten.”
It added: “The US has one of the most open economies in the world, yet our trading partners keep their markets closed to US exports — and reciprocal trade will finally correct that imbalance.”
The EC has hit back saying it “sees no justification for increased US tariffs on its exports”.
It added today: “Tariffs are taxes. By imposing tariffs, the US is taxing its own citizens, raising costs for business, stifling growth, and fuelling inflation. Tariffs heighten economic uncertainty and disrupt the efficiency and integration of global markets.”
And, while the commission assured it “remains committed to an open and predictable global trading system that benefits all partners”, it vowed to react “firmly and immediately” against the US, adding: “The EU will always protect European businesses, workers, and consumers from unjustified tariff measures.”
Within 180 days, the director of the US office of management and budget will assess the fiscal impacts of the Reciprocal Trade and Tariffs Plan and deliver an assessment in writing to the president – however, there has been inconsistency between plan and action.
President Trump previously threatened a blanket 10%-20% global tariff on imports, with a 25% tariff on those from Mexico and Canada. But then he revoked it for “a 30-day review”, placed 25% tariffs on steel and aluminium imports, threatened 60% tariffs on Chinese imports but settled for 10%, and paused the de minimis exemption on Chinese shipments, but then re-instated it two days later, also for a 30-day review.
Meanwhile, India is establishing closer relations with the US. A meeting this week between President Trump and India’s prime minister, Narendra Modi, ended with reports of a “mega-partnership” deal for India to import more US oil and gas.
During Mr Modi’s two-day visit, President Trump criticised India’s high trade tariffs as “a big problem”, and the Indian leader said he was open to reducing tariffs on US goods.
Labour unrest at the port of Rotterdam has exposed long-standing issues and diminishing hopes of a resolution to backlogs and congestion in the near term.
Maersk told customers yesterday it would be omitting a call at the Hutchinson Port Delta II terminal on Monday, because of “unplanned strike action” at the facility.
Workers represented by the FNV Havens and CNV unions have been locked in dispute with the Chinese terminal operator since the second half of last year over port automation concerns.
The latest strike action began on Sunday and ended yesterday, and reports claim Hutchison has been forced to close the terminal gates due to overcrowding.
Contract negotiations began in November but hit a wall, with further strikes threatened until agreement is reached, and while Maersk told customers it would “continue to monitor the situation,” hopes of a quick resolution are fading.
The Halifax Port Authority was awarded funding up to CA$22.5 million (US$15.7 million) from Transport Canada through the Green Shipping Corridor Program to prepare the port for the fuels and energy sources of the future.
Major funded project activities for the port of Halifax include completing a risk assessment for hosting alternative-fuelled vessels, working with partners to support electrification efforts, investing in equipment to continue lowering emissions, developing the workforce, exploring lower carbon fuels including hydrogen, and planning for the future by doing foundational work in a series of risk and commercial feasibility studies.
"This is an important project supporting the future of the Port and our competitiveness," said Fulvio Fracassi, President and CEO of the Halifax Port Authority. "As the global shipping industry continues to take steps to decarbonize, we need to be prepared for the transition."
The funding builds on existing work at the Port of Halifax including the Memorandum of Understanding (MoU) with the Port of Hamburg. The Canadian port said it will share next steps and updates as activities take place.
