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.
India’s government is considering setting up a dedicated container shipping line to ease local shippers from an over-dependence on foreign-flagged carriers.
The new entity is expected to be named Bharat Container Line, and feature equity participation from public and private organisations.
According to reports, some 100 containerships will be procured or chartered for the new venture.
The move ties in with an ambitious $3bn “maritime development fund” New Delhi has announced as part of its annual budget for the fiscal year 2025-26, which “will directly benefit in financing for ship acquisition”, according to India’s shipping ministry.
“It aims at boosting India-flagged ships’ share in the global cargo volume by up to 20% by 2047,” it added.
Indian policymakers had been under tremendous pressure from exporters and industry groups to rein-in foreign lines exploiting supply chain disruption by charging high freight rates and other surcharges on Indian cargo.
The Federation of Indian Export Organisations (FIEO), at the vanguard of that push, persistently called for India-registered tonnage participation in major trade routes, in order to make domestic goods more competitive in international markets.
“A 25% [market] share by an Indian shipping line can save $50bn a year, and will also reduce arm-twisting by foreign shipping lines on medium and small businesses,” the export group had told the government.
FIEO president Ashwani Kumar last week welcomed the new budget proposals, which he called “a series of strategic initiatives aimed at bolstering India’s foreign trade sector, especially exports”.
“It will also help the country in saving a huge amount of foreign exchange remitted in the US dollar to foreign shipping lines,” he added.
Meanwhile, responding to the constant appeals, Shipping Corporation of India (SCI), the country’s only long-haul carrier, recently unveiled plans to add more box ships to its severely depleted fleet.
But with the global container shipping industry navigating some volatile conditions, some experts have expressed scepticism over the government plans.
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