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Diving summary:
- Ocean rates fell to their lowest level since late 2023, near the start of the Red Sea crisis, Freightos head of research Judah Levin wrote in Freightos’ weekly update on Oct. 15.
- Initial loadings and trade war-related supply growth helped pressure transpacific container prices, which fell 8 percent week-on-week, according to the report.
- According to Levin, US import volumes have been lower since mid-2023 and are expected to continue to decline through December, pushing rates lower further.
By the Numbers: Ocean Rates for October 8-15
1431 dollars
Average rate per FEU from Asia to US West Coast, down 8% WoW
3015 dollars
Average rate per FEU from Asia to US East Coast, down 8% WoW
Diving Insights:
Ocean rates and import volumes are falling amid a wave of turmoil for shipping, including the imposition of US tariffs on China-linked vessels and some easing of tensions in the Red Sea.
Developments of the Red Sea crisis
As the first phase of the Israeli-Hamas ceasefire begins, Levin said, expectations are rising for the return of containers in the Red Sea. After years of schedule disruption and congestion due to the long-running waterway crisis, the truce is expected to bring a wave of capacity back into the market.
Levin reported that some shipping companies have already begun increasing their services through the Suez Canal. However, many operators have “demonstrated stability and security after a significant period,” Levine wrote in the update.
US port charges for China bound vessels
The U.S. imposed a port call fee on China-bound vessels on Tuesday, Levin said, despite hopes that the fees would be reduced or eliminated due to reported progress in trade talks between the two countries.
Some shipping companies have decided not to pass on additional costs to customers. For example, AP Moller – Maersk Anders Svensson, head of contract product management for North America, said in September that he was planning to contain the cost while deploying Chinese-built vessels in other trade lines. Meanwhile, Levin reported last week that China-based operator Cosco has assured customers not to expect disruption or additional charges.
Due to such actions, fees may have limited impact on East Pacific shipping rates, operations or capacity, Levin said.
China also levied port fees on US ships starting Tuesday as a countermeasure to US shipping taxes, China’s Ministry of Transport said on Oct. 14.
The country’s charges affect about 5 percent of port calls, and affected companies are likely to adjust their vessel network to reduce exposure, Levin said, citing Clarksons research data.
Other sanctions
On Friday, the United States also threatened to fine countries that vote for the International Maritime Organization’s net zero framework as a global tax to reduce carbon emissions in the ocean shipping industry. Some of the potential measures include imposing visa restrictions on crew members and additional port charges for ships owned, operated or flagged by NZF sponsoring countries.
Meanwhile, the United States also plans to impose 100 percent tariffs on China-related ship-to-shore cranes and cargo handling equipment starting Nov. 9, according to a notice from the U.S. Trade Representative. These tariffs will also be applied to multi-modal chassis and chassis parts.
Editor’s note: This story was first published in our Logistics Weekly newsletter. Register here
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