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February 25, 2025 Update

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February 25, 2025 Update

The Freightos Weekly Update keeps you informed on international freight with key economic data, demand trends, and rate insights.

Judah Levine

February 25, 2025

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Weekly highlights

Ocean rates – Freightos Baltic Index

Asia-US West Coast prices (FBX01 Weekly) fell 8% to $4,362/FEU.

Asia-US East Coast prices (FBX03 Weekly) fell 11% to $5,698/FEU.

Asia-N. Europe prices (FBX11 Weekly) fell 7% to $2,954/FEU.

Asia-Mediterranean prices (FBX13 Weekly) fell 7% to $4,129/FEU.

Air rates – Freightos Air index

China – N. America weekly prices increased 3% to $5.09/kg.

China – N. Europe weekly prices increased 2% to $3.2/kg.

N. Europe – N. America weekly prices stayed level at $2.35/kg.

Analysis

More proposed US policy changes unveiled last week are once again roiling international trade in general and ocean freight in particular. These steps included President Trump signing a memorandum advising federal agencies to research and take steps to prevent Chinese investment in certain US industries, including ports and shipping, and a commerce secretary proposal that all foreign vessels pay a US port tax.

But the biggest bombshell came from the US Trade Representative’s announcement of a proposed action that would target China’s growing influence in the shipbuilding industry by imposing fees ranging from $500k to $1.5 million per US port call by any Chinese carrier, Chinese vessel, or other carrier that has Chinese vessels as part of their global fleet. The action would also provide refunds to carriers using US vessels and sets targets for the share of US exports that should be moved by US flagged vessels in the coming years.

The actions are based on the findings of Biden-era USTR research into China’s shipbuilding industry which were released in mid-January. The report concludes that state-led efforts in China targeted the shipbuilding and logistics markets resulting in unfair advantages and harm to the US. China’s share of shipbuilding tonnage grew from less than 5% in 1999 to 50% in 2023, with 19% of the world fleet owned by China as of 2024.

About 20% of the more than 1,000 container vessels serving the US market are Chinese-made. But Chinese shipbuilders, according to Alphaliner data, accounted for the largest share of the nearly three million TEU of new containership capacity built in 2024 at 55%, with a similar share each year since 2021. Most carriers are therefore likely to have Chinese-made vessels somewhere in their global fleet and would be subject to these new fees.

Port call fees of $500k to $1.5 million would translate to about $100 to $300 per 40’ container for a 10k TEU vessel, with carriers likely to pass those additional costs on to shippers. But as the proposed action would apply these fees for each US port call and most long haul vessels make three US stops, the fee totals and the additional cost per container would be even higher.

The USTR announcement has triggered a comment period that will last until a March 24th public hearing. Following the hearing, the USTR will deliver recommendations to President Trump who will decide what actions to take.

Should this rule change take effect, some vessels may divert to Canada’s container hubs, though port capacity and the fact that routing through Canada is not feasible for all US destinations will probably limit this shift. Some carriers may also increase reliance on Mexico, though President Trump recently asked Mexico to increase tariffs on Chinese imports. This week he also announced that on March 4th he intends to implement the 25% tariffs on all Canadian and Mexican imports to the US that were postponed in early February. All of these steps would likely increase costs for US importers.

In the meantime, as Asia – Europe ocean trade enters its post-Lunar New Year lull container rates dipped below $3,000/FEU last week, about 50% lower than in early January and just below its seasonal low last year. Carriers are hoping to increase prices by about $1,000/FEU on March GRIs and blanked sailings, but sliding rates despite labor strikes and port congestion in Europe may reflect the impact of capacity growth and re-shuffled alliance competition to start the year.

Transpacific rates are falling post-LNY too, with daily rates so far this week at about $4,000/FEU to the West Coast and $5,000/FEU to the East Coast, for a 30% slide since January which includes reductions in some Peak Season Surcharges that have been in place for more than a year. Some of the current demand dip may be temporary and due to unavailable supply as factory production is still recovering post-holiday.

Container prices on these lanes are still about $1,000/FEU higher than a year ago, and elevated levels on these lanes in Q4 were largely attributable to shippers frontloading ahead of tariff increases. But the current rate slide may reflect that the intensity of this pull forward is easing as many shippers have already been building up inventories since November.

In air cargo, reports that the number of daily China – US freighter flights is dropping may point to a decrease in e-commerce volumes as the market prepares for a change to US de minimis rules. Nonetheless, air cargo spot rates remain elevated for now at about $5.00/kg and are even with levels a year ago.

Judah Levine

Head of Research, Freightos Group

Judah is an experienced market research manager, using data-driven analytics to deliver market-based insights. Judah produces the Freightos Group’s FBX Weekly Freight Update and other research on what’s happening in the industry from shipper behaviors to the latest in logistics technology and digitization.

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The New Economics of Logistics Visibility

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Knowing that a shipment will arrive six hours late is information. Knowing it early enough to reschedule labor, protect a customer commitment, avoid detention, or change an inventory decision is economic value.

That distinction is becoming central to the logistics visibility market. The earlier argument that exceptions are becoming the real unit of work explains why visibility economics depend less on event volume than on whether the organization can convert important events into timely resolution.

The first era of visibility was largely about answering a basic question: Where is my shipment? The next era is about a harder question: What should I do because its state has changed?

Visibility Is Not the Outcome

Location and status data can be valuable, but they are intermediate products. A business does not earn a return because a dot moved across a map more accurately. The return appears when information changes an operational decision. A useful way to think about visibility is as a chain: signal -> interpretation -> decision -> intervention -> economic outcome. If any link is missing, much of the potential value disappears.

A Signal Has to Arrive Inside the Decision Window

Timing matters.

A delay discovered after the customer has already missed production is history. The same delay identified early enough to expedite an alternate shipment may be actionable. An ETA update received after warehouse labor has reported for a shift may have less value than the same update received while the schedule can still be changed.

This means visibility quality is not only about accuracy. It is about whether the signal arrives with enough lead time to support an intervention.

Not Every Exception Deserves Attention

As visibility improves, organizations often discover a new problem: too many exceptions. A network with thousands of shipments will always contain delays, deviations, missed scans, changing ETAs, and incomplete data. If every deviation creates an alert, planners become the bottleneck. The more important capability is prioritization.

Which late shipment threatens a high-value order? Which delay creates a stockout? Which container risks demurrage? Which arrival change will disrupt a dock schedule? Which event is likely to self-correct without intervention?

Visibility becomes intelligence when the system can distinguish operational consequence from mere deviation.

ETA Is a Decision Input

Estimated time of arrival is a good example of how the economics are changing. ETA was once primarily a customer-service or tracking metric. Increasingly it can influence warehouse scheduling, yard planning, labor, inventory, customer promises, and downstream transportation. That makes ETA a shared operating variable.

The value increases when the prediction is connected to the systems that can respond. A changing ETA that remains trapped in a visibility dashboard creates less value than one that can trigger a workflow or decision elsewhere.

Dwell, Detention, and Demurrage Make the Economics Visible

Some visibility use cases have direct financial consequences. Better awareness of arrival, dwell, free-time windows, and container status can help organizations manage detention and demurrage exposure. Yard visibility can reduce unnecessary trailer search and moves. Earlier exception detection can protect delivery appointments and reduce costly service recovery. These cases make an important point: visibility value is often realized outside the visibility platform itself.

More Visibility Can Increase Work

This is the uncomfortable side of digital transparency. If a company exposes ten times as many events but does not improve prioritization or workflow, it may create ten times as many things for people to inspect. The result can be an expensive monitoring layer sitting on top of the same manual decision process.

That is why visibility and autonomous exception management are converging. The system must increasingly help decide which events require action, assemble context, recommend a response, and automate routine resolution where appropriate.

Measure Intervention, Not Just Coverage

Visibility programs are often measured by tracking coverage, data completeness, ETA accuracy, or number of connected carriers. Those are necessary operating metrics, but they do not fully describe business value.

Organizations should also ask: How many material exceptions were identified early enough to act? How quickly were they resolved? How often did intervention protect service or avoid cost? How many alerts required no useful action? How much planner time was consumed per exception?

Those measures connect visibility to economics.

The Market Is Moving Toward Action

This shift has strategic implications for technology providers. Pure visibility is becoming less differentiated as location and event data become more widely available. The higher-value layer is interpretation and action: understanding what an event means to a specific operation and helping execute the appropriate response.

That pushes visibility platforms toward orchestration, workflow, decision intelligence, and AI. It also pushes TMS, WMS, and other execution systems toward richer external event awareness.

The Bottleneck Moves

For years, logistics organizations complained that they could not make better decisions because they could not see what was happening. Increasingly, they can see more.

The bottleneck is moving.

When a network can identify exceptions continuously, the constraint becomes the speed and quality with which the organization can interpret and resolve them. That is precisely the environment in which AI agents become interesting—not because logistics needs another conversational interface, but because it needs more capacity to do operational work.

Related Logistics Viewpoints research

The New Architecture of Logistics
Systems Engineering in Logistics
2026 Autonomous Exception Management Market Map
The Economics of Decision Latency
Previous in this series: Transportation Is Becoming Computational

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o9 Solutions Uses a Knowledge Graph to Connect Supply Chain Decisions

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Supply chain decision-making is difficult partly because the relevant information is distributed across products, locations, suppliers, orders, capacities, policies, and external events. A system may have access to all of those records and still struggle to understand the relationships among them quickly enough to support a consequential decision.

o9 Solutions addresses that problem through its Digital Brain architecture, including an enterprise knowledge graph and in-memory modeling designed to connect demand, supply, inventory, planning, and operating context. That semantic layer is important because it gives analytics and AI a structured representation of how supply chain entities relate to one another rather than treating the environment as a collection of independent tables and documents.

The company combines this architecture with integrated planning, optimization, scenario modeling, machine learning, and human oversight. The strategic direction is toward a continuous decision environment where changes can be interpreted quickly, alternatives can be modeled, and recommendations can be traced back to the assumptions, events, and constraints that produced them.

As with any broad planning and intelligence platform, the value depends on implementation quality. Knowledge models need strong data governance, entity resolution, process ownership, and clear decision rights. A sophisticated model of the supply chain is useful only if the organization can keep it current and use it consistently in real operating workflows.

o9 Solutions appears in the Logistics Viewpoints Supply Chain Decision Intelligence MarketMap and Autonomous Exception Management MarketMap. The two MarketMaps highlight the relationship between integrated decision intelligence and the faster exception-response capabilities now developing around it.

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AI Will Not Transform the Supply Chain Until the Architecture Around It Catches Up

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Executive thesis. The model is becoming the least durable layer of the AI stack. Sustainable advantage will come from the operating architecture around AI: authoritative context, governed tools, permissions, observability, and connection to enterprise workflows.

The model is only one component

Supply chain AI discussions often begin with model capability: prediction accuracy, reasoning quality, computer vision performance, or the fluency of a generative system. Those capabilities matter, but operational value depends on everything around the model. The system still needs authoritative context, enterprise tools, permissions, workflow, observability, and a reliable path from recommendation to action.

Different AI patterns solve different problems

Prediction, optimization, generative AI, vision, and agents should not be treated as interchangeable technologies. Forecasting demand, selecting a route, extracting information from a document, interpreting an image, and executing a multi-step workflow require different evidence, control, and performance measures. A mature architecture starts with the decision or task and chooses the AI pattern that fits it.

Context is the operating fuel

An AI system can produce a plausible answer while using stale or incomplete operational context. In logistics, that can be dangerous because the truth may reside across orders, inventory, rates, carrier status, warehouse state, supplier records, and policy documents. Retrieval, master data, identity resolution, and system access therefore become part of the AI architecture, not secondary data-engineering concerns.

Tool access turns intelligence into consequence

The moment an AI system can create a shipment, change an order, contact a carrier, release inventory, or approve an exception, governance becomes an operational requirement. Tool permissions, financial limits, approval gates, idempotency, retries, and rollback are the mechanisms that separate an interesting demonstration from a dependable production workflow.

Measure workflow performance

A fluent response is not the right success metric for operational AI. Supply chain leaders should measure decision latency, manual context gathering, exception closure, override behavior, error recovery, tool failure, and the business outcome being improved. That measurement discipline also creates a rational basis for expanding autonomy as evidence accumulates.

The Logistics Viewpoints AI in Logistics: Use Cases, Architecture, and Implementation Guide separates the major AI patterns and connects them to data, tools, governance, workflow, observability, and ROI—the architecture required to move from model capability to operating value.

Executive implication

AI strategy should separate model selection from control architecture and measure value through workflow performance, decision quality, and operational outcomes.

Go deeper: provides the durable buyer, architecture, and implementation reference for this topic. AI & Advanced Analytics connects this analysis to the broader Logistics Viewpoints research architecture.

Related Logistics Viewpoints research

Download: AI in the Supply Chain — From Architecture to Execution
The New Architecture of Logistics

Go Deeper

Read the full AI in Logistics: Use Cases, Architecture, and Implementation Guide.

Explore the broader AI & Advanced Analytics domain for related Logistics Viewpoints research and analysis.

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