Weekly highlights

Ocean rates – Freightos Baltic Index

Asia-US West Coast prices (FBX01 Weekly) fell 10% to $1,744/FEU.

Asia-US East Coast prices (FBX03 Weekly) fell 21% to $2,733/FEU.

Asia-N. Europe prices (FBX11 Weekly) fell 6% to $3,071/FEU.

Asia-Mediterranean prices (FBX13 Weekly) fell 1% to $3,091/FEU.

Air rates – Freightos Air index

China – N. America weekly prices increased 2% to $5.57/kg.

China – N. Europe weekly prices stayed level at $3.52/kg.

N. Europe – N. America weekly prices fell 1% to $1.72/kg.

Analysis

Even as the tariff landscape on the country level seems to be solidifying, trade probes on specific goods like pharmaceuticals, semiconductors, and lumber – including furniture – requested by President Trump earlier in the year are now concluded or nearing completion, and could mean additional sectoral tariffs soon. 

For some countries that have reached trade agreements with the US, tariffs meant to be reduced or removed on many types of goods are still being collected as implementation conditions still need to be fulfilled or details of the deals are still being hammered out. These implementation lags mean it will take longer to see if the tariff changes impact freight volumes and rates.

China is sending a top trade negotiator to Washington following the recently-announced 90-day extension of 30% baseline US tariffs on Chinese exports first rolled out in May.  Though there are some reports of some increase in China-US ocean demand since the extension announcement, overall volumes and rates – helped on by growing capacity levels – continue to trend downward. 

Transpacific container arrivals likely peaked in July, as many peak season shipments were pulled forward to beat the August China-US tariff expiration date.  Asia – N. America spot rates have fallen 60% – 70% in an almost uninterrupted slide since that early rush. Rates to the West Coast decreased 10% to $1,744/FEU last week – the lowest level for this lane since December 2023. East Coast prices fell 21% to $2,733/FEU for a 34% slide so far in August.

Transatlantic rates were level at $2,284/FEU last week, and though not much freight impact is expected from the recent US – EU trade deal, auto tariff reductions have yet to take effect, and so far alcohol exports will not be exempted. In other trade related developments, carriers are continuing to adjust services and shift vessels to minimize exposure to US port call fees for Chinese vessels and operators that will start in mid-October. 

Peak season volume strength may have peaked for Asia – Europe lanes as extended lead times from Red Sea diversions mean goods must be moved before the end of September. Even with strong demand and port congestion carriers have struggled to push rates up or keep them from falling through much of this year’s peak season. 

Asia – N. Europe spot prices fell 6% last week to about $3,100/FEU and back to levels seen in late June. Asia – Mediterranean rates eased 1% to $3,100/FEU as well, the lowest level since late May for this trade.  Prices on these lanes are 60% lower than last year, with transpacific prices 70% lower, reflecting growing overcapacity in the container market even as the new vessel orderbook size recently hit a new record.

The US will end de minimis exemptions for all low value imports starting this Thursday. A lack of clarity as to how new tariff rules for low-value postal parcels will apply is leading several European post services to suspend handling some shipments for now.   

The White House suspended de minimis eligibility just for Chinese imports back in early May, leading to reports of as much as a 50% drop in B2C e-commerce shipments to the US from China since then. But nonetheless, overall Chinese e-commerce export volumes have continued to grow, as Chinese platforms shift their focus to other markets, especially Europe where e-commerce imports have doubled by value during this same period. The growth of e-commerce volumes from China to Europe and the UK is intensifying local opposition to competition from these types of imports, with calls for an ending of de minimis exceptions in these countries as well.

Even with these reports of e-commerce shipment drops from China to the US and increases to Europe, air cargo rates have been stable overall, likely reflecting a significant shift of freighter capacity between markets. Freightos Air Index China – Europe rates were level at $3.52/kg last week and prices to N. America increased 2% to $5.57/kg.