Ocean freight rates have seen notable increases on key trade routes. Shippers on the Asia-US West Coast route experienced an 8% jump in rates, with prices reaching $4,825 per 40-foot container (FEU). Similarly, Asia-US East Coast rates increased by 3%, now averaging $6,116 per FEU.
Demand ahead of Lunar New Year (LNY) is fueling this surge. Shippers are frontloading goods to avoid potential tariff increases, which has pushed volumes to record levels at major ports like Long Beach, California. Mid-December General Rate Increases (GRIs) have also driven container spot rates higher on transpacific routes.
While rates remain elevated, a seasonal dip is expected after LNY. However, disruptions from Red Sea diversions and persistent demand may keep prices above long-term averages.
Airfreight rates have declined on major routes. Prices from China to North America fell 3% this week, settling at $5.67 per kilogram. Meanwhile, rates to Northern Europe dropped significantly by 13%, now averaging $4.28 per kilogram.
Despite these decreases, airfreight remains a costly option compared to ocean shipping. Limited capacity and the high variety of goods shipped transoceanically make airfreight impractical for many shippers. Agricultural products, vehicles, and other bulky items continue to rely on ocean transport.
For shippers looking to balance cost and speed, monitoring these fluctuations is key to optimizing shipping strategies.
Pre-Lunar New Year (LNY) demand is surging, creating unique challenges for shippers. U.S. shippers are frontloading shipments ahead of expected tariff increases. This trend has led to record-breaking November volumes at the Port of Long Beach.
Ocean freight rates from Asia are climbing as Lunar New Year approaches. January's General Rate Increases (GRIs) will likely push container prices higher. By late February, demand should decrease, but rates will remain elevated due to ongoing Red Sea diversions.
Shippers are feeling the impact of rising transpacific container rates. Drewry’s World Container Index (WCI) recorded a 26% hike in mid-December. This increase added nearly $1,000 per 40-foot container on the Shanghai-Los Angeles route.
The Shanghai-New York route saw a similar spike, with rates climbing 17% to $6,074 per 40-foot container. These increases reflect heightened demand and limited capacity ahead of LNY.
To help you stay informed about market trends, here’s a snapshot of what freight forwarders are generally paying for shipping services based on the latest Freightos Index data. While actual costs to shippers may vary depending on forwarder agreements, these benchmarks are helpful for planning and budgeting your logistics needs:
FEU stands for Forty-Foot Equivalent Unit.
It is a standardized measurement used in the shipping industry to quantify cargo capacity. One FEU represents the volume of a standard 40-foot shipping container. This term is often used to calculate freight rates and container volumes.
A forty-foot equivalent unit (FEU) is a shipping container that measures 40 feet long, 8 feet wide, and 8.6 feet tall. It's the standard size for maritime containers and is used to measure cargo capacity in the shipping industry.
For context, one FEU is equivalent to two TEUs (Twenty-Foot Equivalent Units), which is another common unit of measurement in logistics.
Labor disputes at US ports are further complicating international shipping. The International Longshoremen’s Association (ILA) remains opposed to automation, citing potential job losses. Employers, however, argue that automation is essential for efficiency and long-term job creation.
The possibility of an ILA strike looms, particularly on the East Coast. Such disruptions could lead to congestion and higher rates for shippers in January. Proactive planning and alternative routing will be crucial for mitigating risks.
However, things are picking up on the west coast. The Port of Long Beach handled record container volumes in November. It processed 884,154 TEUs, a 20.9% increase from the previous year. Loaded imports rose by 21.8%, while exports improved by 9.5%. Strong consumer demand and concerns over labor negotiations have driven these numbers. The port’s efficiency and capacity continue to make it the most critical hub for U.S. imports.
Chinese imports to the US have declined, while Mexican imports have surged. Mexico’s favorable trade policies and lower tariffs have made it an attractive gateway for goods bound for the US.
However, new Mexican tariffs on Chinese apparel and stricter e-commerce reporting requirements could disrupt this trend. Shippers relying on Mexico’s INMEX program to reduce duties must adapt quickly to these regulatory changes.
Whether you’re navigating higher ocean rates or adjusting to airfreight declines, proactive strategies can keep your supply chain running lean & on-time. Understanding international shipping rates is more critical than ever. Ocean and airfreight prices fluctuate based on demand, tariffs, and labor disputes. Staying informed helps shippers adapt to market changes and find cost-effective solutions.
For the latest insights, tips and commentary surrounding the logistics industry, look no further. Shippers will find thoughts from the award-winning team at Translogistics covering everything related to your transportation processes and plans. If you have a question we are readily available at marketing@tli.email
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