Container rates have not yet fallen following the reopening of the Strait of Hormuz. In fact, prices for sea containers have actually risen further in recent weeks.
The rise is due to limited capacity, ongoing uncertainty on key shipping routes and a notably early purchasing season. Many importers are bringing forward the procurement of products for the festive season, causing demand for container transport to peak earlier than usual.
The reopening of the Strait of Hormuz has not yet had a dampening effect on container rates. Since late February, when the conflict between the United States and Iran escalated, sea container rates have more than doubled.
According to Drewry, rates on the Shanghai–Rotterdam route rose again by 7 per cent at the start of July to $4,682 per 40-foot container. Drewry expects rates on the Asia–Europe route to rise further in the coming weeks due to the peak season and capacity discipline among shipping lines.
For shippers, this means the market will remain tight for the time being. Those needing space on fully booked vessels will face higher spot rates, stricter booking conditions and possibly additional surcharges. Further information on current developments in sea freight can be found on the sea freight page.
The British research firm Drewry has observed that demand for sea freight is peaking earlier than usual. The peak season traditionally begins later in the summer, when retailers build up stock for the festive season. This year, that trend has started earlier.
According to freight market expert Lars Jensen, many importers have brought forward purchases of goods for the festive season, including Christmas. Uncertainty over US import tariffs is playing a major role in this. Importers want to avoid goods becoming more expensive later this year due to new or higher tariffs.
This early purchasing is creating extra demand at a time when available capacity is limited. This is driving container rates even higher. For companies importing goods from Asia, timing is therefore more important than ever. Read more about importing and sea freight rates.
The uncertainty surrounding US import tariffs is causing additional volatility in the market. Importers are taking into account the expiry of existing arrangements and the possibility that President Donald Trump may announce new or higher import tariffs.
This uncertainty is particularly evident on routes from Asia to the United States. According to Drewry, the Shanghai–Los Angeles rate rose by 10 per cent in early July to $6,349 per 40-foot container. The Shanghai–New York rate rose by 11 per cent to $7,902.
For European importers, US tariff pressures are also indirectly relevant. When significant capacity shifts to lucrative transpacific routes, this can affect availability on other trade lanes. Consequently, shortages on one route can have knock-on effects on rates and scheduling on another route.
The rise in container rates is being exacerbated by limited capacity. Drewry points to strong demand during the peak season and capacity discipline amongst carriers. On the Asia–Europe route, only one blank sailing was announced for the week in question, whilst shipping lines are simultaneously implementing higher FAK rates and surcharges.
Disruptions along key shipping routes are also a factor. The Strait of Hormuz is more accessible again, but the market is not recovering immediately. Previously, containers were diverted, shortages arose at certain locations and pressure on alternative routes increased. The Financial Times reported that, following the reopening, volumes passing through Hormuz were still only around half the level seen before the disruptions.
For logistics planners, this means that an open shipping route does not automatically lead to lower rates. Capacity must be redeployed to the right locations, sailing schedules must stabilise and port congestion must ease before the market can truly return to normal.
In contrast to container transport, air freight rates have remained relatively stable in recent weeks. However, air freight rates are still higher than in previous years since the start of the Iran conflict.
For time-sensitive goods, air freight may therefore remain an alternative, though not always at favourable costs. The choice between sea freight and air freight depends on value, delivery time, stock levels, margins and the risk of delays.
Companies wishing to safeguard their stock planning are therefore increasingly looking at combinations of transport modes. Sea freight remains attractive for high-volume shipments, whilst air freight can be used for urgent consignments, seasonal products or essential components. Further information can be found on the pages about air freight and multimodal transport.
Rates for liquid bulk, such as crude oil, are moving differently from the container market. Following earlier rises, prices in this segment have been falling from high levels in recent weeks.
This difference illustrates that each freight market has its own dynamics. Container transport is currently influenced primarily by retail demand, import duties, vessel capacity, route uncertainty and the peak season. In the wet bulk sector, energy prices, tanker availability and geopolitical risks play a different role.
For companies with international freight flows, it therefore remains important to monitor market developments for each mode of transport. A decline in one transport market does not automatically mean that container rates will also fall.
The current market demands meticulous planning. Importers who wait for lower rates run the risk of space remaining scarce or rates rising further. At the same time, it is important not to focus solely on the spot price.
Availability, reliability, cut-off times, transit time, surcharges and arrival scheduling ultimately determine the true cost of a shipment. A cheaper rate can end up being more expensive if containers are delayed, arrive at the shop too late or incur additional storage costs.
TOP closely monitors developments in container rates, capacity and sailing schedules. For customers, it remains wise to discuss shipments in good time, provide complete documentation and keep their options open. Read more about container handling, demurrage and detention.
…the peak season for container transport normally peaks later in the summer? This year, many importers are bringing forward their purchases due to uncertainty surrounding import duties, capacity and geopolitical risks.
More than 10 per cent of the container fleet is stranded due to congestion.
Read more →Asia–Europe remains sensitive to capacity, demand and surcharges.
Read more →More capacity does not automatically mean lower fares.
Read more →Unrest on shipping routes continues to affect capacity and scheduling.
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