News / Rates need to rise, say Gemini carriers, as Europe's trade gap widens

ID 11951737 © Rambleon

Carriers say “rates need to increase”, as the Asia-Europe fronthaul versus backhaul trade imbalance continues to grow. 

In its recent report, Container Trades Statistics (CTS) noted that Europe had seen hardly any year-to-date growth in exports.  

According to its October teu lifting data, while Europe’s imports were up, by nearly 2m teu for the year, exports grew by just 15,000 teu. 

“North America’s stagnation may come as little surprise, but Europe’s widening trade imbalance is more striking,” said CTS. 

Indeed, Juan-Carlos Duk, senior MD of trade management for Hapag-Lloyd, told The Loadstar the imbalance had an implication on cost for the carriers.  

“The headhaul has to compensate, to a large extent, for the lower volume and unsustainable rate levels of the backhaul trade, which deteriorated significantly over the past 18 months,” he said.  

And recent analysis from Sea-Intelligence also illuminated this heightened imbalance, cmpared with other major east-west trades.  

It found that transpacific and Atlantic backhaul shippers now covered an increasing share of the round-trip spot rate, but that “a different development” was seen on Asia-Europe, where “round-trip rates dropped markedly below pre-pandemic levels in 2023 and then shot back up in 2024-25 in a very erratic pattern”, the analyst said. 

It explained: “We are now, in December, at a point where the average round-trip rate is $2,348 per 40ft, versus a level of $2,040 in December 2019. However, it should be noted that the round-trip rate did drop below $ 2,000 in October and November. 

“In this case, we see that the backhaul ratio began normalising from the extremely low 5% level from late 2022, and briefly reached a more normal level during parts of 2023. However, this has since clearly deteriorated, and we have in 2024-2025 had a market where the backhaul shippers consistently contributed less to the round-trip economics than what was the case prior to the pandemic.” 

Graph: Sea-Intelligence

According to Mr Duk, Hapag-Lloyd is “monitoring the market developments closely” to find “the right opportunities to steer cargo as efficiently as possible”. 

But he urged: “At a certain point, rates need to increase to ensure we can continue with high-quality services for our customers.” 

And a spokesperson from Gemini Cooperation partner Maersk added: “As a container carrier, you normally adjust your capacity in a tradelane to the demand on the headhaul. That’s the normal rule. It wouldn’t make sense to use the backhaul.” 

But their hub and spoke network design allows the two carriers to be more flexible with capacity on their east-west network, added the spokesperson, as the mainline loops were “much shorter”, some 60% of the former number of port calls in a service loop.  

“So, you basically adjust the shuttles to demand to keep utilisation high and unit costs under control.”