What container shipping rates tell us about the economy
When economists want to take the temperature of global trade, they increasingly look not at ...
With container spot freight rates on the main east-west trades continuing to decline for another week, analysts are warning shippers and forwarders that service reliability could be hit as carriers take a more aggressive approach to blanking.
According to this week’s World Container Index (WCI) from Drewry, the steepest declines in spot rates were on Asia-Europe trades, with the Shanghai-Rotterdam leg shedding 9% from the previous week, to end at $2,164 per 40ft.
Meanwhile, the Shanghai-Genoa route declined 7% week on week, to finish at $3,048 per 40ft, while on the transpacific routes, the Shanghai-Los Angeles leg was down 8%, to $2,239, while the spread to the US east coast widened slightly with the Shanghai-New York leg losing 5%, to end at $2,819 per 40ft.
Source: Drewry
“Average spot rates have fallen on all Far East front hauls to the US and Europe in the past week, but there may be a sting in the tail for shippers,” said Peter Sand, Xeneta’s chief analyst.
“Carriers will begin blanking sailings more aggressively in a bid to tighten capacity and bring the decline in freight rates under control,” he explained.
Drewry identified the chief reason for the recent downturn: a pre-Chinese New Year mini-peak failed to materialise.
New FAK rates levels advised this week on the Asia-Europe trades reflected this weakness: MSC’s Asia-North Europe FAK rate for implementation on 1 March was set at $3,000 per 40ft for North Europe and $4,500 per 40ft for Mediterranean ports, knocking some 25% of the FAK rate it introduced at the beginning of 2025.
CMA CGM and Hapag-Lloyd revealed similar pricing today – the French carrier aiming for $4,600 per 40ft for the Mediterranean, while Hapag-Lloyd’s FAK rates will be $4,000 per 40ft for North Europe, and $4,100 for the Mediterranean.
Privately, smaller Chinese forwarders are advising shippers to refrain from booking Asia-Europe shipments until after CNY, as “prices are very unstable at the moment”.
The situation looks even bleaker for transpacific carriers, with US west coast forwarder Freight Right reporting actual rates to the west coast paid this week in the $1,450-$1,500 range per 40ft, “which is considered the breakeven point for many carriers; any further drops would result in carriers operating at a loss”.
“The industry has essentially finished all bookings for February, as the holiday shutdown in Asia effectively halts new manufacturing and shipping activity,” it added.
While this past week has seen limited adjustments to capacity, according to Xeneta….
Source: Xeneta
… Drewry’s blanked sailings tracker, carriers announced 18, 27, and 28 respectively over the next three weeks, which it said was “a frequency much higher than in previous years”. And Mr Sand warned that further blanked sailings could come at very short notice, potentially leaving cargo on docks.
“If a shipper expects cargo to leave port on a certain date, it should factor-in the risk of that service being blanked – potentially at the last minute – and the subsequent ripple effects of delays on their supply chain.
“Shippers may benefit from overcapacity if it forces lower freight rates, but if that overcapacity also causes increased blanked sailings, there could be an operational price to pay,” he said.
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