Asia-US container rates continue to soar; liquid tanker rates steady to softer
HOUSTON: Rates for shipping containers from east Asia and China to the US continued to surge as importers pull volumes forward to beat impending tariffs, while liquid tanker rates were steady to softer.
CONTAINER RATES
Spot rates from online freight shipping marketplace and platform provider Freightos rose by 8% to the West Coast this week and have risen by almost three-and-a-half times, to $6,236/FEU (40-foot equivalent unit) this week from $1,806/FEU on 27 February.
Judah Levine, Head of research at Freightos, said an early start to this year’s peak season on the transpacific has sent rates spiking since May. He said carriers are shifting capacity from secondary lanes to service the increased demand.
“Transpacific East Coast rates are now $1,000/FEU higher than last year’s frontloading-driven summer high, with West Coast prices just above their 2025 peak,” Levine said.
Levine said the early peak season rush is attributed to frontloading ahead of carriers fuel surcharges, manufacturer price increases, and the approaching tariff deadline.
“If enough shippers are indeed pulling peak season volumes forward, we could expect the early start to mean an early peak season unwind as well, possibly sometime in July,” Levine said. “But delays at congested ports could mean that this volume strength will stretch on a little longer than many shippers may have preferred.”
Levine said carriers are set to introduce more rate increases to start July, so the degree of success carriers have with these price hikes should reflect where the market is in terms of this year’s peak season peak.
Rates to the West Coast from supply chain advisors Drewry rose by 10% this week and are up by almost three times from where they were on 27 February, as shown in the following chart.
Rates for shipping containers from east Asia and China to the US continued to surge as importers pull volumes forward to beat impending tariffs, while liquid tanker rates were steady to softer.
Drewry said eight blank sailings have been announced on the transpacific trade route for the next week, reflecting tight capacity.
Carriers continue to announce GRIs (general rate increases) and PSS (peak season surcharges) for July in anticipation of strong cargo volumes, with HMM introducing a PSS of $3,000/FEU effective 15 July. Drewry expects rates to rise further in the coming weeks.
Rates from Freight Right Logistics are more than four times higher than they were on 28 February.
Robert Khachatryan, founder and CEO of Freight Right Logistics, said that overall, the week reflected a global trade environment defined by tariff volatility, industrial protection, supply chain security, and selective bilateral dealmaking rather than broad liberalization.
“Carriers are testing the market’s upper limits by introducing an additional $1,500/FEU GRI for the first half of July,” Khachatryan said. “This triggered a massive, last-minute rush at the end of June as shippers scrambled to push containers out of China to avoid the premium.”
On the volumes being pulled forward, Khachatryan said importers have fundamentally compressed the typical multimonth peak season.
“Fearing prolonged volatility, businesses pulled forward orders they did not immediately need, clogging current vessel capacity with goods destined for sales cycles months down the line,” Khachatryan said.
Looking ahead, Khachatryan said the market is rapidly approaching a critical breaking point.
“Because current rate structures are no longer a true reflection of baseline market conditions, a noticeable drop in volume is projected for July,” Khachatryan said. “Many general importers possess roughly three to four weeks of safety stock and are expected to pause bookings for the first half of the month to see if rates soften. The primary exception will be manufacturing supply chains, which are forced to absorb these stiff premiums to avoid halting production lines.”
Khachatryan said that while a two-week shipping strike or buyer strike from importers could force an adjustment, a significant price correction (such as a drop back down to the $5,500 range) is highly unlikely in the near term.
“Because core geopolitical disruptions remain active and carriers are intent on squeezing every penny out of the current capacity crunch, spot rates are expected to grind out at these elevated levels through the end of July,” Khachatryan said.
Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers – such as polyethylene (PE) and polypropylene (PP), which are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers.
They also transport liquid chemicals in isotanks.
LIQUID TANKER RATES
Rates for liquid chemical tankers ex-US Gulf were largely stable this week, except for declines along the US Gulf (USG) to Asia trade lane. This route remains largely dependent on strong contract volumes as most of the regular carriers were able to fill any excess capacity. The market overall has been relatively weak, leaving owners to remain flexible on rates to complete voyages. Several market players have made inquiries about July liftings, but no new fixtures seem to have been reported.
From the USG to ARA, spot rates remain soft, particularly for smaller parcels but remain steady for larger parcels as the lingering uncertainty around the Middle East conflict continues to weigh on the market. This market continues to remain focused on methanol and ethanol inquiries and several larger parcels of both were seen fixed. COA (contract of affreightment) volumes continue to dominate the trade lane across all grades of chemicals.
On the USG to Brazil trade lane, the market has been steady leading rates to remain relatively unchanged week on week. There was a stable level of spot activity with only a handful of new requirements, however, there was a slight uptick in spot inquiries but not enough to influence a significant change in rates. Most frequently discussed in the market were ethanol and caustic soda cargoes. Overall, the market was relatively quiet with steady COA nominations.
Bunker fuel prices continue to remain bearish on the back of plunging energy prices due to the pause in the conflict in the Middle East crisis.
Source: ICIS
