Trends to Watch

Tariffs Talk

• We’re just a little less than two weeks away from April 2, 2025 — the date President Donald Trump reaffirmed that new reciprocal tariffs will take effect.
• On that day, Trump will give a reciprocal tariff “number” to each trading partner that represents their tariffs, non-tariff trade barriers, currency practice, and other factors, according to Treasury Secretary Scott Bessent.
• Meanwhile, Canadian and Mexican goods will continue to be eligible for de minimis treatment until “adequate systems are in place to fully and expeditiously process and collect tariff revenue.”
• Follow our live blog to stay updated on the latest developments.

Ocean: Trans-Pacific Eastbound (TPEB) Update

• Capacity and demand: March demand has remained stagnant, showing no growth since after the Chinese New Year (CNY). Forecasted demand has not met expectations, or has not materialized as projected. Capacity: Shipping capacity remains healthy, with deployment staying above 80% from the rest of March into April.
• Equipment: Ample equipment supply is available across most origin gateways, and no major shortages are expected.
• Freight rates: Floating market rates: There has been a slowdown in floating market rates this week, with rates stabilizing at current levels. April GRI and rate stabilization: Carriers have announced their General Rate Increase (GRI) for April. PSS removal: The Peak Season Surcharge (PSS) has been removed by most carriers for the remainder of March.

Ocean: Far East Westbound (FEWB) Update

• Capacity and demand: Capacity for the second half of March remains stable, with no additional blank sailings announced for April, though ongoing congestion in Rotterdam, Netherlands, is causing some rolling cases. To mitigate port congestion impacts, transshipment arrangements will be managed at origin. Demand has shown a slight uptick, and with the downsizing of vessels on the pre-arrival service, the market is moving toward a more balanced supply-demand equilibrium. Space for new bookings remains generally available, and the booking release process is running smoothly, but rolling issues may still occur.
• Equipment: Equipment supply is sufficient, though carriers are occasionally substituting 40-foot containers with 40 High Cube containers, which are restricted for Rotterdam discharge. If a 40HW is assigned on the Equipment Interchange Receipt (EIR), we recommend requesting the yard to exchange it for a 40-foot or 40 High Cube container that is empty and ready to be loaded with goods.
• Freight rates: The Shanghai Containerized Freight Index (SCFI) decline was driven by the rollback of the March GRI, leading to rate stabilization. Focus has now shifted to the April GRI, with major carriers announcing increases while others wait to assess market conditions. The success of implementing April’s GRI remains uncertain, largely depending on market volume in the second half of March. Flexport recommends moving shipments before potential increases, as carriers aim to maintain a pricing floor.

Ocean: Trans-Atlantic Westbound (TAWB) Update

• Capacity and demand: Blank sailings have been reduced, and we expect more stable capacity in March. These blank sailings are mainly in South Europe services. There is congestion at the Ports of Piraeus, Mersin, and Valencia, causing delays in services.
• Equipment: Equipment shortages persist in parts of Central Europe, particularly in Austria, Slovakia, Switzerland, Hungary, and Southern/Eastern Germany. Carrier haulage is recommended for these origins. In Southern Europe, ports have not experienced any equipment issues at this time.
• Freight rates: The majority of carriers have canceled the implementation of the North Europe PSS, as they expect demand to remain flat in April, in contrast to the South of Europe. In the Mediterranean, certain carriers are pushing for the implementation of a PSS for April, focusing on the West Mediterranean. The surcharge ranges between USD 700-1,000 per 40-foot container due to continued high demand and overbooked utilization.

Air Freight Update (March 3 – March 9, 2025 Week 10):

• Overall market stability with YoY growth: Global air cargo demand remained stable week-on-week (WoW), but saw a +2% year-on-year (YoY) increase in Week 10. Across Weeks 9 and 10, total tonnages were up +4% YoY, driven by a +8% increase from Asia-Pacific origins, partially influenced by Lunar New Year timing.
• Asia-Pacific recovery driving regional trends: Asia-Pacific chargeable weight rebounded +5% WoW, returning to mid-January levels. Tonnages from the Asia-Pacific to Europe increased +4% WoW, with strong growth from China (+5%), Hong Kong (+6%), Japan (+7%), Taiwan (+7%), Thailand (+9%), and Singapore (+9%). Spot rates from the Asia-Pacific to Europe fell -3% WoW, but remain +20% higher YoY due to strong increases from key markets (e.g., China +14%, Hong Kong +22%, Thailand +38%).
• Rates trending up YoY but mixed short-term: Average worldwide air freight rates were +5% higher YoY in Weeks 9 and 10, rising +1% WoW to $2.33 per kilo. Globally, spot rates held steady at $2.55/kg WoW, but are +8% higher YoY (Asia-Pacific spot rates +11% YoY). Spot rates from China and Hong Kong to the U.S. stayed stable at $3.78/kg WoW.
• MESA and Dubai see declines: Middle East & South Asia (MESA) to Europe held steady at $2.42/kg, but demand fell -4% WoW, potentially due to Ramadan. Dubai-Europe tonnages dropped -15% WoW, following a -17% drop the previous week. As a result, spot rates fell -12% in Week 10 to $1.88/kg.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI is increasing for China to the U.S. East Coast, and decreasing for China to the U.S. West Coast and China to North Europe.

Week to March 17, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to the U.S. West Coast has decreased from 44.5 to 40 days. China to North Europe also showed a downtick, falling from 73 to 71.5 days. Meanwhile, China to the U.S. East Coast increased from 62.5 to 63 days.

 

Trends to Watch

[Tariffs Update]

• Starting Wednesday, a 25% tariff has hit all steel and aluminum imports, including derivative products outside Chapters 73 and 76, regardless of compliance with USMCA or other FTAs (like KRFTA).
• The announcement followed a whirlwind of decisions on Tuesday when President Trump initially declared a steep 50% tariff on Canadian steel and aluminum—only to reverse the move just hours later. In retaliation, Canada and Europe quickly announced their own countermeasures.
• Follow our live blog to stay updated on the latest developments.

[Ocean – TPEB]

• Capacity and market: Flat demand: March demand remains stagnant, showing no growth since after Chinese New Year. Capacity: Shipping capacity has returned to near full recovery (almost 100%).
• Rate trends: Declining floating rates: Market rates continue to decrease steadily.Narrowing rate gap: The difference between fixed and floating rates is shrinking, driven by falling floating rates and abundant capacity.PSS mitigation/removal: Multiple carriers are reducing or eliminating Peak Season Surcharges (PSS).
• Equipment: Ample equipment supply is available across most origin gateways, with no significant shortages anticipated.

[Ocean – FEWB]

• Capacity outlook: This week, capacity changes were minimal, with no new blank sailing announcements for April. MSC downsized vessels on the FEWB main power string, Lion, reducing capacity by 5k TEU per week. However, new fleets, primarily from HPL, have partially offset this. Overall, March’s capacity changes have been limited.
• April GRI announcement: MSK has led the way in announcing a General Rate Increase (GRI) for April, marking the start of a new round of rate hikes. However, the success of this GRI depends on market trends in late March.
• Historically, GRIs signal potential long-term cost increases, prompting shippers to advance shipments and driving up rates. However, with current demand trends, cargo growth momentum may be insufficient, and if demand doesn’t pick up in mid-March, the GRI may not be implemented, similar to this month.
• Booking behavior recommendations: Since late February, GRIs for March have been canceled, extending the period of lower market rates. On the Asia side, factories are fully operational, and production is on track. While February saw weak demand, the current market isn’t facing a true demand shortage. Logistical challenges are slowing transportation, and once destination inventory levels are resolved, we expect a surge in export demand. Port congestion at destination ports is causing delays and accelerating inventory reductions. If inventory levels reach a critical point soon, a market rebound is possible. We recommend moving cargo early to capitalize on the current low-rate window and mitigate potential rate increases.

[Ocean – TAWB]

• Capacity/demand: Blank sailings are being reduced, leading to more stable capacity in March, particularly in South Europe services (East Mediterranean). Most carriers in North and South Europe have good utilization, with some reaching 100% utilization. This indicates increased demand, especially in North Europe.
• Rates: For North Europe, PSS implementation is mixed. Some carriers have implemented a mitigated PSS in March, while most have postponed it to April, with some now considering canceling the April PSS. In the Mediterranean, certain carriers are planning a PSS for April, mainly in the West Mediterranean, with rates around USD 700-800/40′ ex West Mediterranean and USD 900-1000/40′ ex North Europe.
• Equipment: Equipment shortages continue in parts of Central Europe, especially in Austria, Slovakia, Switzerland, Hungary, and Southern/Eastern Germany, where carrier haulage is recommended. Southern European ports are currently not facing equipment issues.

[Air – Global] Mon 24 Feb – Sun 02 Mar 2025 (Week 9) (Source: worldacd.com):

• China-to-USA weakens amid trade uncertainty: Air cargo volumes fell -10% YoY, with spot rates dropping to $3.80/kg (-9% YoY, -11% MoM). De minimis uncertainty cut ecommerce flights, while ocean imports surged 41% as shippers faced trade restrictions.
• China-to-Europe outperforms the USA market: Shipments grew +4% YoY, and spot rates surged to $4.58/kg (+17% YoY, -2% MoM), showing resilience compared to the U.S. market.
• Global Air Cargo grows despite post-LNY softness: February saw a +5% YoY increase in worldwide tonnage, with Asia-Pacific and South America leading at +8% YoY, while Middle East & South Asia (MESA) declined -6% YoY post-Red Sea crisis peak.
• Market stabilizing, but trade policies loom: Air cargo demand rose for four consecutive weeks, with global spot rates at $2.57/kg (+10% YoY), signaling recovery post-Lunar New Year. However, U.S. tariffs, potential $1M port fees, and trade uncertainty may disrupt supply chains, potentially shifting more cargo to air.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Upcoming Webinars

Tariff Trends 2025: Expert Insights on the New U.S. Customs Landscape

Tuesday, March 18 @ 8:00 am PT / 11:00am ET / 15:00 GMT / 16:00 CET

News This Week

Flexport CEO: ‘Efficiency Is a Byproduct’ of Successful AI Implementation

Flexport launched new AI-driven tools to enhance supply chain visibility and automation, including route planning, data analysis, and duty drawback processing. While scaling automation, Flexport plans to grow its workforce. Future priorities include automating standing rates and improving trade advisory tools.

Tariffs Put Us in a Carrot-and-Stick Situation, Says Flexport CEO Ryan Petersen

On Wednesday, Flexport CEO Ryan Petersen joined Bloomberg Surveillance to discuss recent tariff and trade developments—including impacts on U.S. manufacturing and exports, how businesses are responding to recent changes, and last month’s U.S. Trade Representative (USTR) proposal. “The United States is reindustrializing relatively quickly, but it’s too soon to say whether it’s happening as a result of the Trump administration,” Ryan said.

Tariff uncertainty prompts US retailers to downgrade spring import forecast

US retailers have lowered their Q2 import projections amid tariff uncertainties between the Trump administration and key trading partners. The National Retail Federation (NRF) and Hackett Associates report decreased forecasts for April through July due to ongoing tariff challenges and high inventories from cargo frontloading. Import volumes for April and May are projected to grow year-over-year but at a slower pace than previously expected, while June and July are anticipated to decline, with July imports down 13.9% from last year. The NRF cites concerns over increased tariffs on Chinese goods and potential new fees on Chinese tonnage at US ports, which could raise costs for cargo owners and consumers.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI is decreasing for China to the U.S. East Coast and China to North Europe, and increasing for China to the U.S. West Coast.

Week to March 10, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to the U.S. West Coast has jumped from 40 days to 44.5 days. Meanwhile, China to the U.S. East Coast decreased from 64.5 to 62.5 days, while China to North Europe also showed a downtick, falling from 76.5 to 73 days.

 

 

Please direct questions about the Flexport OTI to press@flexport.com.

See the full report and read about our methodology here.

The contents of this report are made available for informational purposes only. Flexport does not guarantee, represent, or warrant any of the contents of this report because they are based on our current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this report.

 

Source from Flexport.com

Trends to Watch

[Tariffs Update]

• On Wednesday, President Donald Trump agreed to exempt automobiles from the 25% tariffs on Mexico and Canada for one month.
• More than one in five cars and light trucks sold in the U.S. were built in Canada or Mexico, according to S&P Global Mobility. The tariffs could drive up prices for some models by as much as $12,200.
• Additionally, the reciprocal tariffs are set to start on April 2. Follow our live blog for the latest updates.

[Ocean – TPEB]

• Capacity and market: Demand is slowly improving but hasn’t yet reached pre-CNY levels, while capacity has returned and stabilized to over 90%, with space available at all gateways. It’s expected that shipping volumes may shift from China to Southeast Asia.
• Rate trends: Floating rates are steadily declining, with some carriers extending rates until the end of March. Due to the drop in floating market rates and ample capacity, the Peak Season Surcharge (PSS) has been reduced for March.
• Equipment: There is currently ample equipment supply across most origin gateways, with no major shortages expected.

[Ocean – FEWB]

• Capacity outlook: In early March, the overall utilization of carrier vessels was lower than initial expectations. A flat market prompted carriers to withdraw their March GRI and adopt a more competitive stance to attract cargo. Several void sailings in March slightly eased the oversupply situation, but did not result in a significant capacity shortage. The market continued showing an overall oversupply. Additionally, as the U.S. Trade Representative (USTR) proposed imposing fees and restrictions on international maritime transport services involving Chinese ship operators and Chinese-built vessels, carriers have begun adjusting their trade capacity deployment between the TPEB and FEWB. However, the broader impact on the FEWB trade remains uncertain at this stage.
• Demand outlook: Demand on the FEWB trade has almost recovered to normal levels following the CNY slowdown. On the export side, production is back at full capacity, but in Europe, order delays are occurring due to inventory buildup issues. Furthermore, weaker shopping demand in Europe this summer, along with fewer major international events compared to last year, has reduced the need for early purchasing and shipping, leading to higher inventory levels. This has contributed to softer market demand and a shortage of cargo volumes in March.
• Market development outlook: Given current flat market conditions and the potential impact of the USTR proposal on carrier capacity adjustments, the market is likely to experience short-term fluctuations with heightened uncertainty. Additionally, carriers are expected to attempt to push up rates through GRIs in mid-to-late March or early April to improve vessel utilization. Unless significant events occur, such as the reopening of the Red Sea route, current FAK spot rates are not expected to be further lowered.

[Ocean – TAWB]

• Capacity / demand: Blank sailings have been reduced, and we expect more stable capacity in March. These blank sailings are primarily concentrated in South Europe services, particularly in the East Mediterranean.
• Utilization: Most carriers are experiencing good utilization in both North and South Europe, with some reaching 100% utilization for March sailings. This indicates an increase in demand, which is more pronounced in North Europe. Additionally, the potential implementation of tariffs by the U.S. administration on EU goods is expected to further impact trade demand.
• Rates: Most carriers in North Europe have decided to postpone the March PSS to April. However, some carriers have mitigated the delay and plan to implement the surcharge for shipments to the U.S. East Coast and U.S. Gulf. March FAK rate levels reflect skepticism regarding a potential PSS. In the Mediterranean, certain carriers have announced plans to introduce a PSS in April, following the lead of North European carriers.
• Equipment: Equipment shortages persist in parts of Central Europe, particularly in Austria, Slovakia, Switzerland, Hungary, and Southern/Eastern Germany. For these origins, carrier haulage is recommended. Meanwhile, Southern European ports are not currently experiencing any equipment shortages.

[Air – Global] Mon 17 Feb – Sun 23 Feb 2025 (Week 8) (Source: worldacd.com):

• Asia-Pacific rebound: Air cargo tonnages from Asia-Pacific origins continued their recovery post-Lunar New Year, with a +6% increase in Week 8, following a +20% jump in Week 7. Asia-Pacific to Europe tonnages grew +5%, while Japan to Europe surged +19% WoW. Other key markets, including South Korea (+7%), Vietnam (+8%), and Thailand (+18%), also saw gains.
• Asia-Pacific to USA recovery: Tonnages on this lane rebounded by +5% in Week 8, after a +28% increase in Week 7, bringing volumes back to mid-January levels. Notable increases came from Japan and Hong Kong (+11% each), as well as South Korea and Taiwan (+9% each).
• Rate trends: Spot rates from the Asia-Pacific to the USA rose +4% WoW to $4.99/kg, with China to USA recovering +9% to $4.08/kg. Meanwhile, Asia-Pacific to Europe rates dropped slightly to $3.99/kg, driven by declines from China (-3%), Hong Kong (-3%), and Japan (-6%).
• Global stability: Overall worldwide tonnages rose +1% WoW, with Asia-Pacific’s +6% gain offset by declines from North America (-2%) and Central and South Asia (-6%). Average global air freight rates increased +2% to $2.32/kg, with the Asia-Pacific being the primary driver. Year-on-year comparisons remain skewed due to different Lunar New Year timings.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

News This Week

Flexport CEO: ‘Every single member on your team should be using AI

Flexport launched 20 AI-driven products to transform logistics, including Flexport Intelligence for AI-powered reporting and Flexport Control Tower for multi-provider freight management.
Looking ahead, the company plans for deeper freight-fulfillment integration and AI-driven inventory financing, maintaining rapid innovation.

Potential US tariffs ignite US-Canada cross-border spot truck rates, volumes

Freight volumes and spot rates between Canada and the U.S. are surging ahead of 25% U.S. tariffs that took effect on March 4. Businesses are rushing shipments to avoid cost hikes, driving a 57% jump in Toronto-to-Chicago dry-van spot-market volumes and rising rates. Spot rates from the US to Canada have risen by 18% since the US election and by 6% in the past two weeks, reaching their highest point in two years. Cross-border shipments made up 72% of loads in January at Canadian load-board operator Loadlink, and Loadlink’s Canada spot market freight index spiked 40%. In contrast, U.S.-Mexico rate increases remain modest.

Trans-Pacific carriers reaching higher in early 2025–26 contract talks

Trans-Pacific container lines are seeking 20-30% rate hikes for 2025-26 contracts, aiming for $2,000 per FEU to the West Coast and $3,000 to the East Coast. Many importers plan to finalize contracts by March, while some retailers are delaying talks, anticipating moderate import growth and increased vessel capacity. Spot rates have been dropping, with West Coast rates at $2,450 per FEU (-37% YoY) and East Coast at $3,575 (-38% YoY). Carriers are using General Rate Increases (GRIs) and Peak Season Surcharges (PSSs) to stabilize prices, but competition is driving discounts below $2,000 per FEU.

Source from Flexport.com

Trends to Watch

[Tariffs Update]

• On Wednesday, President Donald Trump threatened to impose 25% tariffs on imports from the European Union, the U.S.’s third-largest trading partner alongside China.
• Last Friday, the U.S. Trade Representative (USTR) published a proposal to impose steep fees on Chinese shipping companies and Chinese-built ships entering U.S. ports.
• Operators with a U.S.-built vessel may receive a refund of up to $1 million per U.S. port call. China manufactures 70% of the world’s green ships, while the number of container ships built in the U.S. is relatively small. Currently, there are 18 U.S.-built vessels, with 3 more on order.
• Container ships typically make 2-3 U.S. port calls per loop. Under this proposal, they could face additional fees of over $3 million per trip—a significant expense compared to the typical revenue of $10-15 million per journey. This would equate to $250-$300 per TEU.
• Some carriers and operators may be able to avoid these proposed fees through network redesign. Currently, the impact on individual companies will be difficult to predict, as it depends on the carrier mix behind the supply chain and the strings they ship on.
• Read our live blog for more details on the proposal, as well as live tariff and trade policy updates.

[Ocean – TPEB]

• Capacity and market: Capacity is recovering after Chinese New Year (CNY), currently at over 90%. Demand is also increasing, but hasn’t yet reached pre-CNY levels. Currently, there is ample space available compared to before CNY. This suggests that things are normalizing after the holiday slowdown, but demand is still somewhat soft.
• Rates trends: Floating rates are decreasing rapidly for the rest of February and into March. General Rate Increases (GRIs) are unlikely for March. This indicates downward pressure on pricing, likely due to increased capacity and relatively lower demand. On the fixed contract side, the Peak Season Surcharge (PSS) is being mitigated for March, while floating rates are trending downward.
• Equipment: Equipment availability has improved, and is now sufficient at most Asian gateways compared to pre-CNY. This is a positive sign, suggesting that logistical bottlenecks related to equipment are easing.

[Ocean – FEWB]

• Space outlook: Bookings from late February through early March have not been significantly affected by the GRI. Week 9 volume remains at 75%-85% of pre-CNY normal weekly volume. Early March blank sailings have had little impact on capacity, as demand remains flat. No significant demand increases have been observed, and bookings continue smoothly with no reported space or equipment issues.
• Destination port congestion: Congestion at most destinations has eased. However, the Route to Market (RTM) is still facing anchor berth waiting times for on-water shipments, which may lead to transshipment or arrival delays. Additionally, the Belgium rail strike on February 13 likely reduced yard turnover efficiency, which could affect vessel call efficiency in the coming weeks.
• Market outlook: Most carriers have announced a GRI for early March in an effort to raise rates, despite limited market demand to support the increase. At the same time, carriers continue to seek cargo for this period. Historically, there have been instances where carriers aligned to set higher-than-expected rates, ultimately succeeding in pushing up the market’s Freight All Kinds (FAK) rates. As of February 25, no cancellations or reductions of the March GRI have been reported.
• You can also find our weekly update on ocean dwell time at UK and European ports below:
  
  

[Ocean – TAWB]

• Capacity/demand: Blank sailings are decreasing, and we expect more stable capacity in March. The majority of carriers are experiencing good utilization in both North and South Europe, with fewer signs of overbooking, which had been driven in recent weeks by the U.S. administration’s tariffs on steel and aluminum.
• Rates: Most carriers have decided to postpone the March PSS to April. Some carriers have mitigated this by planning to implement the PSS for the U.S. East Coast and U.S. Gulf. March FAK rate levels show signs of skepticism regarding a potential peak season charge.
• Equipment: Equipment shortages persist in parts of Central Europe, particularly in Austria, Slovakia, Switzerland, Hungary, and Southern/Eastern Germany, where carrier haulage is recommended. Meanwhile, Southern European ports are not currently facing any equipment issues.

[Air – Global] Mon 10 Feb – Sun 16 Feb 2025 (Week 7) (Source: worldacd.com):

• Global recovery: After a -13% decline during the Lunar New Year period, global air cargo tonnages rebounded with two consecutive +3% week-on-week (WoW) increases, in contrast to 2024’s steeper -20% drop and subsequent +15% rebound.
• Asia-Pacific rebound: Tonnages from Asia-Pacific origins recovered sharply with a +15% WoW increase in Week 7, following a -35% drop in Week 5—much milder than the nearly -60% decline seen during the equivalent LNY phase last year.
• China/Hong Kong trough: For China and Hong Kong, the lowest point in the LNY dip occurred in Week 6, with a -45% decline relative to two weeks earlier, compared to a -66% fall in Week 7 during 2024.
• Cargo to the USA: Cargo from China and Hong Kong to the USA saw significant Week 7 rebounds (+40% and +27% WoW, respectively), yet these volumes remain approximately 20%–30% below their January averages.
• Spot rate movements: In Week 7, Asia-Pacific spot rates averaged $3.54 per kilo (+2% WoW, +9% YoY), while rates from the Asia-Pacific to the USA increased +4% WoW to $4.81 per kilo. Meanwhile, China-to-USA rates continued to decline (-6% WoW), though Japan and South Korea rates saw a notable rise (+28% and +13% WoW).

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Upcoming Webinars

[Live Broadcast] The Future of Logistics: Something Big is Coming

Thursday, February 27 @ 8:00 am PT / 11:00 am ET/ 16:00 GMT / 17:00 CET

North America Freight Market Update Live

Wednesday, March 12 @ 9:00 am PT / 12:00 pm ET

News This Week

Flexport releases onslaught of AI tools in a move inspired by ‘founder mode’

Flexport is rolling out a suite of AI-powered products and features, marking the first in a series of semi-annual announcements. Among the highlights of this release are Flexport Intelligence, which provides real-time shipment insights in response to natural language prompts, and Control Tower, which enables real-time visibility and control across entire logistics networks. These AI-driven tools are designed to complement—not replace—human customer relationships. Flexport is also streamlining operations by testing out AI-powered voice agents for truckers, warehouses, and other partners.

Trump’s proposed port call fees against China a ‘big deal’: Flexport CEO

The U.S. Trade Representative (USTR) has proposed imposing hefty port fees on Chinese ships. Flexport CEO Ryan Petersen explained on NewsNation that ‘there’s pretty much no way around this,’ as China produces about 70% of the world’s container ships. Petersen noted that even if a shipping company primarily uses non-Chinese vessels, owning just one Chinese-made ship would still possibly trigger a $500,000 fee per port call.

Trade groups renew push for ocean carrier movement on digitization

Nearly three dozen trade groups are urging shipping lines to speed up the adoption of digital standards for the benefit of shippers, forwarders, and customs brokers. The call, made in a letter to members of the Digital Container Shipping Association (DCSA), follows a similar plea from 11 months ago. The DCSA recently released new standards for booking and electronic bills of lading. The letter urges carriers to align their implementation plans, collaborate with other DCSA members, and involve customers in development. Signatories, including major industry associations, call for progress updates starting in mid-2025.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI plateaued for China to the U.S. West Coast, while increasing for China to North Europe and China to the U.S. East Coast.

Week to February 24, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to the U.S. West Coast has plateaued at last week’s level: 39.5 days. Meanwhile, China to the U.S. East Coast jumped from 62 to 65 days, while China to North Europe also showed an uptick, increasing from 74 to 75 days.

 

 

Please direct questions about the Flexport OTI to press@flexport.com.

See the full report and read about our methodology here.

The contents of this report are made available for informational purposes only. Flexport does not guarantee, represent, or warrant any of the contents of this report because they are based on our current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this report.

 

Source from Flexport.com

Trends to Watch

[Tariffs Update]

• On Tuesday, President Donald Trump told reporters that he may impose 25% tariffs on automobiles, pharmaceuticals, and semiconductors as early as April 2.
• However, he did not specify whether the tariffs would apply to all imported vehicles, or target specific countries.
• If implemented, the tariffs could significantly impact major auto-exporting countries to the U.S., including Mexico, Japan, and Canada.
• For more details on the latest tariff updates, read our blog.

[Ocean – TPEB]

• Capacity and market: Capacity is recovering after the Chinese New Year (CNY), currently at over 90%. Demand is also increasing, but hasn’t yet reached pre-CNY levels. Currently, there is ample space available compared to before CNY. This suggests that while things are getting back to normal after the holiday slowdown, demand is still somewhat soft.
• Rates trends: Floating rates are decreasing rapidly for the rest of February and into March. General Rate Increases (GRIs) are unlikely for March. This indicates downward pressure on pricing, likely due to the increased capacity and relatively lower demand.
• Equipment: Equipment availability has improved and is now sufficient at most Asian gateways compared to pre-CNY. This is a positive sign, suggesting that logistical bottlenecks related to equipment are easing.

[Ocean – FEWB]

• Space outlook: Several blank sailings have been announced, impacting capacity from late February to early March. Overall recovery on the FEWB trade lane remains slow.
• Destination port congestion: Carrier reports indicate ongoing congestion at destination ports. Notably, Rotterdam is experiencing ETA delays of 5-9 days for vessels awaiting berth.
• GRI announcement: At least three carriers within the Gemini and Ocean alliances have announced a GRI for March, exceeding 50% based on current market offers. While rates for the second half of February remain stable at lower levels, carriers aim to push rates higher in early March through this GRI. This announcement may also incentivize shippers to advance their cargo to the latter half of February.
• Predictions and suggestions: Given current supply-demand dynamics, we believe the March FAK rate is unlikely to experience such a sharp increase. However, this GRI could effectively halt further rate declines and potentially lead to a slight market uptick in March. Shippers are advised to book earlier in February to secure current rates and available space while mitigating the risk of higher rates in March.

[Ocean – TAWB]

• Capacity/demand: Capacity has surged in the last two weeks of February, with many vessels fully booked on the North Europe–U.S. East Coast trade. This increase is linked to the upcoming steel and aluminium tariffs that the U.S. administration will implement on March 12. Meanwhile, in the Mediterranean, utilization remains strong, with no signs of overbooking.
• Rates: Some carriers have postponed the March Peak Season Surcharge (PSS) to April, while others have implemented it selectively for certain regions. Market skepticism remains regarding the PSS, which currently affects only exports from North Europe.
• Equipment: Equipment shortages persist in parts of Central Europe, particularly in Austria, Slovakia, Switzerland, Hungary, and Southern/Eastern Germany. For shipments originating from these areas, carrier haulage is recommended to mitigate equipment challenges.

[Air – Global] Mon 03 Feb – Sun 09 Feb 2025 (Week 6) (Source: worldacd.com):

• Global rebound & pricing decline: Air cargo tonnages rebounded by +3% week on week in Week 6 (Feb 3–9, 2025) after the Lunar New Year dip, while overall worldwide rates dropped –5% WoW to US$2.30 per kilo (+1% YoY).
• Asia-Pacific impact: The rate drop was largely driven by the Asia-Pacific, where prices fell –11% WoW; spot rates in this region dipped –8% WoW to US$3.56 per kilo, though both global and regional spot rates are +4% higher YoY.
• Middle East & South Asia (MESA) trends: MESA origins saw a slight –1% WoW dip in tonnage (–7% YoY), with spot rates falling –4% WoW to US$2.99 per kilo, but these remain +26% higher YoY. Trade to Europe shows tonnages –21% lower YoY, with spot rates still +32% higher YoY.
• China/Hong Kong to USA & Europe:
• To USA: China-origin tonnages dropped –20% WoW in Week 5 and –28% WoW in Week 6 (–41% YoY), with spot rates falling to US$3.99 per kilo.
• To Europe: China/Hong Kong tonnages fell significantly (up to –30% WoW in Week 5 and further in Week 6), though spot rates remained relatively stable around US$3.91 per kilo.
• Other East Asian Markets recover: Countries like South Korea, Taiwan, and Vietnam experienced steep tonnage declines during Week 5 (ranging from –42% to –60% WoW) but rebounded in Week 6, with increases of +21% to +68% WoW. Their spot rates remain well above last year’s levels.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

 

News This Week

Ocean carriers’ ever-tightening grip on capacity control shows no signs of loosening

Container shipping has become more expensive and less reliable over the past 25 years due to shrinking capacity. In the early 2000s, carriers prioritized meeting demand, but after the 2008 financial crisis, they slowed ships to cut costs. Since then, blank sailings and port congestion have further reduced capacity, while external shocks like COVID-19 and geopolitical conflicts have made things worse. With new environmental regulations ahead, carriers may pass rising fuel costs onto shippers, adding to their challenges.

US regulator reopens truck broker-transparency proposal for new comments

U.S. regulators are reopening public comments on a proposed rule requiring freight brokers to disclose shipper-paid rates and broker margins to trucking companies. The Federal Motor Carrier Safety Administration (FMCSA) extended the comment period until March 20 following a request from the Small Business in Transportation Coalition. The rule seeks to improve transparency by mandating electronic records and access to transaction details within 48 hours. However, the FMCSA declined to ban broker contracts that waive carriers’ rights to this information.

Small Warehouses Are Getting Harder to Find

The vacancy rate for warehouses under 100,000 square feet is just 3.9%, compared to 6.7% overall and 10.1% for larger buildings. Developers have focused on building big warehouses to meet ecommerce demand, leaving a shortage of smaller spaces, especially in urban areas. As companies seek smaller warehouses to cut costs and improve delivery times, finding space remains a major challenge.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI maintains its ascent for China to the U.S. West Coast, while declining for China to North Europe and China to the U.S. East Coast.

Week to February 17, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to the U.S. West Coast has risen from 38 to 39.5 days. Meanwhile, China to the U.S. East Coast and China to North Europe have fallen from 65.5 to 62 days and 76 to 74 days, respectively.

 

 

Source from Flexport.com

Trends to Watch

[Tariffs/De Minimis Exemption Update]

• Effective Tuesday, February 4, an additional 10% tariff has been imposed on goods from China and Hong Kong under President Trump’s executive order, which also eliminates the de minimis rule for Chinese-origin goods.
• The executive order also suspends duty drawback on these additional duties for goods originating from China (Mexico and Canada deferred). However, businesses may still recover the standard duties, including Section 201 or Section 301 duties.
• In response, China swiftly announced a series of retaliatory measures against the U.S.
• Meanwhile, tariffs on Canada and Mexico have been deferred for 30 days after President Trump reached a last-minute agreement with Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau.
• For more details on the latest tariff updates, read our blog.

[Suez Canal Update]

• As of February 4, 2025, the Suez Canal is experiencing a return to stability following previous disruptions caused by attacks in the Red Sea.
• The Houthis have pledged to honor the Gaza ceasefire reached last month and have suspended attacks on commercial shipping in the region. Despite this, major shipping lines remain cautious, prioritizing security before resuming regular operations.
• The Suez Canal Authority (SCA) is actively working to restore traffic through the canal, given the improving security situation.
• On Monday, the SCA issued new navigational maps for a planned 10-kilometer extension of the canal. This project aims to increase capacity, allowing an additional six to eight vessels to transit daily.

[Ocean – TPEB]

• Demand remains weak post-Lunar New Year in February, with floating rates expected to decline further. By Weeks 9 and 10, we can see a slow recovery.
• Capacity: Blank sailings announced before the holiday are now impacting market capacity. However, with deferred shipments built ahead of LNY, most carriers report good vessel utilization in February despite the slowdown in demand. Given the anticipated rate decrease, carriers are expected to accept over-bookings in preparation for March.
• Equipment: No shortages have been reported.

[Ocean – FEWB]

• Demand remains weak post Lunar New Year in February, with floating rates expected to decline further.
• Capacity: Blank sailings announced before the holiday are now impacting market capacity. However, with deferred shipments built ahead of LNY, most carriers report good vessel utilization in February despite the slowdown in demand. Given the anticipated rate decrease, carriers are expected to accept over-bookings in preparation for March.
• Equipment: Occasional equipment shortages at origin persist due to blank sailings and vessel delays. Timely Equipment Interchange Receipt (EIR) printing to ensure that documents are generated and processed promptly to avoid delays in equipment pickup and early equipment pickup can help mitigate the risk of missed cargo-loading.

[Ocean – TAWB]

• Service updates: Recent changes in ocean carrier alliances and vessel deployments, which temporarily reduced available capacity and caused service disruptions in recent weeks, have now been fully implemented. These strategic realignments within major carrier alliances are expected to stabilize schedules and enhance service reliability going forward.
• Blank sailings have decreased in both North and South Europe.
• Rates: Some carriers have implemented a Peak Season Surcharge (PSS) starting March 1 for shipments from North Europe to the U.S., Canada, and Mexico.
• Demand remains stable in February, with carrier capacity at healthy levels.

[Air – Global] (Mon 20 Jan – Sun 26 Jan 2025) (Week 4) (Source: worldacd.com):

• Global air cargo rates and volumes: Average global air cargo rates increased by +4% week-on-week (WoW) in Week 4 (Jan. 20-26) to $2.52/kg, marking an +11% year-on-year (YoY) increase. Tonnages from the Asia-Pacific rose +2% WoW, now +6% YoY, though still -8% below the Week 49 peak.
• Asia-Pacific to Europe and USA trends: Asia-Pacific to Europe tonnages surged +10% WoW, now +5% YoY, with China to Europe up +11% WoW and +12% YoY. Spot rates from the Asia-Pacific to Europe ($4.32/kg) and China to Europe ($4.29/kg) were stable, but +30% YoY. Asia-Pacific to USA rates rose to $5.30/kg, up +28% YoY, while China to USA rates ($4.49/kg) were up +5% YoY.
• Worldwide tonnages stabilizing: Global tonnages remained broadly stable (+1% WoW) in Week 4 after rebounding +28% in Week 2 and +11% in Week 3. Current levels are -7% below December averages, but are similar to levels last October and this time last year, indicating slower YoY growth in 2025 compared to +11% YoY growth in 2024.
• Central and South America (CSA) growth: Outbound tonnages from CSA soared +17% WoW in Week 4, with a +62% increase in the first four weeks of 2025, mainly driven by flower shipments ahead of Valentine’s Day. Flower shipments more than doubled (+114%), with 92% destined for North America.
• Colombia and Ecuador leading flower exports: 98% of CSA flower exports to North America originated from Colombia (61%) and Ecuador (37%). Flowers accounted for 77% of Colombia’s and 63% of Ecuador’s total air exports in early 2025, reinforcing their reliance on the North American market.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Upcoming Webinars

The Ripple Effect of U.S. Tariffs: What Global Companies Need to Know

Thursday, February 6 @ 8:00 am PT / 11:00 am ET/ 16:00 GMT / 17:00 CET

Scenario Planning: 3 Key Developments Shaping The Freight Market

Monday, February 10 @ 7:00 am PT / 10:00 am ET/ 16:00 CET / 15:00 GMT

Navigating the 2025 RFP Season: A Beginner’s Guide to a Successful RFP

Tuesday, February 11 @ 11:00 am PT / 2:00 pm ET

North America Freight Market Update Live

Thursday, February 13 @ 9:00 am PT / 12:00 pm ET

Navigating the 2025 RFP Season: An Advanced Guide to Upscaling Your RFP

Wednesday, February 19 @ 10:00 am PT / 1:00 pm ET

This Week in News

Flexport CEO breaks down the complex and uncertain global trade landscape

As global markets face uncertainty amid President Donald Trump’s tariff hikes, Flexport CEO Ryan Petersen discussed how businesses are navigating the rapidly shifting trade landscape in an interview with CNBC’s Jim Cramer. According to Petersen, many companies have been rushing to import goods in anticipation of escalating duties, particularly on Chinese imports.

USPS Resumes Accepting Packages From China After Unexpected Suspension

The USPS abruptly halted package acceptance from China and Hong Kong on Tuesday following China’s retaliatory tariffs on U.S. goods. The ban was quickly reversed on Wednesday, with USPS and Customs and Border Protection (CBP) working to enforce new tariffs with minimal disruption.

Flexport CEO outlines real impact of tariffs on shipping, consumer prices

On Tuesday, Flexport CEO Ryan Petersen sat down with Blake Burman at NewsNation to discuss the latest on U.S.-China trade—specifically, the new 10% tariff and the suspension of the de minimis exemption, both of which took effect yesterday. “I don’t think this is the end of it,” Ryan said. “The treasury secretary has until April 1 to put in a formal recommendation for the president on Chinese trade, so I’d expect barriers to trade to ratchet up.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI is on the rise across the board.

Week to February 3, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to North Europe has risen considerably in the past month: despite a small decrease in the last few weeks, it has been on the rise for two consecutive weeks, increasing from 78 to 79 days. Meanwhile, China to the U.S. West Coast and China to the U.S. East Coast have also been on the rise, increasing from 37 to 37.5 days and 64.5 to 65.5 days, respectively.

 

Trends to Watch

[Tariffs Watch]

• President Donald Trump told reporters on Monday that he intends to impose universal tariffs “much bigger” than 2.5%, shortly after pledging tariffs on semiconductors, steel, aluminum, pharmaceuticals, and copper.
• Additionally, over the weekend, President Trump threatened Colombia with emergency tariffs. That standoff was quickly resolved after the Colombian government agreed to the Trump administration’s terms.
• The Senate Committee on Commerce, Science, and Transportation met this week to discuss the Panama Canal’s impact on U.S. trade and security. At last week’s inauguration, President Trump reiterated his plan to “take the Panama Canal back.”
• For more details on the latest tariff updates, read our blog.

[Ocean – TPEB]

• Demand: Demand reductions due to the Lunar New Year holiday have put downward pressure on rates. The SCFI has declined for its third consecutive week.
• Rates: No rate adjustments are expected in the next 1-2 weeks due to holidays in China. Further short-term rate adjustments are anticipated in early February, following a pattern similar to Peak Season Surcharge (PSS).
• Vessel utilization: To prevent vessel underutilization, carriers have established roll pools at major origin loading ports, leading to expected rollovers in the coming two weeks. No equipment shortages have been reported at origin.

[Ocean – FEWB]

• Carrier announcements: To prevent under-utilized vessels, carriers have announced void sailings before and after the Chinese New Year holidays. This has resulted in the buildup of roll pools at major origin loading ports. Rollover cargo is expected in the next two weeks.
• Service updates: New alliance services will fully launch in February, with more updates to follow regarding service reliability.
• Equipment availability: Occasional equipment shortages are occurring at origins due to blank sailings and vessel delays.
• Client advisory To minimize the risk of missed cargo loading, we recommend timely Equipment Interchange Receipt (EIR) printing and earlier equipment pickups.

[Ocean – TAWB]

• Service updates: New alliance services are set to begin in February.
• Blank sailings The frequency of blank sailings has decreased in Northern Europe. However, some blank sailings persist in specific services, primarily in the Eastern Mediterranean.
• Space availability Carriers are observing slight increases in available space on routes to the U.S. East and West Coasts.
• Equipment challenges Equipment shortages continue to affect Central Europe, including Austria, Switzerland, Hungary, Slovakia, the Czech Republic, and southern Germany. Carriers recommend utilizing carrier haulage to better monitor and manage demand.

[Air – Global] Mon 13 Jan – Sun 19 Jan 2025 (Week 3):

• Air cargo demand trends: Global air cargo tonnages increased by +8% week on week (WoW) in Week 3 (Jan 13-19), following a +29% rebound the previous week. Tonnages have now recovered to ~90% of pre-Christmas levels, after a sharp -35% decline in late December and early January. Year-on-year (YoY), global tonnages rose by +3% in Week 3 and +2% for Weeks 2 and 3 combined.
• Spot rate developments: Average global air cargo rates were stable at $2.43/kg in Week 3, +7% YoY. Global spot rates declined by -3% WoW, but remain +16% higher YoY, with notable increases from the Middle East & South Asia (MESA) (+54% YoY) and the Asia-Pacific (+20% YoY).
• Asia-Pacific market performance: Asia-Pacific tonnages rose +5% WoW in Week 3 and are +5% YoY, but still -10% below peak Week 49 levels. The post-peak demand decline in the Asia-Pacific (-33%) is similar to last year (-30%), but recovery to Europe is lagging, with Asia-Pacific to Europe down -20% vs. Week 49 and China to Europe down -15%.
• Regional rate trends: Asia-Pacific to Europe spot rates dropped by -4% WoW to $4.35/kg, which is -15% lower than Week 49, but still +31% YoY. Asia-Pacific to USA tonnages rose +7% WoW, now -16% below Week 48 peak, while rates fell for the fifth consecutive week to $5.21/kg, though still +29% YoY.
• Market drivers: The seasonal recovery is underway but faces headwinds due to an early Lunar New Year (Jan. 29), affecting demand patterns.High spot rates persist YoY, reflecting capacity constraints and sustained ecommerce demand, especially on major trade lanes.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Upcoming Webinars

The Ripple Effect of U.S. Tariffs: What Global Companies Need to Know

Thursday, February 6 @ 8:00 am PT / 11:00 am ET / 16:00 GMT / 17:00 CET

Navigating the 2025 RFP Season: A Beginner’s Guide to a Successful RFP

Tuesday, February 11 @ 11:00 am PT / 2:00 pm ET

North America Freight Market Update Live

Thursday, February 13 @ 9:00 am PT / 12:00 pm ET

Navigating the 2025 RFP Season: An Advanced Guide to Upscaling Your RFP

Wednesday, February 19 @ 10:00 am PT / 1:00 pm ET

This Week in News

Asia-Europe ocean rates fall as weak demand sparks battle for market share

The Asia-Europe trade lane is experiencing intense competition between forwarders and carriers, with falling rates and slowing demand leading up to the Lunar New Year holidays. Many Chinese factories shipped orders early, resulting in a quiet market since mid-January. Short-term Asia-North Europe rates have dropped 21% since late December, settling at $3,963/FEU, while Asia-Mediterranean rates are down over 10%.

Sailing cuts slow pace of decline for India-USEC spot ocean rates

Spot rates on the India-U.S. East Coast trade have slowed their decline, supported by reduced capacity from blank sailings by major carriers. Current rates average $1,350–$1,500 per FEU, with Platts reporting $1,480 as of Jan. 24, down slightly from earlier in the month. Despite plans for February GRIs and surcharges, carriers remain doubtful of their success amid volatile market conditions. Any partial reopening of the Suez Canal could add further pressure to rates due to overcapacity.

Carriers eye Red Sea transits after Houthi rebels pledge restraint

Ocean carriers remain cautious about resuming Red Sea transits despite a Houthi announcement limiting attacks to Israel-affiliated vessels. Carriers like Hapag-Lloyd and Maersk insist they will only return when the region is deemed safe. The Red Sea crisis, which began in late 2023, forced most ships to reroute around Africa, reducing available fleet capacity and driving up freight rates. Analysts warn that a return to the Suez route will flood the market with capacity, leading to supply chain disruptions and sharp declines in spot rates. While carriers may mitigate overcapacity through scrapping and slow steaming, a market downturn appears inevitable.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI is on the rise for China to North Europe and China to U.S. West Coast, while China to the U.S. East Coast has plateaued.

Week to January 27, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to North Europe had risen considerably in the past month, showing a small decrease last week by falling to 75.5 days, and is once again on the rise this week—up to 77.5 days. Similarly, China to the U.S. West Coast increased from 35.5 to 37.5 days, while China to the U.S. East Coast has stabilized at 64.5 days.

 

Trends to Watch

[Customs Update]

• On January 17, 2025, U.S. Customs and Border Protection (CBP) announced a Notice of Proposed Rulemaking (NPRM) to restrict certain products from qualifying for the de minimis low-value shipment exemption.
• According to CBP, the proposed rule would disqualify merchandise subject to specific trade and national security actions, including Section 232, 201, and 301 tariffs, from duty-free treatment. Shipments claiming the exemption would also need to provide the 10-digit Harmonized Tariff Schedule of the United States (HTSUS) classification.
• This NPRM is the second following the Biden Administration’s September 13 announcement. The public has 60 days to comment on the proposal.
• For assistance, contact customsbd@flexport.com.

[Tariffs Watch]

• We’re closely monitoring the tariff updates following President Donald Trump’s inauguration on Monday. So far, he has announced plans to implement 10% tariffs on Chinese goods and 25% tariffs on goods from Mexico and Canada, effective February 1.
• In the meantime, the President also announced a 60-day freeze on new regulations, which could delay recent rulemaking tied to de minimis shipments.
• Visit our blog to stay up-to-date.

[Ocean – TPEB]

• Rates: Shipping lines have reduced short-term rates to both coasts to stimulate demand ahead of Lunar New Year. FAK rates remain higher than NAC rates, plus peak season surcharges (PSSs). Further PSS adjustments are likely to occur only by mid-February.
• Blank sailing: Carriers have planned blank sailings for the CNY period and network adjustments. Available capacity is expected to decline starting in Week 5 and remain limited until Week 8, after which a significant increase is anticipated.
• Space: Due to the Pre-Chinese-New-Year (CNY) rush, space remains constrained, particularly on fixed allocations. However, some strings still have open space, especially to the West Coast and, to a lesser extent, the East Coast.
• Equipment: No significant equipment issues have been reported at origin.

[Ocean – FEWB]

• Lunar New Year and alliance restructuring: The Lunar New Year and the restructuring of shipping alliances will take place in the first half of the month, providing carriers with an opportunity to efficiently allocate existing capacity. Both capacity and freight rates are expected to transition smoothly, with the market remaining relatively oversupplied.
• Capacity and market competition: There has been no significant change in the overall capacity of the new alliances. However, a new wave of market share competition is anticipated to resume after work restarts following the holiday period.
• Israel-Gaza ceasefire impact: The Israel-Gaza ceasefire agreement, effective January 19, 2025, has not yet led carriers to make decisions about resuming affected routes. In the short term, this is unlikely to cause a drop in freight rates.
• Regional trade observations Europe: The European economy remains sluggish.Tariff impact: Recent U.S. tariff increases on Chinese goods may stimulate export demand from China to Europe and other regions, potentially boosting trade. FEWB trade: A modest increase in FEWB trade might occur after the Lunar New Year.
• Market outlook: Taking these factors into account, the market is expected to remain generally stable. Unless there is a sudden surge in cargo volumes, FEWB rates are likely to continue their gradual downward trend.

[Ocean – TAWB]

• Capacity: Carrier capacity is starting to open up following the tentative agreement between the ILA and USMX. Space is now available for shipments from North Europe to the U.S. East Coast. However, capacity from South Europe remains tight.
• Blank sailings persist due to service restructuring and the phase-in of new services.
• Equipment challenges continue in Central Europe, particularly in Austria, Switzerland, Hungary, Slovakia, the Czech Republic, and South Germany.

[Air – Global] Mon 06 Jan – Sun 12 Jan 2025 (Week 2):

• Global Air Cargo Price Trends: Global air cargo spot prices remain significantly elevated, up over +20% compared to the previous year, despite a typical seasonal dip in early January 2025. Rates particularly from Asia Pacific and MESA regions contribute to maintaining this higher level.
• Asia Pacific Route Analysis: Spot rates for Asia Pacific to the USA dropped by -5% week-on-week in early January 2025, and tonnage fell sharply initially but rebounded. However, spot rates remain substantially higher year-on-year, with a noted decrease from China to the USA.
• Asia Pacific to Europe Shifts: Tonnage and spot rates from Asia Pacific to Europe sharply decreased in early 2025 after high numbers in late 2024. There was a slight rebound, with spot rates significantly higher compared to the same period last year, highlighted by rising rates from key countries like South Korea, Hong Kong, and Japan.
• MESA Origin Rate Dynamics: MESA-origin air cargo rates have been declining as disruptions to ocean freight supply chains impacted 2024’s elevated levels. Despite recent falls, rates remain significantly higher year-on-year. Political and security concerns, such as threats affecting the Red Sea, continue to influence shipping and air cargo dynamics in the region.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Upcoming Webinars

The Ripple Effect of U.S. Tariffs: What Global Companies Need to Know

Thursday, February 6 @ 8:00am PT / 11:00am ET / 16:00 GMT / 17:00 CET

European Freight Market Update Live

Tuesday, February 11 @ 15:00 GMT / 16:00 CET

North America Freight Market Update Live

Thursday, February 13 @ 9:00 am PT / 12:00 pm ET

This Week in News

ECSA-US spot rates weaken rapidly after hitting record high in Q4

Spot rates on the East Coast South America-to-U.S. lane have dropped sharply this month after reaching record highs in Q4 2024. Rates fell from $5,800 per FEU in November to $4,300 per FEU by January 21, due to reduced demand and less full vessels. Despite this, trade remains strong, with Brazilian exports to the U.S. hitting a record $40.3 billion in 2024. Experts expect Brazil-U.S. trade to stay robust in 2025, though global uncertainties remain.

CBP’s proposed rule nixes de minimis treatment for array of imports

U.S. Customs and Border Protection (CBP) has proposed rule changes to eliminate de minimis treatment for low-cost imports subject to Section 201, 232, and 301 tariffs, meaning goods under $800 would no longer be exempt from import duties. This change aims to protect domestic industries, particularly textiles and manufacturing. Shipments claiming the exemption would also need to provide tariff classification numbers. The proposal could increase costs for U.S. consumers due to higher tariffs. Importers may consolidate shipments to avoid exceeding the $800 threshold. Public comments are open until March 24.

How businesses are preparing for the tariffs Trump has promised to impose

As companies brace for potential tariffs under President Donald Trump, Ryan Petersen, CEO of Flexport, joined PBS to discuss how uncertainty surrounding tariffs has prompted businesses to take action. Petersen emphasized the unpredictability of tariff rates, but suggested that moving goods early is a sensible strategy—as is creative tariff engineering.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI for China to North Europe has finalized its ascension cycle and is now decreasing, while China to the U.S. East Coast and China to the U.S. West Coast see an uptick.

Week to January 20, 2025

This week, the Ocean Timeliness Indicator (OTI) for China to North Europe has finalized its ascension cycle and is now decreasing, having initially risen sharply from 68 to 80 days and then decreasing to 75.5 days. Meanwhile, China to the U.S. East Coast and China to the U.S. West Coast are both on the rise, moving from 62.5 to 64.5 days and from 35 to 35.5 days, respectively.

 

Trends to Watch

[Ocean – TPEB]

• Rates: Shipping lines have reduced short-term rates to both coasts to stimulate demand ahead of Lunar New Year. FAK rates remain higher than NAC rates, plus peak season surcharges (PSSs). Further PSS adjustments are likely to occur only by mid-February.
• Equipment: No significant equipment issues have been reported at origin.
• Space: Due to the Pre-Chinese-New-Year (CNY) rush, space remains constrained, particularly on fixed allocations. However, some strings still have open space, especially to the West Coast and, to a lesser extent, the East Coast. Carriers have planned 11% blank sailings during the CNY period, aligning with network adjustments.

[Ocean – FEWB]

• Demand: Pre-Chinese New Year (CNY) demand has slowed, resulting in low carrier vessel utilization rates and a softening market.
• Capacity: In response, carriers have announced void sailings, primarily targeting WK5, with total capacity reduced to 223k TEU—down from the typical weekly range of 300-320k TEU. Updates to carrier alliance services are planned after the CNY holiday, but no clear strategy for overall capacity changes has been outlined. Meanwhile, carriers are actively promoting space for post-CNY shipments.
• Carrier availability: The new alliance structure set for 2025 is expected to heighten price competition as carriers contend for market share. Reports from origin ports show declining activity, signaling limited pre-CNY rush shipments and a shift in freight demand toward holiday mode. Based on recent pricing trends and port throughput data, it appears the turning point in cargo volume has already passed.

[Ocean – TAWB]

• Labor dispute update: The ILA and USMX have announced a tentative agreement, successfully averting the strike planned for January 16, 2025. As a result, carriers have canceled the ILA disruption charges that were set to apply in the event of a strike.
• Rates: Rates have largely been extended for the second half of January, as the strike will no longer occur. Carriers are also extending rates into February in anticipation of the new network rollout.
• Blank sailings: Blank sailings continue as part of service restructuring and the phased implementation of new services.

[Air Freight Update] Mon 30 Dec – Sun 05 Jan 2025 (Week 1) (Source: worldacd.com)

• Growth moderation signals market shift:
  • December 2024 global tonnage grew +6% YoY, with pricing up +7% YoY, marking a slowdown from earlier months.
  • Q4 2024 growth softened to +8% YoY, reflecting higher comparison bases and easing demand.
• Regional powerhouses drive rates up:
  • Asia-Pacific and MESA spot rates surged by +23% and +59% YoY, respectively, maintaining regional dominance.
  • Combined air cargo rates began 2025 at $2.65 per kilo, up +13% YoY.
• Spot vs. contract rates:
  • Global spot rates jumped +22% YoY, while contract rates rose more modestly by +6%.
• Short-term seasonal impact:
  • Tonnages dipped -8% (2Wo2W) at year-end, driven by capacity cuts (-24% to -48%) and U.S. weather disruptions.
  • Transatlantic Westbound rates soared +50% YoY in December, fueled by shifting freighter capacity.
• Deceleration from key regions:
  • Asia-Pacific Q4 tonnage growth slowed to +11% YoY, down from +20% YoY in Q1.
  • MESA tonnage growth eased to +7% YoY in Q4, highlighting broader demand cooling.

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Upcoming Webinars

North America Freight Market Update Live

(Today) Thursday, January 16 @ 9:00 am PT / 12:00 pm ET

This Week in News

2025’s logistics risks include tariffs, labor strife

The year 2025 brings significant challenges for logistics strategies, with tariff uncertainties, labor disruptions, and shifting pricing dynamics across all transport modes. Ocean shippers must prepare for the ratification process of the ILA-USMX contract and potential tariff impacts, prompting some to frontload imports. Rail shippers face capacity constraints and elevated U.S.-Mexico trade demand, while air cargo may see short-term boosts due to regulatory changes and tariff timing.

US LTL truck pricing flat, but still elevated despite low demand

LTL pricing has plateaued since late 2024, with rates still elevated post-Yellow’s 2023 collapse but stable due to soft demand. Shippers now have leverage to resist steep rate hikes in 2025 contract negotiations. Freight volumes remain flat, with no signs of increased demand, though LTL carriers’ strong cost management supports modest rate increases. Fuel surcharge savings have provided some relief for shippers amid the stagnant freight market.

Carriers extend spot rates in bid to avoid further rate erosion in eastbound trans-Pac

Eastbound Trans-Pacific spot rates are being extended into mid-February by several ocean carriers, signaling weakening pricing power amid declining demand and upcoming Lunar New Year factory closures. Planned rate hikes for mid-January have been shelved, and carriers are offering guaranteed rates and promotional discounts to secure volumes. Spot rates to the U.S. West and East Coasts have dropped 10% and 7%, respectively, reflecting overcapacity and a slowing market. Customers may delay non-essential bookings in anticipation of further rate declines.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI for China to North Europe continues its ascent, while China to the U.S. East Coast sees a small downtick. Meanwhile, China to the U.S. West Coast is back with an uptick.

Week to January 13, 2025

This week, the Ocean Timeliness Indicator (OTI) has continued its jump to a new high for China to North Europe, rising from from 77 to 80 days. Meanwhile, China to the U.S. West Coast broke its descent by moving from 34.5 to 35 days. Meanwhile, China to the U.S. East Coast showed a small downtick, falling from 63 to 62.5 days.

 

Trends to Watch

[ILA – USMX Labor Dispute Update]

• In a statement released yesterday evening, the ILA and USMX announced they have reached a tentative agreement on a new six-year master agreement, averting a strike.
• The agreement comes just one week before the parties’ existing contract extension expires on January 15. Formal negotiations resumed on Tuesday (January 7) of this week, preceded by a secret meeting two days earlier, where ILA and USMX representatives intended to make headway on the central issue of automation, CNBC reported. A document from Sunday’s meeting indicated “a focus on the creation of new human jobs to complement any new port technology.”
• The ILA and USMX will continue to operate under their current contract until the new contract is ratified. More details will be released after ILA and USMX members approve the final document.
• Get the full breakdown on our live ILA-USMX blog.

[Ocean – TPEB]

• Rates: With Lunar New Year around the corner, ocean carriers have implemented a General Rate Increase (GRI) effective January 1, along with mitigation starting this second week of January.
• Multiple carriers had announced and planned for ILA-disruption-related charges with varying amounts, start dates, and methods of charging. In light of the tentative agreement, many carriers (including Maersk, ONE, ZIM, and EMC) have begun canceling these surcharges.
• Peak Season Surcharges (PSSs) remain, as there have been no changes yet since the January 1 announcement.
• Equipment: No significant equipment issues have been reported at origin. But with Lunar New Year around the corner, we will start to see pressure on equipment and truckers—especially in light of potential new tariffs.
• Space: Amid the pre-Lunar-New-Year rush, space remains constrained. However, there are some strings with open space, especially to the West Coast.
• Carriers have planned some blank sailings for Lunar New Year.

[Ocean – FEWB]

• Lunar New Year factory closures are expected to be concentrated around Weeks 3-4. This will slightly lower market demand; however, the impact will be mitigated by ongoing carrier equipment shortages. As a result, we anticipate that market Freight All Kinds (FAK) rates will remain stable with slight downward adjustments.
• Market prices remain high, hovering around $4,800-$5,000/FEU. The earlier-than-usual Lunar New Year this year, combined with the short period between Christmas and Lunar New Year, has significantly narrowed the production and transportation window. Consequently, the expected pre-Lunar-New-Year shipment rush has not been observed, and is unlikely to occur before Lunar New Year.
• Carriers are prioritizing profitable space utilization over simply increasing overall utilization. This approach, coupled with equipment limitations, is the basic motivation behind carriers’ higher rate levels.
• Before carrier changes and string service upgrades in February, we predict carriers will establish rolling pools to ensure a smooth transition by late January. This is a typical carrier space management measure during Lunar New Year to ensure lifting balances as well.
• Some carriers may prefer to deploy their own operating vessels during this period. Please remain flexible regarding cargo ready date (CRD) and estimated time of departure (ETD) schedules, or substitute equipment options to minimize space release/delay risk.

[Ocean – TAWB]

• Many carriers had announced ILA disruption charges. In light of the tentative agreement, many (including Maersk, ONE, ZIM, and EMC) have begun canceling these surcharges.
• Additionally, some carriers had planned to implement GRIs on January 15 in light of the now-averted strike. We will share more details as carriers finalize changes.
• Blank sailings are continuing in January, with almost all alliances announcing blank sailings until Week 5.
• New services will start in February.

[Air – Global] (Source: Baltic Air Freight Index)

• Global trends:
  • The Baltic Air Freight Index dropped 3.7% by January 6, reflecting a decline in air freight rates.
  • Despite the dip, the index remains 25.9% higher year-over-year, showcasing resilience in the market.
• China export routes:
  • Rates from Hong Kong fell by 11.1% week-over-week, but are still up 14% compared to last year.
  • Shanghai experienced a 6.8% week-over-week drop, yet rates remain 37.6% above last year’s levels.
• Southeast Asia developments:
  • Rates to Europe increased from Bangkok and Vietnam.
  • Vietnam-to-U.S. rates saw a decline.
  • India witnessed slight rate decreases in both export and import directions.
• European market shifts:
  • Frankfurt’s outbound rates surged 19.8% week-over-week, translating to a 40.8% year-over-year increase.
  • London’s North-America-bound rates rose, but overall rates fell 5.8% week-over-week, remaining 19.4% higher than the previous year.
• U.S. market activity:
  • Chicago’s outbound rates rebounded post-holiday, climbing 16.3% week-over-week and 30.9% year-over-year.

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

This Week in News

Limited disruption likely as new carrier alliances roll out: Alphaliner

Ocean carriers are set to launch new global networks on February 1, 2025, involving major alliances like Gemini Cooperation, Premier Alliance, and MSC. While some disruption is expected, key factors will limit its impact, such as the resolution of the ILA-USMX dispute. The Lunar New Year slowdown will also give carriers time to adjust. Though there will be some skipped sailings, most ships are already positioned, and repositioning of vessels from trans-Pacific services will help mitigate capacity shortages.

Trump aims tariffs at Denmark, an exporter of insulin and hearing aids

Donald Trump threatened to impose “very high” tariffs on Denmark if the country resists his offer to buy Greenland, a move that would likely strain trade relations. While Denmark is a relatively small trading partner for the U.S. (ranked 41st), such tariffs could impact industries that rely on Danish imports, especially pharmaceuticals and hearing aids. More than 75% of U.S. insulin imports by value and a significant portion of hearing aids come from Denmark.

Transportation pricing index hits highest level since freight recession began

In December, transportation price growth rates saw a significant surge, reaching their highest point in over two years, according to the Logistics Managers’ Index (LMI). Transportation capacity, on the other hand, showed modest growth—far behind the rise in prices. Additionally, both upstream and downstream companies expect inventories to rise significantly over the next year.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI jumped for China to North Europe, and stabilized for China to the U.S. East Coast. Meanwhile, China to the U.S. West Coast broke its descent.

Week to January 6, 2025

This week, the Ocean Timeliness Indicator (OTI) has jumped to a new high for China to North Europe, rising from from 67 to 77 days. Meanwhile, China to the U.S. West Coast broke its descent by moving from 33 to 34.5 days. China to the U.S. East Coast plateaued at 63 days, falling from 63.5 days.