European line freight plummeting! Full glide
The latest Shanghai export Container Freight Index (SCFI) fell 148.8 points, or 7.27 per cent, and has fallen below the 2,000 mark to 1,896.65 points, and has fallen for four consecutive weeks. The four major ocean routes all declined, of which the European line continued to enter the off-season, the cargo volume decreased, and the decline was particularly significant, reaching 15.93%. The Eastern and Western United States also fell more than 4 percent.
Freight forwarding industry analysts pointed out that the shipping company's behavior of hoarding goods and reducing cargo capacity before the year, making the freight rate of the United States line relatively stable. However, due to the larger ships and the continued low annual cargo volume, the price of the European line is expected to continue to fall in the second half of the month.
The shipping industry further explained that because the Spring Festival holiday has just ended, the overall shipment situation is not obvious, so the trend of freight rates still need to wait for further clarity of the quotation next week. At the same time, the United States tariff policy will have some impact on the market, the most important source of shipments is China, the United States imposed 10% tariffs to determine, continue to observe the future impact.
However, it is worth noting that at present, the market performance of the container industry in the first quarter of 2025 is more hot than originally expected, the Far East to the West of the United States, the United States East of the long rate negotiation results are more than double last year, the Far East of the United States 40 feet from $2,500, the United States East of $3,500, the same period of negotiations last year was only $1,200 to $1,500.
The Drury World Container Index (WCI) showed that freight rates on the Shanghai-Los Angeles and Shanghai-New York routes both fell 1% this week from the previous week to $4,717 and $6,212 per 40 feet, respectively. However, the unsolicited quotes Loadstar receives from freight forwarders in China are well below this official index level. Specifically, there are quotes showing that next week's departures from Shanghai to Los Angeles and Oakland will cost only $2,300 /FEU, while Shanghai and Ningbo will cost only $3,600 /FEU to the eastern United States.
"Spot prices in Asia will be very attractive between the Chinese New Year and the end of February, it's all about supply and demand in the market," explained one freight forwarding executive. But she also noted that negotiations on long-term rates remained "at a fairly high level" as shippers continued to prioritize securing capacity for large volumes of cargo.
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To stop rates from falling further, shipping companies' main response strategy has been to cut capacity. Peter Sand, chief analyst at Xeneta, recently warned that the number of cancellations could increase significantly. According to Xeneta, capacity cancellations on the Far East-Mediterranean route will continue to grow, with empty voyage capacity on the route reaching 38,900TEU for the week ending February 24, an increase of 318% from current levels. Similarly, in the Far Eastern Nordic region, blank voyages will equate to around 75,700TEU of capacity as of February 24, an increase of 449%.
Peter Sand said: "Carriers will not sit idly by when freight rates collapse. "They do everything they can to keep rates stable, and they have become more savvy in capacity management in recent years." "On top of that, new services launched by shipping alliances indirectly limit the capacity to enter new routes," he said.
SCFI Rates:
In terms of the oceanic line, the Far East to Japan's Kansai and Kanto are the same, 305 and 308 dollars; The Far East to Southeast Asia was $454 per TEU, down $54, or 10.63%; Far East to South Korea fell $1, or 0.72%, to $138.
