After a very brief uptick the first week of September, freight rates out of Asia have settled back to low levels. Carriers had hoped for market improvement this month ahead of the Golden Week holiday in China (October 1-8), when factories and other businesses close for an extended period. No meaningful demand increase materialized, so carriers have once again turned to capacity limitations to help stem the tide of rate reductions. Blank sailings are ramping up for October and will likely continue throughout the fourth quarter as demand remains weak. Freight rates on the Asia-US trades are nearing the low levels last seen right before the Red Sea Crisis began in late 2023.
USTR 301 Chinese-built vessel fees are scheduled to be assessed on vessel operators, where applicable, as of October 14. Most carriers have shifted assets to remove Chinese-built vessels from US services. At this time, carriers do not plan to implement new surcharges directly tied to the new USTR 301 fees, although they reserve the right to revisit the situation. Ultimately, the consensus is that the current market is too weak to support an increase of any type.
The tariff landscape continues to evolve. We have seen sudden shifts in market dynamics caused by various factors over the last several years. As always, we remind shippers to continue to plan ahead and book in advance, even in softer markets. Demand can change very quickly.
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Rachel Shames
VP, Pricing & Procurement
CV International, Inc.