A recent publication by Xeneta highlights that the latest trade agreements between the U.S. and its major trading partners are not revitalizing the struggling ocean container shipping sector.According to their analysis, average spot rates for shipments from China to the U.S. West Coast have dropped a staggering 59% as June 1, now sitting at $2,268 per FEU (40-foot container). The East Coast isn’t faring much better; rates there have decreased by 43%, landing at $3,796 per FEU during the same timeframe.
Even routes that usually maintain stability, like North Europe to the U.S. East Coast, are feeling the pinch with rates falling to $2,000 per FEU—a 5% dip since June and a notable 25% drop compared to January 1.Emily Stausbøll, a Senior Shipping Analyst at Xeneta, points out that these trade deals aren’t going to magically fix what’s wrong in ocean shipping. “We shouldn’t expect these agreements to inject new life into an already sluggish market,” she notes.
Stausbøll also mentions that while a recently negotiated 15% tariff on EU imports might seem like a compromise,it still poses challenges for shippers: “This tariff isn’t great news; it’s just less bad than what coudl have happened.” Similarly bleak is this week’s round of negotiations between the U.S. and China in Stockholm—these talks aren’t likely to revert import costs back to pre-April levels when important tariffs were first introduced under Trump.
The current downturn follows a brief spike in April and May when shippers rushed imports due to temporary tariff reductions. “That surge has passed,” Stausbøll explains as freight rates continue their downward trend—especially on fronthaul trades from Asia.
In response, carriers are trying various strategies like cutting capacity on U.S.-bound routes but may find these efforts inadequate given the oversupply of vessels globally. Stausbøll warns that while carriers enjoyed hefty profits during supply chain disruptions in recent years, they might face tough times ahead if they can’t reverse this steep decline in freight rates.
Supporting this outlook is data from Drewry’s World Container Index (WCI), which fell by 3.3% last week—the sixth consecutive weekly drop—and forecasts an even weaker supply-demand balance heading into late 2025 likely pushing spot rates lower still. The timing of rate fluctuations will hinge on future tariff decisions made by Trump and potential shifts in capacity due to uncertain penalties against Chinese ships slated for October implementation.
Despite plans from several carriers aiming for General Rate Increases (GRIs) on transpacific routes,industry insiders remain doubtful about whether these initiatives will effectively raise prices amid ongoing low demand levels.
