The current round of freight rate increases is influenced by multiple factors, including changes in tariff policies, expected adjustments to fuel surcharges, and the ongoing turmoil in the Middle East.
Recently, as the 10% temporary tariff imposed by the United States on global imports is set to expire on July 24, a large number of cargo owners are accelerating shipments, hoping to deliver goods to the US before the tariff policy adjustment. This has swept away the gloom of weak demand and falling freight rates on the east-west main trunk routes, creating a buoyant market atmosphere.
The latest data shows that on June 12, the Shanghai Containerized Freight Index (SCFI) stood at 2985.22 points, up 258.74 points from the previous week, with the weekly increase expanding to 9.49%. This marks the seventh consecutive weekly rise for the SCFI, indicating that the acceleration in the container spot market is still intensifying.
Among them, freight rates on the four major deep-sea routes—Europe, Mediterranean, US West Coast, and US East Coast—all climbed, with single-week increases reaching double digits. Freight rates on the US West Coast route are approaching $6,/FEU, and on the US East Coast route, they are close to $7,/FEU. The east-west main trunk routes are once again experiencing a tight situation where “a single container slot is hard to find.”
The Drewry World Container Index (WCI) also showed a synchronized upward trend, rising 23% week-on-week on June 4 to $3,/FEU. Among these, freight rates on the Trans-Pacific route increased by 25%, /Mediterranean routes by 22%, and the Trans-Atlantic route by 5%. On June 11, the WCI rose another 3% to $3,/FEU.
Drewry analysis suggests that the current round of freight rate increases is influenced by multiple factors, including changes in tariff policies, expected adjustments to fuel surcharges, and the ongoing turmoil in the Middle East.
From overcapacity to slot shortages, from continuous declines to steady rises, the east-west main trunk routes are once again capturing the attention of the container shipping market.
Peak Season Arrives Early, Multiple Factors Converge
Several shipping analysis institutions believe that the “sunset clause” in US tariffs is the core igniter for this sharp jump in freight rates.
The comprehensive tariffs imposed by the Trump administration under Section 122 of the Trade Act of 1974 are set to expire on July 24, prompting Asian exporters to rush shipments before this deadline. This rush, combined with Mexico’s Hot Sale mid-year promotion, Amazon Prime Day stockpiling, and consumer demand driven by major events like the World Cup, has led overseas buyers to start inventory replenishment early. E-commerce and foreign trade orders have been released intensively, causing a short-term surge in domestic shipments in May, far exceeding the current capacity of maritime container slots. This directly led to tight slot availability on east-west main trunk routes, with the peak season starting earlier than in previous years.
At the same time, changes in the geopolitical landscape continue to reshape the global shipping map.
The uncertainty in the Red Sea situation has forced a significant proportion of commercial vessels to continue rerouting around the Cape of Good Hope, increasing single voyage durations by 7 to 15 days, which has significantly diluted global effective capacity.
On June 18, Iranian Foreign Ministry Spokesperson Baghaei stated that the text of the memorandum of understanding between Iran and the United States has been finalized and formally signed, and the Strait of Hormuz will reopen. However, approximately 500 vessels stranded in the Persian Gulf may take weeks to clear. In the short term, the actual impact of the strait’s reopening on the capacity landscape of the container shipping market is limited, but the capacity release effect needs close monitoring in the medium to long term.
Although this development has alleviated market anxiety regarding the Middle East to some extent, capacity turnover efficiency on the two core corridors—the Trans-Pacific and Asia-Europe routes—remains significantly constrained.
Data from the Baltic and International Maritime Council (BIMCO) shows that global port congestion is worsening. At Shanghai’s main container hub, the Waigaoqiao terminal, average vessel delays range from 3 to 7 days, while delays at the Yangshan port area are about 2 to 3 days. Ningbo Zhoushan Port is also facing similar difficulties.
Furthermore, structural changes in capacity deployment are amplifying the supply-demand contradiction.
Alphaliner data indicates that over the past year, global container capacity increased by approximately 1.84 million TEUs. Of this, the Far East to Europe route absorbed 667,000 TEUs, accounting for 36% of the global new capacity, and its total capacity now represents about 25% of the global container fleet.
However, much of this new capacity has been offset by the extended voyage distances caused by rerouting around the Cape of Good Hope, and has not truly translated into effective supply.
Sea-Intelligence analysis suggests that as long as the Red Sea route remains unnormalized, capacity utilization and freight rates on that route will be particularly sensitive to any incremental changes in demand.
Drewry analysis states that although shipping companies are gradually restoring capacity on east-west main trunk routes, the growth rate of demand is faster. Even with a reduction in blank sailings, freight rates continue to rise.
Drewry predicts that from week 24 (June 8-14) to week 28 (July 6-12) this year, a total of 710 sailings are planned on east-west main trunk routes, of which 39 are expected to be blank sailings, resulting in a blank sailing rate of 5%, meaning 95% of sailings will proceed as scheduled. In terms of impact distribution, the Trans-Pacific eastbound route is the most severely affected, accounting for 49% of total blank sailings; followed by the /Mediterranean routes at 33%; and the Trans-Atlantic route is relatively less affected, at 18%. The Gemini Cooperation maintains a relatively high schedule reliability, while MSC has no blank sailings during this period, showing a significant improvement in service stability.
Additionally, the phased easing of Sino-US trade policies has boosted market trade confidence. Overseas buyers have ended their wait-and-see stance, and a large backlog of orders was shipped intensively in May, further exacerbating port congestion and route saturation, amplifying the dual market conditions of space shortages in May and price increases in June.
In summary, the rapid rise in freight rates on east-west main trunk routes this round is not caused by a single factor but is the result of multiple driving forces resonating together, including the tariff countdown, geopolitical risks, and changes in capacity structure.
Seizing the Opportunity, Shipping Companies Plan Ahead
The tense market sentiment is further reflected in the rate increase plans of shipping companies.
Data shows that since June 1, a new wave of freight rate increases has emerged across various routes. Entering mid-to-late June, market space remains tight, with multiple shipping companies reportedly planning further rate hikes. MSC has already announced a rate increase plan, pushing European route rates from July 1 to $4,/TEU and $7,/FEU. CMA CGM followed suit, raising July rates to over $6,/FEU and adding a peak season surcharge.
However, rate increases are not the only measure shipping companies are using to respond to this market situation. Behind the sustained strength of spot rates, leading liner companies have already been implementing more profound strategic layouts at the level of route networks and capacity structure.
At the beginning of 2026, the Ocean Alliance released its latest DAY10 route products, featuring a “dual-version” design with a “Cape of Good Hope version as the mainstay, Suez version switchable.” This shifts the competitive focus from “scale competition” to “network resilience,” covering core corridors such as Asia to Europe, Asia to North America, and Asia to the Middle East.
In April 2026, Maersk conducted a major reshuffle of its Asia-Europe network, readjusting the port rotations of various routes and concentrating capacity on core North European gateways. The AE1 route added a call at Antwerp and removed Tangier; the AE3 route added calls at Yantian, Aarhus, Gothenburg, and Southampton, removing Ningbo and Algeciras; the AE5 route incorporated Ningbo and Algeciras; the AE12 route replaced Port Said East and Colombo with Algeciras and Singapore; the AE15 route removed calls at Izmit and Istanbul, replacing them with Damietta and Colombo.
Meanwhile, the Gemini Cooperation, formed by Maersk and Hapag-Lloyd, is accelerating its layout on Asia-Mediterranean routes.
In contrast, MSC’s strategy demonstrates more contrarian thinking.
At the beginning of 2025, MSC withdrew all its ultra-large vessels (19,200 TEU to 24,300 TEU) from Asia-Europe routes, redeploying them to high-profit routes like Asia-Mediterranean and Asia-West Africa. At the same time, it replaced the main vessel types on Asia-Europe routes with Neo-Panamax vessels averaging around 14,700 TEU.
By operating the JAED Mediterranean route with vessels exceeding 24,000 TEU, MSC has become the carrier with the largest average fleet size in the region.
This contrarian move of “actively downgrading” capacity levels on Asia-Europe routes is both a response to the prolonged low freight rates and provides ample flexibility for adjusting the network when rates rise rapidly.
Chinese shipping companies like COSCO Shipping have shown a more aggressive stance on Trans-Pacific routes.
Leveraging the strong growth in Chinese foreign trade exports, COSCO Shipping has gained an advantage in slot allocation and capacity deployment on US routes. In May 2026, COSCO Shipping Lines announced the deployment of 14 direct US West Coast services, incorporating Shenzhen’s Yantian Port as a core origin port, actively increasing capacity deployment on Trans-Pacific routes.
Overall, the east-west main trunk routes are transitioning from a “capacity digestion” phase to a “quality capacity competition” phase. Whoever can secure capacity positions first is likely to take the initiative in the next stage of market competition.
Market Uncertainties Remain
Whether the current market conditions on east-west main trunk routes can be sustained remains unknown. Drewry analysis suggests that the future market direction will mainly depend on two aspects: first, whether capacity can keep up with demand fluctuations; second, how much impact changes in the Middle East situation will have on global supply chains. Geopolitics is arguably the biggest uncertainty.
Strait of Hormuz Infographic
Currently, there is potential for a substantial easing of the Middle East situation, which would have a profound impact on the global shipping landscape. At the same time, expectations for the resumption of Red Sea navigation are rising. Once the Suez Canal passage is fully restored, a large amount of capacity currently rerouting via the Cape of Good Hope will be released intensively, putting significant downward pressure on freight rates.
The unwinding of the geopolitical premium may only be a matter of time. However, the tight supply-demand balance is unlikely to be fundamentally reversed in the short term.
The tariff window has not yet closed, Red Sea diversions will continue until security assessments are clear, and combined with port congestion and low capacity turnover efficiency, multiple factors are jointly pushing east-west main trunk routes into a tight supply-demand channel. Before demand shows a significant decline, the situation of high freight rates and tight space is expected to persist for some time.
Meanwhile, shipping companies are continuously increasing capacity deployment and adjusting networks. Market focus has shifted to freight rate trends, port congestion, and the next developments in the Middle East situation. Drewry believes that if the recent strong demand is merely stimulated by short-term disruptions and capacity supply continues to improve, shippers might be able to moderately relax their strategies for early shipment and safety stock. However, booking lead times and route choices still require close attention. Market variables remain, and any sudden change in a single factor could rewrite the current supply-demand equation.
The direction of the container shipping market ultimately depends on whether capacity management can keep pace with demand fluctuations and the extent of the impact of Middle East developments on global supply chains.
For shippers, in a tightening market, securing space early and maintaining operational flexibility remain key to dealing with uncertainty. For shipping companies, finding a balance between short-term profits and long-term planning is essential to taking the initiative in the next phase of market restructuring.
