U.S. route freight rates continue to weaken, with the Shanghai Containerized Freight Index (SCFI) falling for two consecutive weeks.
According to the latest data released by the Shanghai Shipping Exchange on November 14, the SCFI index fell by 43.72 points last week to 1451.38 points, a weekly decrease of 2.92%. Among the four major ocean routes, except for the Mediterranean route freight rates remaining flat and the European route freight rates increasing, the U.S. route freight rates all fell, with the West Coast route rate decline being particularly significant, exceeding 15%.
Last week, the freight rate per FEU from the Far East to the U.S. West Coast fell by $389 to $1823, a weekly decrease of 17.58%; the freight rate per FEU from the Far East to the U.S. East Coast fell by $248 to $2600, a weekly decrease of 8.76%; the freight rate per TEU from the Far East to Europe rose by $94 to $1417, a weekly increase of 7.1%; the freight rate per TEU from the Far East to the Mediterranean remained the same as the previous week at $2029.
On the near-sea routes, the freight rate per TEU from the Far East to Japan’s Kansai remained the same as the previous week at $312; the freight rate per TEU from the Far East to Japan’s Kanto remained the same as the previous week at $321; the freight rate per TEU from the Far East to Southeast Asia increased by $19 compared to the previous week to $531; the freight rate per TEU from the Far East to South Korea increased by $3 compared to the previous week to $141.
Industry insiders stated that U.S. retailers have completed their stockpiling ahead of schedule. It is expected that demand will slow down and booking volumes will decline in the second half of November. Customers are shipping more rationally and are more sensitive to freight rates. The container shipping companies’ planned freight rate increase action for November 15th failed. As container shipping companies have no further plans to reduce capacity and demand has not significantly recovered, U.S. route freight rates have fallen back to near the low point of the past five weeks, with the West Coast route rate falling back near the break-even point again.
On the other hand, the increase in European route freight rates is mainly because the spot freight rates are close to the break-even point of container shipping companies. Coupled with the timing of the new annual contract freight rate negotiation period at the end of the year, container shipping companies intend to push up spot freight rates to facilitate the annual contract negotiations, resulting in relatively stable freight rate trends.
According to the “Global Port Tracker” report released by the National Retail Federation (NRF) and Hackett Associates, import volumes at major U.S. ports are expected to enter a typical year-end slowdown in November and December. The fourth quarter is the traditional off-season for European and American routes. Even though container shipping companies have already reduced capacity supply, the current average load factor for U.S. routes is only about 70%.
Looking ahead, considering that the 2026 Spring Festival holiday is later than in previous years, freight demand is expected to remain sluggish until the end of the year. Shipping intensity is expected to strengthen in January next year. With tariffs between the U.S. and multiple Asian countries being finalized and export costs decreasing, U.S. route customers can schedule their ordering and shipping plans accordingly, which will help increase shipments on U.S. routes before the Spring Festival.
