Freightos Baltic: Container rates firm slightly on pre-Lunar New Year demand and geopolitical unrest

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Transpacific rates have climbed roughly 5% since mid-December, stabilising at $2,750/FEU to the US West Coast and $4,000/FEU to the East Coast. Although headline rates are relatively firm, forwarders note early discounting as available space limits carriers’ pricing leverage, with demand ahead of Lunar New Year arrivals remaining moderate.

Asia–Europe container rates remained elevated last week, near $3,000/FEU to North Europe and $4,850/FEU to the Mediterranean, levels last seen during the summer peak. Early pre-Lunar New Year demand, coupled with targeted capacity additions, has supported rates, though daily spot levels are showing slight easing this week.

Some carriers are pursuing mid-month GRIs of over $4,000/FEU to Europe and above $5,500/FEU to the Mediterranean, while winter weather disruptions at European ports have temporarily constrained capacity. Forwarders report that cargo flows remain robust despite some buyer resistance, particularly on Mediterranean lanes.

US import volumes are projected to rise 6% month-on-month in January, the first sequential increase since July, though still about 5% below last year, with annual deficits expected through April. The National Retail Federation’s latest outlook shows slightly stronger 2026 volumes compared with its previous report, suggesting cautious optimism for post-holiday restocking.

Geopolitical developments add further uncertainty to global container flows. The US Supreme Court is expected to rule by June on the legality of IEEPA tariffs, with a likely decision against the administration creating questions over tariff continuity and potential refunds. 

US statements on 25% tariffs targeting countries trading with Iran could affect China if enacted, while threats to close the Strait of Hormuz would mainly disrupt transhipment at Dubai’s Jebel Ali port. This could potentially force volumes to shift elsewhere, possibly to South Asian hubs, which could create congestion and higher freight rates, though only 2–3% of global container volumes would be impacted. 

Any political shift in Iran reducing Houthi influence could accelerate a return of container traffic to the Red Sea, where carriers are already cautiously resuming operations.

Written by: Farid Muzaffar