Freightos Baltic: Container rates spike as Hormuz blockade enters fourth month and peak season sets in

 Read more on Freightos

Nearly 100 days into the US-Israel-Iran conflict, the Strait of Hormuz remains closed with no resolution in sight as both sides continue exchanging fire and sanctions. Carriers have passed on war-elevated fuel costs across major east-west lanes throughout the softer months of March to May, keeping steady upward pressure on freight rates.

Weekly averages closed May roughly flat, with transpacific rates around $3,200/FEU to the US West Coast and $5,000/FEU to the East Coast, and Asia-Europe lanes near $3,000/FEU to North Europe and $4,400/FEU to the Mediterranean. That stability is now breaking down, with June 1 GRIs and peak season surcharges driving daily rates up by $1,000 to $1,800/FEU on major east-west trades this week alone.

Early peak season demand has prompted carriers to cut contracted allocations and apply premiums ahead of schedule, with further rate increases already announced for mid-month. Asia-Europe daily rates have surpassed last June and July's peak season highs, while transpacific remains roughly $1,000/FEU short of last year's tariff frontloading-driven July spike. War-related congestion at some transshipment hubs and rail bottlenecks in Germany add further risk of delays.

On the tariff front, US importers stand to recover roughly half of the $166 billion collected under IEEPA duties, but only for entries not yet finalized by US Customs and Border Protection. The Trump administration is signaling it may contest refunds on already-liquidated entries, a challenge that could push affected importers into trade court litigation and delay recovery considerably. Trade lawyers are advising those with liquidated entries to file protests now where the window remains open.

The trade war continues to redirect global flows, with US import volumes softening while Asia-Europe trade tracks ahead of 2025's already strong pace. Rising China-EU tensions complicate that picture, with Brussels weighing legislation to curb subsidized imports. Meanwhile, the EU's planned fees on low-value parcels from July risk border delays if reporting systems, which carriers say are not yet ready, fail to meet the implementation deadline.

Written by: Farid Muzaffar