Market situation – container flows – February '25

Market/Trade Information

Asia

• In March, MSC will shift all of its ‘megamax’ vessels from the Far East-North Europe trade to the Far East-Med and Far East-West Africa trades. No clear reason or strategy behind this was given by MSC but the relatively weak market indicators on Far East-North Europe might have played a role in the decision. On top of this, yard utilization in North West Europe is very high and the shifting schedules, as a consequence of forming the new alliances, bad weather and strikes, has hit the terminal operators very hard. Smaller vessels might get treated in a more efficient way.

• Europe-bound Chinese rail freight is expected to become a whole lot more expensive as the Chinese government will stop subsidizing its rail freight network. The Chinese government believes that air and ocean will be more dominant in the future.

• Carriers are increasing blank sailings and have announced GRIs from March in an attempt to push rates back up. However, the market is pretty skeptical about the (mid- to long-term) success.

Europe/ Mediterranean / Black Sea

• MEDEF, the French industry consortium, has demanded a swift end to the strikes in the French ports. The unions however announced an intensive program of industrial action for the full month of March with ‘four-hour walkouts’ and a full-fledged strike on March 18-20^th.

• The issues in the European ports and the low yard turnover of containers will have an extended effect on more Central European countries with no direct access to sea ports. Equipment shortages will be more severe in places like Switzerland, Hungary, Slovakia, and Eastern Germany.

• ICS2 release 3 will become operational on April 1^st. ICS stands for Import Control System, and is an electronic security screening system for goods shipped from a non-EU country destined to, or in transit through, the European Union, Switzerland, Norway and Northern Ireland. Releases 1 and 2 were more focused on air freight. The ICS2 requires detailed filing and needs to be submitted to the European Country Customs Authorities in a form (ENS) prior to arrival of the goods.

North and Central America

• The U.S. federal government foreign trade agency has put forward a plan to charge Chinese-built ships and Chinese operators port fees of as much as USD 1.5 mln per visit to a U.S. port. The ‘fee’ is described as rectification for unfair shipbuilding market manipulation by China. It is a big announcement which creates a lot of turmoil however, according to Alphaliner, for companies operating Chinese-built ships, the proposal is a graduated fee correlated to the proportion of Chinese-built vessels in the carrier's fleet and orderbook. Under this measure, an operator could face a fee of up to USD 1.5M, if 50% or more of their active fleet is Chinese built. A similar fee is suggested for vessels on order. Currently roughly 30% of the container fleet is Chinese built. Cosco, obviously, will be impacted the most with just shy of 60% of Chinese vessels. The second carrier is, not entirely surprisingly, CMA CGM with 41%. Other ‘European’ shipping lines have about 25% Chinese-built vessels. ONE and HMM, both strong Transpacific carriers, have a relatively small ‘Chinese fleet’. The major problem will be in the near future as the vast majority of the new orders, from all carriers, is put with Chinese shipbuilders.

• Following earlier threats to apply tariffs on foreign products departing from Canada and Mexico, U.S. President Trump has declared that he will impose tariffs on cargo originating from the EU. The main goal is to slow down the import of European cars into the U.S. market. Steel and aluminum will be affected as from March 12^th, and other commodities might follow in a later phase.  The tariffs will amount to up to 25%, with no exemptions. The EU is the U.S.’s third-largest trading partner alongside China. On the same day, an additional 10% was added to the current tariffs on Chinese products.

• The possible cancellation of the minimis (*) by President Trump might push low value goods, currently imported by air, to the ocean carriers again. A lot of the Chinese e-commerce goods benefit from this minimis principle. For e-commerce giants like Temu and Shein this can be a real gamechanger.

  (*) Minimis allow an importer to bring shipments into the U.S. without formal paperwork or even without paying taxes and duties, as long as the total daily value of the importer’s entries is below $800.

 Latin America

• Schedule reliability to East Coast South America has been impacted by significant delays at Navegantes and Rio Grande in Brazil. This has led to blank sailings and port omissions, putting extra pressure on the already congested terminals. Heavy rains in South Brazil have added to the delays. Carriers have transshipped cargo via Santos and other ports. However, the congestion in these ports is creating a ripple effect. Transshipment ports like Panama, Caucedo, Rodman, Kingston, and Cartagena are all seeing significant delays.

• Apart from the ports, road logistics seem to be experienced a perfect storm across the entire continent.

  • Logistics costs in Brazil have increased when diesel prices reached their highest average in several years.

  • Similar trends have been seen in Argentina where the logistics costs have risen significantly.

  • Uruguay's exports to Mercosur grew by 8.96%, demanding more road transportation services. (Mercosur = economic cooperation between Argentina, Brazil, Paraguay, and Uruguay)

  • In Colombia, trucking companies face significant delays and costs due to roadblocks and rising fuel prices.

  • Chile and Colombia are advancing digital platforms to gain more logistics efficiency, while Peru is investing in infrastructure projects.

  • In Colombia, new regulatory changes have also been implemented by the Ministry of Transport for the Integrated Control and Evaluation System for Freight Motor Transport (SICETAC). They agreed a minimum of 8 hours per trip as the basis for the minimum transport price, distributed among waiting time, loading and unloading. Together with adjustments in the minimum tariffs by distances and the trucking companies will have to include real-time monitoring of the turn time, which will be introduced by the end of 2025 for loading and unloading via GPS. All transport companies must comply with the new regulations. This to prevent malpractices and to make the trucking industry more interesting in Colombia as they need more truckers.

• In Chile there is a growing demand for premium warehouse space to overcome high congestion at the ports and to cope with the seasonal demand.

Red Sea and Gulf area

• Currently the rerouting via Cape of Good Hope remains in place. Rumors indicate a return to the Suez Canal in April or May. No official announcements have yet been made, however, and the amount of vessels that will go through the Suez Canal in a first stage remains unclear. If a full return happens, this would mean an injection of 2 mln TEU of vessel capacity in the market.

General information

• Schedule instability expected to remain. As a result of the many changes in the alliances, with vessels fading out of one service and fading into another, ports are being omitted, and expected sailings are being pushed forward or getting delayed. The shipping lines need to overcome this chaotic period, which not only affects their own schedule reliability, but also the operations on the terminals as well as the agreements made between shipper and receiver. The market indicates some more issues in the weeks to come. Only in April are the schedules expected to be more or less settled. Current schedule reliability is around 50%, which is very low.

These trends give the market changes on the spot market compared to 1 year ago, 3 months ago or 1 month ago.