Last week, ocean freight rates from Asia to Europe and the Mediterranean increased, with Europe-bound rates reaching $5,300/FEU, approaching pre-Lunar New Year levels.

The rise is likely driven by demand ahead of the holiday, as Asia-Europe/Mediterranean shippers work to secure inventory shipments before the slowdown. Otherwise, containers may face delays near the Cape of Good Hope, as they would only be transported after the Lunar New Year.

Carriers aim to push mid-month GRI increases, anticipating further rate hikes as the holiday nears.

In contrast, trans-Pacific shippers are not under the same pre-holiday urgency, meaning demand may rebound in the coming weeks. Without this added pressure, and with the looming January 15 ILA strike deadline, the window for shipping and receiving goods from Asia is narrowing, causing rates to dip last week. Carriers will attempt to push prices higher through mid-December GRIs, targeting increases of $1,000–$3,000/FEU, though success may depend on demand closer to the Lunar New Year.

Meanwhile, the National Retail Federation (NRF) reported strong ocean freight volumes and rates during the typically slow shipping season. This strength is attributed to preemptive fourth-quarter loading before the strike deadline and higher tariff expectations since November’s election results. The NRF’s Q4 import estimate is now 11% higher than October's initial projections, at 640,000 TEUs. Freight forecasts through April 2025 are 7% higher year-on-year, suggesting shippers will continue early loading in anticipation of tariff hikes.

For non-Asian routes, rates may climb seasonally around the Lunar New Year, though capacity increases could limit gains. Rates are expected to ease in late February. The upcoming February carrier alliance restructuring and new service launches could intensify competition, exerting downward pressure on March rates.

In air freight, increased capacity and early bookings have mitigated peak-season chaos. Despite the year’s busiest weeks, rates outside China remained high. The Freightos Air Index shows Middle East-North America rates rose about 20% since late October, exceeding $4/kg last week—the highest this year. This reflects seasonal pressure on sea-air shipments as alternatives to direct air freight from China.

Throughout 2024, e-commerce volumes bound for North America and Europe have driven higher offshore prices and tight capacity, particularly for B2C transactions. While demand for low-cost goods from platforms like Temu and Shein is expected to grow, DSV predicts challenges to minimum exemption rules for cross-border air cargo shipments in 2025 could limit the sector’s growth.