Global ocean freight rates are continuing their downward trajectory, driven by persistent overcapacity and early peak-season shipping activity. Freightos said in a new analysis that spot rates across major trade lanes have dropped sharply, even as demand remains steady and geopolitical trade shifts unfold.

Asia–North America rates have seen the steepest declines. Transpacific container volumes likely peaked in July, as shippers rushed to move goods ahead of the August expiration of U.S. tariffs on Chinese exports.

Since then, rates have fallen nearly uninterrupted—down 60% to 70% from their early-season highs. West Coast prices dropped 10% last week to US$1,744 per FEU, the lowest since December 2023. East Coast rates fell 21% to US$2,733 per FEU, marking a 34% decline in August alone.

Asia–Europe lanes are also under pressure. Spot prices to Northern Europe fell 6% last week to US$3,100 per FEU, while rates to the Mediterranean eased 1% to the same level.

"Transpacific container arrivals likely peaked in July, as many peak season shipments were pulled forward to beat the August China-US tariff expiration date. Asia - North America spot rates have fallen 60% - 70% in an almost uninterrupted slide since that early rush," said Judah Levine, head of research at Freightos.

Freightos noted that both trades are now 60% below last year's levels, underscoring the impact of excess capacity and extended lead times caused by Red Sea diversions.

Despite solid demand and ongoing port congestion, carriers have faced continued difficulty raising rates—or even preventing further declines—throughout much of this year’s peak season.

"Peak season volume strength may have peaked for Asia - Europe lanes as extended lead times from Red Sea diversions mean goods must be moved before the end of September," Levine said.  "Even with strong demand and port congestion carriers have struggled to push rates up or keep them from falling through much of this year’s peak season."

"Prices on these lanes are 60% lower than last year, with transpacific prices 70% lower, reflecting growing overcapacity in the container market even as the new vessel orderbook size recently hit a new record," he added.

Trade policy developments are adding complexity. While country-level tariff frameworks appear to be stabilizing, sector-specific probes—such as those targeting pharmaceuticals, semiconductors, and lumber—could lead to new tariffs. For countries with trade agreements in place, implementation delays mean tariff reductions are not yet reflected in freight volumes or pricing.

China–U.S. trade remains volatile. A top Chinese negotiator is headed to Washington following a 90-day extension of the 30% baseline tariff first introduced in May. Though some reports suggest a modest uptick in demand, overall volumes and rates continue to decline.

Meanwhile, transatlantic rates held steady at US$2,284 per FEU last week. The recent U.S.–EU trade deal has yet to impact freight flows, with auto tariff reductions still pending and alcohol exports remaining subject to duties.

Carriers are also adjusting vessel deployments to avoid new U.S. port call fees targeting Chinese operators, set to take effect in mid-October.

Despite these shifts, the container shipping market remains oversupplied. The record-high vessel orderbook is expected to keep downward pressure on rates well into the next fiscal year.