Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) increased 18% to $1,687/FEU.    
• Asia-US East Coast prices (FBX03 Weekly) increased 2% to $3,071/FEU.
• Asia-N. Europe prices (FBX11 Weekly) increased 13% to $1,975/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) increased 1% to $2,147/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices stayed level at $5.34/kg.
• China – N. Europe weekly prices increased 1% to $3.97/kg. 
• N. Europe – N. America weekly increased 5% to $1.78/kg.

Analysis

US Treasury Secretary Scott Bessent is set to meet with China’s Vice Premier He Lifeng this week in Malaysia following the sharp increase in trade tensions between the countries and just ahead of the planned Trump-Xi meeting in S. Korea at the end of the month. 

The White House expressed optimism that the US and China will deescalate from recent steps which included China increasing export controls on rare earth metals and President Trump threatening 100% tariffs on Chinese exports starting November 1st.  Reports this week also indicate that the US and India are nearing a trade deal that would reduce the US’s current 50% tariffs on Indian exports to around 15%.

In other trade war developments, President Trump signed a proclamation that will impose 10%-25% tariffs on heavy trucks and parts starting November 1st. Alongside this tariff expansion though, the new law also increased tariff offsets for automakers. This move follows an order last month which included a long list of tariff exemptions and authorized some federal agencies to issue tariff exemptions independently.

The past week also saw examples of geopolitical drama directly relevant to the ocean freight market. A US threat to sanction – including via port call fees – countries that vote for an IMO net zero framework may have contributed to the vote being postponed until next year. 

And though there are no reports of vessels paying USTR port call fees yet – only one China-built vessel is scheduled to arrive at the Port of Los Angeles this week –  a US-flagged container ship was charged $1.7m to dock in Shanghai as China’s reciprocal fees also went into effect. Like on the transpacific eastbound, carriers are shifting their deployment of liable vessels to other lanes to avoid the surcharges at China’s ports.  

The 145% US tariffs on Chinese goods from early April to mid-May drove a sharp drop in China-US ocean volumes, and a November 1st 100% tariff would likely do the same. But with frontloading to date and November a slow month for ocean freight, there would likely be a smaller volume drop compared to April-May.   

Despite reports of lagging demand as the US container market moves further into an early slow season, carrier mid-month GRI introductions, likely helped by tighter capacity reductions, are pushing Asia – N. America rates up. Transpacific prices to the West Coast increased 18% last week from a year to date low of about $1,400/FEU the week before to about $1,700/FEU, with daily rates this week above the $2,000/FEU mark so far. Daily rates to the East Coast of $3,357/FEU are more than $300/FEU higher than a week ago.

Asia – Europe prices climbed 13% last week to about $2,000/FEU on October GRIs as well, with daily rates this week approaching $2,300/FEU. Daily rates to the Mediterranean are also at about $2,300/FEU for a $200/FEU increase compared to the last couple weeks. Price increases on Europe lanes may be partially supported by port congestion made worse by labor disruptions in both Rotterdam and Antwerp last week – though the parties have now settled the Rotterdam dispute and paused Antwerp strikes for at least the next ten days.

These rate increases have pushed prices back to about September levels. But rates climbing during low-demand periods for both Asia-Europe and the transpacific has many observers skeptical that prices will remain elevated, though carriers will attempt November GRIs as well.  

Air cargo on the other hand is about to enter the typical East-West peak season period. There are reports that President Trump’s November 1st tariff threat is sparking some frontloading out of China. But Freightos Air Index China-US rates remained level last week at $5.34/kg and are at about $5.40/kg so far this week, possibly reflecting a quick addition of capacity to the lane as more demand materialized.

Continued Asia – Europe volume growth driven by Chinese B2C e-commerce is also being accompanied by capacity growth, keeping China – Europe rates about level with last year, with prices stable at about the $4.00/kg level last week and this. A massive fire at Bangladesh’s Dhaka airport over the weekend destroyed the airport’s cargo center, suspending flights and causing a major setback for the region’s garment trade during its peak season.  Flights resumed by Sunday night, with air cargo rates so far unaffected.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 8% to $1,431/FEU.    
• Asia-US East Coast prices (FBX03 Weekly)  fell 8% to $3,015/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 9% to $1,747/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 4% to $2,131/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices increased 19% to $5.33/kg.
• China – N. Europe weekly prices fell 3% to $3.92/kg. 
• N. Europe – N. America weekly fell 1% to $1.70/kg.

Analysis

Reported progress in US-China negotiations last month had some hopeful that the USTR would reduce or cancel its planned port call fees before the October 14th roll out date. Instead, the past week has featured a flurry of trade tension escalations between the world’s two largest economies.

In addition to tit for tat fees on US-linked vessels making China port calls starting October 14th, China announced new restrictions on rare earth metal exports with some taking effect immediately and others starting December 1st.

President Trump responded by threatening to cancel his late-month summit with Chinese leader Xi Jinping in S. Korea and to introduce 100% tariffs on all Chinese exports to the US starting November 1st –  though the 145% tariff pause that the White House extended back in August will in any case expire on November 10th.  The US administration also threatened, among other sanctions, to introduce port call fees or bar entry to vessels flagged in countries that vote for the International Maritime Organization’s net zero framework at the IMO’s meeting this week.

In terms of immediate impact, as some Chinese carriers have stated that the USTR fees will not impact their schedules or lead to surcharges for customers, and most other carriers have reduced the number of liable vessels making US calls, the fees may be unlikely to impact eastbound transpacific freight rates, operations or capacity much for now. And as Clarkson’s Research estimates that China’s port fees would impact only about 5% of port calls, and most impacted carriers will likely adjust vessel deployments to minimize exposure, these fees are unlikely to cause much of an impact.

In any event, the biggest driver of freight rates at the moment is growing container vessel capacity. 

The first stage of the Israel-Hamas ceasefire has increased anticipation of a container traffic return to the Red Sea which, after some period of schedule disruptions and congestion, would release a significant amount of capacity back into the market. CULines and other carriers are already increasing services through the Suez Canal. Most carriers however, will not resume transiting the Red Sea until after a significant period of demonstrated stability and security.

But in the meantime, ocean rates have already fallen to their lowest levels since just before the start of the Red Sea crisis in late 2023. Transpacific rates dipped another 8% last week to about $1,400/FEU to the West Coast and $3,000/FEU to the East Coast. Current US import volumes estimated to be at their lowest since mid-2023 due to trade war frontloading earlier in the year – and projected to continue declining through December – are contributing, along with supply growth, to the strong downward pressure on transpacific container prices. 

But  Asia – Europe demand is likely stronger than last year. And despite volume strength and persistent congestion recently worsened by labor disruptions at some key ports, container rates slipped 9% to $1,747/FEU last week and are also back to 2023 levels, pointing to capacity growth as a key driver of current rate behavior.

Carriers will introduce GRIs of about $1,000/FEU for Asia-Europe services in November, with some announcing increases for Asia – N. America as well, in an attempt to push rates up ahead of Asia – Europe contracting season. Significant capacity reductions in October however have so far not succeeded in slowing the rate slide.

For air cargo, President Trump’s November 1st China tariff threat may be driving some recent increase in rates, though the government shutdown is also reportedly causing some congestion in the US and this time last year peak season demand had already started to pick up. Freightos Air Index China – US prices increased 19% last week back to mid-September levels of about $5.30/kg, though rates were approaching the $7.00/kg a year ago.

China – Europe prices fell 3% to $3.92/kg, but remain 5% higher than a month ago and about level with last October. The labor disruptions in Belgium impacting ocean freight are also causing air delays, especially to passenger flights, though so far cargo rates remain unaffected.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 16% to $1,554/FEU.    
• Asia-US East Coast prices (FBX03 Weekly)  fell 18% to $3,260/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 9% to $1,925/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) decreased 6% to $2,217/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices fell 13% to $4.48/kg.
• China – N. Europe weekly prices fell 9% to $4.06/kg. 
• N. Europe – N. America weekly stayed level at $1.74/kg.

Analysis

President Trump announced plans for new Section 232-based sectoral tariffs late last month on certain types of furniture imports, pharmaceuticals and trucks to go into effect in October. These moves may be part of White House preparations for the possibility that the Supreme Court will strike down the International Emergency Economic Powers Act-based tariffs which make up the lion’s share of the Trump duties introduced since the beginning of the year. 

The pharmaceutical tariff plan has since been postponed, and duties on heavy trucks are now slated to start only in November.  Furniture tariffs, the most significant of these sectors for ocean freight, are set to take effect on October 14th.

USTR port call fees for Chinese carriers and vessels are scheduled to start October 14th as well. Non-Chinese carriers are making additional, last-minute adjustments to their vessel deployments to minimize their exposure to the fees.  Chinese carriers COSCO and OOCL, meanwhile, have made few changes and COSCO has advised customers not to expect service disruptions or surcharges due to the fees. As such, it seems unlikely shippers will experience much of an impact once the new law takes effect. 

As the roll out date approaches, the Chinese government announced a change to its maritime laws that allow it to apply retaliatory fees or bar port and crucial data access to vessels from countries that take discriminatory actions against Chinese vessels or carriers. American carriers, like Matson, and US flagged vessels make up a modest share of transpacific volumes,  so this kind of response may not have an outsized impact, but does represent an escalation as the deadline approaches. 

In the meantime, ocean container spot rates have continued to slide.  With Golden Week behind us and peak season over for both the transpacific and Asia – Europe trades, a demand lull is likely to take hold on these lanes until the lead up to Lunar New Year some time in January.

Transpacific rates fell 16% to the West Coast last week to a possibly loss-making $1,554/FEU, and prices slid 18% to the East Coast to $3,260/FEU. Asia – Europe rates fell 9% to less than $2,000/FEU and Asia – Mediterranean prices fell 6% to $2,217/FEU – with all these lanes at least 60% lower than this time last year and at or near their lowest levels since just before the start of the Red Sea crisis almost two years ago.  

That rates are falling to this degree while Red Sea diversions are still in place suggests that capacity growth is a big factor in lower rates across the industry, with the eventual end of the war in Gaza primed to release even more capacity back into the market. 

Some carriers are aiming to increase Asia – Europe rates moderately on mid-October GRIs. But the success of these increases – or at least a stop to the rate slide here and on the transpacific – will likely depend on carriers removing sufficient levels of capacity through blanked sailings and service suspensions announced through end of the year.

The US government shutdown has not impacted ocean freight so far, though there have been reports of delays and disruptions to US air cargo flows. The recent typhoon in the Far East likewise did not have a major impact on China-US air cargo rates, with Freightos Air Index prices for the lane down 13% last week to about $4.50/kg suggesting no significant ocean to air shift. Rates are significantly lower than this time last year when prices were nearing the $7.00/kg mark, possibly reflecting the impact of the decrease in e-commerce volumes on this lane.

Asia – Europe prices slide 9% week on week to $4.06/kg after climbing to $4.45/kg – a high for the year – just before Golden Week. Some typhoon-driven ocean to air shift may be helping keep rates above the $3.50 – $3.70/kg range held for most of July and August. That prices have been just above or even with H2 rates last year despite significant demand growth on this lane likely points to capacity shifts to this lane as the market adjusts to mostly trade-war driven changes to volume flows. 

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 5% to $2,185/FEU.
• Asia-US East Coast prices (FBX03 Weekly) increased 2% to $3,426/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 15% to $2,196/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 15% to $2,421/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices increased 4% to  $5.44/kg.
• China – N. Europe weekly prices increased 2% to $3.72/kg.
• N. Europe – N. America weekly prices increased 3% to $1.77/kg.

Analysis

Typhoon Ragasa caused significant damage in areas of Taiwan and the Philippines as it passed through the South China Sea early this week before making landfall in China’s Guangdong province on Wednesday.  Ragasa, now a tropical storm, is traveling along the coast toward Vietnam.

The typhoon closed all container ports and airports in Hong Kong and southern China since Monday, with some reopening Thursday.   Hapag-Lloyd expects the damage and backlog to create delays of several days at the major ports in the region, with vessels at Yantian possibly held up by as much as a week.

The delays could be particularly disruptive for shippers still trying to move orders ahead of the Golden Week holiday in China starting October 1st. But, as many Asia – Europe shippers have likely already moved peak season goods, and with transpacific peak season pulled forward by tariff deadlines, the lull in demand expected in October could minimize the extent to which disruptions from the typhoon will be felt on the major tradelanes.

Transpacific container rates to the East Coast ticked up 2% last week to $3,426/FEU, but prices fell 5% to $2,185/FEU to the West Coast. Daily prices to the West Coast have slipped below $1,900/FEU so far this week.

Asia-Europe and Mediterranean spot rates continued their nearly uninterrupted since mid-July decline last week, with prices falling 15% on both lanes to $2,196/FEU to Europe and $2,421/FEU to the Mediterranean. The decline pushed rates on both lanes to their lowest levels since December of 2023. Rates continue to slide despite reports that enough capacity has been removed to reach a supply-demand balance, leading some to suggest that a price war is now contributing to falling rates on these lanes.

For all ex-China lanes though, congestion at Far East ports due to the typhoon – together with an increase in blanked sailings for October – could help carriers stabilize rates as demand likely continues to slide into Q4.

In trade war developments, President Trump and Chinese leader Xi Jinping held a call earlier this week. The conversation focussed on reaching a TikTok resolution but, according to the White House, also made progress on trade issues, with the US-China tariff status quo set to expire in November. 

The USTR is set to start applying port call fees for Chinese carriers and China-made vessels on October 14th. Chinese carrier COSCO has announced it does not anticipate disruptions to its transpacific services and will not introduce surcharges due to the new fees, with other carriers, like Maersk, also stating they do not plan to introduce fees due to the new rule. Meanwhile, the US’s 50% tariffs on Brazil have led to  reports of sharp decreases in Brazil-US container volumes.  

In air cargo, Typhoon Ragasa caused thousands of flight cancellations out of airports in the affected regions, including Hong Kong, though some flights are expected to resume today. Disruptions to ocean logistics could cause some short term shift to air. 

More broadly, the industry continues to feel impacts from trade war-driven shifts in sourcing and demand. Some reports, for example, show that as China-US volumes have declined, Vietnam-US capacity has doubled. Asia-Europe lanes have also seen volume growth as some manufacturers explore a “US+1” strategy, with carriers likewise shifting capacity to where demand is growing.

With these capacity shifts between lanes accompanying changes in demand, Freightos Air Index data show China-Europe rates of $3.72/kg have been about stable since mid-July and about even with last year. An uptick so far this week to about $4.00/kg could reflect some increased air demand due to a border closure in Poland that is disrupting China-Europe rail.  China-N. America prices increased 4% last week to $5.44/kg, though last year prices were at about $5.80/kg. 

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) increased 7% to $2,309/FEU.
• Asia-US East Coast prices (FBX03 Weekly) increased 4% to $3,368/FEU.
• Asia-N. Europe prices (FBX11 Weekly) increased 2% to $2,585/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 4% to $2,833/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices fell 1% to $5.24/kg.
• China – N. Europe weekly prices increased 3% to $3.64/kg.
• N. Europe – N. America weekly prices stayed level at $1.72/kg.

Analysis

The latest round of China-US trade talks got underway in Madrid this week, with progress on a Tik Tok deal possibly a good sign for broader trade discussions.

The Trump administration extended 30% baseline tariffs on all imports from China for another 90-days a month ago in order to encourage further negotiations. And though the move has not led to a significant surge of transpacific container volumes since, it may have slowed the rate of declining demand.

Frontloaded volumes that arrived ahead of tariff deadlines set for April and again for July and August have come at the expense of the typical strength of H2 US container imports relative to the first half of the year most years. The latest National Retail Federation US ocean import volume report estimates that H2 volumes will be down 10% year on year, with October imports 13% lower than a year ago and November and December volumes 20% lower.

Source: National Retail Federation, Global Port Tracker

The latest estimate for September import volumes, however, are 16% higher than the NRF’s September projections made at the beginning of August – just before the 90-day China tariff extension announcement – suggesting some positive impact on imports from the sustained 30% US tariffs on China.

Transpacific container rates to the West Coast increased slightly last week to $2,309/FEU, and are 34% higher than prices at the end of August. Rates to the East Coast climbed 4% last week to $3,368/FEU and have increased 24% so far this month. Prices climbed on early month General Rate Increases and were supported by some increase in demand ahead of the approaching Golden Week holiday in China and an increase in blanked sailings – and may have been helped by some volume increase due to the 30% China tariff extension. 

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Not everyone is convinced that the October 14th USTR port call fees on China-made vessels and operators will materialize, as the issue may be part of the ongoing US-China negotiations. But carriers are making moves to minimize their exposure nonetheless. And these adjustments may have also put some temporary upward pressure on rates as vessels and services were being shuffled.   

Carriers will attempt additional mid-month GRIs for transpacific services this week, and though carriers are also increasing blanked sailings for the rest of September and October, demand trends have many observers anticipating rates will fall. 

Asia-Europe container rates climbed 2% last week to $2,585/FEU, while prices to the Mediterranean dipped 4% to $2,833/FEU. Rates on both lanes have fallen about $200/FEU so far this week, signalling the coming end of this year’s peak season as Golden Week nears. Despite volume increases compared to last year though, rates significantly lower than the $5,000+/FEU prices seen last September reflect the effects of growing capacity on these lanes. 

Steep US tariffs on imports from India are leading to reports of falling India-US air cargo demand as some shippers pause or cancel orders. Freightos Air Index South Asia – N. America rates have fallen 13% since July to $4.18/kg while prices to Europe have dipped only 2% to $2.92/kg. Ex-China rates were stable overall last week with prices to the US easing 1% to $5.24/kg, and rates to Europe ticking up 3% to $3.64/kg. 

SURVEY HIGHLIGHTS: Nearly 3/4 of small importers report significant cost increases from tariffs, with half reducing shipments entirely. 44% face cost spikes of 20%+ while 52% expect weaker holiday sales, according to a new Freightos/Clearit survey of 390+ North American businesses.

This snapshot reveals just the surface of how deeply the ongoing trade tensions are affecting small and medium-sized businesses. As tariff policies become clearer, the outlook grows increasingly concerning for these companies. Below, we explore the comprehensive findings from our latest survey and what they mean for businesses navigating the uncertain trade landscape in 2025.

Businesses Under Pressure: The Widening Effects of Trade Disruption

A recent Freightos/Clearit survey of 390+ North American importers paints a concerning picture of the trade war’s ongoing impact on businesses. Companies are feeling the squeeze, with significant disruptions to their operations so far this year. And now that tariff policies are becoming clearer, the outlook on costs and sales is increasingly worrying, as most respondents believe the worst may be yet to come. 

72% of businesses reported moderate to significant increases in landed costs and nearly 50% have reduced shipping activity due to tariffs already in place; over half expect weaker sales as a result. Importers say the 90-day extension of 30% US tariffs on China will not lead to a significant freight rebound this year for several reasons, including earlier frontloading and the status quo already pricing some shippers out.

The findings suggest broader economic consequences, including:

• Diminished international trade relationships
• Decreased consumer strength
• Potentially existential threats for some businesses, especially SMBs

One importer summed it up as follows: “The tariffs combined with the sinking value of the dollar have created a 30% increase in costs just in a few months. Devastating to our bottom line.”

Note that this survey is the third in a series of surveys conducted across small importers. For previous versions, please see here and here.

Because of the impact of the tariffs we are aggressively looking to sell our company before the end of 2025. Our small company can not run with the additional 50% product cost due to tariffs.

-US Small Importer

Tariff Business Impact: Costs Rising, Shipments Falling

This year has been punctuated by tariff announcements including the “Liberation Day” 10 % universal tariff on April 5, country-specific reciprocal tariffs that were announced on April 2 and later paused twice, first until July 8, then again until August 7, when they finally went live. Many of these announcements were provided with what businesses felt were insufficient warning, leading to uncertainty.

Clarity…and Concern

Now, as recent trade agreements and additional sectoral tariffs are clearer, most (56%) businesses report more concern about negative impacts than they had due to earlier tariff changes.

This worry for the future is particularly striking when taking into account how dramatically their businesses have already been impacted:

• Widespread disruption: 84% said frequent tariff changes have been disruptive or very disruptive to business.

• Substantial cost increases: 72% reported that tariffs have already increased their costs by at least 5%. A shocking 44% say costs have climbed by 20% or more.

• Reduced shipping: This has already led to reduced import volumes from small businesses; 50% of businesses have reduced shipment volumes due to higher costs.

• Growing concern: 57% are more concerned about tariffs negatively impacting their business than they were earlier in the year. For comparison, when we asked this question in May, only 31% were more concerned than they were earlier in the year.
• Consumer weakness: Concern about the downfunnel impact of weaker demand is growing. Slightly more than half (52%) expected weaker back-to-school and holiday sales than last year, compared to only 35% who had expected lower Memorial Day sales due to tariffs when asked back in May. 

• International standing: Whether the tariffs are removed or not, there could be long-lasting consequences. Some 60% think the trade war has weakened the standing of US businesses as trading partners.

How am I supposed to stay in business if I have $400 tariffs and fees on a $700 order that the client won’t pay?”

– Small importer reporting 20%+ cost increases

Freight Impact: Scrambling for Strategy

Rapid changes are also sending shippers scrambling for strategies to help mitigate the trade war’s impact, taking action such as accelerating orders, changing production centers, or even cancelling. Beyond the 50% who have reduced shipment volumes due to higher costs, about 15% each have:

• Pulled holiday orders forward
• Paused or delayed holiday orders
• Canceled manufacturing mid-order
• Moved some sourcing to US

We paused for a period of time when [tariffs were] initially announced. Now we feel there is some stability with the pauses being extended, but before that the uncertainty was so high that we decided to wait to see what would happen.

– Furniture importer

Adapting to these changes has not been one-size-fits-all – businesses are reaching for anything that works to manage the unpredictability.

90-Day China Tariff Extension: Limited Relief

In May and June, the initial postponement of China tariffs led to a brief spike in shipments, as importers accelerated their shipments to beat the tariffs. This front-loading, however, was quite short-lived, as demonstrated in the chart below:

The recent postponement did not have a similar effect.

While some importers said the recent extension of the 30% US tariff on Chinese imports is allowing them to restart shipments, overall, the extension is not triggering a second peak season wave. Instead, it’s having diverse effects on different businesses: 

• Many are unaffected due to prior frontloading or because sectoral tariffs are a bigger challenge
• Others expected the 30% to remain in place and have continued shipping as usual
• Some are already priced out by 30% baseline tariffs

As one importer said: “We had to buy more than usual while we could get product at a lower price. 2025 costs will be higher than usual with a greater risk of deadstock”

Another described uncertainty that prompted them to restructure their entire supply chain: “Most if not all my importing has moved out of China. I’m too worried tariffs could switch from one day to the next even though there is a 90-day extension.”

Analysis and Going Forward

The survey results paint a picture of businesses caught in an economic crossfire, with potential ripple effects that could reshape supply chains and trade relationships for years to come.

Long Term Structural Changes Ahead

“The survey shows that the trade war has already negatively impacted many US importers, and that expectations of new or expanded tariffs and the duties applied under the trade deals of the last few weeks has shippers bracing for possibly more severe challenges to business moving forward,” says Judah Levine, Freightos Head of Research. The data suggests we’re witnessing not just temporary disruption but potentially long-term structural changes to international sourcing and pricing strategies.

Impossible To Forecast or Plan

Adam Lewis, President of Clearit Customs points to the particularly hard hit SMBs have taken: “With still so much uncertainty in the trade environment, this survey makes one thing clear: Unfortunately, small and medium sized businesses are bearing the brunt of the trade war. Unlike larger corporations, they don’t have the same insulation or sophistication to absorb frequent tariff changes, currency swings, and rising costs. The unknowns have been the most damaging, making it nearly impossible to forecast, budget, or protect margins.”

Looking ahead, the trade landscape could continue to stabilize in coming months with more agreements reaching finalization. However, the combination of disrupted supply chains, weakened consumer sentiment, and eroded international relationships creates a challenging environment that will likely require businesses to maintain flexibility in sourcing, pricing, and inventory management for the foreseeable future.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) increased 25% to $2,163/FEU.
• Asia-US East Coast prices (FBX03 Weekly) increased 20% to $3,241/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 11% to $2,540/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 3% to $2,949/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices were level at $5.30/kg.
• China – N. Europe weekly prices fell 4% to $3.55/kg.
• N. Europe – N. America weekly prices increased 3% to $1.72/kg.

Analysis

The Trump administration will appeal a trade court ruling that struck down the president’s IEEPA-based tariffs to the Supreme Court, which has agreed to expedite the proceedings. The court will hear arguments in November, with a decision possible before the end of the year.   A potential White House loss on appeal is adding uncertainty to a somewhat firming tariff landscape, and could have significant implications for US importers, including refunds for tariffs already paid. 

President Trump signed an executive order last week putting 15% tariffs – including on automotive goods – on Japanese exports into effect retroactive to early August after several weeks of negotiations on the details of the agreement in principle announced in July.

But the White House is still struggling to implement several other announced agreements. The US and South Korea are trying to bridge a gap regarding investment commitments. And European Union members are objecting to recent expansions of the global US tariffs on metals which would push duties above the 15% mark for many important EU exports. Another late-week executive order however, exempted a list of items including certain metals from the country-specific tariffs, creating some optimism that similar exemptions will enable negotiators to finalize these agreements.

In ocean freight, USTR port call fees on Chinese carriers and vessels built in China will go into effect on October 14th. Carriers are already making adjustments to minimize their exposure to the rule fees, with Chinese operators to face the biggest challenges, and the overall impact on operations and container rates to the US remaining to be seen.

Transpacific container rates climbed more than 20% or about $400 – $500/FEU last week on start of September GRIs following weeks of decline. These increases pushed rates to $2,163/FEU for the West Coast and $3,240/FEU to the East Coast, with West Coast prices continuing to tick up so far this week. These increases still put prices at about a third of their levels a year ago, but may hold for now on some bump in demand in the lead up to Golden Week – though overall container demand into the US is trending down – and increases in canceled services and blanked sailings. 

Even as transpacific volumes sag though, global container demand has continued to grow, with global bookings up 5% annually in July.  Part of that growth came from a 10% year on year bump in Asia – Europe volumes. Peak season demand likely peaked on this lane in July and early August, with Asia – Europe rates falling again last week, decreasing 11% to $2,540/FEU. 

Asia – Europe prices have decreased 25% in the last month and 67% compared to last year. But even with significantly stronger volumes than in 2024 during the July peak, rate highs that month were still 60% lower than a year prior, likely due mostly to capacity growth.

IATA’s latest air cargo volume data show that, despite the US changes to de minimis, global volumes continue to grow as demand shifts to and is growing on other lanes. Global volumes increased by 5% year on year in July, including 13% growth for Asia – Europe CTKs even as Asia – N. America volumes dipped for a third consecutive month. The US’s August total cancellation of de minimis could have some moderate further impact on US-bound volumes, with more countries considering changes to their de minimis rules as well. 

Even with overall growth, the Freightos Air Index global benchmark rate was 4% lower than a year ago in July, with the current global rate 7% lower year on year. Shifts in capacity have minimized rate volatility for many lanes, with China – US rates at $5.30/kg to close last week, and China – Europe prices easing slightly to $3.55/kg. Last year prices were also stable in September before starting to climb with some early peak season pressure in October.”

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 1% to $1,725/FEU.
• Asia-US East Coast prices (FBX03 Weekly) fell 1% to $2,708/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 7% to $2,841/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 2% to $3,033/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices fell 5% to $5.30/kg.
• China – N. Europe weekly prices increased 5% to $3.70/kg.
• N. Europe – N. America weekly prices fell 3% to $1.67/kg.

Analysis

“A US federal appeals court last week upheld a US Court of International Trade decision from earlier this year that deemed the president’s use of the International Emergency Economic Powers Act (IEEPA) to introduce tariffs illegal. 

President Trump had relied on IEEPA for tariffs aimed at addressing illegal fentanyl imports from Canada, Mexico and China, and for the long list of country-specific reciprocal tariffs first announced in April.  The decision sets an October 14th deadline for the administration to appeal to the Supreme Court and allows these IEEPA-based tariffs to remain in effect until the appeals process is exhausted. A final ruling by the Supreme Court would likely only come some time well into next year, meaning there are no immediate implications for supply chains, just more uncertainty.

If the Supreme Court upholds the decision, it is possible that payments already made for these tariffs would have to be refunded. But the administration has already employed more established trade acts for its sectoral tariffs, like those on steel and aluminum, automotive goods and copper, with expansions on the list of included items and tariffs on other sectors like pharmaceuticals, semiconductors and lumber possibly coming soon. 

So striking down the IEEPA tariffs would be a significant change to the tariff landscape, but if they are removed expectations are that the administration would work to expand tariffs other ways like by increasing the use of trade laws leveraged so far as well as via other trade acts at its disposal. 

In the meantime, some countries still without trade deals with the US, like Mexico facing a November tariff deadline, and India, for whom 50% tariffs went into effect last week, continue to take steps aimed at reaching agreements.  But some countries that have arrived at deals in principle – like Japan and EU members –  are not yet trading under the terms of those agreements as the details continue to be hashed out.

In ocean freight, transpacific container rates were stable last week at about $1,700/FEU and $2,700/FEU to the west and east coasts respectively. Daily rates to start this week though jumped up $400 – $500/FEU on both lanes, possibly reflecting carrier attempts at introducing September GRIs. Demand, space and rate trends of the last few weeks suggest it will be difficult for carriers to push these rate bumps through, though more blanked sailings are being announced as Golden Week approaches. 

Even if successful though, those higher rate levels would be well below the West Coast peak season level of $7,000 – $8,000/FEU seen last year. Those rates would also still be lower than at any point last year, with the slow season low for the year at about $3,000/FEU in April 2024. These year on year comparisons, with Red Sea diversions still in place, likely point to growing overcapacity already putting downward pressure on rates.

Asia – N. Europe rates continue to ease from their elevated peak season level of about $3,400/FEU held in July and into August. Rates decreased 7% to $2,841/FEU last week, with Asia – Mediterranean prices dipping 2% to about $3,000/FEU.  Carriers are expected to increase blanked sailings for these lanes as well. That these rates are also beneath the year lows for 2024 when Red Sea diversions were attributed with causing the highly elevated price baseline, likewise suggests fleet growth is contributing to overall lower rates year on year, even as carriers continue to order more ships.

In air cargo, the recent US tariff increases on India are leading to reports of some demand and capacity increases out of neighboring Bangladesh. The trade war has also driven a big increase in air cargo volumes, especially electronics, out of Vietnam, with resulting increases in capacity not only to the US but to Europe as well. 

The US ended the de minimis exemption for imports from all countries last week, after closing it to just China back in May. The full closure will likely further impact importers who relied on the exception and contribute to higher prices for many e-commerce shoppers. But in terms of US bound air cargo, the lion’s share of impact from de minimis changes has likely already been felt with the China suspension. 

According to USCBP, in 2024 three quarters of de minimis entries to the US were from China and since the exemption was closed to Chinese imports in May, daily de minimis entries have dropped by about 85%. The two next biggest countries of origin for de minimis entries to the US are Canada and Mexico, which mostly rely on road transport. 

There are reports of significant drops – some up to 50% – in China-US e-commerce air cargo shipments since May. But at the same time, the big Chinese e-comm platforms have shifted some of their focus – and air cargo capacity – to other markets, especially Europe where e-comm imports have doubled in value in the same period. This shift may mean, globally, air cargo may not have felt a sharp slowdown and may not feel much of an impact from US de minimis closing completely since China played such an outsized role. 

Even with these trade war-driven volume shifts, the quick, parallel shifts of capacity seem to have kept air cargo rates relatively stable. 

Freightos Air Index China – Europe rates increased 5% to $3.70/kg last week, with prices to N. America down 5% to about $5.30/kg – both within the general price ranges seen since the spring. Rates from South East Asia to N. America were at $4.63/kg last week, down from $4.82/kg the previous week but at around the average since May. Prices from SEA to Europe are at $3.70/kg, up from about $2.70/kg in mid-July, and back to levels seen in June, possibly reflecting capacity adjustments on this lane.”

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 10% to $1,744/FEU.
• Asia-US East Coast prices (FBX03 Weekly) fell 21% to $2,733/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 6% to $3,071/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 1% to $3,091/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices increased 2% to $5.57/kg.
• China – N. Europe weekly prices stayed level at $3.52/kg.
• N. Europe – N. America weekly prices fell 1% to $1.72/kg.

Analysis

Even as the tariff landscape on the country level seems to be solidifying, trade probes on specific goods like pharmaceuticals, semiconductors, and lumber – including furniture – requested by President Trump earlier in the year are now concluded or nearing completion, and could mean additional sectoral tariffs soon. 

For some countries that have reached trade agreements with the US, tariffs meant to be reduced or removed on many types of goods are still being collected as implementation conditions still need to be fulfilled or details of the deals are still being hammered out. These implementation lags mean it will take longer to see if the tariff changes impact freight volumes and rates.

China is sending a top trade negotiator to Washington following the recently-announced 90-day extension of 30% baseline US tariffs on Chinese exports first rolled out in May.  Though there are some reports of some increase in China-US ocean demand since the extension announcement, overall volumes and rates – helped on by growing capacity levels – continue to trend downward. 

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 – N. America spot rates have fallen 60% – 70% in an almost uninterrupted slide since that early rush. Rates to the West Coast decreased 10% to $1,744/FEU last week – the lowest level for this lane since December 2023. East Coast prices fell 21% to $2,733/FEU for a 34% slide so far in August.

Transatlantic rates were level at $2,284/FEU last week, and though not much freight impact is expected from the recent US – EU trade deal, auto tariff reductions have yet to take effect, and so far alcohol exports will not be exempted. In other trade related developments, carriers are continuing to adjust services and shift vessels to minimize exposure to US port call fees for Chinese vessels and operators that will start in mid-October. 

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. 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. 

Asia – N. Europe spot prices fell 6% last week to about $3,100/FEU and back to levels seen in late June. Asia – Mediterranean rates eased 1% to $3,100/FEU as well, the lowest level since late May for this trade.  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.

The US will end de minimis exemptions for all low value imports starting this Thursday. A lack of clarity as to how new tariff rules for low-value postal parcels will apply is leading several European post services to suspend handling some shipments for now.   

The White House suspended de minimis eligibility just for Chinese imports back in early May, leading to reports of as much as a 50% drop in B2C e-commerce shipments to the US from China since then. But nonetheless, overall Chinese e-commerce export volumes have continued to grow, as Chinese platforms shift their focus to other markets, especially Europe where e-commerce imports have doubled by value during this same period. The growth of e-commerce volumes from China to Europe and the UK is intensifying local opposition to competition from these types of imports, with calls for an ending of de minimis exceptions in these countries as well.

Even with these reports of e-commerce shipment drops from China to the US and increases to Europe, air cargo rates have been stable overall, likely reflecting a significant shift of freighter capacity between markets. Freightos Air Index China – Europe rates were level at $3.52/kg last week and prices to N. America increased 2% to $5.57/kg. 

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 8% to $1,940/FEU.
• Asia-US East Coast prices (FBX03 Weekly) fell 3% to $3,472/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell 2% to $3,273/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) fell 1% to $3,113/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices increased 5% to $5.44/kg.
• China – N. Europe weekly prices fell 4% to $3.53/kg.
• N. Europe – N. America weekly prices fell 2% to $1.73/kg.

Analysis

When the US lowered baseline tariffs on Chinese exports from 145% to 30% in May for a period of ninety days, transpacific ocean freight demand surged and container rates soared to more than $6,000/FEU to the West Coast as shippers rushed to move goods that would make it to the US before the August expiration date. 

A recent Freightos poll of about eighty supply chain professionals found that about half expect the White House’s recent announcement that it will extend that 30% baseline tariff for an additional ninety days to lead to another peak season bump. But the other half thinks, even with the extension, this year’s peak season is behind us – and so far container rates seem to support those expectations.

Transpacific rates to the West Coast fell 8% last week to less than $2,000/FEU, their lowest level since the start of the Red Sea crisis. Daily rates so far this week are down to the $1,700/FEU level held just before the Houthi attacks began in late 2023. Prices to the East Coast fell 3% to $3,472/FEU last week, but are down to $2,700/FEU so far this week, also within striking distance of their pre-Red Sea levels.

Container rates on the transpacific are falling due to tariff-driven frontloading that saw stronger than normal volumes earlier in the year and brought a brief and early peak season surge back in June. But rates falling back to levels last seen before the Red Sea crisis began – even as attacks continue – suggest that overcapacity is also playing a role in rate behavior. 

Spot market developments for Asia – Europe trade may also support the possibility that overcapacity is already impacting rates. 

Carriers report that Asia – Europe peak season demand is robust. But even with strong volumes, persistent congestion at several major European container hubs, and Red Sea diversions still absorbing capacity directly on this lane, container rates are 60% lower than a year ago, when the Red Sea crisis was cited as the major driver for highly elevated rates of about $7,000/FEU to Europe and $8,000/FEU to the Mediterranean. 

As of last week, Asia – N. Europe rates were still flat at about $3,300/FEU, the peak season level they’ve held since early July. Asia – Mediterranean prices slipped to about $3,100/FEU down from a peak season high of $4,800/FEU reached in mid-June. Carriers will reduce capacity on these lanes in September to try and keep prices from easing further. 

In air cargo, an Air Canada flight attendant strike that started over the weekend froze passenger operations and disrupted cargo flows as well. A tentative agreement between the carrier and union reached late Monday however, means operations are already gradually starting back up. 

Freightos Air Index rate data shows air cargo prices were stable overall last week, with China – US rates up slightly to $5.44/kg, China – Europe prices dipping 4% to $3.53/kg and transatlantic rates down 2% to $1.73/kg.