Container Shipping Quarterly

Special Report

think will likely happen in 2026 as it will take time for the full capacity to return,” J. P. Morgan noted in its update.

The bank has forecast 2 % growth in global volume this year, with volume rising 5 % in the first quarter before falling to 1 % growth for the remaining quarters of 2025.

“ We continue to see the freight backdrop as challenging and it remains subject to heightened demand risks as we enter a global trade war, given recent announcements of reciprocal tariffs with business confidence subject to downside risks,” J. P. Morgan said.

John McCown, founder of private equity firm Blue

Alpha Capital, agreed in his McCown Report released in early March.

“ The year 2025 could be a return to the roller-coaster volume swings that most of us had hoped were in the past,” he wrote.“ Whether it’ s the Panama Canal situation, the complex reciprocal tariffs or the initiative to tax ships with a Chinese connection each time they call on a US port, these initiatives inject chaos, uncertainty and unnecessary costs into the container supply chain.”

email: greg. knowler @ spglobal. com

Tariffs, falling spot rates undermining trans-Pacific contract market

Carriers are now quoting Asia – USWC contract rates of less than $ 2,000 per FEU. Robert V Schwemmer / Shutterstock. com

By Bill Mongelluzzo

Ocean carriers on the eastbound trans-Pacific are acknowledging they will be unable to achieve their desired rates in 2025 – 26 annual service contracts with importers amid fresh concerns about the health of the US economy and a spot market that continues to slide.

Mere weeks ago, those same carriers were adamant about nailing down rates for next year at a minimum level of $ 2,000 per FEU to the West Coast and $ 3,000 per FEU to the East Coast, saying they were determined not to underprice their services again as they believe they did in the existing 2024 – 25 contracts.

“ BCOs are still asking for lower.”

But a plummeting stock market and larger questions about the direction of the US economy after the tariff chaos unleashed by the Trump administration in recent weeks has container lines resetting their rate expectations.

Four carriers told the Journal of Commerce they are now setting their sights slightly lower than $ 2,000 per FEU to the West Coast and $ 3,000 per FEU to the East Coast.

One carrier executive said the new going rate in service contract negotiations with shippers is $ 1,800 to $ 1,900 per FEU to the West Coast and about $ 1,000 higher to the East Coast. But even that may not be a level to satiate some beneficial cargo owners( BCOs) who may prefer to wait to see if the market moves lower.

“ BCOs are still asking for lower,” the executive said.

The rapid decline in spot rates during the Lunar New Year factory closures in Asia is prompting some retailers to look at one or two more rounds of negotiations before they agree to a final contract rate for the 2025 – 26 service year, a second carrier source said.

Most service contracts begin on May 1.

Spot rates dragging

Plummeting spot rates are weighing on service contract pricing now under negotiation.

Average short-term rates from North Asia to the US West Coast fell to $ 1,700 per FEU in the week of March 21, down 67.6 % from the first week of January and 46 % year over year, according to Platts, a sister company of the Journal of Commerce within S & P Global. Spot rates to the East Coast of $ 2,900 per FEU were down 59.7 % since Jan. 1 and 38 % year over year.

Rates in a second round of bids for 2025 – 26 contracts“ have mostly fallen below” $ 2,000 per FEU to the West Coast and $ 3,000 per FEU to the East Coast, according to

22 Journal of Commerce | April 7, 2025 www. joc. com