Asia-Europe Routes Mired in Battle, Trans-Pacific Rally Stalls
Publish Time: 2025-09-22 Origin: Site
As spot freight rates on the Asia-Europe route are "discounted" almost daily, freight buyers on this route fear a new freight rate war may have already fully begun. Earlier this week, Lloyd's List reported that despite the actual reduction of approximately 500,000 twenty-foot equivalent units (TEU) of planned capacity on the Asia-Europe route (Asia-North Europe, Asia-Mediterranean), spot rates have continued to fall over the past three months.
Alphaliner calculated that 461 ships would be needed to fully meet the capacity demand of 31 Asia-Europe routes, but only 425 are currently deployed. From this, it concluded: "This clearly indicates that a freight rate war is unfolding among some major carriers."
This week, major spot rate indices saw double-digit declines again. A European freight forwarder told Lloyd's List: "It looks like the freight rate war has started. We now receive updated notices of lower rates every day. So far, blank sailings and vessel adjustments have done little to curb the rate decline."
The Drewry World Container Index (WCI) shows that the rate for the Shanghai-Rotterdam route fell 11% week-on-week, dropping below the $2,000/FEU mark for the first time in over a year, finally settling at $1,910/FEU. The rate for the Shanghai-Genoa route decreased 9% week-on-week to $2,131/FEU.
Xeneta data reveals that since early September, the average spot rate to North Europe has dropped 22.5%, while the rate to the Mediterranean has fallen 14% over the same period. Peter Sand, Chief Analyst at Xeneta, said: "The average spot rate decline on the North Europe route is much steeper than that on the Mediterranean route, but this situation may change in the coming weeks. By the end of this month, the rolling weekly average capacity to the Mediterranean is expected to increase to 208,000 TEU, while capacity to North Europe will remain relatively stable. This may cause spot rates on the Mediterranean route to fall faster, narrowing the gap with those on the North Europe route." He added.
However, sources also indicated that the market may see some growth after the off-season following the National Day Golden Week. The freight forwarder added: "We expect [the rate decline] to continue after the National Day Golden Week, but I don’t think this downward trend will last until the end of the year. I anticipate a rebound, and we expect demand to pick up sometime before the end of the year."
Meanwhile, the recent rally in spot rates on the trans-Pacific route seems to have fizzled out. In the middle of the month, carriers raised rates by $1,000 to $3,000/FEU, but the impact on freight rates was minimal.
The Drewry World Container Index shows that the rate for the Shanghai-Los Angeles route fell 4% week-on-week to $2,561/FEU, while the rate for the Shanghai-New York route dropped 5% to $3,571/FEU.
However, in the latest Shanghai Containerized Freight Index (SCFI), the trans-Pacific route saw much larger declines, suggesting that the Drewry World Container Index may fall more sharply next week, as it typically lags the SCFI by a few days.
The SCFI shows that the rate for the route from Shanghai to basic ports on the U.S. West Coast fell 31% week-on-week to $1,636/FEU, while the rate for the route from Shanghai to basic ports on the U.S. East Coast dropped 23% to $2,557/FEU. The declines in these two routes have largely erased the gains made in the first half of September.
Slightly differently, the Xeneta Shipping Index (XSI) shows that the average rate on the trans-Pacific route remained stable in the past week, while the FBX Index owned by Freightos indicates that rates on both trans-Pacific routes rose slightly.