Competition Intensifies as U.S. West Coast Freight Rates Plunge

Sourcing: Shipping Gazette 2025/06/24

With increasing capacity supply and heightened competition, spot rates on the trans-Pacific routes rapidly cooled after a brief surge. U.S. West Coast rates have now fallen below $3,000 per FEU.

Key Data (as of June 20):

·  SCFI Index: 1,869.59 points (↓10.5%)

·  Europe Routes:

        Shanghai → Europe: $1,835/TEU (↓0.5%)

        Shanghai → Mediterranean: $3,063/TEU (↓4.0%)

·  North America Routes:

        Shanghai → U.S. East Coast: $5,352/FEU (↓20.7%)

        Shanghai → U.S. West Coast: $2,772/FEU (↓32.7%)

Drewry WCI Index Highlights (as of June 19):

·  Global composite index: $3,279/FEU (↓7%)

·  Notable Lane Movements:

        Shanghai → Rotterdam: $3,171/FEU (↑12%)

        Shanghai → Genoa: $4,075/FEU (↑1%)

        Shanghai → New York: $6,584/FEU (↓10%, ↑81% since May 8)

        Shanghai → Los Angeles: $4,702/FEU (↓20%, ↑73% over 6 weeks)

Market Analysis:

·  U.S. Demand Slowdown:
        Drewry notes the post-tariff-pause import surge lacked sustained momentum.

·  Tariff Policy Instability:

        Vespucci Maritime's Lars Jensen states: "Predicting trade war developments is nearly impossible."

        Shanghai→LA rates recorded largest weekly drop since 2012 ($1,212/FEU decline).

        Trump-era tariff uncertainties continue disrupting supply chain planning.

·  Geopolitical Risks:
        Iran-Israel conflicts further heighten global supply chain instability.

Outlook:
Drewry anticipates weakening supply-demand balance in H2 2024, leading to rate "normalization." 

Timing depends on:

U.S. court rulings on Trump-era tariffs

Potential capacity adjustments from Section 301 investigations

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