Rate Related Update and Market Conditions
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Market Conditions and Rate Related Update
Trans-Pacific shipping rates rise as congestion worsens at major Asian ports
Trans-Pacific freight rates rose in December due to anticipated strikes and tariff concerns, with Asia-U.S. West Coast rates up 10% and East Coast rates up 13%. Meanwhile, Asia-Europe rates declined slightly, but Red Sea rerouting and pre-Lunar New Year demand caused port congestion in Asia and globally. Major ports face worsening delays, driven by increased volumes and the ongoing impact of the Red Sea crisis.
Another shipping company announces its return to Ukraine
CMA CGM has launched a new ODX service to Ukraine, calling at Odessa Port with two 1,100-1,500 TEU ships. It joins MSC and Iteris Feeders, which operate via Chornomorsk Port. Earlier, Hapag-Lloyd resumed Ukraine services in May, followed by MSC in June and Maersk in October. These moves signal the gradual revival of Ukraine’s shipping routes.
Hapag-Lloyd Announces Strike-Contingent Surcharges Amid Labor Contract Tensions
Hapag-Lloyd has announced two surcharges, effective January 20, 2025, in anticipation of potential labor disruptions at U.S. East and Gulf Coast ports. The Work Disruption Surcharge (WDS) and Work Interruption Destination Surcharge (WID) will cover additional costs related to strikes, slowdowns, and operational delays. These surcharges, $850 per 20-foot container and $1,700 per 40-foot container, will apply to imports from various global regions. The charges will be waived if no disruptions occur.
Maersk Urgent Notice: Prepare for East Coast Terminal Strike
A potential strike at U.S. East Coast ports on January 15, 2024, looms as labor talks between USMX and ILA stall over port automation. Supported by President-elect Donald Trump, the ILA opposes automation, escalating tensions. Maersk has urged customers to move containers off terminals before disruptions, anticipating operational halts and supply chain challenges, while preparing contingency plans to minimize impacts.
Port Congestion
Analyzing the Current State and Trends of U.S. Retail Through Costco
Costco is addressing potential tariff impacts through early inventory purchases, supplier collaboration, and alternative sourcing. U.S. consumers are cautious, focusing on quality and value, with strong growth in non-food categories like jewelry and gift cards. Capital investments target new warehouses and technology upgrades. Low-margin items like gift cards drive traffic and e-commerce engagement, supporting overall growth without relying on higher profit margins from other products.
The American Alliance for Anode Material Producers imposes up to 920% tariffs on imported Chinese graphite products for lithium-ion battery anodes
The U.S.-China competition in technology and supply chains escalates as the American Alliance for Anode Material Producers (AAAMP) petitions for up to 920% tariffs on Chinese graphite imports, citing low-price dumping and subsidies. While investigations may extend to 2025, preliminary tariffs could take effect earlier. Experts warn that targeting graphite, critical for batteries and defense, risks backfiring on U.S. industries, deepening this trade and technology conflict.
US Gulf Coast Ports Expand to Meet Growing Container Volumes
US Gulf Coast ports experienced significant growth in 2024, driven by resilient consumer spending and pre-emptive shipping ahead of a potential labor strike. The Port of Houston emerged as a key player, with containerized imports rising by 9.3% during the first 11 months of the year, according to PIERS. Anticipating further increases in 2025, the region is investing in infrastructure improvements to ensure smooth operations and accommodate rising demand.
US Import Growth Expected Through Spring Amid Potential Supply Chain Risks
US imports are projected to grow through spring 2025 as retailers respond to strong sales and prepare for potential labor disputes and new tariffs, according to the Global Port Tracker (GPT) report from Hackett Associates and the National Retail Federation. The report predicts a 12% year-over-year surge in January import volumes, followed by a 4.1% dip in February. Meanwhile, air cargo remains robust, and hopes for a surface freight recovery continue to build as economic growth slows but remains steady.
