Container Shipping Market Shows Signs of Warming Up as Freight Rates Stage Another Strong Rally
According to the latest data released by the Shanghai Shipping Exchange on December 12th, the Shanghai Containerized Freight Index (SCFI) for last week rose by 108.83 points to 1506.46 points, marking a weekly increase of 7.79%. Freight rates on all four major deep-sea routes increased, with rates on the US and Mediterranean routes both surging by over 10%.
Last week, the rate per FEU (Forty-foot Equivalent Unit) from the Far East to the US West Coast rose by $230 to $1,780, a weekly increase of 14.84%. The rate per FEU from the Far East to the US East Coast increased by $337 to $2,652, up 14.56% week-on-week. The rate per TEU (Twenty-foot Equivalent Unit) from the Far East to Europe climbed by $138 to $1,538, a 9.86% weekly rise. The rate per TEU from the Far East to the Mediterranean jumped by $437 compared to the previous week to $2,737, representing a significant 19% weekly gain.
On the intra-Asia routes, rates showed mixed movements. The rate per TEU from the Far East to Japan's Kansai region remained unchanged from the previous week at $312, while the rate to Japan's Kanto region also held steady at $321. The rate per TEU from the Far East to Southeast Asia increased by $13 to $556, whereas the rate to South Korea saw a slight decline of $4, settling at $139.
Industry insiders indicate that last week's SCFI increase primarily reflects shipping lines' announced freight rate hikes for the latter half of December. The goal of this round of increases is to push rates above $2,000 per FEU for the US West Coast route and above $3,000 per FEU for the US East Coast route. However, given limited shipment momentum on the demand side—with shippers moving cargo only as needed due to higher tariff costs, and carriers unwilling to significantly cut capacity by reducing sailings—it remains to be seen whether the rate increases will hold or be followed by a decline.
Currently, the main replenishment operations ahead of the US Christmas and New Year holidays are largely complete, leading to a noticeable weakening of import-side shipment momentum. Consequently, demand on the trans-Pacific routes overall continues to show a slowing trend. The overall load factor from China's export side is approximately 70% to 90%, and cargo volumes have not yet recovered.
Several industry sources estimate that for freight rates to see a significant sustained increase, it may require a combination of cargo volume recovery ahead of the Lunar New Year holiday in January next year and proactive capacity management by shipping lines. While cargo volumes on the US West Coast and Europe routes are perceived to have increased recently, this has been offset by excess capacity supply. With the 2026 Lunar New Year holiday falling in February, pre-holiday stocking activities may be delayed until late December or even January next year.
