Nearly six weeks after the closure of the Strait of Hormuz, limited vessel movements continue, with only a few ships transiting daily through coordinated arrangements. Ocean operations outside Gulf-related flows remain stable, but rising fuel costs and availability are affecting multiple trade lanes.
Container rates have increased despite weak seasonal demand. Transpacific rates to the U.S. West Coast have risen by US$700 per FEU, or nearly 40 per cent, to more than US$2,400 per FEU. Asia to Northern Europe rates have increased by US$500 per FEU, or 20 per cent, to around US$2,900 per FEU. These levels now exceed those recorded a year earlier.
Earlier in the year, rates were lower due to overcapacity and soft demand. However, since late February, rate levels have strengthened. Asia to U.S. West Coast rates are currently around 8 per cent higher year on year, while Asia to Europe rates are up 22 per cent.
Market dynamics continue to limit rate increases. Downward pressure from supply-demand conditions has reduced the impact of surcharges and general rate increases, with reports of carrier discounts and pricing below announced levels. Asia to Mediterranean rates reached US$3,800 per FEU, up US$260 per FEU since late February, but below the mid-March peak of US$4,300 per FEU.
Fuel supply is becoming a constraint. Singapore, a key bunkering hub, has around one month of fuel stocks remaining, while Rotterdam remains supplied. Prolonged disruption could lead to slow steaming or blank sailings, increasing pressure on freight rates.
Air cargo markets are also affected. Some regions are facing fuel supply limitations, with Vietnam cancelling domestic flights and refuelling restrictions reported in South Korea and the Philippines. Gulf carriers are gradually restoring capacity, with Emirates SkyCargo at 60 per cent of normal schedules, Etihad Airways at 40 per cent, and Qatar Airways Cargo at 20 per cent.
Airfreight rates remain elevated. South Asia to Europe rates are at US$4.17 per kg, up 62 per cent, while Southeast Asia to Europe stands at US$4.50 per kg, up 33 per cent. Europe to Middle East rates have doubled to US$3.67 per kg. Some lanes show stabilisation, with China to Europe rates at US$4.67 per kg, down 7 per cent compared to two weeks earlier, and Southeast Asia to Europe down 10 per cent.
Freight markets continue to adjust to fuel availability, capacity shifts, and route changes.
Source: Container News
