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Shippers and freight forwarders will face a variety of challenges in the first 32 days of 2025, according to Xeneta
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The new year begins with the Red Sea crisis reaching more than 400 days of disruption, with a return of container ships to the region seen as unlikely
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The end of Jan 2025 marks the start of the Chinese New Year, with factory shutdowns, demand and rates rising, and supply chain disturbances seen until mid-February
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Xeneta’s Peter Sand and Emily Stausboll tackled the various issues during a recent webinar ‘2025 Ocean Freight Outlook: Navigating Capacity Shifts and Rate Dynamics’
Shippers and freight forwarders will face a variety of challenges in the first 32 days of 2025, according to a Xeneta blog.
The new year begins with the Red Sea crisis reaching more than 400 days of disruption, with a return of container ships to the region seen as unlikely, Xeneta said.
Businesses will be seeking ways to navigate changing consumer demands, operating costs, cyber threats, failing shares, and rising insurance premiums.
Xeneta’s Peter Sand and Emily Stausboll tackled the various issues during a recent webinar “2025 Ocean Freight Outlook: Navigating Capacity Shifts and Rate Dynamics”.
The webinar was organized by Xeneta, creators of the world’s largest ocean and air freight rate benchmarking and market analytics platform.
Among the takeaways in the 30 minute session were the following:
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China to North Europe – Spot rates on the China to North Europe and the Mediterranean trade lanes jumped to $1,000, a reversal of the recent softening. Since the webinar, there have been two spot rate increases, the first Stausboll said she was “surprised to see carriers push through GRIs at this rate.” These GRIs have stuck, indicating a general upward direction, and could indicate how spot rates may develop on other trades such as the Far East to the US.
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US market outlook – Sand said the return of Donald Trump to the presidency does not bode well for the US economy. Come January, there is a potential strike around the corner. US importers whose goods can be stored will probably bolster inventories to help navigate the period of uncertainty. For those considering shipping more than their contracted allowance, “be aware of the long-short market spread,” said Sand. “The bigger the spread, the likely it is for carriers and shippers to act in a way that is different to what you would otherwise expect,” he added.
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The Transatlantic – The Transatlantic westbound trade usually has a lag, as much as two quarters behind the top four trades. Stausboll said, “November and December aren’t high times for new long-term contracts entering validity. A lot of contracts being signed around now to come into effect Jan. 1, so the rates we’re seeing today might not necessarily be what you should expect to happen if you’re going into tender negotiations.” The possible US East Coast and Gulf Coast strike “a very real possibility,” she said shippers using the Transatlantic route need to consider a contingency plan.
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Demand, Supply, and Capacity Dynamics – TEU demand growth is expected to settle at 4.5% as the year ends, much higher than the underlying economic activity suggests. This means frontloading is taking place to build up inventories, which should begin to neutralize next year. TEU demand growth will slow to 3% next year. Trump’s expected tariffs will see higher volumes of imports to the US ahead of their implementation. Said Sand: “Looking ahead, 2025 will see supply growth outstrip demand growth.”
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Emissions and Regulations – Trades impacted by the Red Sea crisis saw significant carbon emission increases this year, notably the Far East to Mediterranean. Stausboll stated: “Carriers were increasing shipping speeds where they could. Longer sailing distances at higher speeds had a direct impact on emissions.” Next year will be an important year for the International Maritime Organization, as it must make some important decisions when it comes to a global emissions price.
READ: Xeneta expects 2025 to be another challenging year in container shipping
