Container Rates Slide for Fifth Week as Lunar New Year Demand Disappoints

Global container shipping rates fell for a fifth straight week, slipping 1% to $1,933 per 40-foot container, as the usual pre-Lunar New Year cargo rush once again failed to show up.

The latest drop in the Drewry World Container Index underscores how weak this peak season has been. Rates have declined steadily since early January—an unusual pattern for what is typically one of the strongest periods of the year—and carriers are responding with increasingly aggressive capacity cuts.

Transpacific trades remain under the most pressure. Spot rates from Shanghai to Los Angeles fell 1% to $2,214 per FEU, while Shanghai–New York rates also slipped 1% to $2,800. In response, carriers have announced 57 blank sailings over the next two weeks on transpacific routes alone, well above typical seasonal levels, according to Drewry’s Container Capacity Insight.

“This downward trend highlights a significant shift in the market, as the traditional pre-Lunar New Year cargo rush is failing to materialise in 2026,” Drewry said.

Asia–Europe lanes are showing similar softness. Rates from Shanghai to Rotterdam dropped 2% to $2,127 per FEU, while Shanghai–Genoa fell 3% to $2,965. Carriers have announced another 24 blank sailings across Asia–Europe and Mediterranean routes over the coming two weeks as factory shutdowns and lingering demand weakness weigh on volumes.

The slide runs counter to normal seasonal behavior. Spot rates typically rise ahead of Lunar New Year as exporters rush cargo out the door before factories close. This year, rates peaked earlier than usual and have been trending lower ever since.

“Container spot rates are falling sharply, which indicates that the market is weak, contrary to the general expectation of rising demand before the CNY,” Drewry said, warning that rates could ease further if typical seasonal patterns hold.

The downturn has been building for weeks. Just a week earlier, the index had fallen 7% to $1,959 per FEU, marking a fourth consecutive weekly decline. By then, carriers had already begun pulling capacity aggressively, canceling 18, 27, and 28 transpacific sailings across a three-week stretch.

Capacity management is unfolding against a complicated backdrop. Diversions around the Cape of Good Hope are still absorbing roughly 2 million TEU—about 8% of the global container fleet—but the gradual return of some services to the Suez Canal is beginning to reintroduce supply and muddy the rate outlook.

Drewry analyst Philip Damas said the timing and scale of any broader return to Suez will be one of the key variables shaping the market this year. Carriers are weighing security risks, insurance costs, competitor behavior, and port congestion before committing fully.

That cautious reopening began when Maersk and Hapag-Lloyd said their ME11 service would resume Red Sea transits in mid-February following trial voyages and a lull in attacks after the Gaza ceasefire in October 2025. But risk appetite remains uneven. Days later, CMA CGM rerouted three Asia–Europe services back around the Cape, citing the “complex and uncertain international context.”

“These conflicting decisions suggest capacity will return to the market gradually rather than all at once,” Drewry said, adding that a phased return could help avoid a sudden spot-rate collapse.

Looking further ahead, analysts continue to warn that global freight rates could fall by as much as 25% in 2026 as new vessel deliveries collide with softer demand, even if Red Sea conditions remain relatively stable.

The Suez Canal Authority has forecast a return to normal traffic levels by the second half of 2026. Before attacks began in late 2023, the canal handled about 12% of global seaborne trade and roughly 80 containerships per week.

With carriers now planning 63 blank sailings for February—up sharply from 27 in January—the market appears braced for further rate pressure as factories shut down and cargo demand continues to soften.

Related Posts:

• Maersk Posts Q4 Ocean Loss as Red Sea Reopening Tests Cost Discipline
• Hapag-Lloyd Reports Lower 2025 Profit as Gemini Network Takes Shape

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