Container Rates Stabilize After Tariff-Driven Volatility as Market Braces for Second-Half Contraction

Drewry’s World Container Index decreased 3% to $2,350 per 40ft container this week, marking the ninth consecutive week of decline as the market continues to stabilize following months of extreme volatility.

The container shipping market has experienced significant turbulence since US tariffs were announced in April, with rates surging from May through early June before a sharp decline until mid-July. Recently, the downward trend has lost momentum as the rate of decrease slowed considerably.

Transpacific routes showed particular weakness this week, with Shanghai–Los Angeles rates falling 2% to $2,494 per FEU and Shanghai–New York dropping 5% to $3,638 per FEU.

“Since the big rush to ship cargo before the tariff increase is now over, Drewry expects spot rates to be less volatile in the coming week,” according to their latest analysis.

The current stabilization follows a remarkable July 2025 performance, when U.S. container imports reached their second-highest level on record, just shy of the all-time high set in May 2022, according to a recent analysis by Descartes. A 18.2% month-over-month surge from June to July reflects importers racing to beat impending trade policy deadlines.

China played a central role in the surge, with shipments jumping 44.4% from June, raising China’s share of total U.S. imports to 35.2%, up from 28.8% in June.

Jackson Wood, Director of Industry Strategy at Descartes, noted: “Following two months of uneven performance, July’s surge in container imports underscores the impact of U.S. tariff policies, not just seasonal demand cycles, on container volumes”.

Looking ahead, industry forecasts suggest a significant downturn. Drewry’s Container Forecaster expects the supply-demand balance to weaken again in the second half of 2025, causing spot rates to contract further. The report notes that “the volatility and timing of rate changes will depend on Trump’s future tariffs and on capacity changes related to the introduction of US penalties on Chinese ships, which are uncertain”.

This prediction aligns with the National Retail Federation’s forecast that import cargo volume at major U.S. container ports will end 2025 down 5.6% from 2024 levels as newly implemented tariffs create significant pressure on international trade, despite growing 3.7% in the first half of the year.

The remainder of 2025 shows a concerning trend with forecast declines of 5% in August, 19.5% in September, 18.9% in October, 21.1% in November, and 19.3% in December compared to 2024 figures. November’s projected 1.71 million TEUs would represent the lowest monthly total since April 2023.

Industry analyst John McCown described the situation to gCaptain as “the sort of carnage that should be expected with these nonsensical tariffs and even blunter USTR ship fees that are an all out attack on trade itself,” adding that “the big declines that are coming can’t help but ripple through the economy and reduce growth.”

As the shipping industry navigates these choppy waters, several critical trade policy deadlines loom, including the August 29 repeal of the de minimis exemption, the October 15 expiration of the U.S.-China tariff truce, and recently implemented reciprocal tariffs affecting more than 60 countries.

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