U.S. Trade Deals Offer Little Relief for Struggling Container Market

Recent trade agreements between the U.S. and key trading partners are failing to revitalize the struggling ocean container shipping market, according to the latest analysis from Xeneta released today.

Data from the ocean freight intelligence platform reveals that average spot rates from China to the US West Coast have plummeted 59% since June 1, settling at USD 2,268 per FEU (40ft container). The US East Coast has experienced similar trends, with rates dropping 43% to USD 3,796 per FEU during the same period.

Even the typically more stable North Europe to US East Coast route has seen rates decline to USD 2,000 per FEU, representing a 5% decrease since June and a more substantial 25% drop compared to January 1.

“US trade deals are not a magic bullet and we should not expect them to breathe new life into the subdued ocean shipping market,” explains Emily Stausbøll, Xeneta Senior Shipping Analyst.

Stausbøll notes that while the recently negotiated 15% tariff on EU imports represents a compromise, it still creates challenges for shippers. “A 15% tariff on imports from the EU is not good news for shippers – it is just news that isn’t as bad as it could have been,” she said.

Similarly, this week’s US-China negotiations in Stockholm are unlikely to return import costs to pre-April levels, when the Trump administration implemented sweeping reciprocal tariffs.

The freight market’s current downturn follows a brief surge in April and May when shippers frontloaded imports during a temporary tariff reduction period. “That cargo rush is now over and freight rates are falling hard, particularly on the fronthaul trades from the Far East,” Stausbøll explains.

Carriers are attempting to stabilize rates by reducing capacity on US trade routes, but these efforts may prove insufficient given the significant overcapacity in the global container fleet.

“Carriers have reported massive profits in recent years in the wake of supply chain turmoil, but unless they can halt the dramatic decline in freight rates, those days may be over,” Stausbøll warned.

Industry data further confirms this outlook. Drewry’s World Container Index (WCI) fell 3.3% last week, marking its sixth consecutive weekly decline. The analysis forecasts a weakening supply-demand balance in the second half of 2025, which will likely drive spot rates even lower. According to Drewry, the volatility and timing of rate changes will depend on Trump’s future tariff decisions and potential capacity shifts resulting from the uncertain implementation of U.S. penalties on Chinese ships, proposed for October implementation.

Despite several carriers planning to introduce General Rate Increases (GRIs) on transpacific trades, industry sources remain skeptical that these measures will effectively increase prices given the continuing subdued demand.

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