The 90 day tariff extension for China moves the current US tariff expiration to 10 November 2025, but the impact on container volumes will be limited as front loading has already shifted most of the peak season cargo in June and July. Further rate weakness on the Transpacific and Asia-Europe routes were recorded last week with the SCFI slipping for its 10th consecutive weekly decline, with the composite index shedding 35% of its value in that period. Prospects for a rate rebound in September continues to recede, with carriers unwilling to take active capacity management measures to address the declining utilization rates. Gemini carriers in particular have maintained a zero blank sailing record on its core services, largely ignoring the rate slide as they continue to prioritise volumes over freight rates.
The charter market remains stubbornly resilient despite the freight market turbulence, with demand in certain Asia, Med, Middle East and Latin America corridors are still firm enough to support the high charter rates.
Johnson Leung
Growing containership orderbook a cause for concern
The containership orderbook has reached a record high of 10.4m TEU, following the flurry of new ship orders placed in the last 12 months, with the orderbook ratio rising to 31.7% of the fleet - its highest levels since 2010. The last time the orderbook ratio exceeded this level in 2004-2009, it ended in a decade-long supply overhang that took 10 years to clear. There is still over 1m TEU of pending ship orders that are due to be added before the end of this year.
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