Market Pulse 2026 Week 21

MARKET BRIEF 2026 WEEK 21
Freight rates out of Asia are rising sharply across the board with higher FAK rates and Peak Season Surcharges set to take effect from 1 June. An early peak season cargo rush is keeping capacity tight across all main tradelanes with limited new vessel deliveries and port congestion helping to cap vessel space availability. Carriers’ earnings will receive a strong boost in the 2nd quarter from the higher rates that are expected to stick until the end of June.

CMA CGM is withdrawing a high capacity Southeast Asia to US East Coast service via the Cape route with immediate effect, citing poor earnings while maintaining the US West Coast transpacific leg. Carriers are preparing to shift capacity to more lucrative routes, including South America and the Med where rates have seen the sharpest increases. Further rate hikes from supply chain disruptions are expected to follow from the re-opening of the Strait of Hormuz, before a reduction in bunker fuel surcharges and a potential return to the Red Sea/Suez route drive the next round of freight rate corrections.

Containership scrapping at standstill even as sanctioned Iranian fleet remains idle
4 Iranian linked-containerships owned by BoCom Leasing of 5,800 to 6,900 teu built between 2005 and 2009 are set to be the largest containerships to be scrapped since 2020 after receiving US approval to be recycled. These 4 ships were part of a total of 22 containerships sanctioned by the United States Office of Foreign Assets Control (OFAC) in July 2025 due to their links to Iran and have been idle since they were off-hired by SeaLead in August last year. Only 4 ships for 4,456 teu have been scrapped in the first 5 months of 2026 with the high demand for ships keeping charter rates and second hand prices at elevated levels. If not for the US sanctions, these ships would have been valued in excess of 400% of their scrap values. 2 more sanctioned ships of 4,800 teu and 6,600 teu owned by China’s CZB Financial Leasing are also stranded in China under similar circumstances.