Tariff and Strike Threats Drive Up Container Prices

According to the Freightos Baltic Dry Index, dual threats such as customs duty increases and port strikes continue to support maritime shipping freight rates, which have historically been in a trough after peaks. In the week ending Friday, rates for Asia-West Coast USA dropped by 4% to $4,905 per forty-foot equivalent unit, while prices for Asia-East Coast USA increased by 13% to $6,095 per FEU. Judah Levine, the research director at Freightos, stated in an analysis sent to clients, "Ahead of a possible strike by the International Longshoremen's Association after the extension of the main coast contract ends on January 15, some pre-loadings and expectations for tariff increases next year have kept transpacific ocean prices high as we enter December; prices for the West Coast have even surpassed the highest levels seen before the 2024 Lunar New Year in January, which were observed at the start of the Red Sea crisis. Some carriers are reported to be implementing significant General Rate Increases (GRI) to raise prices as we start the month." Meanwhile, Asia-North Europe prices hovered at $4,491 per FEU on a weekly basis, and Asia-Mediterranean prices rose by 6% to $5,135 per FEU. Levine added, "European prices were steady last week but have begun to climb this week, with daily prices for the Mediterranean approaching $6,000 per FEU in December GRIs, reflecting an increase of $1,000 compared to the end of November."