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Container shipping rates on key transpacific lanes fell sharply in the first week since the US reciprocal tariffs took effect, with Asia–US trades bearing the brunt of the decline. The Trump administration’s decision to extend the existing 30% baseline tariff on all Chinese imports for a further 90 days—through to 10 November—has provided near-term clarity for long-haul US importers, setting tariff expectations at least into the fourth quarter.

Freightos’ spot rate to the US West Coast dropped 10% last week to $2,119/FEU, while the East Coast benchmark also fell 10% to $3,572/FEU—its seventh consecutive weekly decline. Daily rates to both coasts have held steady since the tariff extension, suggesting that the move may stave off the more abrupt price swings that could have followed a tariff hike on 12 August. The extension may even trigger modest peak-season demand and rate gains in the weeks ahead—momentum that might not have materialised had tariffs risen.

However, much of the year’s demand has already been pulled forward. Frontloading by shippers ahead of the April and July–August tariff deadlines is widely expected to suppress ocean volumes through year-end, with the next notable demand uptick unlikely before the pre–Lunar New Year rush in early 2026.

Elsewhere, geopolitical tensions between Washington and New Delhi have intensified. President Trump, opposing India’s purchases of Russian oil, has imposed a 25% tariff on Indian exports and signed an executive order to raise duties to 50% if no deal is reached by 27 August. The move is already weighing on India’s export order books, with some shippers deferring shipments until tariff uncertainty subsides.

The latest National Retail Federation data show US container imports rising to 2.2 million TEU in April, and are estimated to peak at 2.3 million in July, holding at 2.2 million in August before falling sharply into year-end. While imports typically strengthen in the second half, this year’s projections put H2 volumes 8% below H1 and 14% lower than the same period last year. September–December totals are expected to be down 20% from 2024, with full-year 2025 volumes forecast to be 6% lower than 2024.

These forecasts, issued before the US–China tariff extension, already reflect significant frontloading earlier in the year. Even with the extension, market fundamentals point to subdued demand for the remainder of 2025 and little sustained upward pressure on freight rates.

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Written: Farid Muzaffar