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The Spring Festival freight rush, Asia-Europe sea freight significantly increased
Sea freight rates from Asia to Europe and the Mediterranean region rose significantly last week, with freight rates to Europe reaching $5,300 /FEU, which is close to levels seen before the Lunar New Year in January.

The increase may be attributed to a surge in demand ahead of the Lunar New Year. To ensure adequate inventories are shipped out of Asia before the holiday slowdown, Asia-Europe/Mediterranean shippers have ramped up shipments, driving up rates. If you choose to ship after the Lunar New Year, the container will need to go around the Cape of Good Hope, which will cause a long wait, so shippers move ahead to avoid delays.


The Spring Festival freight rush caused a rise in sea freight rates in Asia and Europe


At the same time, carriers are trying to increase their mid-month GRI (Comprehensive Rate Increase Surcharge) rates and expect this trend to become more pronounced as the holiday season approaches in late January.

By contrast, trans-Pacific shippers did not face this pressure in advance. With the urgency of the Lunar New Year period yet to arrive, it could be weeks before demand picks up. As a result, freight rates in the region fell last week. While carriers are trying to push up prices through the mid-December GRI, with a target price increase of $1,000 to $3,000 /FEU, the freight rate increase may not materialize until the Chinese New Year approaches.

However, according to the latest US seaborne import report released by the National Retail Federation (NRF), due to early shipments in the fourth quarter ahead of the January strike deadline and heightened expectations of tariff increases next year since Trump's election victory in November, seaborne volumes and freight rates have been stronger than usual in the usual off-season months for Marine shipments. The NRF's latest estimate of total imports for the fourth quarter is 11 percent, or 640,000TEU, higher than the total reported in early October. At the same time, the forecast for 2025 imports is also 7 percent higher than in 2024, suggesting that shippers may continue to front-load early in 2025 in response to expected tariff increases.


Spring Festival freight rush


For two routes, Asia to Europe and the Mediterranean, rates are likely to rise further as seasonal demand increases around the Chinese New Year. However, the increase in capacity on these two routes is likely to restrain freight rate increases to some extent before easing back in late February. In addition, the carrier alliance restructuring that took effect in February is likely to increase market competition and put additional downward pressure on rates in March as carriers launch new services.

In terms of air cargo, freight rates for Chinese exports remained high and stable despite last week being the busiest week of the year. This is due to the increase in capacity, advance loading and booking capacity and other measures, effectively avoiding the chaos of the peak season. Air freight index rates between the Middle East and North America have risen about 20 per cent since the end of October, and last week topped $4 / kg for the first time, possibly reflecting pressure this year on air and sea connections, an alternative to direct Chinese exports, during the peak season.

The main driver of rising freight rates and tight shipping space in China in 2024 is the surge in B2C e-commerce volumes in North America and Europe. However, DSV speculated that while the demand for low-cost commodity platforms such as Temu and Shein is likely to continue to grow, heightened challenges to minimum exemptions for cross-border air freight transportation to consumers could curb the surge in e-commerce air cargo in 2025.
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