Surge in Inquiries for U.S. Routes Sparks "Container Space Scramble"; Will Freight Rates Soar?

"Recently, it's been really difficult to secure containers and shipping space," Ms. Zhong, who works in freight forwarding, confessed to a reporter from Cailian Press. "This week, we've been unable to get many containers. With fewer containers at the port, freight rates have started to rise."

Recently, China and the US announced the mutual removal of 91% of tariffs and the revision of the 34% reciprocal tariff measures, with a 90-day suspension of the 24% tariff increase, while the remaining 10% tariff was retained. The adjusted tariffs officially took effect at 12:01 PM on May 14 (00:01 AM on May 14, US Eastern Time). During a visit to Guangzhou Port by a Cailian Press reporter today, it was learned that since the implementation of these measures, multiple freight forwarding companies have seen a surge in inquiries for US routes. There has been a significant increase in freight volume on US routes, with a rush in container shipping and a tightening of shipping space. The industry expects that with the continuous growth of shipments on US routes, freight rates are likely to rise accordingly.

Wang Guowen, Director of the Logistics and Supply Chain Management Planning Institute at the China Development Institute (Shenzhen), stated in an interview with a Cailian Press reporter that traditionally, July to September is the Christmas shipping season. Coupled with restocking and building up future inventory, the next 90 days will be a peak period for shipping.

Driven by continuous positive news, the shipping sector surged again today. By the close of trading, Nanjing Port (002040.SZ), Ningbo Maritime (600798.SH), Ningbo Ocean (601022.SH), and Lianyungang (601008.SH) all recorded three consecutive trading limits. Additionally, the Dow Jones Transportation Average, a barometer of the US transportation industry, has risen by over 7% since the beginning of this week. Shipping giants Maersk and Hapag-Lloyd have seen their shares rise by nearly 11% and 12.5%, respectively.

Data released by trade tracking agency Vizion shows that after the US and China mutually reduced tariffs, container shipping bookings from China to the US, ordered in the US, surged by nearly 300%.

Ben Tracy, Vice President of Strategic Business Development at Vizion, stated that the seven-day average booking volume as of May 5 was 5,709 TEUs (Twenty-foot Equivalent Units), while the seven-day average booking volume as of May 14 soared by 277% to 21,530 TEUs.

Through interviews with multiple sources, a Cailian Press reporter learned that the ocean shipping cycle from Guangzhou to the US East Coast typically takes at least one month, while it takes just over ten days to the US West Coast. Currently, many foreign trade manufacturers are rushing to ship goods during this tariff "window period."

"Some manufacturers already had goods in stock but didn't ship them before. Now that tariffs have been lowered, many are eager to ship immediately. Currently, shipping space on US routes from Guangzhou's Nansha Port and Shenzhen's Yantian Port is somewhat tight, and there are still many bookings being made these days."The head of the Europe-US route business at a freight forwarding company stated that some people may adopt a wait-and-see attitude, but overall, there are still more bookings. Bookings for next week may not guarantee availability as current slots are already taken. Some customers are eager to secure more slots in advance, but they may not necessarily utilize all of them later, possibly booking three slots but only using two, or booking five and using four.

CIMC Group (000039.SZ) publicly announced today that due to the better-than-expected easing of Sino-US trade tensions, which has driven a rebound in energy demand, it is anticipated that there will be an increase in demand for the company's energy equipment, including oil and natural gas.

A reporter from Cailian Press, acting as an investor, called the securities department of COSCO Shipping Holdings (601919.SH) to inquire about the recent tariff changes and their impact on the company's business operations. The staff member only mentioned that the tariff adjustment is a positive signal and that the company's current production and operations are proceeding normally. (Going forward), the company will adjust the capacity of its routes in a timely manner based on customer demand.

In Wang Guowen's view, fluctuations in shipping capacity are caused by tariff increases or decreases, and negotiations before the end of the 90-day transition period will determine whether shipping can proceed smoothly. The shipping market in H2, especially the US routes, will experience fluctuations amid tight conditions, and both shippers and carriers should be fully prepared.

Due to the rising demand, freight rates on US routes have increased significantly. A reporter from Cailian Press learned from a freight forwarding company in Guangzhou that the ocean freight rate for a 20GP container has risen by more than $1,000 compared to before the policy adjustment, with the current rate for a single container being around $3,500. A freight forwarding agent said, "We cannot provide quotes for longer-term prices as they may increase at any time."

"The real surge in ocean freight rates is yet to come. It's not just the US routes; the entire industry market will see an increase," said the aforementioned head of the Europe-US route business. He explained that due to the significant decline in cargo volume on US routes in the early stages, shipping companies had redirected many of their vessels to other routes. Now, with the US routes becoming more profitable, some vessels will be redirected back, leading to price increases on other routes as well.

A source from an international logistics enterprise predicted that freight rates for routes transiting through the US to the Caribbean and Latin America will increase starting from the month-end. CICC stated that the reduction in Sino-US tariffs (with the cancellation of 91% of tariff hikes) will directly drive a rebound in cargo volume on the US West Coast and US East Coast routes. It is expected that freight rates on US routes will increase by 10% in 2025.