"Prices change every day"! Freight rates for U.S. routes have nearly doubled, and the effects of full bookings and price hikes have spread to other routes.

"Freight rates for the US route from the Far East to Los Angeles have doubled (WoW), and prices are changing daily," a freight forwarding executive in Qingdao told a Cailian Press reporter. Many ships operating on other routes have started to divert to the US route, driving up freight rates on other routes, including Mexico.

A salesperson from a Shanghai freight forwarding company also revealed to a Cailian Press reporter today, "Cabins are also fully booked on the Middle East and Africa routes. I couldn't secure a cabin for a Middle East business deal even when booking 10 days in advance (compared to the departure date), and freight rates have increased by 10-20%. Just now, MSC also notified that there are no special-rate cabins available on the Mediterranean East route, and FAK rates will be implemented. These are all chain reactions following the cabin shortages and rate hikes on the US route."

In terms of spot freight rates, there has indeed been a significant rebound in US route rates since May 12. Data provided by Jiyu Technology shows that for the Shanghai-Los Angeles route, as of the time of this report, Maersk's quote for the voyage departing on May 26 has reached $3,705/FEU, a 96% increase from the quote on May 12. For European routes, the current increase is relatively small. Taking the Shanghai-Rotterdam route as an example, as of this morning, OOCL's quote for the voyage departing on May 28 was $1,774/FEU, a 7.5% increase from the quote on May 12.

For US express routes, as their freight rates are higher than those of regular ships, the changes in booking volumes are not as pronounced as those of regular ships. A Cailian Press reporter learned from sources close to Matson (MATX.US), a leading express shipping company, that the company's current booking situation is relatively stable, with no widespread cabin shortages. The company recently raised its freight rates by $1,500/FEU, adjusting prices back to normal levels before the tariff impact.

"Currently, there is a clear upward trend in freight rates on the US route, and European routes may follow suit to some extent, but the increase is unlikely to match that of the US route. This is related to the significant differences in vessel configurations between the US and European routes. Additionally, a higher proportion of US route suspensions occurred earlier, with some vessels diverting to European routes. These vessels are now gradually being redeployed to the US route. It is expected that direct diversions from European to US routes may be relatively limited in the future, but there will still be some linkage effects in the market," Wu Jialu, head of the Industrial and Cyclical Group at CITIC Futures Research Institute, told a Cailian Press reporter.

Wu Jialu further analyzed that cabin shortages in the Middle East may be due to (shippers') inherent demand preferences and the arrival of the peak season, combined with the current shipment of goods accumulated during the earlier Ramadan period. The tight capacity in Mexico and South America is due to a 20-30% reduction in capacity on the original US route, with shipping companies like ZIM partially redirecting vessels from South American routes to the US route. It is worth mentioning that KMTC has started to increase its operations on the US route, and the high freight rates on the US route will bring about spontaneous market adjustments.

In addition, Wu Jialu believes that there may also be a certain degree of tightness in container {{supply}}. Despite the fact that shipping companies ordered a significant number of containers in 2021 and 2024 due to strong freight rates, it is still necessary to observe the duration and intensity of the current rush shipping in the US, and whether it will lead to port congestion, slower turnover, and a shortage of containers. At the same time, attention should also be paid to the impact if shipments fall short of expectations, as well as the risks of a supply surplus in the European route and cargo volumes falling short of expectations this year.

However, liner companies remain cautious about their full-year earnings expectations for this year. Hapag-Lloyd stated in its recently released Q1 financial report that it maintains its unchanged outlook for the full year, expecting the group's EBITDA to be lower than that of 2024 amid a challenging market environment. Another official from a liner company also told a reporter from Cailian Press earlier that they maintain a cautiously optimistic attitude towards the container shipping market for the full year.