Freight market update - 21 May 2025

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• A preliminary trade agreement between the U.S. and China is likely to create a capacity crunch on Eastbound Trans-Pacific trade lanes.

• Tariffs on Chinese exports to the U.S. are being reduced from 145% to 30%.

• Tariffs on U.S. goods entering China are being cut from 125% to 10%.

• Chinese exporters are increasingly targeting Europe to maintain global market share in light of higher U.S. tariffs on Chinese goods.

• In the first four months of 2025, China’s trade surplus with the EU reached a record $90 billion, with expectations of continued growth.

• As capacity tightens on the Trans-Pacific route, South America is emerging as a key strategic hub for global air cargo.

• The ceasefire between India and Pakistan last weekend brought much-needed relief to civilians and supply chains alike.

• The last mile delivery market in North America is expected to grow by USD 14.9 billion between 2025 and 2029.

• The market is projected to expand at a CAGR of 3.8% during this forecast period.

Read on for more in-depth updates.

Asia → North America

US/CA

Transpacific Trends and Market Updates

• A preliminary trade agreement between the U.S. and China is likely to create a capacity crunch on Eastbound Trans-Pacific trade lanes.
• Tariffs on Chinese exports to the U.S. are being reduced from 145% to 30%.
• Tariffs on U.S. goods entering China are being cut from 125% to 10%.
• This change is already clearing a backlog of shipments that had built up over the past month, during which ocean carriers reported volume declines of 30% to 40%.
• As demand surges, freight forwarders are warning of rising spot rates, additional surcharges, and shortages of vessel space and equipment in the coming weeks.
• The goods delayed by previous tariffs are now set to flood the market, but according to Flexport’s head of ocean procurement, Nerijus Poskus, ships are already operating at 85–90% capacity.
• More than 40% of scheduled sailings in May were canceled due to reduced demand, and this has kept overall capacity constrained.
• Poskus noted that it could take over a month to restore capacity, as vessels serving the Trans-Pacific route were redeployed to other trade lanes and are not readily available.
• He anticipates that a space shortage on the Trans-Pacific will quickly escalate.
• Even before the trade deal was finalized, carrier executives had warned that a rebound in Asian imports would lead to port congestion.
• Maersk CEO Vincent Clerc described the situation as likely to trigger a “catch-up effect” due to the sudden increase in demand.
• Executives at the recent Georgia Foreign Trade Conference warned that U.S. ports may be overwhelmed, as infrastructure has not been upgraded since the cargo surge in 2020.
• Further complicating matters is the issue of container availability, with many empty containers either moved to Southeast Asia or not returned.
• This misalignment may result in critical equipment shortages across key routes.
• China’s expanding trade surplus with the European Union (EU) is sparking concerns that Europe is becoming a primary destination for redirected Chinese exports.
• Chinese exporters are increasingly targeting Europe to maintain global market share in light of higher U.S. tariffs on Chinese goods.
• In the first four months of 2025, China’s trade surplus with the EU reached a record $90 billion, with expectations of continued growth.
• While some Chinese exports are being rerouted through Latin America and Southeast Asia, significant volumes are being shipped directly to Europe due to its large consumer market.
• Persistently high U.S. tariffs are reinforcing China’s shift toward European markets.
• The Chinese yuan has fallen to its lowest value against the euro in over a decade, making Chinese products more competitively priced in Europe.
• Recent talks in Paris between French and Chinese officials highlighted both a commitment to cooperation and the existence of notable disagreements.
• Germany, once a country with a trade surplus over China, is now seeing the opposite trend.
• In 2020, China faced a trade deficit of over $18 billion with Germany; by 2024, that had shifted to a surplus of $12 billion.
• If current trends persist, China’s trade surplus with Germany could surpass $25 billion by the end of 2025.
• EU officials are paying close attention to the evolving trade dynamics.
• EU trade chief Maros Sefcovic confirmed that the bloc is actively monitoring containerized imports from China to detect possible shifts from Trans-Pacific to Europe-bound trade flows.
• As capacity tightens on the Trans-Pacific route, South America is emerging as a key strategic hub for global air cargo.
• At the IATA CNS conference in Miami, participants were informed that this shift represents a major transformation for the air cargo industry.
• Carriers and freight forwarders were advised to understand how these changes could impact the broader logistics landscape.
• Peter Cerda, IATA’s regional VP for the Americas, highlighted the rapid growth of e-commerce in Latin America, partially fueled by changes in trade tariffs.
• Stephanie Abeler, Lufthansa Cargo’s VP Americas, noted that shifting trade lanes are unlocking new opportunities across South America.
• Despite the opportunities, the redirection of capacity may lead to global imbalances.
• Peter Penseel, president of Delta Cargo, warned that diverting freighters from routes like Shanghai to Chicago to serve South America could create gaps in other regions.
• He added that such shifts—especially into South America and Mexico—will inevitably affect the global air cargo system.
• Penseel stressed the need for carriers and freight forwarders to consistently monitor and adapt to changing capacity demands.
• The arrival of more competitors in South America may intensify market pressure on regional carriers.
• Andrés Bianchi, CEO of Latam Cargo, remarked that while demand shifts may remain modest, changes in supply routes are a greater concern.
• He emphasized the importance of staying aware of how other operators are repositioning their capacity and how it may disrupt local operations.
• Brandon Fried, executive director of the Air Forwarders Association, echoed these concerns and warned of rising costs and infrastructure challenges due to increased investment in the region.
• Fried pointed out that while it’s relatively simple to redirect a freighter from the U.S. to cities like Buenos Aires or Lima, sustained investment could bring wage inflation and operational headaches similar to those faced in the U.S.
• The ceasefire between India and Pakistan last weekend brought much-needed relief to civilians and supply chains alike.
• Although military conflict has paused, the residual effects are still being felt across the region.
• Port operations were disrupted on both sides, with western Indian terminals experiencing blackouts.
• Major Pakistani ports also faced challenges, including the suspension of carrier calls.
• The air cargo sector faced even greater disruptions, as over 30 airports in India were temporarily closed.
• Reciprocal airspace bans led to rerouted flights, which drastically reduced capacity.
• These reroutes significantly increased shipping costs, particularly for sensitive products such as pharmaceuticals.
• While operations have resumed, the overall situation remains unstable and delicate.

Turkey → North America

• In early May, both FAK (Freight All Kinds) and PP (Prepaid) rates experienced increases.
• There are signs that some rate levels for the second half of the year may be revised downward, though no official confirmation has been made.
• Demand is gradually rebounding after significant drops recorded in April.
• Trade volumes from China to the U.S. declined by 60% last month, leading to numerous blank sailings.
• Starting mid-May, forward bookings are on the rise, especially among China-based shippers ramping up volumes due to tariff changes and temporary trade relief.
• Around 23% of scheduled weekly sailings have been canceled this week as carriers actively manage capacity in line with the recovering demand.
• Freight rates from India and Bangladesh remained stable in early May, with only minor adjustments reported.
• Some rate extensions have been confirmed through late May.
• Schedule reliability on the India Subcontinent–Europe (ISC–EU) route has improved, increasing from 38.1% to 47.4% in recent months.
• MSC has suspended its Rotterdam port call from Chittagong due to persistent congestion issues.
• A direct call to Rotterdam is expected to resume later in May via the Australia Express service.
• Ongoing political tensions between Pakistan and India continue to disrupt routing options.
• As a result, cargo is being transshipped through alternative hubs such as Colombo, the Middle East, and Singapore.
• Some carriers have imposed additional surcharges in response to the situation.
• Although a ceasefire is currently in place, unresolved tensions still pose service risks.

North America → Turkey

• Norges Bank Investment Management (NBIM) has committed $800 million to Blackstone’s North America logistics fund.
• The investment will target logistics assets in major population centers across the United States and Canada.
• The focus aims to capitalize on growing demand for distribution and fulfillment centers in densely populated regions.
• The last mile delivery market in North America is expected to grow by USD 14.9 billion between 2025 and 2029.
• The market is projected to expand at a CAGR of 3.8% during this forecast period.
• Growth is being driven by the booming B2C e-commerce industry in the U.S.
• A major trend in the market is the increased focus on technological advancements, particularly involving AI-driven solutions.
• However, operational challenges remain a key obstacle for last mile delivery companies.
• Maersk is expanding its logistics network to support rising trade demand amid stabilizing freight rates after last year’s market volatility.
• Christopher Cook, Managing Director of South Asia at Maersk, forecasts a 4% growth in global trade for this year.
• He expects Maersk’s performance to align with the overall trade growth trend.
• Cook noted that freight rates surged early last year due to a capacity crunch and the need to reroute vessels around the Cape of Good Hope.
• In the second half of the year, freight rates cooled, driven by changes in supply and demand dynamics.
• Maersk has seen strong growth in India, especially in apparel, automotive, and cold chain logistics sectors.

Terminal Updates

Vessels heading to North America via the North Atlantic Sea are expected to have a change in schedule due to severe weather conditions.

New York:

• The waiting time for all vessels calling APMT is up to 6 hours. Maher Terminals LLC reports vessel waiting times averaging around 6 hours.
• Average gate turn times are 38 minutes for single transactions and 58 minutes for double transactions.
• New cranes at APMT are set to be commissioned within the next two weeks.
• Although berth space will remain constrained, two vessels will be able to operate simultaneously along east-facing berths.
• APMT New York is currently experiencing high demand for gate appointments, particularly near vessel cut-off days.
• Customers are advised to deliver export cargo early—during the initial freight acceptance window—when appointment availability is typically higher.

Norfolk:

• The waiting time for a berth is up to 12 hours at Norfolk International Terminal (NIT) and 18 hours at Virginia International Gateway (VIG).
• Average gate turn times are 31 / 46 minutes for single and double transactions at NIT, and 37 / 64 minutes for single and double transactions at VIG.
• Virginia International Gateway is back in operation, though multiple cranes remain down for modifications or electrical work, with limited estimated return times.
• Crane #4 at NIT remains out of service since April 16 with no current update.

Charleston Terminal:

• No waiting time at Wando Welch Terminal and no waiting time at North Charleston Terminal.
• Average truck turn times are 19.4 / 20 / 15.1 minutes at Wando Welch Terminal, North Charleston Terminal, and Leatherman Terminal respectively.

Savannah:

• The average waiting time for vessel berth is 1 day for class 1 and 1.8 days for class 2 vessels.
• Average gate turn times are 34 / 52 minutes for single and double transactions respectively.
• Import dwell time is 5.6 days. Rail dwell time is 1 day.

Houston:

• Waiting time is up to 24 hours at Barbours Cut Terminal and 6 hours at Bayport Container Terminal.
• Average gate turn times are 35 / 60 minutes at Barbours Cut and 36 / 56 minutes at Bayport for single and double transactions respectively.
• Loaded import dwell time is 3.6 days at Barbours Cut and 3.6 days at Bayport.
• Yard use remains high at Barbours Cut.
• The Port of Houston is adjusting receiving days and cut-offs on short notice to maintain terminal fluidity.

Oakland:

• Average import deliveries are taking up to 4 days at Oakland International Container Terminal (OICT).
• Average gate turn times are 96 minutes.
• Three cranes at OICT are currently out of service.
• Berth maintenance is ongoing at OICT with one berth down at a time through Week 19.

Seattle-Tacoma:

• No waiting time at Husky Terminal or Washington United Terminal in Tacoma. No waiting time in Seattle.
• Import rail dwell is 2.3 days at Husky and 3 days at T18.
• Average gate turn times are 46 minutes at T18 and 72 minutes at Husky.

Los Angeles/Long Beach:

• All terminal gates are running as published and in line with the Pier Pass program.
• Port of Los Angeles dwell time for local import cargo is 3.6 days; on-dock rail dwell is 4.9 days.
• Import units on the street are averaging 3.8 / 6.7 days for 20 ft and 40+ ft containers respectively.
• Port of Long Beach dwell times for local imports remain at 4-8 days.
• Average terminal gate turn time is between 35 - 39 minutes, depending on the terminal.

Chassis Pools

All pools are operating as normal.

Intermodal Operations

Truck power can be secured within 1-3 days for the majority of locations, including marine terminals, rail ramps, and depots.

Port Status

Final Thoughts

In light of the latest updates and trends, the market is currently in the course of showing robust performance and is equipped with ample capacity and resources. Individuals and businesses involved in import/export activities must stay well-informed about market dynamics and strategies to make informed decisions.

To ensure a smooth and hassle-free experience with your import/export operations, it is recommended to seek guidance from industry experts. Taking proactive measures and staying proactive in your approach will help you navigate the market effectively. We greatly appreciate your continued readership and encourage you to subscribe to our weekly market updates to stay abreast of the latest developments and insights.