Freightos Weekly Update: Union approves LA/Long Beach port strike; container rates still under pressure

The container carrier march back through the Red Sea continues, with Alphaliner estimating nearly two-thirds of total Asia – Europe capacity is now restored. Especially of note is Israeli carrier ZIM’s announcement that it has resumed taking the Red Sea route for its joint Asia – US East Coast service with MSC, as the Houthis declared the Bab el-Mandeb Strait closed to Israel-linked vessels as recently as August.

Another typhoon rumbled through the Far East starting last week. Typhoon Champi closed container ports and airports in Taiwan on Friday, and threatened but mostly spared operations at East China ports before weakening as it continued on toward Japan.

The major Chinese container hubs continue their recovery from previous storm disruptions over the summer though most are still not completely back to normal. Congestion has been one factor keeping some pressure on container rates even as demand eases post peak season. Some vessel bunching from ships now taking the shorter Red Sea route and arriving ahead of schedule may be slowing the recovery.

Though demand is cool on Asia – Europe lanes carriers are scheduling rate increases for November, with prices already trending up since mid-month as congestion and blanked sailings assist carrier attempts at rate bumps for now. Asia – N. Europe prices climbed 3% to $3,551/FEU last week and rates to the Mediterranean increased 8% to $4,252/FEU. Nonetheless, some forwarders are already reporting carrier discounts and don’t expect additional increases to take.

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