Unexpected Surge in Sea Freight Rates

27 November 2024

The seas are bustling once again. Earlier this year, we experienced an unusually early summer peak season, and demand is already much higher than typical for this time of year. This is putting greater pressure on rates and available shipping space. What can we expect moving forward, especially with the Chinese New Year falling early in 2025?

Short-lived Rate Lows

This spring saw freight rates rise at a rapid pace, as shippers opted to transport their December inventories and more in good time. This was a sensible decision, given the prolonged Red Sea crisis and subsequent uncertainty, resulting in unstable transit times.

In early November, rates from China’s main ports (including Shanghai, Yantian, and Ningbo) rose for the second consecutive week, increasing by 16% week on week. The demand for capacity from Asia remains high— a trend that logistics analysts including Xeneta and Drewry do not expect to change in the near term.

Just weeks ago, sea freight rates were dropping almost weekly, reaching a low point. While the recent surge isn’t expected to escalate as dramatically as last summer, rates are likely to remain relatively high for now. This is due in part to continued Houthi attacks on sea freight traffic in and around the Red Sea, as well as the early Chinese New Year approaching in January 2025.

Winter Weather and Maintenance Impact Already Overcrowded European Terminals

Unfortunately, it’s also far from smooth sailing at Northern European ports. Terminals are still grappling with backlogs, and equipment is piling up. Foggy autumn days have also reduced visibility, causing delays in operations. With the winter months approaching, conditions are expected to become even more challenging.

This is likely to lead to further congestion across all European ports. Antwerp, in particular, is facing longer waiting times due to delayed arrivals from prior ports and scheduled maintenance on its quays in December this year.

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