Trade War Shipping Showdown: Why US & Europe Rates Are Diverging
Publish Time: 2025-05-12 Origin: Site
Freight Rate Split: US Stability vs Europe’s Slide
Rate Performance (Jan 1 – May 2025)
| Trade Lane | Current Rate | Change Since Jan | Key Driver |
|---|---|---|---|
| Far East → USWC | $2,790/FEU | ▼52% | Pre-tariff rush + blank sailings |
| Far East → USEC | $3,830/FEU | ▼44% | Panama Canal capacity relief |
| Far East → North Europe | $2,130/FEU | ▼8% (May 1) | Overcapacity + weak demand |
| Far East → Med | $3,155/FEU | ▼1.6% | Resilient S. Europe imports |
Behind the Numbers
US Routes: Artificial Stability?
April surge: 16% rate jump as importers raced to beat Trump’s April 9 tariffs
Carrier tactic: 12% blank sailings (vs 5% in Q1) mimic COVID-era capacity cuts
Sword of Damocles: Q2 consumer demand drop could collapse current floor
"This is carrier-led stabilization—not market recovery."
— Peter Sand, Xeneta Chief Analyst
Europe Routes: Glut Without Glory
No tariff escape valve: Only 3% of diverted US cargo reaches Europe
Vessel oversupply: New 24,000 TEU megaships add pressure
Silver lining: Mediterranean rates down just 1.6% on Turkish/Egyptian demand
What’s Next? 3 Scenarios
1. US Hold Steady (40% Probability)
Conditions:
Blank sailings continue at >10%
June retail sales beat expectations
Outcome: Rates fluctuate ±5% through Q3
2. Europe Finds Floor (30%)
Conditions:
Carriers scrap 2-3 Asia-Europe loops
Red Sea fully reopens (adding back capacity)
Outcome: Europe rates rebound to $2,500/FEU by August
3. Dual Collapse (30%)
Conditions:
US tariffs crush Q3 imports
European recession deepens
Outcome: USWC below 2,000,Europesub?2,000,Europesub?1,800
Strategic Takeaways
For importers: Lock US rates now—June GRIs likely if volumes tick up
For exporters: Europe’s slump = negotiation leverage for long-term contracts
For carriers: Mediterranean may become new profit center vs North Europe
*Data as of May 2025 | Verify latest rates with Xeneta/Sea-Intel*
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