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Since October, major global container freight rate indices have risen consecutively, bringing a brief warmth to the long-sluggish market.

The Shanghai Containerized Freight Index (SCFI) surged 10.5% to 1,550.70 points on October 31. Multiple major routes moved higher simultaneously: European routes saw stable demand, with freight rates rising 7.9% to $1,344/TEU; Mediterranean routes increased 12.4% to $1,983/TEU. The Trans-Pacific routes rebounded the most significantly. Boosted by the trade "truce" agreement reached between China and the US¡ªunder which the US canceled some additional tariffs and suspended the Section 301 investigation, while China also suspended countermeasures¡ªmarket sentiment improved markedly. Freight rates from Shanghai to the US West Coast and US East Coast rose 22.9% and 13.4% respectively, reaching $2,647/FEU and $3,438/FEU.

Meanwhile, Drewry¡¯s World Container Index (WCI) rose 4% this week to $1,822/FEU, achieving the first "three consecutive increases" since July. Among them, Shanghai-Los Angeles increased 6% to $2,438/FEU, and Shanghai-New York rose 4% to $3,568/FEU.

Tariff War Suspension: Short-Term Emotional Support

At the end of October, China and the US reached a 12-month trade truce agreement in Busan, suspending the implementation of new port fees and reducing tariffs related to so-called "fentanyl." After the news was released, market sentiment improved significantly, and some shippers accelerated their shipping schedules to avoid uncertain risks from future policy changes. Shipping analysts believe that this "tariff ceasefire" has indeed had a positive short-term impact on the market: it eliminated the psychological pressure of further price declines and provided external impetus for the recent freight rate rebound.

Behind the Rebound: Contract Negotiation Period and Market Game

From an operational perspective, the current spot freight rate increase is not highly seasonally cyclical but an "active rebound" achieved by shipping companies through refined capacity management and psychological guidance. Xeneta pointed out that the deployed capacity on the Asia-US West Coast route in October fell to the lowest level since April, and some shipping companies created a short-term "supply shortage" by canceling sailings (blank sailing), consolidating containers, and skipping ports.

Drewry also stated that the freight rate increase was driven by the General Rate Increase (GRI) scheduled to take effect on November 1. On the Asia-Europe route, carriers are raising freight rates for all cargo types (FAK) starting from November 1 to increase spot freight rates before the start of the new annual contract negotiation season. In its report, Drewry directly stated that this upward trend "will be difficult to sustain" and is expected to pull back after mid-November.

Although this strategy of "controlling capacity to support the market" is effective in the short term, it cannot change the reality.

According to Xeneta data, although the spot price of Far East-North Europe has increased month-on-month, it is still 61% lower than the beginning of the year, the largest drop among major trunk lines. Shipping companies try to maintain their negotiating position through freight rate signals, but shippers have already seen through the underlying operational logic.

Every year from October to November is a critical period for annual contract negotiations on Asian export routes (especially European and US routes). The trend of 2026 contract prices will be "predetermined" by the current sentiment in the spot market. For this reason, shipping companies¡¯ freight rate strategies at this time have obvious characteristics of psychological warfare¡ªeven if demand does not improve, they must let the market "see" prices rising.

However, shippers have not been fooled by this superficial phenomenon. According to Xeneta¡¯s market sample, despite the rise in spot prices in October, the average spot price of the Far East-North Europe route is still about $200/FEU lower than the long-term contract price, meaning shippers are still in an advantageous position in the 2026 contract negotiations. Even if the short-term upward trend continues until early November, long-term contract prices will not be significantly raised. In fact, a similar situation occurred in the fourth quarter of last year¡ªspot prices rebounded briefly, but long-term contract prices effective in early 2025 remained flat or even declined.

Long-Term Pressures Remain: Dual Dilemma of Surplus and Weakness

Even with the short-term recovery in freight rates, the medium and long-term prospects of the industry remain weak. The global container fleet is expected to grow by 3.6% in 2026, while transportation demand will only increase by about 3%. The continuous delivery of new ships and limited route adjustments have made oversupply a structural problem. At the same time, the weak global economic growth, declining manufacturing orders, high US inventories, and low European consumption are difficult to reverse in the short term, making the "volume and price increase" in the shipping market still out of reach.