Recent developments in the container shipping market indicate that global spot rates, while still rising, have slowed compared to May and early June. However, some shipping companies, such as Mediterranean Shipping (MSC) and Maersk Line, have recently announced plans to adjust rates for European and US routes.

    Specifically, MSC announced that as of July 1, the freight rate of the European route (European Line) will be increased to a maximum of $9,800, while Maersk Line also informed customers that the European line will be increased by $2,000 per large box to a maximum of $9,400. MSC has also promoted a significant adjustment of the freight rate of the US-East route in advance, and plans to raise the freight rate of each large box by $2,000 from July 1, if successful, the freight rate will break through $10,000 to reach $10,400.

    It is worth noting that Maersk Line's tariff adjustment plan for the European route will be implemented on July 1, but for the US-East route, the original plan for most shipping companies is to raise on July 15. However, as MSC promotes a substantial price increase half a month in advance, and considering that HMM has sent three overtime ships on the eastern route of the United States, it is still necessary to further observe whether the price increase plan of Mediterranean shipping can be successfully realized.

    Market analysts pointed out that the labor agreement between dockworkers and management on the East Coast of the United States will expire on September 30, and the union has stopped negotiations on a new contract because of the impact of automated facilities on workers' work rights at Maersk's dedicated terminals, making the possibility of a strike higher. This has forced shippers to rush shipments ahead of schedule, increasing shipping demand. At the same time, although the Panama Canal has increased the volume of traffic but adopted weight restrictions, it also provides a reason for the MSC to significantly increase freight rates.

    In contrast, the United States West route due to overtime ships and new routes more, the supply of space is relatively adequate, is expected to be July 1 per large box freight will be increased by $1,000. However, the United States East route is more tight, MSC East route freight increase of $2,000 is considered to be possible by the market, but it remains to be seen how long, because new shipbuilding and overtime ships are continuing to put into Europe and the United States route.

    Peter Sand, chief analyst at Xeneta, said that while spot rate growth has slowed, which is a positive sign for shippers, the overall shipping market still faces significant challenges and this situation is likely to continue. Average spot freight rates from the Far East to the West Coast of the United States and Northern Europe have increased by 276 percent and 316 percent, respectively, compared to mid-December last year, which is a huge economic pressure on shippers.

    In addition, spot freight rates in major consuming regions have risen sharply, increasing the likelihood of a pick-up in inflation in the region. However, analysts believe that freight rates are unlikely to reach the high levels seen during the pandemic, but the development of geopolitical events, such as the Israeli-Palestinian conflict, could have a significant impact on freight rates.