Uncertain Waters: Securing Ocean Freight Rates

Uncertain Waters: Securing Ocean Freight Rates

Apr 2, 2025 | , , , , , , , , , , , , ,

While there’s talk in the market about further pressure on rates, the reality is more complex, with container spot rate indices showing mixed signals last week, suggesting that any softening on key east-west routes might not last.

The global supply chain remains unpredictable, and several factors are still keeping the container market tight, which means any short-term dip in rates could quickly reverse, making it risky to assume that prices will continue to ease.

Carriers Act to Support Rates
Shipping lines are actively removing capacity from major east-west trades to reduce supply and put upward pressure on pricing. According to Drewry’s, 68 sailings across the Pacific, Asia-Europe, and Transatlantic trades have been blanked between this week and the end of April, while Sea-Intelligence data reports 47 blank sailings in the same period.

While methods of tracking blank sailings may vary, particularly as the major alliances transition between old and new service structures, the trend is clear; carriers are taking deliberate action to support General Rate Increases (GRIs) and stabilise the market in their favour.

Charter Market Dynamics Are Holding Rates Firm
While spot pricing may hint at a softer market, the time-charter sector continues to show strength. Many non-operating shipowners are keeping older, fully paid vessels in service, since they remain profitable even at lower margins.

This keeps theoretical capacity high but delays any significant correction in long-term charter rates, providing a buffer of rate stability for carriers. Basically the return is greater to ship owners to work the aging vessels in the current market than to scrap them. However once the charter rates diminish as freight rates are not at sustainable levels to support higher charter rates then scrapping vessels becomes more profitable and the supply of capacity will be eroded.

This willingness to keep tonnage in play – rather than scrap it – creates a layer of structural overcapacity. But crucially, it also delays any meaningful correction in longer-term charter costs, which in turn supports rate stability for shipping lines.

Shippers on the Asia-Europe trade lane should be particularly alert. With the traditional peak season approaching and transit times still extended due to Red Sea routing changes, demand could pick up sooner than expected, just as it did in 2024, when European importers advanced bookings to avoid delays.

Utilisation remains relatively high, and the market is only one or two strong booking weeks away from tightening significantly. Once that happens, space could quickly become constrained and prices may respond accordingly.

Congestion, Reliability and GRIs
At the same time, much of the market’s theoretical capacity isn’t actually accessible. Port congestion continues across Europe, including Antwerp, Hamburg, Rotterdam, and Le Havre, with yard occupancy levels of 75–90%, disrupting container flows and delaying vessel turnarounds.

Conditions are similar in Asia. Shanghai is experiencing delays due to fog and vessel bunching, while Singapore and Port Klang are seeing large backlogs and productivity slowdowns. Globally, schedule reliability remains under 55%, and with new carrier alliances still in rollout mode until July, disruption is likely to persist.

This operational friction reduces effective supply, keeping pressure on rates and creating risk for those waiting to move goods last-minute.

The container shipping lines have begun applying General Rate Increases (GRIs) and surcharges in recent weeks to stabilise rate levels in key corridors. While results may vary, these moves signal a clear intent to maintain pricing discipline, particularly as demand indicators begin to shift.

In an environment where schedule reliability is poor, congestion is high, and demand could rebound with little notice, waiting for rate relief may come with unintended consequences.

Certainty Beats Volatility
Shippers looking to avoid surprises would be well advised to fix rates where possible—because securing capacity and cost visibility offers valuable protection in a market that remains anything but predictable.

Freight markets can shift quickly, and when they do, the cost of waiting may outweigh any potential benefit. Fixing rates now delivers stability, security, and peace of mind in today’s volatile environment.

Our fixed-rate agreements act as a practical safeguard against market swings, offering predictable costs to support confident budgeting and planning.

Whether you’re managing high-volume trade lanes or simply seeking greater control over your supply chain, we’re here to help you stay ahead in 2025.

EMAIL our Managing Director, Andy Smith, to learn how we can support your business today.

Air Freight Market Review

Air Freight Market Review

Mar 18, 2025 | , , , , , , , , , , , , , , , , ,

The global air freight market in February and early March reflected moderate year-on-year (YoY) growth, with total worldwide tonnages up 5% in February and 2% higher YoY in early March.

However, market dynamics remain volatile, influenced by shifting trade policies, geopolitical factors, and eCommerce trends.

Asia-Europe air cargo showed strong demand recovery in March, with tonnages rising 4% week-on-week (WoW) and while average spot rates softened they remain 20% higher YoY. Meanwhile, transatlantic routes saw weaker demand from Europe, with London Heathrow and Frankfurt spot rates declining amid softer outbound trade.

Market Situation
Global air cargo tonnages rose 5% YoY in February, supported by an 8% surge from Asia Pacific and a 4% rise in North America and Europe. However, Middle East & South Asia (MESA) volumes declined by 6%, reflecting last year’s Red Sea-driven demand spike.

By early March (Week 10), Asia-Europe trade saw significant WoW volume gains:

  • China to Europe tonnages increased by 5%
  • Hong Kong to Europe volumes grew by 6%
  • Japan & Taiwan to Europe rose by 7%
  • Thailand & Singapore to Europe surged by 9%

Despite these volume increases, average spot price indices on Asia-Europe lanes declined by 3%. However, YoY spot rates remain significantly higher (+20%), supported by China (+14%), Hong Kong (+22%), Japan (+19%), and Thailand (+38%).

Global air cargo markets remained relatively stable through February and early March, with weekly demand fluctuations balancing out across key regions.

  • Asia-Europe: Despite a 4% WoW tonnage rebound in Week 10, rates dipped as supply-demand balances shifted.
  • Transatlantic (Europe to USA): Weaker outbound demand put spot rates under pressure at London Heathrow and Frankfurt.
  • Middle East to Europe: Demand weakened with Dubai-to-Europe tonnages falling 15% WoW.

Global air freight rates remained 6% higher YoY, though Asia-Europe pricing showed a mixed trend, with falls on all the major trade lanes, though rates remain significantly higher than last year.

  • Asia-Europe remains 20% higher YoY.
  • China to Europe still stands 14% higher YoY.
  • Hong Kong to Europe are up 22% YoY.

The Asia-Europe air cargo market rebounded in early March, with tonnage gains but slightly softer rates as market conditions adjusted. Meanwhile, transatlantic routes saw demand weakness, leading to rate declines from major European hubs. Moving forward, trade policies, geopolitical shifts, and capacity adjustments will continue to influence global air cargo pricing and volumes.

In a volatile air cargo market, securing capacity and competitive rates is critical. Metro’s air freight, charter, and sea/air solutions ensure your shipments move efficiently, even on the busiest trade lanes. With block space agreements (BSA) and capacity purchase agreements (CPA) in place, we guarantee space and stable pricing when you need it most.

Whether you’re shipping urgent, high-value, or sensitive cargo, our global expertise and strategic carrier partnerships keep your supply chain running on time and within budget.

EMAIL Elliot Carlile, Operations Director, today to explore how Metro’s air freight solutions can optimise your logistics.

Seven supply chain shocks in seven weeks

Seven supply chain shocks in seven weeks

Feb 19, 2025 | , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Just seven weeks into 2025, global supply chains have already faced a whirlwind of challenges.

From industrial action to trade barriers and shifting alliances, businesses must stay agile to navigate ongoing disruptions. Here are seven of the most impactful developments so far this year.

1. US east coast port strike averted (8th January)
A major disruption was narrowly avoided as the International Longshoremen’s Association (ILA) and United States Maritime Alliance (USMX) reached a tentative six-year agreement. The deal, approved on 7 February, prevented a strike that could have crippled US east coast ports for months. A final vote on 25 February will confirm its ratification.

2. Uncertainty over Suez Canal return (19th January)
Despite a fragile ceasefire in Gaza, container ships will not be returning to the Red Sea anytime soon. Carriers remain cautious, fearing renewed instability and prioritising the established Cape of Good Hope diversions. Even if ships do resume transit, severe disruption is expected, with schedules taking up to two months to stabilise.

3. Trump’s trade policies spark concerns (20th January)
Following his inauguration, President Trump swiftly reignited trade tensions, threatening tariffs on Colombia, China, Canada, and Mexico. Proposals include a 25% levy on steel and aluminium from Canada and Mexico, with reciprocal tariffs also being considered for UK imports. The potential trade war could have widespread consequences for global supply chains.

4. US air cargo demand under threat (1st February)
Trump’s decision to impose a 10% tariff on all Chinese imports and temporarily suspend the de minimis exemption for low-value Chinese shipments has sent shockwaves through the air freight sector. While the exemption was reinstated, changes to eCommerce regulations could significantly disrupt air cargo flows into the US, which is expected to receive 1.4 billion eCommerce packages this year.

5. New Asia shipping alliances reshape trade (2nd February)
The long-anticipated shift from three major container alliances (Ocean, THEA, 2M) to four key players (Ocean, Premier, Gemini, MSC) is now in effect. Asia-North Europe scheduled liner capacity will shrink by 11%, yet the number of weekly sailings will increase from 26 to 28. These changes will reshape global shipping networks for years to come.

6. European road freight rates stabilising (4th February)
After three years of decline, European road freight spot rates may have hit their lowest point. According to the European Road Freight Rate Benchmark, spot rates fell just 1% year-on-year in Q4 2024. While demand remains weak, cost pressures have kept rates 15% above pre-pandemic levels, with short-term volatility expected.

7. Carriers cut sailings to stabilise rates (14th February)
Shipping lines are aggressively blanking sailings to ease the transition to new alliance schedules and sustain freight rates. Between 17 February and 23 March, 51 sailings have been cancelled across key east-west trade routes, with February’s cancellations rising to 133 from 104 in January. Further capacity withdrawals and a general rate increase (GRI) could follow if demand fails to recover.

With trade disputes, shipping realignments, and geopolitical instability shaping global supply chains, the first quarter of 2025 has already presented significant challenges.

Staying ahead requires proactive strategy adjustments to mitigate risks and build resilience. That’s why we share these insights and why your Metro account management team is always by your side, ready to provide expert advice, share knowledge, and develop bespoke solutions tailored to your supply chain needs.

For high-level support, EMAIL Andrew Smith, Managing Director.

Gemini Cooperation’s bid to transform reliability

Gemini Cooperation’s bid to transform reliability

Feb 5, 2025 | , , , , , , , , , , , ,

As the Gemini Cooperation officially launches, its promise of 90%-plus schedule reliability through a hub-and-spoke network is under intense scrutiny.

Maersk and Hapag-Lloyd, the two partners in the venture, aim to address persistent reliability issues in container shipping, where schedule adherence has remained stubbornly low, fluctuating between 50% and 55% throughout 2024.

Gemini’s hub-and-spoke model, which involves central hubs facilitating feeder services to final destinations, is designed to optimise transit efficiency. By consolidating mainline services at designated hubs, the carriers seek to mitigate congestion-related delays that can plague conventional port-to-port operations. 

With 340 vessels and a combined capacity of 3.7 million TEUs, the Gemini network will eventually offer 57 interconnected services – 29 mainline routes and 28 regional shuttles – once fully phased in by mid-year.

Overcoming historical challenges

Achieving the ambitious 90% schedule reliability target remains a formidable challenge, given the industry’s historical struggles with port congestion and operational disruptions. 

While Maersk and Hapag-Lloyd have consistently outperformed the industry average, their own reliability in 2024 remained below 60%. By controlling key transshipment hubs Gemini aims to establish a more predictable flow of goods. 

External risks, however, remain beyond the carriers’ control. Congestion at key ports in China, including Shanghai and Ningbo, has intensified due to demand outpacing capacity growth. The ability of the Gemini model to navigate such disruptions will be crucial in determining its success.

A question of market adoption

Beyond operational feasibility, the long-term viability of Gemini hinges on whether shippers are willing to prioritise schedule reliability over cost savings. The model’s success will depend on whether customers are prepared to pay a premium for consistency, particularly in an uncertain 2025 market. While some shippers may value reduced inventory costs enabled by greater reliability, past efforts to introduce premium services struggled due to market fragmentation and price sensitivity.

With the majority of shippers valuing end-to-end reliability rather than just punctuality between hubs, the challenge for Gemini will be to demonstrate that its model can deliver comprehensive benefits across the entire supply chain.

An industry-first experiment

With competing alliances, Ocean Alliance, Premier Alliance and MSC continuing to favour traditional port-to-port networks, Gemini’s decision to embrace the hub-and-spoke model sets it apart. For ‘Ocean’ and ‘Premier’ it is more or less ‘business as usual’, with their service structure based upon the current setups. 

In particular ‘Ocean’s’ network remains largely unchanged, except for the re-launch of a seventh Far East to Europe service. Further to this, the alliance will add the South Chinese port of Yang- pu, on Hainan Island, to two of its Asia to North America loops. 

‘Premier’ mainly maintains the former THEA services and it will compensate the departure of Hapag-Lloyd by slot agreements with MSC on Far East to Europe services. Operationally, the partners will keep full control of ‘their’ loops, while retaining an existing Vessel Sharing Agreement with Wan Hai Lines in the Transpacific trade. ‘Premier’s’ largest member, ONE, will also continue a Transatlantic Vessel Sharing Agreement with the members of ‘Ocean’. 

With the network still in its early stages, industry observers remain divided on whether Gemini can deliver on its promises. Yet, if the venture achieves its ambitious targets, it could compel competitors to rethink their approach. The coming months will provide the first indications of whether this bold experiment will reshape global container shipping or simply become another ambitious but short-lived attempt at reform.

Metro negotiates rates and volume agreements with a broad portfolio of carriers, including MSC and the three major alliances, ensuring shippers have access to the widest range of service options, port pairings, and competitive rates. 

Our tailored ocean freight solutions reflect each customer’s unique requirements and expectations, delivering optimised logistics strategies. For expert guidance EMAIL Andy Smith, Managing Director, to review your situation and find the best solution for your supply chain.

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