Freightos Baltic: Peak season refuses to peak as transpacific rates keep climbing

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Transpacific rates rose 2% last week to fresh peak-season highs: $7,600/FEU to the West Coast and $9,800/FEU heading towards the East Coast. Asia-North Europe has pulled back over $1,000/FEU from its July peak to $4,600/FEU, still up 70% since mid-May; Mediterranean rates at $4,800/FEU are down over $2,000/FEU but 40% above three-month-ago levels. Transatlantic rates gained $400/FEU in two weeks to $2,600/FEU as carriers cut capacity.

Transpacific demand remains unusually strong despite peak season's early May start. Carriers are adding modest September capacity, with further increases likely — especially East Coast — ahead of October Golden Week blank sailings. Drivers are unclear but likely include the absence of late-July tariff hikes, rising data-center hardware volumes, and tariff refunds fueling inventory restocking. Several carriers plan sizeable Atlantic increases for September, though some doubt they'll hold. Panama Canal low-water surcharges are another possible pressure point for East Coast rates.

A string of typhoons since mid-July has kept Far East hubs congested. Typhoon Saudel shut Shanghai and Ningbo for days, disrupted Busan, and threatens Shenzhen this week. Backlogs haven't cleared between storms — Shanghai has had up to ninety ships waiting over a week — and skipped calls are pushing volume into regional transhipment ports. This congestion, plus still-tight (though improving) Rhine water levels, is helping keep Asia-Europe rates elevated even as demand has cooled since mid-July.

Strait of Hormuz tensions add further risk. Reported progress on an Iran-Oman authority-sharing deal hasn't eased hostilities: Iran continues striking vessels, the US claims demining progress, and US forces hit Iranian rocket launchers seen as mine-capable. Iran retaliated against US sites in Jordan.

Congestion in Asia, resilient US demand, and Hormuz instability are reinforcing each other to keep rates elevated across major trades. Barring a demand pullback or broad de-escalation, further September increases look likely before Golden Week brings relief.

Written by: Farid Muzaffar