Key insights:

1. Only a few vessels per day are transiting the Strait of Horumuz, which this week included a CMA CGM vessel, a first from a major European carrier.

2. Aside from Gulf-related cargo, ocean operations remain stable across the market, but rising fuel costs and fuel availability are the main pressure points on other lanes.

3. Rates would normally be flat or easing this time of year, but transpacific prices have climbed $700/FEU and nearly 40% since before the war to above $2,400/FEU, while Asia–N. Europe rates are up 20% and $500/FEU to $2,900/FEU.

4. Facing growing overcapacity, January - February container rates had been 30-50% lower than in 2025. But since the war that gap has narrowed and transpacific prices are now 8% higher year on year and Asia–Europe rates 22% higher than this time last year.

5. But downward pressure from weak supply-demand conditions may be limiting the impact of fuel surcharges and GRIs, with reports of carrier discounts and benchmark rates still well below announced FAKs; Asia–Mediterranean prices are up more than 7% to $3,800/FEU but have eased from a mid-March high of $4,300/FEU.

6. Fuel availability is also tightening, with only about a month of bunker stocks left in Singapore even as Rotterdam remains supplied; if the conflict drags on, carriers could slow steam or blank sailings to save fuel, adding further upward pressure on rates.

7. Air cargo is also feeling fuel constraints, with Vietnam canceling some domestic flights and reports of refueling restrictions in South Korea and the Philippines, while Gulf carriers continue to recover capacity.

8. Freightos Air Index shows South Asia–Europe rates 62% higher than before the war at $4.17/kg, SEA–Europe up 33% to $4.50/kg and Europe–Middle East doubled to $3.67/kg; But many lanes have leveled off or eased slightly as capacity slowly recovers, including China–Europe down 7% over the last two weeks and SEA–Europe down 10% from recent highs.

Ocean rates - Freightos Baltic Index:

• Asia-US West Coast prices (FBX01 Weekly) increased 11% to $2,420/FEU.

• Asia-US East Coast prices (FBX03 Weekly) increased 5% to $3,350/FEU.

• Asia-N. Europe prices (FBX11 Weekly) increased 2% to $2,922/FEU.

• Asia-Mediterranean prices (FBX13 Weekly) decreased 2% to $3,830/FEU.

Air rates - Freightos Air index:

• China - N. America weekly prices decreased 16% to $6.31/kg.

• China - N. Europe weekly prices stayed level at $4.69/kg.

• N. Europe - N. America weekly prices decreased 3% to $2.37/kg.

Analysis

We are approaching six weeks since Iran closed the Strait of Hormuz, and only a few vessels per day are being allowed through. Ships that are transiting are doing so via coordination with Iran and possibly payments ahead of time, which this week included a CMA CGM container vessel, the first from one of the major European carriers.

Besides containers moving to or from the Gulf states, ocean operations remain stable across the market, with rising fuel costs and availability the main factors impacting other lanes.

Ocean rates would typically be flat or easing this time of year in the soft demand period between Lunar New Year and peak season. But despite weak demand, transpacific container rates to the West Coast have climbed $700/FEU and nearly 40% since just before the war to more than $2,400/FEU, with Asia - N. Europe rates up 20% and $500/FEU to $2,900/FEU.

Earlier in the year, expectations were that carriers – facing a growing fleet and overcapacity – would face a significant challenge in keeping rates above last year’s levels. Indeed, up until the start of the war in Iran average transpacific spot prices were more than 50% lower than in January and February 2025, and Asia - Europe rates were 30% down year on year.

But that margin has steadily narrowed since the end of February, with rates surpassing last year’s prices in the last couple weeks, and current levels 8% stronger than a year ago for Asia - US West Coast and 22% higher for Asia - Europe.

At the same time, the downward pressure on rates from current supply-demand dynamics may be limiting the degree to which fuel surcharges and various other fees and GRIs are succeeding to push rates up, with reports of carrier discounts as well as benchmark levels well below announced FAKs.

Asia - Mediterranean prices of $3,800/FEU are up more than 7% and $260/FEU compared to the end of February, but have retreated from a high of $4,300/FEU in mid-March. Carriers nonetheless continue to announce upcoming price hikes, though the US FMC continues to deny carrier requests to waive the waiting period for new fees.

In addition to the cost of fuel, bunker availability is also a challenge. Only a month’s worth of fuel stocks remain in Singapore – the industry’s largest refueling hub – though Rotterdam, the second largest, remains supplied. If the war stretches on, carriers could start to slow steam or blank sailings to reduce fuel consumption, which could put additional upward pressure on rates.

Fuel availability is also becoming an issue in some regions for air cargo. Vietnam has canceled some domestic flights to conserve jet fuel, with reports of refueling restrictions in S. Korea and the Philippines as well.

Gulf carriers continue their capacity recoveries – with DHL estimating Emirates SkyCargo is back to 60% of its normal schedule, Etihad Airways up to 40% and Qatar Airways Cargo at 20% – but the remaining supply deficit, the volume shifts to alternate East-West routes, and rising jet fuel costs are keeping rates elevated.

Freightos Air Index data show S. Asia - Europe rates 62% higher than before the war at $4.17/kg, SEA - Europe prices up 33% to $4.50/kg and Europe - Middle East rates doubled to $3.67/kg. Even so, rates have mostly leveled off or even eased slightly on most of these lanes following initial weeks of sharp climbs, with China - Europe prices of $4.67/kg 7% lower than two weeks ago, SEA - Europe rates down 10% and S. Asia - Europe prices about even – possibly reflecting the gradual capacity shifts and recovery.