Key insights:

1. The US military operation in Caracas that led to President Maduro's capture included strikes on Venezuela's La Guaira container port (the country's second largest) and a nearby military base, causing operational disruptions and delays for port users.

2. Despite pre-operation reports of some tranship volumes already shifting away from Venezuela due to growing instability, the larger Port of Cabello lies just 60 miles west; with Venezuela representing a small container market (roughly one million TEU annual handling capacity), impacts from the La Guaira strike are expected to remain localized.

3. In trade war developments, the US delayed its planned January 1st tariff increase on lumber products including furniture for one year and backed away from sharp tariff hikes on Italian pasta imports, possibly responding to cost of living pressures; these moves create additional uncertainty about how the administration might react if the Supreme Court invalidates its IEEPA-based tariffs.

4. Start of year GRIs pushed Asia-Europe rates up 9% to $3,000/FEU and Asia-Mediterranean prices up more than 20% to $4,800/FEU last week, reflecting 23% and 45% increases since mid-December respectively, with Mediterranean rates reaching their 2025 peak season high.

5. These rate increases reflect growing pre-Lunar New Year demand even as carriers add capacity; despite being well above long-term pre-LNY norms, Asia-Europe prices remain 40% lower than last year – even with continued Red Sea diversions and likely stronger volumes – pointing to the impact of fleet growth.

6. Transpacific rates continued their mid-December ascent with January 1st GRIs pushing West Coast prices up 22% to $2,617/FEU (over 30% higher than mid-December) and East Coast rates up 12% to $3,757/FEU (20% higher in less than a month).

7. Unlike Q4 GRI attempts that quickly retreated, these price increases have held, suggesting LNY demand is now supporting transpacific rates; however, with volumes projected 10% below last year, year-on-year rate levels remain significantly lower due to these demand factors as well as capacity growth.

8. Air cargo rates continued cooling from peak season highs, with ex-China rates easing to $6.18/kg to the US and $3.44/kg to Europe (down from peaks of $8.00/kg and $4.00/kg), while South East Asia rates fell to $4.28/kg to the US (from mid-December's $5.80/kg) and $2.90/kg to Europe (from $4.00/kg).

Ocean rates - Freightos Baltic Index:

• Asia-US West Coast prices (FBX01 Weekly) increased 22% to $2,617/FEU.

• Asia-US East Coast prices (FBX03 Weekly) increased 12% to $3,757/FEU.

• Asia-N. Europe prices (FBX11 Weekly) increased 9% to $3,000/FEU.

• Asia-Mediterranean prices (FBX13 Weekly) increased 21% to $4,844/FEU.

Air rates - Freightos Air index:

• China - N. America weekly prices decreased 1% to $6.18/kg.

• China - N. Europe weekly prices decreased 2% to $3.44/kg.

• N. Europe - N. America weekly prices decreased 7% to $2.00/kg.

Analysis

“The US operation in Caracas over the weekend, which facilitated the US military’s capture of Venezuela’s President Maduro, included strikes on the city’s La Guaira container port and a nearby military base.

La Guaira is Venezuela’s second largest container port, and tits closure will disrupt operations and cause delays for importers and exporters who normally rely on La Guaira. Even before the US action, there were reports of some tranship volumes shifting away from Venezuela due to the growing instability. But the larger Port of Cabello is only about 60 miles to the west, and as Venezuela overall is a small market for container trade – with handling capacity of around a million TEU per year – impacts from the strike on La Guaira are unlikely to be felt beyond Venezuela.

In trade war developments, the US delayed its planned January 1st tariff increase on lumber products including furniture, for one year. The Department of Commerce also stepped back from plans for a sharp tariff hike on Italian pasta imports. These deescalations may partially be motivated by cost of living concerns that are putting some pressure on the White House. These responses add more uncertainty as to how the administration – whose stated intention is to quickly reinstate tariffs by other means – may react if the Supreme Court decision invalidates its IEEPA-based, country-specific tariffs introduced last year.

In ocean freight, start of year GRIs pushed Asia - Europe rates up 9% to the $3,000/FEU mark last week, and Asia - Mediterranean prices up more than 20% to $4,800/FEU, reflecting 23% and 45% climbs since mid-December, respectively.

These hikes – pushing Mediterranean rates even with their peak season 2025 high and Europe prices to their highest since late August – reflect growing pre-Lunar New Year demand on these lanes, even as carriers add capacity to service these volumes. These rate levels are well above long term pre-LNY norms, but even with Red Sea diversions continuing and volumes likely stronger than last year, Asia - Europe prices remain 40% lower than last year, likely an effect of a growing fleet.

Transpacific container rates, which started climbing in mid-December, continued their ascent last week via January 1st GRIs. Prices to the West Coast increased 22% to $2,617/FEU, and are more than 30% higher than in mid-December. East Coast rates climbed 12% to $3,757/FEU and are up 20% in less than a month.

That prices haven’t retreated at all from December increases – like they had following several GRI attempts in Q4 – suggests that LNY demand is picking up and supporting prices on these lanes too. Even if demand has started to pick up, volumes are projected to be 10% lower than last year, likely contributing, along with capacity growth, to significantly lower year on year rate levels for these lanes.

In air cargo, ex-China rates eased to $6.18/kg to the US and $3.44/kg to Europe – down from peak season highs of $8.00/kg and $4.00/kg – as post-peak demand slows. Prices out of South East Asia are likewise cooling, with rates to the US down to $4.28/kg last week from a mid-December high of $5.80/kg, and prices to Europe sliding to $2.90/kg from a peak of $4.00/kg.”