Container freight rates on the key Asia–Europe lanes are retreating back to pre-conflict levels, as supply chains stabilize and seasonal demand softens following the initial disruption tied to tensions in Iran.
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Latest data from Drewry shows spot rates on the Shanghai–Rotterdam route fell 4% week-on-week to $2,147 per 40ft container, while the Shanghai–Genoa corridor dropped 8% to $3,071 per 40ft. Both lanes are now broadly in line with levels seen before the conflict escalated in late February.
The pullback reflects a combination of weaker seasonal demand and excess vessel capacity, according to analysts.
Shipping intelligence platform Xeneta reports a similar trend, noting that carriers have now adjusted to new routing patterns and redeployed capacity after the initial shock. Average spot rates from the Far East have declined over the past month, down 6% to North Europe and 13% to the Mediterranean.
With the immediate disruption priced out, attention is shifting to how carriers manage supply in the coming weeks.
So far, capacity discipline appears limited. Only a handful of sailings have been canceled, and planned early May rate increases are already losing momentum. Analysts suggest these hikes may struggle to gain traction, especially after some carriers opted to extend existing rate levels into May.
Major liners including Hapag-Lloyd and CMA CGM have announced new mid-May rate targets, but their success will largely depend on whether carriers tighten capacity.
There are early signs of that happening. Data shows capacity on several key east-west trades has declined this week, including a notable drop on the Far East–North Europe route. Analysts say this mix of controlled supply and lingering congestion is helping to keep rates from falling too sharply.
On the transpacific, the strategy appears to be working more effectively. Rates from Shanghai to Los Angeles edged up 4% this week, while the Shanghai–New York route held steady.
Carriers are also holding firm on pricing ahead of the 1 May contract negotiation deadline, wary of weakening their position during annual rate talks.
Short-term demand has been supported by seasonal factors, including holiday-driven shipping activity across Southeast Asia. However, expectations for post-holiday volumes remain subdued, which could limit any near-term rate increases.
Forwarders say underlying demand remains fragile. Some large shippers have already secured discounted rates into the U.S. West Coast, well below official price levels. At the same time, reduced sailings are creating volatility, with more cargo being rolled to later departures.
Schedules are also becoming less reliable, with some sailings disappearing altogether and being pushed into later weeks.
If demand fails to rebound in May, industry players warn that the gap between discounted deals and official rates could widen further—potentially forcing another market correction.
