Overcapacity sends container rates into a tailspin
As Lunar New Year approaches the heat has gone out of container spot rates as the supply and demand imbalance intensifies
Average global box freight rates collapsed 10% week-on-week, according to Drewry Shipping Consultant’s latest weekly rates report as capacity and demand head in opposite directions.
In its latest market report Drewry Shipping Consultant analyst Simon Heaney said that global growth will moderate to 1.8% this year, while last year saw another record for contracting, at 4.8 million teu, taking the orderbook to over 11 million teu about one third of active cellular fleet.
“Deliveries of container ships were on average, approximately 180,000 teu per month [in 2025], while demolitions in their entirety only amounted to 6,000 teu over the entire year,” said Heaney.
According to Drewry’s weekly World Container Index (WCI) spot rates in the two biggest trades were down substantially. Out of Asia to the US West and East Coasts were down 12% and 11%, respectively, to $2,546 per feu and $3,191 per feu. In the European market, spot rates were down 9% to North Europe at $2,510 per feu and 8% to the Mediterranean at $3,520 per feu.
Lunar New Year will begin in around four weeks’ time, 17 February, and that will have a substantial effect on volumes, both ahead of the holiday and after.
Dynamar analyst Darron Wadey said: “Since 2022, the pattern has been a noticeable downturn in rates around this time of year [SCFI]. Furthermore, they have tended to last a couple of months at least before recovering later in the year, given that recent history, this current downturn is not out of character.”
