Freight Surge Could Be Short-Lived

The recent 90-day pause on US-China tariffs has triggered a surge in trans-Pacific shipping volumes. Hapag-Lloyd reported bookings from China to the US jumping over 50% compared to the previous week, as shippers rush to move goods while tariffs are temporarily lower.

But experts are urging caution. This upswing may not last.

A short-term rush

The early increase in demand has led to rising spot freight rates and a potential early arrival of the traditional Q3 peak season. However, the excitement is tempered by several realities. Chinese goods are still subject to a 30% tariff, which makes shipping low-margin products less viable for many businesses. Some companies also need time to restart production after scaling back during the recent 145% tariff period.

What to expect in the weeks ahead

If demand stays high, ports and carriers could soon face:

• Tight container availability

• Port congestion in China and the US

• Delays due to equipment repositioning

• Rising shipping rates

Looking further ahead

Industry analysts say the current rate gains may not hold. With the market still reeling from geopolitical uncertainty and increased shipping competition, spot prices remain over 30% lower than last year. Businesses are also accelerating efforts to diversify supply chains to avoid future shocks.

In summary, while this short-term demand boost is encouraging, the longer-term outlook remains uncertain, and caution is still the watchword for global trade.