The outlook for container shipping between Asia and Europe has been looking more positive, with demand increasing and rates rising by almost 50% since the end of May.
In contrast, the trade route between China and the United States is heading into a slowdown, with both shipping volumes and freight rates expected to fall in the second half of the year.
This shift comes as businesses that had rushed to import goods earlier in the year now find themselves sitting on full warehouses. The temporary suspension of US tariffs on global imports is due to end on 9 July, while a similar pause on China-specific tariffs will expire on 14 August. Even if these pauses are extended, falling demand is still expected to drive rates down.
A short-term increase in cargo arriving at US West Coast ports is likely over the next couple of weeks, but this will only slow the downward trend, with spot rates on the Asia–US West Coast route dropping significantly since early June.
As the US shifts back to relying on inventory from earlier shipments, future import volumes are expected to decline. New and higher tariffs, reportedly set at 55% for Chinese goods, could further weaken demand, especially if introduced alongside other reciprocal trade measures.
While the US market shows signs of softening, conditions appear more favourable in Europe. A new trade agreement will reduce import tariffs on UK goods to 10%, and although negotiations with the EU are still underway, a similar rate is expected to apply to European exports.
Asia–Europe trade has performed strongly so far this year, prompting analysts to revise their full-year forecast from 3.5% growth to 6%. This upgraded outlook reflects a more optimistic economic climate across the continent, with lower inflation and unemployment, rising consumer spending, and strengthening euro/gbp all contributing to improved demand.
On the Asia–Europe route, the 2025 peak season may already be under way. Rates rose sharply in June, and although some easing has since occurred, carriers are expected to cut capacity from August. This includes a reduction of around 90,000 TEU in scheduled capacity on the Asia–North Europe lane compared to July, alongside additional blank sailings. If demand holds firm, these supply-side constraints could reignite upward pressure on rates in the weeks ahead.
Security concerns in the Red Sea remain high following the first Houthi attack on commercial shipping since December. This week, a bulk carrier was targeted using drone boats, rocket-propelled grenades, and small arms fire.
Military sources report that the threat to commercial vessels remains severe, with drone and missile attacks likely to resume without warning. The risk to ships navigating this critical trade corridor continues to be significant.te.
With shifting rates, tariffs and risks across global sea lanes, expert guidance and flexible planning are more important than ever.
Our sea freight experts are on hand to help you navigate uncertainty, optimise costs and keep your cargo moving with confidence.
