Market Update Q1 2025: No.16

Hi All,

March 23 and April 1 increases:
For most of March, vessels have not been full and import demand/volume has not been strong for various reasons. Not the least of these are the tariff implications, and I'm sure everyone has heard plenty about them at this point.

The nebulous nature of the tariff applications has in a sense slowed the trade considerably while importers try and discern if/how/when their business will be affected.

As a result of the low demand, we have in March experienced some downside volatility (Pacific rates declined quite rapidly, last week by -9% to the USWC and -7% to the USEC)

Moving into April and a 30-day window to traditionally complete a majority of the contracts by May 1, carriers are implementing large GRIs to take place April 1, and one carrier (Maersk) has implemented their "PSS" as of March 23 @ $1000 per 40'

The motivation behind this increase is to set a "baseline" rate for the coasts and major IPI destinations - so while there are specific amounts of increase, the goal from the carriers is to dovetail it with the rate "minimums" as viewed by the carrier. In other words, to reach a minimum goal of $2500/40' to the WC, carrier X may implement a GRI of $1000 on top of their $1700 rate but make some adjustments down to $800/cntr to be in line with the minimums so each carrier and negotiation will be individual.

For your landed cost estimates, expect rates to increase on April 1 according to the table below. As always, we will review your rate levels and adjustments will be made to get you the best possible deal for your cargo negotiating as above to minimize the damage to the extent possible.

Carriers will also be re-arranging schedules, blanking sailings, and creating some chaos in this way to support the definitive supply/demand imbalance.

This will not only affect the import schedules and rates, but also the export schedules and rates. Which as most of you who export know, has been quite challenging so far and looks now to get worse, at least in the short term.

We will be in touch with each of you individually to discuss your particular situation and assist in navigating the changes.

Look forward to working with you all
Please find below the updated rate level by carriers from Apr:

Author
Matthew Crocker / CCO