The trend of freight rates in the fourth quarter has given a clear signal in early October: freight rates on the European line have fallen for 12 consecutive weeks, and the transit volume of the Suez Canal has increased by 68% year-on-year to cover capacity; the immediate price of the U.S. line has been high and sideways, and many institutions have judged that this round has reached its peak. The composite value of the World Container Freight Index (WCI) assessed by Drewry on October 1 was US$4434/FEU, down 1% weekly. For the factory, the shipping strategy for the next two months can be summarized as follows: European lines are not urgent, U.S. lines are locked, and heavy cargo negotiations are reopened.
1. Key data for this issue on October 1
| Route (40-foot cabinet/FEU) | spot rate | weekly change |
|---|---|---|
| Shanghai-New York | $10,428 | +1% |
| Shanghai-Los Angeles | $7,835 | flat |
| Shanghai-Rotterdam | $3,399 | -2% |
| Shanghai-Genoa | $3,702 | -3% |
| WCI Composite Index | $4,434 | -1% |
Source: Drewry Weekly Assessment,The full text can be verified here。During the same period, the Shanghai Shipping Exchange SCFI closed at 3,662.30 points in the last period before the festival (September 30). After falling for two consecutive weeks, the market was closed for the National Day holiday.
2. Why does the European line keep falling
The core reason for the European line's decline for 12 consecutive weeks was not the collapse of demand, but the replenishment of capacity: the transit rate of the Suez Canal in the 39th week was 68% higher than the same period last year. The capacity gap of shipping companies around the Cape of Good Hope was gradually filled, and the number of available spaces continued to increase. According to Drewry statistics, about 39 empty flights (suspended flights) have been announced in the window from October 5 to November 8, accounting for about 5% of the total flights, including 10 trans-Pacific flights and 5 Asia-Europe flights, with limited efforts to support the situation. The shipping company tried to stop the decline with the new FAK offer in mid-to-late October-MSC announced that starting from October 19, the Far East to Northern Europe will be US$4500/FEU, and CMA will be US$4900 in the Northern Mediterranean and US$4700 in the Western Mediterranean during the same period-but the freight forwarder reported that prices are still being lowered in the first half of October. Whether the price increase can be implemented depends on the actual booking volume after the holiday.
3. Why hasn't the US line loosened yet?
The U.S. line is now supported by three things: one is that factories concentrate on shipping pre-holiday orders around the Golden Week; the other is that shipping companies use empty flights to control shipping spaces; and the third is that some of the suppressed goods are still in line after the release of tariff uncertainty. Peter Sand, chief analyst of market research firm Xeneta, judges that freight rates have reached the top of the 2026 cycle, but will not collapse. It is expected that in three months, the United States will fall back immediately to the US$6,000 - 7,000 range for the East and the US$4,500 - 5,500 range for the West. The starting point on the East Coast will be higher and the decline will be greater. In addition, congestion at Asian ports has gradually eased with the end of the typhoon season. Air freight rates in the fourth quarter may be topped up by the volume squeezed out during the peak shipping season. Air freight options must be reserved for urgent orders with high value.
There is another clue that is easily overlooked: after the Sino-US trade truce period is extended, demand for the U.S. line is expected to cover after the holiday. This is one of the reasons why shipping companies dare to hold prices in mid-to-late October. The actual meaning for the factory is that the fall in freight rates on the U.S. line will be slower and smaller than that on the European line. Don't use the decline speed of the European line to calculate the price of the U.S. line. Look at the two tables separately. The price difference between the United States and the United States and the United States is currently around US$2500. Institutions expect it to narrow in the fourth quarter. Shipping heavy goods to the United States and the scheduling of light goods is the next routine action to control unit logistics costs.
4. Suggestions for the factory for shipment in the fourth quarter
- European line orders follow the production rhythm:In the downward freight rate channel, unless customers urge it, there is no need to grab the cabin; scheduling the loading date to mid-to-late November will have a high probability of getting a lower freight rate, and the saved logistics costs can be directly added to the quotation.
- Book 7-10 days in advance for U.S. line orders:The U.S. line shipping space is still actively managed. The risk of dumping containers at the end of the peak season is concentrated on low-priority goods. It is more important to confirm the shipping guarantee terms with freight forwarders than saving US$50 in freight.
- Redoing preparations for the annual treaty negotiation:Contract negotiations for 2027 will start one after another after November. The 12-day decline in spot goods on the European line is a ready-made argument to lower prices. Keep screenshots of Drewry's weekly report and use data at the negotiating table.
- Floating clauses are left for freight rates in the quotation:Different from the period of high freight rates, it is now a downward market, and the validity period of the quotation can be set at 15-20 days, with the indication that "the freight rate on the booking date shall prevail" to avoid a rebound in the market after locking in low prices.
A final reminder of the rhythm: factories were shut down during the Golden Week holiday, and the cargo volume itself was at a low point. Only the booking data for two to three weeks after the holiday can truly represent the demand level in the fourth quarter. Don't make long-term decisions based on the verbal quotations of freight forwarders in the past two weeks. Wait until the arrival of the new FAK and the post-holiday bookings are clear in mid-October, and then finalize the shipment arrangements for large cargo in November and December. The judgment will be more accurate.
5. Common questions
1. Suez has recovered. Will freight rates soon return to last year's lows?
It won't get it all in one step. Although the transit volume of the Red Sea route has rebounded, the uncertainty of Houthi armed activities remains, and the shipping company still leaves room for a full return; at the same time, the situation in the Strait of Hormuz and the replenishment of the U.S. route after Golden Week will disrupt the pace. The reasonable expectation is that the European line will slow down, the U.S. line will slow down at its high level, and remain volatile at high levels before the end of the year.
2. We are a small factory and only ship a few containers per month. Do these index data have anything to do with us?
The relationship is direct. The freight index is the cost basis for the freight forwarder to quote you. The 12-week decline in the European line means that the European line quote you had two months ago has now paid more. Spend 10 minutes every quarter to look at the WCI comprehensive value and major route data. When making an inquiry, you have a clear idea and a basis for bargaining.
3. On October 19, the shipping company announced the price increase. Should we ship before the price increase?
Let's see if your goods are in a hurry first. This round of announcements is more like an attempt to hold prices after the holiday. Historical experience is that the redemption rate of price increase announcements during the downward cycle is not high, as evidenced by the fact that price cuts are still ongoing in the first half of October. Non-emergency goods do not have to pay for the announcement, follow the pace of production and lock the shipping space terms.
