Container rates have strengthened over the past two weeks with the Transpacific initially leading and now Asia-Europe, Asia-Med, and the North-South trades gaining momentum. The Asia-USWC route is seeing rates at $3,500/feu, up from $2,500/feu before the China-US trade agreement, and market quotes for next week are above $5,000/feu. Whether these big gains come to fruition remains to be seen, but given the surge in spot bookings and the tight overall capacity in the region, there is likely to be some meaningful near-term gains. According to Vizion, China-US bookings surged again last week with over 216,000 teu booked, compared with 228,000 teu the week prior and the 91,000 teu bookings on average during the prior five weeks (118,000 teu during 1Q25). These past two weeks have more than offset the decline during the April "freeze" and suggest activity has been driven by a combination of pent-up demand, forward-buying, and peak season. Some of this excitement is tempered by news of increased capacity expected to utilize the Red Sea / Suez Canal. CMA-CGM is shifting its Med Express service, which serves India, Middle East, and Med markets, through the Suez Canal. This service consists of 10 containerships, which are a small portion of the company's 600+ ships in operation and the 75+ that would normally transit the through the Red Sea that are mostly diverting. Alleyes are on plans for its other routes and also on its Ocean Alliance partners COSCO and Evergreen. As we have discussed previously, Red Sea diversions have soaked up 12% of container capacity and the difference between a healthy market and a very pressured one.
