The Merchant · n°137 · March 6, 2025

🚢 US port fees squeeze importers

🚢 A Trafalgar-style blow to rates?
🇫🇷 Le Havre blocked in March...
✈️ Toward the end of the e-commerce bubble?

Figure of the week

11 This is the number of union action days planned in March in French ports.

Quote of the week

“Are they doing it on purpose to flood us with fentanyl?” Marco Rubio, the American Secretary of State, accused China of flooding the United States with fentanyl, a drug with devastating effects, before the Trump administration announced a new 10% increase in customs tariffs on Chinese products.

A Trafalgar-style blow for shipping companies?

Ocean freight rates are experiencing a significant decline, illustrated by the continued fall of the World Container Index (WCI): 6% in one week (and more than 15% over the last fortnight). Despite several attempts at General Rate Increases (GRI), the trend remains downward, weighed down by the absence of a post-Chinese New Year recovery. Faced with these historically low rates since the start of the Red Sea crisis, MSC is reallocating its vessels to more profitable lines (Asia-Mediterranean or Asia-West Africa). Other carriers are considering new “blank sailings” to adjust supply to sluggish demand.

In 2025, this downward pressure on rates could weigh heavily on margins already weakened by rising operating costs and the delivery of new container ships. These difficulties are reinforced by the hardening of trade wars: as Peter Sand, Chief Analyst at Xeneta, points out, the addition of port fees or new customs surcharges is prompting carriers to modify their routes and could cause congestion in American ports. The situation is not rosy.

And when announcing CMA CGM’s results for 2024, Rodolphe Saadé spoke frankly: 2025 will be “marked by heightened geopolitical tensions and an unprecedented level of uncertainty.” While the recovery of freight volumes is already compromised by growth forecasts revised downward, carriers must also contend with specific challenges, notably the massive delivery of new vessels (nearly 8 million TEU expected).

Can the market begin a recovery, or will the prolonged stabilization of freight rates at historically low levels durably erode the sector’s balance? The Transpacific Maritime Conference 2025, which opened on Monday, may perhaps help initiate the beginning of an answer…

Cherry season comes early in French ports

Yesterday, French ports experienced the first of eleven actions to come in March. The unions are demanding the maintenance of a special regime allowing them to retire four years before the legal age. And the movement is going to harden further. With what program? First a 72-hour strike from March 18 to 20, accompanied by several four-hour work stoppages scheduled for March 6, 10, 12, 14, 24, 26, and 28… Heavy weather on the horizon in the ports.

Traffic losses, wage increases to compensate for lost hours, and forced reorganization of schedules - the cost of the strike is likely to be felt at all levels: the disruptions are not without consequences. MEDEF is sounding the alarm over the considerable operational overcosts. Based on February’s figures, it forecasts that transport costs will experience an average increase of 23%, while the revenue of the companies concerned could drop by nearly 25%. Faced with the risk of a prolonged conflict, the employers’ organization advocates the creation of a public-private negotiation unit to guarantee a rapid resumption of activity.

As it stands, Héloïse Roux, Procurement Manager at Ovrsea, strongly advises against using Le Havre for export. It is preferable to fall back on other ports such as Antwerp, Dunkirk, Rotterdam, or Zeebrugge. Even though some congestion is already looming, nothing matches Le Havre, where the first possible entry is estimated at 7 days. For import, it is even more complicated, since the goods are already at sea bound for Le Havre, and any change would come with a significant additional cost.

In short, France’s largest port is anything but a haven of peace.

E-commerce caught in strong turbulence

The e-commerce bubble threatens to burst, according to Eric Kulisch, an air freight specialist at Freightwaves. Major players such as the Chinese platforms Temu and Shein are seeing their model threatened. In the United States, the removal of the de minimis is disrupting a system that carried strong growth in air freight. By placing these platforms under surveillance to ensure they do not resort to forced labor, the European Commission - perhaps imitated by the Trump administration - is disrupting their model a little more.

For Kathy Liu, VP of global sales and marketing at Dimerco, “e-commerce will not disappear, but it is shifting from a B2C model to a B2B2C model. This transition is expected to reduce demand for air freight, with more shipments moving to ocean freight.” For now, these developments are not affecting air freight rates too much, which have begun to rise very slowly since the beginning of March. This is the result of the reduction in the number of cargo flights from China to Europe and the United States - in the latter case, some carriers are suspending contract negotiations while awaiting regulatory clarification. It remains to be seen whether this trend will hold in March.

Thessaloniki on the lookout for emissions

The Port of Thessaloniki is launching a new pilot project under the METAVASEA program. It involves collecting precise data on the emissions of berthing vessels. This is a first in the Mediterranean or in the EU for RightShip’s Maritime Emissions Portal (MEP). While involving local players in data collection, this initiative seeks to offer a better understanding of the carbon emissions caused by the value chain in order to better target mitigation policies.

👋 See you next week, The Merchant team

Sources

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