The Merchant · n°145 · May 8, 2025

De minimis change threatens “logistical mess”

🚢 Overcapacity between Asia and Europe
🇪🇺 Long congestion looming in Northern Europe
✈️ End of de minimis... and then what?

Figure of the week

90% This is the potential decline in the number of flights directly linked to e-commerce, according to Derek Lossing, founder of Cirrus Global Advisors.

Quote of the week

“The situation in Antwerp is no worse than elsewhere.” According to a spokesperson for the Belgian port… Which is to say it is not good, in a context of heavy congestion at Northern European ports.

Rates falling… but not in the Pacific

The tariff war decided on by Donald Trump weighs heavily on global trade. For Drewry, it could lead to a 1% decline in the global volume of containers traded in 2025. That is a drop comparable to the pandemic (-0.9%). We are still far from the effects of the 2008 crisis (-8.4% in 2009).

At the heart of this earthquake, the volumes traded from China to the United States are in free fall: -54% between late March and late April. To support demand in the face of a devastated supply, carriers reacted quickly: according to Vizion, blank sailings represented 14% of trans-Pacific capacity in April, and this figure would climb to 18% in May. This policy had one consequence: rates did not collapse between China and the United States. On the Shanghai-Los Angeles lane, Drewry’s WCI index is down only 1% this week, and the one toward New York down 3%. Sanjay Tejwani, director of 365 Logistics, puts it bluntly: “Carriers have learned to manage their capacity to avoid a brutal drop in prices like before the pandemic.”

But far from the Pacific, the trade war is not without effects. The vessel-redeployment strategy toward other routes adopted by many carriers exerts downward pressure on rates. This is notably the case on the Asia-Europe route! Since early May, rates have been falling: -5% on Shanghai-Rotterdam, or -4% on Shanghai-Genoa. Despite blank sailings, the routes toward Northern Europe are in a situation of overcapacity, particularly because demand is rather weak. The cause? The gloomy consumption of Europeans, worried about the geopolitical and commercial context.

In short, from Rotterdam to Shanghai, the whole world remains hanging on the tariff negotiations between the United States and China…

Traffic jams in Northern Europe

Many carriers had been announcing it since mid-April. And it came to pass: Antwerp, Rotterdam, Hamburg, Bremen… the main European port hubs are saturated. The causes? A succession of strikes; logistical overloads; and strains on supply chains.

The port of Antwerp was almost paralyzed last week by a national strike in Belgium, the fourth in two months. On April 29, maritime traffic there was “totally blocked” according to the port authority: 100 ships were waiting for a berth or departure clearance. And the disruptions are not limited to Belgium! In Hamburg, waiting times rise to as much as five days. In Rotterdam, average handling times are exploding, aggravated by staff shortages due to public holidays. The rise in traffic over the past year is struggling to be absorbed.

The causes of this crisis are numerous: dissolution of the 2M maritime alliance; reorganization of connections, for example with Gemini Cooperation bringing together Maersk and Hapag-Lloyd; or the low levels of the Rhine that limit river freight… Not to mention the saturation of rail freight, heavily affected by landslides near Hanover.

The situation could worsen. For Peter Sand, chief analyst at Xeneta: “If the ports have not cleared their backlog by mid-June, it will be carnage.” Everyone is watching with concern the Chinese cargoes that could be diverted from the United States toward Europe if the context of commercial and geopolitical tensions does not evolve or worsens.

In short, a storm warning for European logistics until the fall.

Where to fly?

On Friday, May 2, the de minimis exemption on postal shipments under 800 dollars from China and Hong Kong to the United States was finally scrapped - several months after the decision was announced. The parcels concerned will now be taxed at 120% of their value or 100 dollars per item. This threshold will climb to 200 dollars as of June 1. This targeted measure has an extremely strong impact. For Niall van de Wouw, head of air freight at Xeneta, “This amounts to abolishing de minimis for all countries, so much does China dominate this segment.” The situation is all the more complicated as the long-term contracts signed by some carriers remain valid…

Since then, the air freight sector has been counting the points. Derek Lossing, expert at Cirrus Global Advisors, there will be a 90% drop in trans-Pacific flights linked to e-commerce. This represents a shortfall of 22 billion dollars for the sector over three years! One telling sign: UPS, FedEx and DHL are already going to reduce their number of daily flights between Asia and the United States.

Faced with this brutal contraction, carriers must reallocate their capacity - a phenomenon also observed on ocean routes. The CEO of Cargolux, Richard Forson, notes a significant drop in departures from Anchorage (Alaska): seven fewer cargo flights per day. The reorientation is toward Europe, Africa and Latin America. Circumvention strategies are also being put in place. India is already emerging as a future strategic hub: Apple is going to localize there its production of iPhones destined for the American market.

👋 See you next week, The Merchant team

Sources

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