Bull run raises expensive questions for shippers

Figure of the week

7.7% EU-US trade reached a record $875 billion last year, with a 7.7% rise in EU exports to the U.S. to €580 billion, overshadowing a 2.2% rise of U.S. imports into the EU climbed 2.2% to €295 billion. However the figures may well be overturned next year as tariffs on EU car exports to the US kick in.

Quote of the week

“Our expectation is that the market is not ready to turn a corner just yet. The drop will be a gradual one because there is still Black Friday and the Christmas replenishment shipping to go.” Xeneta chief analyst Peter Sand tells shippers not to expect an abrupt easing off of high rates.

Bull run raises expensive questions for shippers

Analysts are increasingly split on whether the early peak season is running out of steam or whether it could continue even into Q3 . To that end, all eyes are on whether the round of GRIs implemented by ocean carriers at the beginning of this month will hold up until mid-July. At that point, carriers are planning yet another round of spot rate increases. If the trans-Pacific rate hikes already implemented hold, the next round is likely to have greater impact. Some analysts, however, believe any further GRI plans for July are likely to fall flat. They say the four-month bull run in spot rates could come to an end as early as this week , at least as far as the West Coast is concerned. One of the main reasons is new capacity incoming on the eastbound trans-Pacific. Capacity from Asia to the US will rise 7.5% month on month in July, while August will see a further 6.5% jump. If this capacity makes itself felt, it should contribute to a softer market for shippers, and less of a fight for cargo space after mid-July. Some industry insiders say carriers are already showing occasional signs of being more willing to negotiate rates, although that evidence remains very much anecdotal. After all, with the market second-guessing whether the Trump administration will introduce new tariffs on July 24, shippers have good reason to front-load cargo and drive up demand. The closeness of those new tariffs would indicate that this front-loading is soon due to come to an end, causing the market to return to a more normal footing. Other industry insiders, however, believe there will be enough demand to support higher rates well into Q3. They argue that many shippers have yet to import Black Friday and holiday season cargo and that doing so will sustain rates and demand for several weeks more. For now, shippers should bear in mind that vessel space is particularly tight on services from Asia to the East Coast and Houston. As for how long rates will remain unexpectedly high, watch this space .

Full extent of air freight AI challenge underlined

New data shows the full extent of how demand for semiconductors and AI-related hardware is driving global air cargo demand and creating new chokepoints for shippers . Global air cargo spot rates rose 38% year on year during June, according to Xeneta. Asia-Pacific to North America represented the strongest demand worldwide. Chief Airfreight Officer Niall van de Wouw said: “The scale of AI’s impact is easy to underestimate because it sits inside a small slice of total air cargo volume, below 10% of what flies, but the facts that confirm its role as the main driver of air cargo growth are undeniable.” Meanwhile, e-commerce shipments between China and the US fell off dramatically following changes to de minimis rules but rebounded by 26% year on year in May. Shippers are being forced to wait for lower fuel prices to feed into spot rates. Since talks between the US and Iran to end the war in the Middle East began, oil prices have largely fallen. The trend was temporarily bucked earlier this week when prices began to rise after reports of an Iranian attack on a container ship. However, the wider fall in fuel prices, down 26% month on month in June, has not been reflected in spot rates. Analysts believe this could be because airlines tend to buy fuel supplies in advance. Many carriers may still be carrying out operations using fuel that they contracted to buy at higher rates. Other factors that could have pushed up global spot rates include front-loading prior to the abolition of de minimis rules in the EU, soaking up global capacity. Indeed, some analysts are forecasting that high trans-Pacific air freight spot rates might hold up throughout Q3, outlasting their ocean freight counterparts. Shippers can expect fuel price falls to start feeding through soon, but they may have little winder effect on rates for now .

Reliability takes hit due to early peak season

The early peak season and port congestion have seen container shipping reliability take a hit . Shippers had been enjoying increased reliability throughout 2026, but the trend is starting to reverse slightly. Xeneta’s Global Reliability Scorecard saw global on-time carrier performance fall from 39% in May to 37% in June. The company’s Senior Market Analyst Destine Ozuygur said: “June checked our collective optimism. No trade improved, on-time arrivals fell, and delays crept back up.” Keith Gaskin, managing director and founder of BCO network ShiftX, said carriers were facing a difficult balancing act given port congestion. “Capacity is only usable if it can be deployed, removed at the port, and loaded at the port efficiently and on time, and it’s been a huge issue this year,” he said. Blameless customers with cargo ready to ship may have had to pay the price for carriers’ attempts to maintain schedules in the face of the disruption. “I think some of the alliances are trying to work really hard to bring their schedule integrity to a much higher percentage, and to that end, we’ve seen sometimes the vessel just cutting and running because it was delayed and they couldn’t turn around the containers at the port quickly enough because of congestion. “So, on the one hand they’re trying to improve schedule reliability, but if you’re a customer that delivered your container on time and did all your customs clearance, through no fault of your own you may have faced rolled boxes because the carrier is trying to improve its schedule reliability. It’s a very difficult balancing act,” he explained. With capacity management pressures starting to ease, shippers may be able to look forward to an uptick in reliability in the coming weeks .

🤔 Did you know ?

US truckload spot rates have reached levels not seen since the COVID pandemic in the run-up to the July 4 holiday period. A lack of capacity, caused by fleet cuts, small carrier exits and driver shortages, is playing a bigger role than demand in driving rate inflation. The big question is whether those rates will crest and then fall. Summer is typically a slower time for the trucking industry in the US.

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