The Merchant · n°210 · October 15, 2026

The Merchant - Carriers plot GRIs, AI squeezes air capacity

Figure of the week

6.9 days

Shippers are currently waiting, on average, an extra 6.9 days for US-bound containers from China due to the knock-on effects of port congestion. Global ocean container schedule reliability fell for the fourth consecutive month in September as ports struggled to recover from the effects of a series of powerful typhoons. Asia-linked services saw some of the worst delays, with the average delay increasing 0.8 days month on month to 6.9 days.

Quote of the week

“Irrespective of our own reservations about the ongoing security risk, we cannot deny the evidence that liners are returning to Suez ahead of our projected timeline.”

Drewry’s head of container research, Simon Heaney, estimates that Suez transits will reach 80% of pre-diversion levels by February 2027, given that carriers are showing a strong appetite for a return. This comes despite intensifying conflict between the Houthis and Saudi Arabia.

Ocean carriers plot GRI salvo

This year’s peak trans-Pacific season has proved not only unexpected but remarkably resilient. Nevertheless, it appears it is finally winding down. Drewry’s World Container Index (WCI) registered the spot rate on the Shanghai to Los Angeles route as down 3% week on week. The Shanghai to New York leg fell 2%. Carriers are not planning to take these spot rate falls lying down. They are preparing a new round of GRIs around October 15-18, targeting early November to mid-November sailings. There are indications further rounds of GRIs might follow. Will the market support these rate increases? To make sure the GRIs stick, carriers are planning numerous blank sailings to reduce capacity. They believe they will be aided by significant congestion at major hubs. Chinese ports are still shaking off disruptions caused by typhoons. Singapore is also seeing delays. However, Xeneta chief analyst Peter Sand was among those who cast doubt on whether the GRIs would work. “The successful implementation of these increases remains uncertain. The faster-than-expected return to the Suez remains the biggest threat to carrier efforts to support rates,” he said. Only the coming weeks will show shippers whether the carriers’ strategy will work. Watch this space.

Shippers warned AI demand will add to capacity crunch

The trans-Pacific air freight market is gearing up for peak season, and as it does, analysts are warning that there is no let-up in sight for strong demand. The removal of the de minimis exemption on shipments from China may have hit e-commerce, but AI-related demand is more than compensating for the fall. Products ranging from semiconductors to servers are set to create strong demand for the foreseeable future. Industry insiders estimate that westbound demand out of Asia grew 12% in June. Continued investment in AI cloud infrastructure and advanced computing is set to sustain demand. At the same time, continued supply chain diversification is ensuring that other export networks across Asia remain busy. That will see demand from Taiwan and Southeast Asian countries like Vietnam, Malaysia, Thailand, and Singapore adding to pressure on capacity. The capacity crunch would be even tighter if it hadn’t been for a shift of freighters to the trans-Pacific from Asia-Europe. And this very shift in capacity is helping to blur the picture of how traffic is changing, according to Shawn McWhorter, president of Nippon Cargo Airlines Americas (NCA). “Lots of industry statistics don’t include dedicated forwarder traffic, so you don’t know if the market has shrunk or if the change you see is due to capacity that has not been reported,” he said. “Continued supply chain diversification is creating a wider network of export origins across Asia. Vietnam and Thailand are emerging as important sources for technology components, while Singapore and Malaysia play significant roles in server rack assembly alongside the established manufacturing and assembly capabilities of Taiwan and China,” he added. The bigger picture is that heavy demand is leading to rates rising rapidly in the post-CNY period. Shippers will need to prepare for greater lead times and anticipate needs ahead of time. Transatlantic demand is also increasing fast, with space hard to find within the week for large batches.

Tariff refund dollars may have outsized market impact

US tariff refunds may help keep trans-Pacific container spot rates high well into 2027, a key ocean carrier executive has said. Evergreen General Manager Wu Kuang-Hui said that he expected strong demand in the US market to continue to support higher trans-Pacific rates. His remarks come just as US courts clear the way for class action lawsuits to obtain tariff refunds. The court’s decision could give a lifeline to small businesses, which have so far been unable to recoup their tariff expenditure. There are record-high import volumes at several major US ports, low inventory levels, and optimistic consumer demand, he said. Wu noted that US spot rates were higher than negotiated rates in Q4 last year. He expects that new long-term contract prices will be higher than this year’s. One factor sustaining demand could be tariff reimbursements. “Importers could receive about $160 billion in tax rebates, potentially allowing lower end-product prices and higher inventory levels, which could stimulate further imports,” he said. Last week, the US Court of International Trade gave the go-ahead to a class action on behalf of importers seeking refunds of unlawful tariffs. Around $40 billion of the $160 billion due in refunds remains to be paid. Most of it is believed to be owed to small businesses, which have lacked the resources to seek repayment. While paying tribute to the effectiveness of the refund policy so far, Judge Richard Eaton said the success of the program overall did not remove the need for collective proceedings. He said that a program that relied on voluntary applications by importers would inevitably lead to some missing out. Those who had not obtained refunds were overwhelmingly smaller importers, deterred by the cost or effort involved, he said. A class action lawsuit would make it easier for these importers to join forces with others in a similar position. This would reduce the chance that the US Treasury would be left retaining “billions of dollars of unlawfully collected duties.” Whether or not shippers are owed tariff refunds, they should be prepared for a period of extended demand that could lead to persistently high spot rates.

❓ Got a question about your flows? We answer it in an upcoming edition.

Did you know?

Increased volatility is putting shippers off long-term fixed contracts. Instead, they are looking for easily adjustable base rates to help react to market conditions. Three-month contracts accounted for 60% of new contracts in Q3, compared to 47% in Q2, according to Xeneta.

Sources

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