The strong cargo that supported the Intra- Asia container market in recent weeks continued to moderate during the latest reporting period. Regional freight rates declined by 4% week on week to around USD1,035 per 40-foot FEU, marking the second consecutive week of corrections.
The strong cargo that supported the Intra- Asia container market in recent weeks continued to moderate during the latest reporting period. Regional freight rates declined by 4% week on week to around USD1,035 per 40-foot FEU, marking the second consecutive week of corrections. The latest movement suggest that the early peak-season rush is gradually easing as vessel capacity and cargo demand become better balanced across major regional trade lanes.
Rate Corrections and Easing Congestion
Spot rates on major corridors connecting China with South and Southeast Asia experienced notable slides as demand normalized and localized congestion improved:
• China to South Asia: Rates from Shanghai to Jawaharlal Nehru Port (JNPT) slid 6% this week to settle at $2,155 per FEU, reflecting improved vessel availability after the earlier surge in exports.
• China to Southeast Asia: Freight rates from Shanghai to Manila declined by 3%, dropping to $555 per FEU, following an even larger fall of 26% that occurred the week before. The continued decline is directly associated with reduced port congestion at Manila, where vessel waiting time has reduced by four hours. Rates from Shanghai to Laem Chabang also weakened to $974 per FEU.
• Northbound Stability: On the other hand, the export routes from Southeast Asia to China were immune to the rate cuts. The rates between Ho Chi Minh City and Shanghai and Jakarta and Shanghai remained unchanged at $65 and $80 per FEU, respectively, supported by balanced cargo volumes and sufficient vessel capacity.
Capacity Injections and Network Revisions
Southeast Asia maintains its importance as a key production location across the world. Against a backdrop of ongoing trade issues between China and the US, the Chinese manufacturers are increasing their investments in the Southeast Asian market in order to avoid tariffs. This is resulting in optimization of shipping operations within the region:
• MSC has expanded its Lang Co Express service, which links South China and Central Vietnam, by successfully reinstating crucial port calls at Nansha, Ho Chi Minh City, and Singapore.
• CNC revised its South Korea-China-Straits KCM2 service to improve operational efficiency. The carrier removed calls at Shantou and a second Busan stop, introducing a weekly northbound call at Xiamen in their place. The service maintains strong network coverage utilizing seven vessels in the 4,200 to 4,400 TEU range.
• Taiwanese operator TVL Marine has officially re-entered the Intra-Asia container market, adding fresh capacity to meet the sustained regional demand.
Short-Term Outlook
The latest correction indicates that the early peak- season spike is gradually giving way to a more balanced market, consistent with the normalization trend observed during the previous reporting period. Although regional freight rates have softened for two consecutive weeks, overall market levels remain significantly above the recoded a year, reflecting healthy Intra- Asian trade activity. Looking ahead, freight rates are anticipated to remain relatively stable through July as carriers continue to adjust capacity in line with demand. However, ongoing geopolitical tension in the Middle East continues to pose risk to shipping schedules, insurance costs and vessel operations, limiting the like likelihood of a sharp decline in the regional freight rates in the near term.
