As the Christmas season approaches, market sentiment suggests that it is not an ideal time for container shipping companies to raise freight rates. Shipping alliances had originally planned to implement rate hikes on December 1. However, on the afternoon of December 1, an Asian member of a major shipping alliance unexpectedly announced that it would not proceed with any increases.
This decision immediately pushed West Coast rates back to USD 1,450 per FEU and East Coast rates to USD 2,300, abruptly ending what industry insiders previously predicted as a “one-and-a-half-day rally”—lasting less than a single day.
Industry analysts expect other alliance members to follow quickly. Even if they do not formally align, they are likely to reduce the scale of their intended increases.
Originally, West Coast rates were set to rise from USD 1,450–1,500 to USD 1,900–2,050, while East Coast rates were expected to climb from USD 2,300 to USD 2,700–2,900. However, with current vessel load factors hovering at just 60–70%, confidence in the December 1 increase was already low.
Prior to the planned hike, the market had already seen West Coast rates as low as USD 1,350, and a major non-alliance carrier with sizeable capacity had delayed its rate increase by one week—further limiting upward price momentum.
Analysts note that the carrier that first announced “no increase” may actually benefit, as it is likely to secure more bookings and achieve a healthier load factor than competitors. Interestingly, on Europe-bound services—dominated by ultra-large container vessels—no carriers issued December 1 rate-increase notices.
According to Drewry, between Week 49 of 2025 (Dec 1–7) and Week 1 of 2026 (Dec 29–Jan 4), carriers canceled 56 sailings out of 719, accounting for about 8% of scheduled departures. Nearly half of these cancellations were on trans-Pacific eastbound services (48%), followed by Asia–Europe/Mediterranean (25%) and trans-Atlantic westbound (27%).
Still, 92% of sailings remained on schedule.
Alphaliner: Carrier Profits Down 53% YoY, With Further Decline Expected
Despite ongoing attempts to push freight rates higher, market conditions have made it difficult for container lines to achieve sustainable gains.
According to Alphaliner’s latest weekly report, the world’s top 10 carriers (excluding MSC, which has not released results) recorded a 53% year-on-year decline in profit over the first three quarters of the year. Although earnings remain positive, the downtrend is clear.
Even so, carriers’ extraordinarily high profits over the past five years provide a strong cushion for long-term financial stability.
Alphaliner expects carrier performance to deteriorate further, primarily because there are no geopolitical disruptions on the horizon that could lift freight rates.
Maritime Strategies International (MSI) expressed a pessimistic outlook in its monthly Horizon Report, forecasting significant declines in demand across major east–west trades over the next three quarters—including sharp contractions on the trans-Pacific eastbound route, and slowdown in Asia–Europe westbound and trans-Atlantic westbound volumes.
Port Congestion & Capacity Dynamics
Severe congestion and delays at Northern European ports have provided some support for Asian export freight rates.
However, MSI predicts that demand across all three major east–west trade lanes will weaken in the coming year, while vessel supply continues to expand.
As a result, freight rates are expected to remain at low levels through 2026, with vessel scrapping activity likely to stay minimal.
The charter market, however, remains an outlier.
Most newbuilding orders are concentrated in large vessels, while the charter market is dominated by small and medium-sized ships.
With limited availability of these vessels and ongoing demand from liners, the charter market has become decoupled from the slump in the freight market.
Potential Impact of U.S. Tariff Ruling
A potential turning point for carriers may come from the U.S. Supreme Court.
The Court is currently reviewing a case brought by several U.S. importers challenging the sweeping tariffs imposed by former President Trump under the International Emergency Economic Powers Act (IEEPA).
U.S. Trade Representative Jamieson Greer told media that the Supreme Court is expected to rule within the year, though the timeline suggests a likely announcement in spring or even June—unless released earlier than expected. Regardless of the outcome, preparations for next steps are already underway.
MSI believes that if the government loses the case and tariffs are temporarily lifted, the resulting uncertainty could trigger a new wave of pre-emptive front-loading by U.S. importers.
Overall Market Outlook Remains Dim
Although a few potential catalysts exist, the general outlook for the container shipping market remains subdued.
Linerlytica’s weekly report highlights that demand growth has fallen below the rate of fleet expansion, leading to a gloomy short-term forecast.
During the winter slack season, carriers remain reluctant to reduce capacity, which is putting downward pressure on major east–west trade route rates—especially on the trans-Pacific.
With supply–demand imbalance worsening, any restoration of services via the Suez Canal could further intensify pricing pressure.
