Container freight rates are falling, due to the increased shipping capacity as a result of the delivery of new vessels this year, but also in view of the expected gradual return of containerships from the Red Sea, estimated in the second half of 2025.
Market analysts also emphasized that if US President Trump’s announcements to impose tariffs on products from China, Europe, Canada and Mexico are implemented, they will likely hurt personal and business consumption in the long term, while reducing future demand for cargo in the container market.
Also, due to trade policies between countries, a shift in trade routes with new alliances cannot be ruled out.
New vessels
According to the Container Shipping Outlook Report by global consultancy AlixPartners, another 200 ships will be delivered this year, adding 2 million TEUs to the fleet, or about a 6% increase, after older ships are expected to be scrapped.
In addition the return of containership capacity diverted from the African route to the Suez Canal along with the massive supply of new ships “could upset the balance of supply and demand, driving rates down and returning the industry to years of overcapacity.”
Last year, almost 11%, or 3 million, was added in TEUs new capacity in container shipping, but was absorbed by the additional capacity required due to diversions of ship routes via the Cape of Good Hope.
The total container fleet on European trade routes increased by 31%, according to Alix Partners.
The report also noted that the launch of the Gemini partnership between Maersk and Hapag Lloyd from February 1 marks one of the boldest efforts to address the industry’s reliability challenge, as it will offer better global market coverage, cost savings, reliable routes and environmental benefits.
“If successfully executed, more than 340 vessels operating in a hub-and-spoke network could offer a viable alternative to the port-to-port model,” it said.
