The annual negotiations have entered the last juncture, and the US line price is 20% higher
Sunny Worldwide LogisticsIt is a logistics company with more than 20 years of transportation experience, focusing on markets such as Europe, America, Canada, Australia, Southeast Asia, etc., and is more than the owner of the cargo owner.
The annual contract negotiations for the global container shipping North America line are now in its final stage. Recently, it was revealed that large U.S. retailers are signing North American line service contracts for 2025-2026, with prices expected to rise 15% to 20% compared to last year. At the same time, starting from April, medium-sized importers and logistics industries have also entered the second round of price negotiations, with annual growth expected to start from 20%.
According to industry planning, all cargo owners must complete the signing of the new year contract with the shipping company before the end of April. Recently, global indicator airlines announced a hike in spot prices at the North American line in April, a move that led to the global container freight index ending a ten-week downward trend. Last week, spot freight rates for Far East to North America routes rebounded strongly, with freight rates from Far East to West and the U.S. reaching ,177/FEU, a weekly increase of 16.3%, while freight rates from Far East to the U.S. reaching ,194/FEU, a weekly increase of 11.4%.
Logistics industry insiders pointed out that the safety issues in the Red Sea and other sea areas have not been completely resolved, and the situation has been repeated. Therefore, before global shipping companies cannot ensure the safety of navigation in waters such as the Red Sea, their route services will still choose to detour the Cape of Good Hope. The instability of the global situation will further aggravate the difficulty of ship dispatching in the global maritime chain in 2025, and container liners may face the problem of supply and demand imbalance again. Therefore, shipping companies have recently begun to accelerate the signing of long-term contracts.
In annual contract negotiations for North American routes, the first round usually starts with large logistics operators. Their contract price is often an important indicator for the second round of medium and small customers and logistics. According to industry reports, the contracts signed by major U.S. retailers are about 15% to 20% higher than last year. It is expected that the contract price negotiations for medium-sized importers and logistics industries will be higher than this level starting from April, and the market generally speculates that the price increase will exceed more than 20% in the same period last year.
Wanhai Company also said that the Red Sea crisis problem has continued to this day since last year. Although freight rates have fallen for ten consecutive weeks due to sluggish demand after the Lunar New Year, geopolitical issues in the Middle East still pose a threat to ship supply. Once market demand rebounds, the shortage of ship supply will be highlighted again. Customers generally accept that contract prices have risen compared with the same period last year. Based on the results of the completed negotiations, the acceptable freight rates for customers have increased by 20% to 30% compared with last year.
Well-known shipping logistics industry insiders further pointed out that the heating of geopolitical issues in the Middle East has caused many uncertainties in the global liner market. Trump's tariff policy and the Israeli-Palestinian conflict also had a significant impact on market supply this year. Due to the increase in uncontrollable variables, shipping companies have to raise prices when signing long contracts with customers and add various additional conditions to deal with future market changes.
