Freight and Logistics News and Market Update

Air

• The US Presidential Administration issued an executive order announcing an extension to the July 9 tariff deadline, pushing back the date to August 1. The announcement came with the promise of steep tariffs on over a dozen countries, including Japan and South Korea, if a deal is not reached before then. Current tariff rates for China and Hong Kong will not be affected by this Executive Order. The ongoing uncertainty continues to cause strains across businesses and global supply chains as manufacturers await more stability.
• The air cargo market remains an uncertain issue as the second half of 2025 begins. The ongoing uncertainty surrounding US tariff levels in addition to the de minimis changes impacting low value Chinese imports continue to impact supply chains, disrupt traditionally dominant global trade lanes and push carriers to redeploy capacity across their networks. June saw the second consecutive month of decreases in the global spot rate market, the first time in over a year and a half. The changes have seen demand out of secondary APAC markets such as Vietnam and Thailand increase, and the busy summer travel months will likely lead to growth in demand, but to what degree remains a question.

Ocean

• Carriers dropped plans for a rate increase and scaled back surcharges due to excess capacity and weakening demand. Spot rates dropped, with importers paying as low as $2,000 per FEU to the West Coast and under $4,000 to the East Coast. Despite some holiday shipments, most anticipate a softer peak after heavy frontloading during the tariff reprieve.
• Ocean carriers are maintaining high westbound trans-Atlantic capacity ahead of the July 9 expiration of the US Presidential Administration’s 90-day tariff pause, anticipating potential trade disruptions depending on ongoing US-EU negotiations. Despite the elevated capacity, demand has softened, with short-term rates declining over 35% since the start of the year and import volumes from North Europe and the Mediterranean trending downward since spring peaks. While some frontloading may occur before tariff changes, forwarders and analysts advise caution in interpreting demand trends in this uncertain environment.
• Dollar General filed a $14.77 million complaint with the US Federal Maritime Commission, accusing Yang Ming of breaching its 2021 service contract by providing only 616 of 2,226 containers. Despite submitting shipment forecasts, Yang Ming failed to meet capacity commitments in 11 of the 14 weeks, forcing Dollar General to secure more expensive spot market space or skip shipments.
• Carriers on the India–US East Coast route have cut peak season rate hikes to $500–$600 per container from the initially expected $1,500–$3,000. Weak demand and tariff uncertainty have delayed cargo, prompting carriers to adjust rates weekly to maintain full vessels, with spot rates between $2,400 and $3,000 per FEU. Despite full ships, forwarders say capacity is reduced due to blanked sailings, and future volume recovery hinges on US-India trade policy decisions.

Air

• AeroUnion has recently announced the newest brand in their network. Avianca Cargo Mexico will offer increased connectivity to Mexico, the US and globally, with the incorporation of the second A330 P2F aircraft allowing the transport of oversized and temperature-controlled goods. Mexico will function as a strategic hub for regional markets and increase overall network connectivity across Latin America and beyond.
• With recent fleet expansion increasing the available equipment for LEVEL, the carrier has announced they will be increasing the frequency on their Santiago-Barcelona route to five weekly flights during the Northern Hemisphere winter season. The increase will be effective from December through February before returning to four weekly flights in the spring.
• Latin America showed a 3.1% increase in demand and 3.5% increase in air cargo capacity in May 2025 compared to May 2024, reflecting steady growth amid global trade shifts.

Ocean

• Colombia and China opened a new ocean route connecting Shanghai with Colombia’s primary Pacific port at Buenaventura. The project has been spurred on by Chinese carrier Cosco, and goods leaving the port will stop at the port of Chancay in Peru prior to moving across the Pacific to China. The deal comes as trade negotiations have created a tense situation between both China and Colombia with the US and looks to strengthen China’s relationships across Latin America.

Air

• Asia Pacific airlines continued to see growth in air cargo demand in May, though air cargo growth has moderated due to weaker exports from key manufacturing economies. Cargo demand grew 3.0% year-on-year, supported by shipment rerouting and front-loading despite weaker exports from key markets. The Association of Asia Pacific Airlines expects future growth to face pressure from softening export orders and rising geopolitical risks, though shifts in trade routes may offer some relief.
• The end of the US de minimis tax exemption for low-value parcels from China has triggered a sharp drop in Asia-to-US air cargo in May, with volumes down 10.7% year-on-year and low-value eCommerce shipments falling 43% month-on-month. As a result, carriers have cut trans-Pacific freighter capacity and Chinese eCommerce firms are increasingly shifting focus to markets like Europe and Southeast Asia. While some demand has rebounded due to tariff pauses, overall volumes remain pressured by trade policy uncertainty.
• Rising trade tensions between the US and China, including steep tariffs on Chinese imports, have sharply slowed transpacific air cargo flows and accelerated a shift of eCommerce and manufacturing supply chains to Southeast Asia. While long-term growth in air cargo primarily driven by eCommerce and multi-node supply chains is expected, near-term uncertainty, underinvestment in airport cargo infrastructure and shifting global trade patterns are challenging industry players. Experts stress the need for agility and greater investment in cargo facilities to keep pace with evolving demand.

Ocean

• Shipping a 40ft container from Asia to North Europe is now more expensive than to the US West Coast for the first time since 2025, due to tighter capacity and successful rate hikes on the Asia-Europe route. In contrast, spot rates on transpacific routes have plunged sharply due to overcapacity and weaker-than-expected demand. While Asia-Europe shows short-term resilience, volatility across global lanes suggests challenges ahead for carriers managing capacity and pricing.
• Container shipping rates from China to the US are under renewed pressure as carriers continue to add capacity, particularly to the West Coast, following the reduction of US tariffs from 145% to 30%. Spot rates have dropped sharply to an average of $3,388 per FEU, down 43% from the June peak, as demand softens and overcapacity builds, prompting resistance to peak season surcharges. Analysts warn that carriers misjudged post-tariff demand, leading to an oversupplied transpacific trade lane.
• Carriers are easing back on blank sailings in the Asia–East Coast South America trade, with just 1% of capacity skipped in July compared to over 10% in previous months, signaling an expected loosening of space and potential pressure on spot rates. After spiking from $1,380 per TEU in early May to $6,650 by late June, rates are likely to remain high through mid-July before softening into August, barring unexpected demand surges. Driven by earlier peak activity and last year’s electrive vehicle shipment surge, capacity on the lane has surged 46% year over year, led by Maersk and other carriers expanding tonnage and launching new joint services.

Air

• Realterm, a global logistics real estate developer, is partnering with Leipzig/Halle Airport (LEJ) to build a 45,000 square meter air cargo facility with direct airside access and advanced warehousing designed for express, ecommerce and specialized cargo. The development will feature aircraft parking and truck staging areas to streamline logistics. LEJ, Germany’s second-largest cargo airport with 24/7 operations and no slot restrictions, handled 1.4 million tons of cargo in 2024. The project highlights LEJ’s long-term growth strategy and Realterm’s international cargo infrastructure expertise.

Ocean

• A severe heatwave across western Europe has caused water levels on Germany’s Rhine River to drop, significantly limiting cargo vessel capacity, especially near key points like Kaub, Duisburg and Cologne. Vessels are operating at only 40–50% capacity, triggering surcharges and increasing costs for cargo owners as multiple vessels are now required to move the same shipments. The Rhine, a vital waterway for transporting commodities like grains, oil products and minerals, remains operational but strained. With no immediate relief in sight, supply chain disruptions are expected to persist.
• Four crew members were killed after the Liberian-flagged, Greek-operated bulk carrier Eternity C was attacked off the coast of Yemen, marking the first fatal Red Sea shipping incident since June 2024. The strike follows another recent attack on the MV Magic Seas, raising concerns about renewed threats to vessel safety in the region. The incidents underscore the heightened security and operational risks currently facing global logistics and maritime trade.

Air

• Foxconn recently recalled over 300 of their Chinese engineers from Indian iPhone manufacturing facilities following pressure from the Chinese government. The move could impact production if the move continues to extend into the allocation of machinery required for production to continue. While it may be possible to replace the engineers, replacing capital equipment would be much more difficult for the manufacturers to handle and could put significant pressure on smaller Indian manufacturers to continue.

Ocean

• The Saudi Ports Authority (Mawani), in partnership with the National Center for Privatization, has signed contracts to privatize multipurpose cargo terminals at eight Saudi ports under a Build-Operate-Transfer (BOT) model spanning 20 years. The agreements were inked with national partners Saudi Global Ports (SGP) and Red Sea Gateway Terminal Company (RSGT), with private sector investments exceeding SAR 2.2 billion (approximately US$586.5 million). Under the terms of agreement, SGP will undertake the development, management and operation of multipurpose terminals at four Eastern Province ports: King Abdulaziz Port in Dammam, Jubail Commercial Port, King Fahd Industrial Port in Jubail and Ras Al-Khair Port. On the other hand, Red Sea Gateway Terminal will manage the four Western Province ports: Jeddah Islamic Port, Yanbu Commercial Port, King Fahd Industrial Port in Yanbu and Jazan Port. Mawani stated that the privatization contracts for King Fahd Industrial Port in Yanbu involve increasing container handling capacity through the deployment of the latest STS and RTG cranes, reach stackers, modern trucks and trailers, while streamlining truck turnaround times and vessel berth to enhance improved operational efficiency.

• On July 2, 2025, Customs Bulletin and Decisions, US Customs and Border Protection (CBP) proposed changes to the classification and origin rulings for certain imported goods. CBP plans to reclassify specific wireless headphones and earphones—such as gaming headsets, mobile earphones and wireless earbuds—as sound reproduction devices under HTSUS 8518.30.20, revoking or modifying three prior rulings. This reclassification reflects CBP’s view that these items are composite machines primarily used for audio output. Additionally, CBP proposes revoking rulings on brake hoses, determining that cutting and assembling hoses in countries like China and Thailand does not substantially transform them, thus affecting their country-of-origin designation. Public comments on these changes are due by August 2, 2025.
• The US Consumer Product Safety Commission (CPSC) has proposed a rule requiring lithium-ion battery systems in micromobility products—such as e-bikes, e-scooters, hoverboards and similar devices—to comply with specific voluntary safety standards, with added performance and labeling requirements. This rule would apply to both built-in and user-replaceable batteries, including those in conversion kits. It aims to reduce fire and electric shock risks, citing over 200 incidents and dozens of fatalities linked to battery failures. The rule also includes provisions for third-party testing of children’s products and is open for public comment until August 22, 2025.
• The International Trade Administration (ITA) has introduced a formal process for expanding the 25% Section 232 tariff to cover additional imported automobile parts, following a presidential directive issued in March 2025. US auto parts manufacturers can submit requests during designated two-week windows each January, April, July and October—the first of which began July 1, 2025. These requests must include detailed information such as product descriptions, HTSUS codes, domestic industry impact and data showing how increased imports may threaten national security or undermine the goals of the Section 232 tariffs. After submission, valid requests will be posted publicly for a 14-day comment period, and the ITA will issue final decisions within 60 days.
• Under Executive Order 14309, issued on June 16, 2025, the US implemented provisions of the US-U.K. Economic Prosperity Deal, which includes new trade rules for importing U.K.-origin automobile parts and civil aircraft products. Effective June 30, 2025, the order establishes a tariff-rate quota for U.K. automobiles, allowing up to 100,000 vehicles annually at a reduced tariff rate. It also grants preferential tariff treatment for U.K.-made auto parts and civil aircraft products under the WTO Agreement on Trade in Civil Aircraft. US Customs and Border Protection has issued specific guidance for filing entries under these new terms, including separate instructions for light trucks that do not qualify for the quota.