Freight and Logistics News and Market Update

Air

• Around half of transpacific air freight capacity has returned following a temporary tariff truce between the US and China. Tariffs on some goods dropped from 145% to 30%, and the end of the de minimis exemption for shipments from China and Hong Kong initially dampened eCommerce demand. The recent recovery appears driven by the return of traditional B2B air freight, with shippers moving goods that were paused during trade negotiations.
• Air cargo forwarders are leaning heavily on spot rates amid continued global trade uncertainty. With temporary reprieves and shifting agreements affecting the market, many consider long-term contracts too risky to pursue. The market remains cautious as forwarders wait for clearer direction in global trade policy.

Ocean

• Ocean freight rates from India to the US West Coast have jumped 60% over the past two weeks as tightening capacity and rising trans-Pacific demand squeeze availability. A surge in Chinese exports during the 90-day tariff reprieve is limiting space for Indian shipments. Rates now average $3,000 to $3,500 per container and could climb to $7,000 by July if trends continue.
• US ports could face $7 billion in added costs from proposed tariffs on Chinese-made container cranes, prompting groups like Association of Asia Pacific Airlines (AAPA) to request a delay. With 44 of 55 recently ordered cranes coming from China and future demand still tied to Chinese suppliers, ports warn the tariffs could divert critical funding from infrastructure.
• A surge in early US imports from China is driving up ocean container spot rates, but trucking prices remain flat due to abundant capacity. Analysts say that even with increased freight volumes during the 90-day tariff pause, over-the-road demand is unlikely to rise significantly, as surface freight has declined since 2022. While key warehouse markets are seeing more load movement, spot truckload rates are expected to stay low unless a substantial import-driven rebound materializes in June.

Air

• Braspress Air Cargo (BAC), a new Brazilian cargo airline, has received its Air Operator Certificate and is set to begin operations in the coming days. The carrier will launch domestic cargo services from Viracopos International Airport, aiming to meet growing demand for air freight in the region.
• As uncertainty and capacity cuts affect the transpacific trade lane, foreign carriers are eyeing Latin America as a new growth region. With eCommerce demand rising rapidly in countries like Brazil and Mexico, some carriers are shifting capacity away from Asia to serve this emerging market. However, the influx of foreign competition may challenge local Latin American carriers that rely on higher yields and limited competition.

Ocean

• CK Hutchison Holdings has confirmed that Gianluigi Aponte, founder of MSC, is leading the group seeking to acquire its global port operations. The proposed $20 billion deal is still subject to regulatory approval, and Hutchison has emphasized that no agreement will be finalized until all required authorizations are secured.
• Argentina’s president issued a decree last week deregulating the merchant navy, allowing foreign operators to run vessels and hire non-Argentinian crews on the country’s waterways. The decision has been met with strong opposition from the United Maritime Workers Union (SOMU) and others who see it as a major setback for the national maritime workforce.

Air

• Air freight capacity between China and the US has dropped by nearly a third following the suspension of de minimis exemptions for low-value shipments from China and Hong Kong, hitting Asian airlines that depend on eCommerce volumes. A temporary tariff reprieve has led to a modest recovery in capacity, but long-term demand remains unclear as retailers like Shein and Temu shift to ocean freight and warehousing strategies. Airlines are adjusting routes, and Southeast Asian countries may gain from the resulting shift in trade flows.
• The Association of Asia Pacific Airlines (AAPA) is urging governments to resolve persistent supply chain disruptions that are delaying new aircraft deliveries, limiting capacity and threatening trade growth in the Asia Pacific region. These delays, compounded by material shortages and trade barriers such as US tariffs, are also slowing progress toward aviation’s 2050 decarbonization targets. AAPA emphasizes the need for coordinated action between governments and suppliers to support a more sustainable and efficient aviation industry.

Ocean

• Major container lines are looking to more than double spot rates for shipments from China to the US West Coast, driven by a 90-day tariff reprieve that has sparked a surge in bookings. Spot prices have already climbed, and carriers plan further rate hikes and surcharges starting June 1. Despite the rising costs, demand remains strong as importers rush to move goods before potential tariff increases take effect.
• Ocean carriers are restarting trans-Pacific services in response to rising import demand from China and a 90-day US tariff suspension set to expire August 14. However, immediate capacity remains tight due to blank sailings and slow vessel repositioning. Carriers like Zim, MSC, and Evergreen are reinstating routes, but space shortages are causing cargo rollovers and shipment delays expected to continue into early July.
• Zim Integrated Shipping Services is reviving its Zim Central China Xpress route from China to Los Angeles to capture rising demand during the 90-day US-China tariff reprieve. Despite this move, the carrier has lowered its 2025 trans-Pacific growth outlook to the low single digits, citing continued market uncertainty and reduced volumes following the April 9 tariff announcement. Zim also cautions that West Coast ports could face congestion if imports surge and plans to gradually retire Chinese-built vessels ahead of October’s tariff enforcement.
• A surge in trans-Pacific cargo following the 90-day US-China tariff reprieve is causing vessel congestion and container shortages at key Asian ports, particularly in China. Carriers report delays of up to 72 hours at Shanghai, Qingdao, and Busan, with congestion spilling over to Ningbo, Singapore, and Southeast Asian hubs. Shippers are struggling with equipment shortages as carriers prioritize containers based on space and rates. Further disruption is expected through June as vessels are redirected from Asia-Europe routes to meet trans-Pacific demand.

Ground

• Six countries, including China, Kazakhstan, Iran, and Türkiye, are developing a $8 billion, 12,000-kilometer rail corridor linking China to Europe via the Middle East. The new route is designed to reduce shipping times from 30–45 days to 18–25 days, offering a faster and more reliable alternative to sea freight while bypassing risks like port strikes and chokepoints. Although not the longest rail route globally, the corridor has the potential to reshape Eurasian trade and supply chains.

Air

• Authorities in Germany and Switzerland have arrested three Ukrainian nationals suspected of involvement in a parcel bomb plot allegedly linked to Russian intelligence services. While specific targets have not been officially confirmed, the activity is believed to have aimed at disrupting logistics operations. Investigations are ongoing.

Ocean

• EU foreign ministers are increasing efforts to regulate a fleet of 500–700 aging oil tankers believed to be transporting a significant share of Russia’s seaborne oil exports through northern European waters. Often operating with unclear ownership, flagging or insurance status, these vessels raise regulatory and maritime safety concerns. Recent developments, such as Estonia’s interception of a vessel under scrutiny and the entry of a Russian aircraft into NATO airspace, have prompted renewed calls from Baltic states for enhanced maritime oversight. Officials emphasize the importance of coordinated enforcement to support stability and transparency in regional shipping.
• European port congestion remains a challenge, particularly in Bremerhaven, where labor shortages have led to average delays of five to six days. Contributing factors include reduced workforce availability during recent holidays and low water levels on the Rhine, which have restricted barge movements from key hubs like Antwerp and Rotterdam. Although some alternative ports are experiencing less congestion, rerouting remains difficult due to limited capacity and the ongoing disruption in the Red Sea, leaving importers with few practical alternatives.

Ground

• Europe’s zero-emission freight transition advanced on May 16 with the launch of a Milence charging hub for electric heavy goods vehicles (HGVs) in the UK, part of a 1,700-site network being developed by Daimler, Volvo, and Traton. To meet the EU’s goal of a 45% CO₂ reduction in truck emissions by 2030, more than 35,000 public fast chargers will be needed. However, the pace of infrastructure rollout and inconsistent policy alignment remain key challenges. In the UK, Project JOLT is testing electric trucks to help fleets adapt to operational changes, including limited range and charging logistics.

Air

• Air India is set to expand its global reach through more than 10 new codeshare agreements this fiscal year. These partnerships are expected to strengthen connectivity across North America, Europe and Africa, helping to drive feeder traffic and support the airline’s goal of achieving 25% annual growth in its international operations.

Ocean

• Egypt’s Suez Canal Authority (SCA) has announced a 15% reduction in transit fees for container vessels with a net tonnage of 130,000 metric tonnes or more, effective May 15, 2025. The discount, valid for 90 days, is intended to encourage shipping lines to resume using the canal amid ongoing tensions in the Red Sea region.
• Abu Dhabi Ports Group has announced a series of terminal and vessel agreements with partners in Kazakhstan, alongside cooperation agreements with several institutions in the country. The initiatives include expanding both the Caspian and open sea fleet and exploring joint opportunities in trade development and Special Economic Zones through newly signed Memoranda of Understanding. AD Ports affirmed its commitment to enhancing trade and economic cooperation between the UAE and Kazakhstan.

• Canada has announced a temporary suspension of the 25% surtax on certain US-origin imports, including select motor vehicles from specific companies. The measure is designed to ensure the continued availability and smooth flow of critical goods that support public health, safety and national security. By easing trade restrictions on key materials such as steel, aluminum and specialized medical products, Canada aims to strengthen domestic manufacturing, healthcare operations and emergency preparedness. This six-month relief is intended to prevent supply chain disruptions and help industries maintain operations without added costs or shortages.
• The US has delayed the implementation of new tariffs on EU goods from June 1 to July 9 following discussions with the European Commission. The delay allows time for further negotiations, while the EU has also paused retaliatory tariffs on $21 billion worth of US imports. The European Commission had previously proposed a zero-tariff deal on industrial goods and warned it may proceed with countermeasures if talks fail.
• On May 20, US Customs and Border Protection announced two new initiatives to enhance trade flow and security at the US-Mexico border. In Laredo, Texas, a rail inspection system donated by Canadian Pacific Kansas City is now operational, offering 100% scanning of outbound trains and incorporating a radiation detection component for added safety. Meanwhile, more than $17 million in improvements at the Los Tomates border crossing in Brownsville, Texas, funded by Cameron County, include expanded vehicle lanes, upgraded inspection bays, and a modernized facility. These enhancements are expected to be fully operational soon and aim to reduce congestion and support more efficient cross-border trade.
• A new tax bill introduced in Congress would eliminate the de minimis exemption for duty-free imports under $800 by July 1, 2027. While the exemption was recently revoked for shipments from China and Hong Kong, it remains in place for most other countries. The proposed legislation would apply to all commercial shipments and establish penalties for misuse, with fines of 5,000 dollars for a first offense and 10,000 dollars for repeat violations. The bill is part of broader efforts by federal agencies to address concerns about counterfeit goods and restricted substances entering the US through low-value shipments with limited oversight.
• The US Department of Commerce has issued procedures to help importers reduce or avoid the Section 232 tariff on automobiles, which took effect on April 3. Vehicles imported from Canada and Mexico that meet USMCA requirements are exempt from tariffs on their US content. Starting May 20, importers can request an exclusion by submitting documentation detailing the vehicle’s value, content origin, production sites and USMCA certification. If approved, Customs and Border Protection will be notified. If US content is found to be overstated, the full tariff will apply retroactively and on future shipments from that importer.

• France and Germany have requested that the EU reconsider a proposed supply chain law designed to address forced labor and environmental impacts, citing concerns about the administrative burden it may place on European companies in a competitive global environment.