Ocean carriers fight overcapacity to protect rates
Global container shipping is heading into the second half of 2025 under mounting rate pressure. Overcapacity, subdued demand, and a muted peak season are keeping pressure on spot prices on major east–west trades.
Even with operational disruptions such as port congestion in Asia and Europe and vessel diversions around southern Africa, carriers are struggling to reverse the market’s downward momentum.
The long-anticipated summer peak has failed to gather momentum, with Far East–Europe and Far East–Mediterranean trades, which would typically see a seasonal uplift in the third quarter, suffering further rate erosion. The pricing gap between the two has almost closed, which is a sharp reversal from earlier in the summer when Mediterranean services commanded a clear premium.
On the transpacific, rates to both the US East and West Coasts have slipped back towards pre–Red Sea crisis levels. Brief surges earlier in the year, driven by tariff reprieves that released pent-up cargo, were short-lived, as new vessel deliveries and weakening demand quickly reasserted downward pressure.
The root of the challenge is structural. A wave of new-build capacity continues to enter the market just as global trade volumes soften. Even when congestion and diversion routes absorb some tonnage, the supply-demand balance remains heavily skewed towards oversupply.
The carrier playbook for rate protection
Today’s container shipping lines are far more agile than in the pre-pandemic period, responding rapidly to both market weakness and fleeting windows of opportunity. Their evolving playbook includes:
• Blank Sailings – Cancelling scheduled voyages to remove space from the market and support utilisation.
• Slow Steaming – Extending voyage times to absorb surplus capacity and reduce fuel consumption.
• Fleet Idling – Temporarily withdrawing vessels from service to tighten available supply.
• Accelerated Demolition – Retiring older, less efficient vessels earlier, particularly in advance of tougher EU environmental compliance.
• Opportunistic Surcharges – Applying peak season surcharges or general rate increases whenever ships run full, regardless of whether the peak is seasonal or short-lived.
The immediate outlook remains challenging. Without a sustained rebound in demand or a coordinated capacity reduction, rates are likely to stay under pressure. Carriers will undoubtedly continue to adjust networks with precision, using every lever available to prevent pricing from sliding into unprofitable territory.
Over the longer term, structural shifts in global trade could work in carriers’ favour. New trade agreements and continued supply chain diversification away from single-country dependencies may generate more complex shipping patterns. This will require greater network flexibility and may help sustain rates above pre-pandemic levels, even in a lower-growth environment.
For now, the carriers’ primary battle is to manage the imbalance between supply and demand. A real test of their ability to protect profitability in one of the most over-supplied markets in recent memory.
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