Global Shipping Sees Diverging Fortunes Across Trade Lanes

The global shipping market ended October 2025 in a state of uneven stability - steady on some routes, under pressure on others, and shaped by a mix of geopolitical tension, muted demand, and shifting trade flows.

While global tonnage remains sufficient and freight rates broadly subdued, select corridors - notably East Asia to the United States - are showing early signs of firming.

Weak Growth, Pockets of Resilience

According to the United Nations Conference on Trade and Development (UNCTAD) global seaborne trade is expanding by only 0.5% in 2025, with containerized volumes up a modest 1.4%,

The slowdown reflects tariff uncertainty, fragile consumer demand in Europe and North America, and longer routes due to security concerns in the Middle East.

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Nevertheless, despite sluggish volumes, freight rates showed signs of stabilizing in October. Drewry’s World Container Index (WCI) averaged US$1,746 per 40-foot container, up roughly 3% week-on-week.

Spot rates from Shanghai to Los Angeles rose to US$2,290, reflecting renewed pre-holiday demand and tighter vessel capacity on trans-Pacific lanes.

Asia–Middle East–Europe: Ample Capacity, Persistent Headwinds

The Asia–Middle East–Europe trade remains weighed down by excess capacity and rerouting challenges through the Red Sea. Geopolitical disruptions continue to push vessels around the Cape of Good Hope, stretching tonnage-days but doing little to lift rates. Carriers are struggling to fill ships, particularly on the India–Europe leg, where demand remains weak.

The Red Sea situation continues to distort sailing patterns. According to UNCTAD, more than 15% of Asia–Europe traffic was still rerouted around Africa in October, increasing voyage distance and operating costs. Yet with European import demand still soft, carriers have been unable to recover those costs through higher freight rates.

UNCTAD Secretary-General Rebeca Grynspan stated: "Not since the closure of the Suez Canal in 1967 have we witnessed such sustained disruption to the arteries of global commerce."

The Cape of Good Hope diversion however, has seen some Gulf ports gain as ships increasingly call at Jebel Ali, Dammam, Duqm, and Sohar to consolidate cargo before longer Europe-bound transits.

C.H. Robinson’s October Freight Market Update shows open capacity across South Asia and the Middle East, with vessel utilisation on India–North America routes hovering around 80 to 85%, and bookings down nearly 30% year-on-year.

East Asia–US: Rates Edge Higher Ahead of Peak Season

The trans-Pacific corridor tells a different story. Carriers have reintroduced General Rate Increases (GRIs) in late October, coinciding with the post-Golden Week restocking cycle in China. Drewry data shows spot rates rising 4 to 6% on key East Asia–US lanes.

Utilisation is improving modestly on North Asia–US West Coast services, and carriers report stronger bookings heading into November. According to some analysts, this seasonal tightening is likely to last through the end of Q4, though it may fade once holiday inventory peaks. Underlying demand however, remains well below pre-pandemic levels, keeping any hopes of a rate rally at bay.

Flat Growth, Fragmented Recovery

Looking toward the rest of 2025, we can expect flat growth and selective rate pressure, rather than a full-scale rebound.

• Capacity: Surplus tonnage persists, particularly on Asia–Europe and South Asia–North America trades. Unless carriers increase blank sailings or slow-steaming, overcapacity will continue to cap rate growth.

• Rates: Trans-Pacific pricing may hold slightly above September levels thanks to seasonal demand and carrier discipline. Asia–Europe rates, however, are likely to remain flat to soft amid weak European consumption.

• Volumes: Containerized trade is expected to sluggish growth with East Asia–US lanes being the bright spot.

• Risks: Ongoing Red Sea instability, potential new tariff measures, and equipment imbalances in Indian and Southeast Asian ports remain the major operational risks for Q4 2025.

A Market in Adjustment

For carriers, the final quarter of 2025 will be about discipline - managing capacity, preserving service reliability, and protecting yield in a slow-growth environment. For shippers, the short-term outlook remains favorable: open space, predictable transit times, and competitive contract rates on most lanes.

The broader trend, however, points to structural change. As sourcing diversifies from China toward India, Vietnam, and Gulf economies, traditional east-west routes are being reshaped.

The world’s shipping networks are adapting to a slower, more fragmented trading system - one where operational agility and cost control, rather than sheer tonnage, will define success.

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