Asia-Europe Freight Rates Drop Amid Alliance Reshuffle

Liner operators are cutting Asia-Europe freight rates for early January as they compete for market share ahead of the upcoming reshuffling of container shipping alliances in February.

On December 27, 2024, the Shanghai-North Europe freight rate edged up slightly by 0.5% from the prior week, closing at $2,962 per TEU after three weeks of declines. However, consultancy Linerlytica noted that spot rates for the first two weeks of 2025 remain unstable, with initial increases quickly followed by reductions as carriers vie for dominance before the alliance changes.

In February, MSC will become an independent operator as its 2M partner, Maersk Line, departs to form the Gemini Cooperation with Hapag-Lloyd. Hapag-Lloyd will leave THE Alliance, which will be rebranded as Premier Alliance. Despite its solo status, MSC will collaborate with the Premier Alliance for Asia-Europe trade routes.

Freight futures also reflected market volatility. On December 30, the December 2024 contract (EC2412) for Asia-Europe freight settled at 3,445 points, a 4.4% increase from the previous week. However, February 2025 futures (EC2502) dropped 13% week-over-week due to reduced daily trading volumes.

Linerlytica stated: “Traders shrugged off the SCFI North Europe rebound on 27 December, as attention shifts to the lacklustre rate hikes in January which could foreshadow a steeper rate decline in February post-Chinese New Year.”

Despite healthy capacity utilization, carriers are offering discounts for shipments during the first two weeks of January to prepare for the alliance shake-up. Maersk has already lowered its January shipment quotes to $4,800 per FEU, prompting competitors to follow suit and further reducing Asia-Europe freight futures settlement prices.