Sharp Drop in Container Freight from China to the U.S.: What’s Behind It?

In June 2025, container freight rates from China to the United States are plummeting. This is a significant shift for the logistics and maritime industries. In this article, we explain the background and outlook in detail.

Shanghai–U.S. West Coast Rates Drop Over 26%

According to the June 13, 2025 data from the Shanghai Shipping Exchange (SCFI), freight rates from Shanghai to the U.S. West Coast fell by 26.5% from the previous week to $4,120/FEU. East Coast rates also declined 2.8% to $6,745/FEU, showing a broader downward trend.

Just one month ago, freight rates more than doubled due to a surge in demand following U.S.–China tariff easing. The current plunge marks an exceptionally sharp reversal.

Background: U.S.–China Relations and Rush Shipments

In mid-May, the announcement of partial tariff reductions between the U.S. and China prompted a wave of urgent procurement by American importers. As a result, short-term freight rates surged. According to SCFI, rates jumped to more than twice the level of mid-April, leading to market-wide supply shortages.

Freight Rates Rebound as Capacity Recovers

Following the surge, major shipping lines resumed previously suspended services, launched new routes, and added capacity. This caused a rapid recovery in vessel supply and shifted the supply–demand balance, triggering a sharp decline in rates.

Freight from Busan, South Korea to the U.S. West Coast also fell 9.2% week-on-week to $4,921/FEU.

Key Factor Going Forward: U.S.–China Tariff Negotiations

The most critical factor influencing future freight rates is the status of U.S.–China tariff measures.

• China to U.S.: Additional 55% tariffs (10% reciprocal + 20% fentanyl-related + 25% Trump-era)
• U.S. to China: Additional 10% tariffs

These tariffs had been temporarily suspended but are set to expire in July. Whether they are extended will significantly affect demand and freight pricing.

Other Routes: Marked Regional Differences

Rate trends vary significantly across other regions as well.

• Shanghai to Europe: $1,844/TEU (+10.6% WoW) — rising for four consecutive weeks
• To Mediterranean: $3,190/TEU (–3.4% WoW) — first drop in four weeks
• To Persian Gulf: $2,083/TEU (+8.0% WoW) — sixth week of increases
• To South America (East Coast): $4,727/TEU (+19.4% WoW) — about 3.4x since May
• To Oceania: $745/TEU (+8.6% WoW) — first positive change in nine weeks

The sharp surge to South America reflects severe supply constraints and highlights growing regional disparities.

Conclusion: Navigating a Rapidly Shifting Market

This freight rate collapse is not just a price fluctuation—it reflects a complex interplay of geopolitics, tariffs, and carrier strategies.

The maritime market is constantly in motion, and complete reversals can occur in just a few weeks. For logistics and trade professionals, tracking these developments closely is key to timely bookings and effective client proposals.