90 day tax reduction period in China US trade war: US ships near full capacity in May
Date：2025-05-23 09:42:00 View：
In the complex game of the US China trade war, we have now entered a crucial '90 day tax reduction period'. The shipping company's freight rates have undergone multiple rounds of adjustments, and sellers are also busy in this storm.
Three consecutive increases in US freight rates
Recently, the most notable trend in the shipping market has been the "three consecutive increases" in US freight rates. Container shipping companies were originally facing the possibility of losses in the second quarter, but after the 90 day tariff reduction period of the China US tariff war, the situation suddenly reversed and the dawn of profitability began to emerge. All shipping companies will naturally not miss this opportunity and have announced plans to increase freight rates.
On May 15th, the shipping company launched its first round of price increases, with each large container (40 foot container) experiencing a price increase ranging from $500 to $1000.
Subsequently, on June 1st, the second round of price increases hit, with the increase expanding to between $1500 and $3000, and market prices began to fluctuate significantly. On June 15th, Mediterranean Shipping (MSC), CMA CGM, and Senro Steamship (SML) surged by $4000, pushing this price hike wave to a climax.
Originally, some shipping companies did not plan to raise prices in mid May, but on May 12th, China and the United States reached a temporary agreement on tariff issues, reducing tariffs by 91%. Some shipping companies were unable to raise prices in time and had to follow up hastily.
For example, MSC arranged a $500 increase from May 21st to 31st, while Wanhai Airlines' China US line increased by $500 from May 22nd to 31st, and non China regions increased by $2000. On June 1st, many shipping companies also joined the army of price increases. Yangming, Japan Ocean Network Shipping (ONE), HMM, and Hapag Lloyd all booked a price increase of $2000, while Star Shipping rose by $800-1000 (depending on the route) and non China regions rose by $2500.
If all three stages of price increases can be achieved, the freight rate per large box on the US West Coast route will reach $7000-8000.
However, industry insiders predict that by then, most of the flights that were originally diverted from the US route will have resumed, and there may even be overtime ships, so the possibility of an actual increase of $4000 is unlikely. However, even so, the expectation of such a significant price increase has left the market in a state of panic.
Cabin space is hard to come by
With the adjustment of tariff policies, the cabin space of ships shipping on the US route at the end of May is approaching full capacity, and some media have reported that the cabin space on the US route in May was almost sold out in one day.
The data from shipping analysis firm Vizion vividly illustrates this hot scene.
As of May 5th, the average booking volume for 7 days was 5709 TEUs.
As of May 13th, this number has surged by 277%, reaching 21530 TEUs.
Starting from June 1st, the US West and US East routes may increase by another $1000-3000. Taking the Shanghai Port to New York route as an example, the current price for a 40 foot container is around $4300, but some customers are willing to pay $6000/FEU or more to "grab space". The daily inquiries in the US market have approached 50, with prices constantly rising and cabin space still tight.
Sellers rush to ship goods
When Jennifer Burch, co-founder of Hightail Hair, learned about the tariff agreement, she immediately arranged a shipment plan for nearly 4000 hair outlets. Temu has resumed the "non semi custodial" mode and notified sellers to increase their stock of hot selling products by 30% -40%. Amazon sellers have also begun actively stocking up.
However, slow sellers have fallen into the dilemma of not being able to ship their goods. Starting from the morning before yesterday, some sellers have reported that after contacting the freight forwarder, they were informed that the delivery date would be postponed, and the storage space before the end of May is no longer available.
The 90 day 'cooling off period' is crucial for sellers, and some other sellers are worried about the subsequent tariff adjustment and are rushing to ship. An industry insider said, 'Not shipping now may be the highest cost in the next three years!'!
In the shipping storm triggered by the "90 day tax reduction period" of the China US trade war, there are no absolute winners or losers, only survivors who constantly adapt to changes and flexibly adjust their strategies. Sellers need to constantly pay attention to policy trends and market conditions, plan ahead, and layout reasonably.