October 9th, 2025 – Ocean carriers on the Asia-Europe trade lane are under increasing pressure to raise westbound rates as the 2026 contract negotiation season approaches. Shippers should prepare for aggressive capacity management, with carriers taking steps to stabilize a market sliding toward pre–Red Sea attack levels.
With spot rates heavily influencing long-term contracts, many shippers and forwarders are preparing to launch tenders over the next two months. Industry observers expect long-term rates to decline further for the 2026 season. A rate war has already emerged, and as financially strained companies enter bidding rounds, pricing pressure is expected to intensify while shipment volumes become more unpredictable.
Spot Rates Fall Sharply Ahead of Negotiations
Spot rates have dropped steeply: Asia-North Europe levels are down 57% year over year to $1,300 per FEU, while Asia-Mediterranean rates have fallen 53.5% to $1,600 per FEU, according to Platts. These figures represent a sharp decline from mid-year highs above $3,000 per FEU. Long-term rates from China to North Europe, now averaging $3,582 per FEU, have also fallen 56% from a year ago, Xeneta reports.
While further declines are possible, analysts warn that carriers will act decisively in the fourth quarter to manage supply and shore up pricing. Additional blank sailings and general rate increases are planned through October and November. Hapag-Lloyd and MSC will implement mid-October FAK rate adjustments between $2,400–$2,660 per FEU on Asia-North Europe and $3,500–$4,600 per FEU on Asia-Mediterranean. Capacity removals in October have reached 195,000 TEUs, up sharply from September, reflecting carriers’ determination to balance supply with weakening demand.
Contracts Shift Beyond Rate-Cutting
The 2026 contracting season will not focus solely on rate reductions. With oversupply and weak European demand, shippers are expected to pursue risk management and resilience in their bid strategies. Industry advisors recommend reviewing contract language to secure longer payment terms, stronger service commitments, and protections against surcharges such as detention and demurrage. Some are also introducing clauses allowing rate reviews if market prices collapse.
Carriers, meanwhile, must balance competitiveness with sustainability. Signing deals below cost may backfire if markets rebound, leading to renegotiations or canceled contracts. Experts note that shippers prioritizing stability and access to capacity should aim for reasonable rates rather than driving prices to unsustainable lows.
Outlook
The coming months will test both carriers’ capacity discipline and shippers’ strategic planning. As tenders roll out and rates fluctuate, the most successful shippers will combine cost competitiveness with long-term reliability, ensuring stable supply chains through 2026 despite persistent market uncertainty.
