February 26th, 2026 – Ocean carriers are continuing to grapple with an imbalance of too many ships and too little cargo, and the persistent weakness in Asia–U.S. freight rates is now spilling over into other major trade lanes.
According to Xeneta Chief Analyst Peter Sand, average spot rates declined this week across all primary fronthaul trades out of the Far East. On the Far East–U.S. West Coast and Far East–U.S. East Coast routes, falling spot rates are aligning with a modest increase in available capacity — a classic sign of softening market conditions.
For the week ending February 19th, average spot rates from the Far East to the U.S. West Coast fell to $1,889 per forty-foot equivalent unit (FEU), down from $2,052 the prior week. Rates to the U.S. East Coast dropped to $2,688 per FEU from $2,882.
The trans-Pacific trade has been volatile, driven by importers taking a wait-and-see approach while carriers attempt to manage persistent overcapacity. Xeneta’s four-week rolling average of offered capacity as of February 16th rose 2.7% week over week on Asia–West Coast services and 2.2% on Asia–East Coast services.
Data from SONAR’s Ocean Volume Index further highlights the slowdown, showing a sharp decline in China–U.S. container bookings since January.
This uncertainty comes at a challenging moment for liner operators as they enter contract negotiations with shippers. After a difficult 2025 marked by year-over-year profit declines among major publicly traded carriers, lines are expected to pursue higher rates. However, that effort could falter if demand remains clouded by economic concerns and tariff-related pressures.
Other key Asian trade lanes are also experiencing rate weakness, though under different dynamics. On the Far East–North Europe route, offered capacity has declined week over week, yet spot rates continue to fall — pointing to even softer demand conditions. This is particularly notable given that China redirected significant export volumes to Europe in 2025 after tariffs sharply curtailed shipments to the United States.
Looking ahead, 2026 is widely expected to be defined by structural overcapacity in container shipping, compounded by a broad return of services to the Red Sea. However, geopolitical risks could complicate that outlook. Rising tensions in Iran may affect security in the region, particularly if it increases the likelihood of renewed Houthi militia attacks on merchant vessels transiting the Red Sea.
Even without a full-scale escalation, heightened military posturing and political rhetoric could delay carriers’ plans to fully resume Red Sea transit. Any postponement in returning to the shorter route would temporarily absorb excess vessel capacity, potentially easing the industry’s overcapacity pressures deeper into 2026.
Meanwhile, rates from North Europe to the U.S. East Coast edged up slightly to $1,492 per FEU from $1,484 the previous week, as capacity on the lane contracted by nearly 10%.
