Why are carriers failing to implement their announced rate increases?

According to Linerlytica, the November 1 GRIs are failing because carriers are offering significant discounts to secure volume as demand weakens. Gemini carriers Hapag-Lloyd and Maersk are quoting $3,000-$3,400 per 40ft on Asia-North Europe routes, well below the targeted increases, forcing competitors to match these lower rates. With available capacity abundant and US import volumes forecast to decline 11% in November, carriers lack pricing power despite formal rate announcements.

What is driving the current weakness in container demand?

Peak season demand has ended, and US import volumes are weakening significantly. The National Retail Federation forecasts a 11% month-on-month decline in US ocean import volumes for November. Additionally, urgent pre-holiday shipments are shifting to air freight rather than ocean, further reducing ocean freight demand and creating excess capacity on major trade lanes.

How should shippers approach contract negotiations in this environment?

The collapse of spot rates and carrier discounting suggests significant negotiating leverage for shippers during the annual contract tendering season. Current spot rates are falling below carrier targets, which typically anchor contract rate discussions. Shippers should benchmark against published spot rates and carrier discounting patterns, as carriers appear more willing to negotiate given weak demand and capacity concerns.

Are blank sailings helping stabilize rates?

Capacity management through blank sailings is declining in effectiveness. Drewry noted that blank sailings for the upcoming week dropped to four from eight the previous week. This suggests carriers are reducing capacity withdrawal strategies, likely recognizing that insufficient demand makes capacity cuts less useful for supporting rates. The trend indicates an extended period of downward rate pressure.

What do the second set of November FAK increases suggest?

Carriers announced additional FAK increases for November 15, with MSC targeting $4,600 per 40ft on Asia-North Europe (up from $4,500 for November 1). However, analysts express skepticism that these higher targets will hold given the persistent discounting already observed. These successive announcements reflect carrier attempts to support rates, but lack credibility in a market with abundant capacity and weak demand.

Shipping & Freight

Moderate

Carriers' GRI attempts fail as container rates collapse

Oct 30, 2026

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The signal

Container spot freight rates on major east-west trade lanes experienced their steepest declines since mid-2025 this week, with transpacific eastbound rates dropping 6% on the Shanghai-Los Angeles route and 5% on Shanghai-New York. The sharp pullback follows the close of the traditional peak season and reflects weakening US import demand, with the National Retail Federation forecasting an 11% month-on-month decline in US ocean import volumes for November.

More significantly, carriers' announced general rate increases (GRIs) of $2,000 to $3,000 per 40ft scheduled for November 1 are effectively collapsing due to persistent discounting and excess capacity across both transpacific and Asia-Europe trades. Analysts note that major carriers including Hapag-Lloyd, Maersk, MSC, and Ocean Alliance members are undermining their own pricing announcements, with some offering rates substantially below published FAK levels as they compete for volume in a weakened market.

This dynamic creates immediate headwinds for carrier revenue and forces supply chain teams to recalibrate their procurement strategies during the critical annual contract negotiation season.

Frequently Asked Questions

What This Means for Your Supply Chain

Simulation Suggestion

this month

What if Asia-Europe spot rates decline another 8-10% by mid-November?

Simulate a scenario where container spot rates on Asia-Europe trade lanes decline an additional 8-10% over the next two weeks as carriers continue discounting to secure volume. Adjust transpacific rates similarly. Model the impact on budgeted freight costs for shippers with locked-in contracts versus those still negotiating Q4-Q1 commitments.

Run this scenario

Simulation Suggestion

this month

What if demand rebounds faster than carriers anticipate in December?

Model a scenario where pre-Christmas demand surge arrives earlier than expected and capacity tightens rapidly. Assume blank sailings increase and spot rates recover 12-15% within 7-10 days. Evaluate the impact on shippers still negotiating Q1 contracts and those relying on spot market flexibility for holiday overflow.

Run this scenario

Simulation Suggestion

strategic

What if carriers accelerate blank sailings to defend rate levels?

Simulate carriers returning to weekly blank sailing levels (8+ per week) to reduce capacity and artificially support spot rates. Model the cascading effects on space availability, lead time variability, and shipper ability to secure capacity for Q1 peak season ramp-up. Compare cost savings from lower rates against service level risks from reduced frequency.

Run this scenario

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