Global Trade Braces for 2nd Half of Year Slowdown as Tariff Deadlines Hit - TFX Update August 11, 2025

The Lead:

Another week of rock bottom spot market prices, trade policy changes and timid importers. It's officially Groundhog Day in the frieght markets.

The week opened with Brussels pausing its US-focused countermeasures while Washington finalized the rulebook for its revamped reciprocal tariffs, including a 40% anti-transshipment penalty. Commerce advanced several trade-remedy actions, and on Aug. 6 the White House added a further 25% tariff on Indian goods (effective Aug. 27), escalating tensions even as the broader U.S. reciprocal tariff schedule took effect on Aug. 7. The WTO raised its near-term trade forecast but cautioned that the very tariff increases implemented this week would dampen flows later in the year. The period ended with a 90-day extension of the US-China tariff pause, maintaining the 10% reciprocal rate on China and averting an immediate escalation.

On Markets & Rates:

Transpacific ocean rates held largely steady this past week. CEA/USWC saw a repeat of last week: low spot quotes edged down about $50 w/w to roughly $1,550-$1,600/FEU on the lowest side (with some lows still near $1,500). August GRIs didn’t stick, and carriers are trimming sailings to stem further erosion. CEA/USEC also saw a repeat of last week. Flat to slightly softer w/w at about $2,600–$2,700/FEU on the lowest end from some carriers. Capacity adjustments are visible here too, but demand remains too soft for any meaningful rate lift.

TrueFreight Index (TFX) is tracking the following rates this week. Graphics below illustrate current FEU trends only.

Week of August 11, 2025:

• CEA/USEC 20FT $2374.02

• CEA/USEC 40HC $2885.57

• CEA/USEC 40FT $2885.57

• CEA/USWC 20FT $1583.48

• CEA/USWC 40FT $1955.97

• CEA/USWC 40HC $1984.44

Week of August 4, 2025:

• CEA/USEC 20FT $2542.41

• CEA/USEC 40FT $3125.14

• CEA/USEC 40HC $3125.14

• CEA/USWC 20FT $1628.72

• CEA/USWC 40FT $1990.42

• CEA/USWC 40HC $1990.42

This Week Explained:

• Tariff clock reset, urgency gone: The 90-day extension of the 30% China baseline tariff removed the near-term “load now” deadline. A few shippers had paused bookings awaiting the decision; once confirmed, they resumed at prior cadence, not a surge.

• Peak-season déjà vu - still muted: Importers have rebased their volumes to reflect tariff-era economics (e.g., from ~10 FCLs/week pre-tariffs to 2-4/week now). That keeps aggregate demand subdued despite the calendar.

• GRIs fizzled; capacity getting pulled: Attempts to lift rates in early August failed in a soft market. Lines are blanking sailings and pruning loops to match supply to demand, which is stabilizing West Coast levels but not lifting them.

• Pre-decision wobble only, not a wave: Some carriers reported a brief booking bump last week from shippers worried the extension might not come. Once the extension landed, the market reverted to “steady/slack.”

• Profit pressure at the floor: With USWC lows ~$1.5-1.6k/FEU, carriers are hovering near contribution margins; they’re unlikely to slash deeper without more capacity action hence the current blanking.

Looking Ahead:

Sideways-to-soft through the rest of August as confidence (not demand) stabilizes under the new 90-day window. Expect pockets of tightness around blank sailings and roll pools, but broad rate momentum remains limited.

On rates CEA/USWC’s low spot likely holds in the $1.5k–$1.8k/FEU range unless carriers accelerate cuts or a fresh policy shock hits. Any uptick will be modest and uneven, tied to capacity management more than demand. CEA/USEC’s low spot, $2.6k–$3.0k/FEU, will likely continue into August with mild firmness possible if lines shift more capacity off the longer transit lane. Still, muted import programs cap upside.

A small late-Aug/September pickup is plausible (holiday top-ups), but far from a classic peak. The tariff environment has structurally lowered run-rates; think incremental bumps, not breakouts.

Bigger picture, faster capacity withdrawals that over-tighten certain weeks, policy volatility that reintroduces deadline front-loading and operational hiccups (port congestion, weather) that create short, local price flares without changing the overall soft trend are likely to continue through August.

In the News:

Linkdin News: Here's how On sneakers beat tariffs: https://www.linkedin.com/news/story/heres-how-on-sneakers-beat-tariffs-6497868/

CNBC: Trump extends China tariff deadline by 90 days: https://www.cnbc.com/2025/08/11/trump-china-tariffs-deadline-extended.html

The White House: Fact Sheet: President Donald J. Trump Continues the Suspension of the Heightened Tariffs on China: https://www.whitehouse.gov/fact-sheets/2025/08/fact-sheet-president-donald-j-trump-continues-the-suspension-of-the-heightened-tariffs-on-china/

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