Ocean Rates Hold Firm as China Factories Reopen - TFX Update wk. March 2, 2026

The Lead:

The transition into March 2026 marked the most significant administrative shift in U.S. trade history as the executive branch pivoted from country-specific "Reciprocal Tariffs" to a broad 15% global surcharge under Section 122. This shift was a direct response to the Supreme Court's invalidation of the IEEPA-based tariff authority, which has left the U.S. government facing potential refund claims exceeding $175 billion. While the new 15% flat rate offers a lower duty for countries like China and India compared to the previous regime, it represents a net increase for allies like the UK and Italy. Consequently, the global trade environment remains highly unstable, with the European Union threatening to reactivate retaliatory levies and the US Trade Representative preparing a fresh wave of industry-specific investigations to replace the temporary 150-day surcharge before it expires in July. All while the US began military activity in Iran late last week. It is still to be determined how, if at all, this conflict will impact global trade policy with the Trump administration or abroad.

This Week’s Ocean, Air & Freight Markets

China-US Ocean Freight Market:

The market is showing the first signs of post-holiday stabilization as Asia resumes operations. While rates have largely bottomed out at the breakeven levels established during the Lunar New Year, the anticipated post-holiday rate crash has not materialized, with pricing currently holding steady.

CEA to USWC: Rates have maintained their floor at approximately $1,450 to $1,500 per container. Despite a lack of upward pressure, there has been no further significant erosion in pricing this week.

CEA to USEC: East Coast rates continue to hold steady in the $2,400 to $2,500 range. The market remains balanced at these low levels as carriers prioritize volume recovery over aggressive price hikes.

Read more about the state of the ocean freight spot market with Freight Right’s TrueFreight Index.

What Happened This Past Week:

• Post-Holiday Factory Resumption: Factories in China and Vietnam have officially reopened, though they are currently working through a backlog of existing orders rather than new demand.

• Absence of Rate War: To the surprise of some analysts, carriers have not engaged in a significant "price war" to capture the first post-holiday shipments, allowing rates to stabilize at breakeven levels.

• Low "Breadcrumb" Volumes: Current shipments consist primarily of leftover inventory, referred to as "breadcrumbs", from before the holiday shutdown, rather than a fresh surge of new orders.

• Carrier Profitability Floor: At current levels, carriers are operating at or near cost. This has created a natural floor, as further reductions would lead to active losses that carriers are currently unwilling to absorb.

• Air Freight Softening: Air freight rates have cooled significantly from January peaks, now settling into the $3.50 to $4.50 per kilogram range as space becomes more available post-holiday.

Looking Ahead:

The market is entering a critical observation period. The next two to three weeks will reveal the true strength of the 2026 shipping season as the new order volume begins to hit the water.

Current projections suggest that rates will remain flat through the end of March. The major focal point for the industry is now the April/May contract season. Carriers are closely monitoring March volumes; if demand remains tepid, they may be forced to utilize more aggressive capacity management, such as extended blank sailings, to bolster their bargaining position for long-term contract negotiations. Shippers should expect a relatively stable, low-rate environment in the short term, with potential volatility returning in late spring.

In the News:

WSJ: World Trade Surged in 2025 Despite Higher Tariffs
https://www.wsj.com/economy/trade/world-trade-surged-in-2025-despite-higher-tariffs-f122a534

BBC: What tariffs has Trump introduced and why?
https://www.bbc.com/news/articles/cn93e12rypgo

Global Trade Magazine: Port of LA Sees Stable Orders Amid Trade Policy Shifts
https://www.globaltrademag.com/port-of-la-sees-stable-orders-amid-trade-policy-shifts/

Reuters: US tariff lawsuits returned to trade court to determine next steps
https://www.reuters.com/world/us-tariff-lawsuits-returned-trade-court-determine-next-steps-2026-03-02/

CNN: Trump’s new tariffs might be illegal, but that may not ruin his tariff quest
https://edition.cnn.com/2026/03/01/business/trump-tariffs-supreme-court-section-122

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