How shippers can adopt strategies to identify opportunities and risk in a contrasting market

If you are a business preparing a budget ahead of tendering for your next long term ocean container shipping contract, where do you start given the massive supply chain volatility during 2025 in the wake of US tariffs and trade wars?

Emily Stausbøll of Xeneta elaborates:

In a hypothetical scenario where your current long term contract entered validity on 1 January 2025 following a tender in Q4 2024, you are likely facing a very different scenario ahead of negotiations in Q4 this year for your next agreement starting on 1 January 2026.

This blog will use this scenario to demonstrate the strategies shippers can adopt to identify opportunities – and risk – by assessing the contrasting landscape across four of the world’s ocean container trades:

•    Far East to North Europe

•    Far East to South America East Coast

•    Far East to US West Coast

•    North Europe to Far East

Compare your current rate with today’s market

A good starting point is to look at the current rate level in the long term market and compare it to your existing agreement, even if that means (for now) ignoring volatility in spot and long term rates in the intervening months. To be clear, the spot market will still be an important factor in your long term contract tender strategy, as this blog will demonstrate.

Once you have this direct comparison, you can begin to use data to understand how these rates are likely to develop ahead of your next tender and the reduction (or increase) you could expect compared to your current contract.

In the case of Far East to North Europe, a shipper is looking at a reduction of 23% compared to their existing agreement if they locked in at today’s long term market average.

Even in a conservative scenario with rates rising 10% from today to 1 January 2026, shippers would still be getting a 15% reduction in rates compared to 1 January this year.

On the other three trades, the decline is even steeper with long term rates down more than 40% compared to 1 January 2025. This doesn’t tell the whole story however, because while there may be opportunity for greater savings where long term rates have fallen harder, there can also be more risk.

Spot rates will impact long term market

The forecast for the remainder of 2025 across the world’s major trades is further decline in spot rates, which will put further downward pressure on long term rates. A declining spot market during negotiations in Q4 will impact market sentiment and make it more difficult for carriers to argue 

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