As the 2025-26 service contract season kicks off, major U.S. retailers are signing trans-Pacific shipping agreements, with shipping rates up 15% to 20% compared to last year. Meanwhile, medium-sized importers are expected to close deals in the coming weeks, but face slightly higher shipping costs.
According to industry sources, large retailers have signed service contracts and set benchmark prices for small and medium importers. Currently, contract shipping from Asia to the U.S. West Coast costs $1,600 to $1,800 per 40-foot standard container (FEU), with an additional $1,000 added to the East Coast. These contracts will take effect on May 1, 2025 and last through April 30, 2026, with a marked increase in price from $1,400 to $1,450 per FEU on the West Coast last year.
Medium-sized importers who ship about 30,000 to 40,000 containers a year are currently entering the second round of price negotiations, and contract shipping costs are expected to be about $100 to $150 per FEU higher than large retailers. Although negotiations are ongoing, some importers choose to delay the signing in anticipation of more favorable conditions.
Changes in U.S. trade policy, potential tariffs on Chinese-built ships, shipping disruptions in the Red Sea region, and uncertainty over consumer demand have made this year's contract price range wider than ever before. Some importers are concerned that the market will weaken further in the second half of the year, delaying the signing of contracts; while others, once affected by a shortage of seats, are opting to pay higher fees to ensure momentum.
Immediate shipping from Asia to the US West Coast has fallen to US$1,600 per FEU1,600, down 69.5% from January, according to the latest data from S&P Global's Platts. Despite the decline in immediate freight rates, some shipping companies are maintaining higher contract prices due to changes in shipping alliances and manpower management strategies.
Shipless Carriers (NVos) also said that negotiations are ongoing, with an initial offer of around $2,500 per FEU, while the current offer has fallen back, it is still well above $2,000. In addition, some shipping companies that rely on China to build ships are offering more competitive prices to maintain business due to concerns about possible tariffs imposed by the U.S. Trade Representative Office (USTR).
The market is still full of uncertainty as contract negotiations continue. While large retailers have established price benchmarks, medium-sized importers are still considering how to make the best choices in a changing economic and geopolitical environment. Over the coming weeks, the industry will gradually determine how to strike a balance between price stability, momentum protection and cost efficiency.
Source: https://www.joc.com/article/largest-us-importers-finalizing-contracts-in-unsettled-trans-pacific-5971122
