CONTAINERS QUARTERLY: Asia-Europe enters 2026 with seasonal firmness, structural uncertainty

The Asia-Europe container freight market entered 2026 on firmer footing after a volatile close to 2025, with seasonal pre-Lunar New Year demand and delayed GRI implementation pushing spot rates higher into early January. However, market participants continue to view the rally as cyclical rather than structural, with caution persisting around post-holiday demand and capacity normalization.

As of Jan. 9, Platts Container Rate 1 (PCR1) and PCR11 -- North Asia to North Europe and the UK -- were assessed at $2,700/FEU, extending gains from late December as general rate increases continued to filter into the FAK market. The Mediterranean market softened modestly after overshooting GRI targets, with Platts Container Rate 3 (PCR3) easing $200 to $4,200/FEU, though it retained a substantial premium over North Europe.

"Rates moved because they had to, not because demand suddenly exploded," one forwarder said.

Pricing dynamics: rebound from October lows

The strength seen into late Q4 and early Q1 represents a decisive reversal from early October, when rates had fallen to unsustainable levels. Platts Container Rate 1 (PCR1) and PCR11 were assessed at $1,300/FEU on Oct. 2, before rising steadily through successive GRI cycles and tightening availability to reach $2,700/FEU by Jan. 9.

This $1,400/FEU increase, equivalent to a 108% rise, highlights the scale of the rebound from the market's trough rather than evidence of tight supply.

Late December marked a turning point after several failed GRI rounds earlier in Q4. With pre-CNY cargo moving earlier than usual and carriers maintaining blank sailings, spot rates firmed into year-end and carried momentum into the first week of January.

Mediterranean premium remains structurally intact

Despite the $200 pullback, PCR3 continued to trade at a $1,500/FEU+ premium to North Europe. Carriers cited limited routing optionality, heavier reliance on transshipment and selective allocation as reasons the basin remains structurally firmer.

The Mediterranean saw a sharper late-December spike, but resistance emerged once carrier targets pushed beyond market-clearing levels.

"GRI ambition in the Med ran ahead of reality," a market participant said. "That's why it corrected, not because the market collapsed."

Cargo rolling and tighter space were reported on several westbound services into early January, reinforcing the resilience of the premium even as absolute levels adjusted.

Long-term confidence still lagging spot strength

Longer-term sentiment remains cautious. Platts Long Term Container Rate 1 (PLCR1) stayed broadly stable at $1,700/FEU, underscoring the disconnect between short-term spot momentum and 2026 contract confidence.

Persistent overcapacity, minimal scrapping and uncertainty around routing normalization continue to cap long-term optimism.

Red Sea signals add uncertainty, not clarity

Maersk's late-December transit through the Bab al-Mandab Strait was widely viewed as symbolic rather than a signal of imminent network change. The carrier stressed that the sailing was an initial step only, with no timetable for a wider return to trans-Suez routing.

Market participants agreed that any broader resumption would likely introduce short-term congestion and operational disruption before exerting downward pressure on rates.

"It wouldn't crash the market first - it would jam it," a forwarder source said.

Outlook: January supported, correction risk post-CNY

Looking ahead, consensus points to firm conditions through January, supported by seasonal demand and managed capacity. Beyond Lunar New Year, sentiment turns defensive.

"January holds; February is the question," a forwarder said. "Everything after that depends on discipline."

Ultimately, carriers' willingness to maintain capacity control - rather than demand growth - will determine whether early-2026 rate gains can be sustained.

Platts is part of S&P Global Energy.