Ocean Oct 14, 2026 · 7 min read

Suez return turns the ocean outlook negative

Suez is back, and Asia–Europe rates are losing their floor. Large container ships will soon make more than 50 Suez Canal transits a week, analyst Linerlytica said on 13 October. It now calls the market outlook negative. We agree, and we think the carriers’ late-October rate increases on Asia–Europe will not hold. Drewry says Asia–Europe rates have fallen for 13 weeks running, with Shanghai–Rotterdam at $3,337 per 40ft container. Xeneta’s Peter Sand: “we are not at the floor yet.” For forwarders, shorter Suez routings free up ships and put the leverage with shippers. Our call: Shanghai–Rotterdam on Drewry’s index will be below $3,000 by the end of November.

Suez traffic is coming back, and it will pull Asia–Europe rates down through year end
Big container ships are going back through the Suez Canal faster than most people expected. On 13 October, analyst Linerlytica said ships of more than 4,000 TEU will soon pass 50 Suez transits a week. (TEU means twenty-foot equivalent unit, the standard way to count container capacity.) It also said each of the main shipping alliances has now started regular westbound Asia–North Europe services through the canal.
Our view is simple. The Suez return is now the single biggest force on Asia–Europe ocean rates, and it pushes them down. Carriers want to raise prices in the second half of October. We do not think they will make those increases stick. Forwarders and shippers should plan for falling Asia–Europe rates into 2027, not a rebound.

What the data shows

Start with the routing. Linerlytica’s weekly note says the switch is accelerating, with “a full scale return to the Suez route expected by the first quarter of 2027”. It names the next movers: “ONE and HMM will be the next carriers to join the Suez influx”. Evergreen, Yang Ming and ZIM are, by Linerlytica’s count, the only main carriers yet to move.
Why does this matter for price? Because of distance. Sailing from Asia to North Europe around the Cape of Good Hope takes far longer than going through Suez. Longer voyages tie up more ships to carry the same cargo. Analysts measure this as TEU-miles, which is boxes multiplied by the distance they travel. When routes get shorter, TEU-mile demand falls even if the number of boxes stays the same.
Linerlytica puts it plainly: “The market outlook has turned negative with TEU-mile demand growth slipping further”. That is the core of the story. The ships are still there. They are just needed less.
Now the rates. Drewry’s World Container Index (WCI) for 8 October, reported by DCN, put the global composite at $4,351 per 40ft container, down 2% on the week. Shanghai–Rotterdam fell 2% to $3,337. Shanghai–Genoa was flat at $3,696. Drewry says Asia–Europe rates have now fallen for 13 weeks in a row.
Xeneta’s numbers, reported by The Loadstar on 9 October, show how far the slide has gone. Xeneta’s Peter Sand said: “The Mediterranean is taking the biggest hit, down 43% since 1 July, while North Europe is down 34%”. His verdict on where the bottom is: “so we are not at the floor yet.”
Drewry has named the threat directly. In The Loadstar’s report, it said “the faster-than-expected return to the Suez route remains the biggest threat to carrier efforts to support rates”.

The transpacific is cooling as well

The transpacific (Asia to North America) tells a similar story for a different reason. Here it is the end of peak season, not Suez.
Drewry’s WCI had Shanghai–Los Angeles down 3% to $7,624 per 40ft and Shanghai–New York down 2% to $10,220. Freightos’ 13 October update, published with China’s Golden Week holiday now over, had Far East–US West Coast rates down 2% to $8,150 per FEU (forty-foot equivalent unit). Asia–US East Coast was level.
Demand looks soft. Freightos cites the US National Retail Federation, which “projects November arrivals to drop 11% month on month”. Judah Levine, Freightos’ head of research, said that was “suggesting that peak season is finally coming to an end”.
Capacity is also coming back on the transpacific. Drewry says blank sailings (scheduled voyages that carriers cancel to cut supply) on the trade drop to four next week from eleven this week. More sailings and less cargo is not a recipe for higher rates.
The one lane moving the other way is Asia–Mediterranean. Freightos says “Asia – Mediterranean prices increased 7% to $3,800/FEU last week.” We read this as a short-term bounce after weeks of heavy falls, not a turn. The Mediterranean has dropped the most since July, so it has the most room for a small rebound.

Why carriers are still confident, for now

There is a twist. Carriers are not in trouble yet. Linerlytica notes that “Charter rates and resale vessel prices continue to edge upwards nonetheless”. Charter rates are what carriers pay to rent ships from owners. They are still rising. Linerlytica also expects carriers to report very strong third-quarter earnings.
That tells us carriers still think they need ships. But charter markets tend to lag. Ships are hired on long contracts, so the charter market reflects decisions made months ago. Spot freight rates react faster.
The bigger picture is supply. Shipping association BIMCO, reported by Seatrade Maritime on 23 September, expects vessel capacity to grow 4.6% this year and 9% in 2027. It believes that if Red Sea routes return to pre-war transit levels, vessel demand could be as much as 10% below offered capacity.
BIMCO’s Niels Rasmussen said “we expect that increased supply growth will drive a weakening of the markets during 2027”, “especially if a return to Suez Canal routings weakens ship demand.”
Put that together. Shorter routes cut demand for ships. Newbuild deliveries add more ships. Both push in the same direction.

The risk that could flip it

One thing could reverse all of this: renewed attacks in the Red Sea.
Freightos reports that Houthi missile attacks on Riyadh airport mark an escalation in the Saudi–Houthi conflict. It notes that “The Houthis sought to close the Bab el-Mandeb Strait to Saudi-linked traffic in July”. Bab el-Mandeb is the narrow strait at the southern end of the Red Sea that ships must pass to reach Suez. Levine warned: “The current escalation may increase the likelihood of renewed Red Sea strikes.”
This is a real risk and forwarders should watch it. If carriers pull out of the Red Sea again, the capacity freed by Suez would vanish overnight and rates would jump. That is what happened when the diversions began.
But carriers have already made the call. Freightos says they have “gradually increased Asia – Europe Red Sea transits since June”. All the main alliances are now running regular services. Reversing that is expensive. Our base case is that the routing holds unless there is a direct attack on a container ship.

What this means for forwarders

First, the late-October increases. Carriers plan higher FAK rates for the second half of the month. FAK means “freight all kinds”, the carriers’ basic spot tariff for general cargo. Drewry says success is uncertain. We think these increases will be announced, partly applied for a week or two, and then eroded. Quote customers with that in mind. Avoid locking in the full increase in your sell rates.
Second, watch surcharges more than base rates. Drewry’s Chantal McRoberts told The Loadstar: “It’s the surcharges that are causing the biggest consternation”. When base rates fall, carriers look for revenue elsewhere. Expect new or renamed surcharges in tenders and on spot quotes. Read every line.
Third, the 2027 tenders. Freightos says the market is “entering tendering season for 2027’s annual ocean contracts” and that some shippers are “hesitant to lock in annual rates”. On Asia–Europe, we think waiting is the right move for most shippers into Q1, when the Suez switch should be complete. Forwarders can add value by offering index-linked contracts. These tie the price to a published rate index, so the shipper benefits if the market keeps falling.
Fourth, transit times. Suez routings cut sailing time between Asia and North Europe. That means faster delivery but also schedule changes as carriers rebuild their networks. Expect some disruption to port rotations and cut-off dates over the next two months. Port congestion in Southeast and South Asia, which Linerlytica says continues, may make this worse in the short term.
Fifth, the transpacific. With peak season over and blank sailings falling, shippers have room to push for lower rates on US-bound cargo for November and December bookings.

Our call

We expect the carriers’ late-October FAK increases on Asia–North Europe to fail. Drewry’s Shanghai–Rotterdam rate, $3,337 per 40ft on 8 October, will be below $3,000 by the end of November.
We also expect 2027 Asia–North Europe annual contracts to settle below 2026 levels, with most big shippers waiting until the first quarter to sign. The only thing that changes this call is a confirmed attack on a container ship in the Red Sea before year end.

Sources