Today, we’re excited to announce the launch of Freightos Enterprise – our comprehensive solution designed specifically for large enterprises that import and export, who need to bring control, visibility, and efficiency to their global logistics operations.

The Power of Integration: One Solution, Three Powerful Modules

Freightos Enterprise unifies three critical components of the freight management lifecycle into a single, integrated solution:

Freightos Terminal – Market Intelligence & Benchmarking

Terminal provides you with unprecedented visibility into freight rates, featuring powerful benchmarking capabilities. Now featuring both spot and contract rate benchmarking, Terminal helps you:

• Real-time rate benchmarking: Compare your contracted rates against current market rates across specific lanes, equipment types, and service levels
• Market trend analysis: Identify emerging patterns in pricing, capacity, and transit times before they impact your operations
• Scenario planning tools: Model the impact of potential disruptions or market shifts on your supply chain costs and performance
• Customizable dashboards: Configure your view to focus on the metrics and lanes that matter most to your business

Terminal processes over 1.2 billion rate data points monthly to provide the most comprehensive view of the market, helping you identify savings opportunities and make data-driven decisions.

Key Features:

• Both spot and contract rate benchmarking
• Air and ocean freight coverage
• Lane-specific insights
• Customizable analytics dashboards
• Historical trend analysis
• Proactive alerts for rate changes

Freightos Procure – End-to-End Tender Management

Procure (formerly Shipsta by Freightos) revolutionizes how enterprises manage tenders and contracts. It creates a single source of truth for your rate management, automating RFQs and streamlining the entire procurement process.

Procure delivers:

• Automated RFQ management: Standardize your bid process, collect responses in a structured format, and eliminate manual consolidation work
• Scenario modeling: Compare different award scenarios to optimize your carrier mix based on cost, capacity, service levels, and sustainability metrics
• Contract management: Maintain a digital repository of all carrier agreements with automated alerts for expirations and renewals
• Supplier performance tracking: Monitor carrier compliance with contracted rates and service levels to inform future procurement decisions
• Collaborative workflows: Enable stakeholders across your organization to participate in the procurement process with role-based permissions

Procure supports both strategic (annual or bi-annual) and tactical (mini-bid) procurement events, giving you the flexibility to adapt your approach based on market conditions and business needs.

Key Features:

• Automated RFQ creation and distribution
• Standardized bid collection and comparison
• Scenario modeling and optimization
• Contract lifecycle management
• Supplier performance analytics
• Mini-bid capabilities for tactical sourcing

Freightos Rate, Book & Manage – Operational Excellence

Rate, Book & Manage (formerly Enterprise Shipper) takes you from procurement to execution seamlessly. It handles everything from rating and booking to shipment management, invoice auditing, and beyond.

This comprehensive operational solution provides:

• Multi-carrier rate management: Access all your negotiated rates in one place for instant comparison and optimal routing decisions
• Automated booking: Create bookings directly with carriers and forwarders without rekeying information or switching systems
• Shipment visibility: Track your freight across all modes and providers with proactive alerts for exceptions
• Document management: Centralize and automate the handling of shipping documents, from booking confirmations to proof of delivery
• Invoice auditing and payment: Automatically verify charges against contracted rates and approved shipments to eliminate billing errors
• Analytics and reporting: Gain insights into operational performance with customizable reports and dashboards

Key Features:

• Centralized rate repository
• Direct carrier and forwarder booking
• Real-time shipment tracking
• Automated document management
• Invoice auditing and reconciliation
• Performance analytics and reporting

Breaking Down Silos, Building Up Efficiency

What makes Freightos Enterprise truly transformative is how these modules work together. Instead of managing procurement, benchmarking, and operations across disconnected systems, everything flows through a single provider:

1. Use Terminal to identify lanes where your rates are above market
2. Launch a mini-bid in Procure for those specific lanes
3. Automatically update your rates in Rate, Book & Manage
4. Book and track shipments using your newly optimized rates

This seamless workflow eliminates data silos, reduces manual work, and provides a single source of truth for your entire logistics operation.

Built for Enterprise-Scale Operations

Freightos Enterprise is specifically designed for:

• Large enterprise importers & exporters with $40M+ annual freight spend (or 4% of revenue)
• Global shipping operations across air and ocean freight
• Key industries include Healthcare, Pharmaceuticals, Automotive, Electronics, Manufacturing, Chemicals, Food & Beverage, and Fashion & Retail

Seamless Integration with Your Existing Systems

Freightos Enterprise is built to integrate with your existing ERP, TMS, and other critical systems. Our platform can be deployed alongside your current solutions, providing immediate value without disrupting established workflows.

• API-first architecture: Connect directly to your existing systems for seamless data exchange
• Pre-built connectors for major ERP and TMS platforms
• Flexible data import/export options to accommodate your specific needs
• Role-based access control to ensure proper security and permissions

The Power of the Freightos Network

As part of the Freightos (NASDAQ: CRGO) ecosystem, Freightos Enterprise connects you to the world’s largest digital freight network:

• 10,000+ forwarder offices worldwide
• 70+ leading carriers representing over 70% of global air cargo capacity
• 13,000+ importers and exporters
• 1.3 million+ transactions annually

This network effect means better visibility, more competitive rates, and unparalleled connectivity across the global logistics landscape.

Ready to Transform Your Freight Operations?

Schedule a demo today to see how Freightos Enterprise can help you:

• Reduce freight procurement cycle time by up to 75%
• Identify cost-saving opportunities across your carrier network
• Improve operational efficiency and eliminate manual processes
• Enhance visibility and control over your global supply chain

Freight forwarders and enterprise shippers looking to learn more about Freightos Enterprise can click here or request a demo.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 5% to $2,343/FEU.     
• Asia-US East Coast prices (FBX03 Weekly) fell 5% to $3,467/FEU. 
• Asia-N. Europe prices (FBX11 Weekly) fell 1% to $2,340/FEU. 
• Asia-Mediterranean prices (FBX13 Weekly) increased 7% to $2,935/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices increased 2% to $5.54/kg.
• China – N. Europe weekly prices stayed level at $3.75/kg.
• N. Europe – N. America weekly prices fell 1% to $2.11/kg.

Analysis

President Trump’s exemption of many electronics from reciprocal tariffs – including from the 145% minimum levy on all Chinese exports – has not slowed the steep drop in China-US container trade that started on April 9th. 

Some US-bound vessels are reportedly departing China only half full as many shippers cancel orders that have now more than doubled in cost. In response, carriers are blanking sailings at the rapid rate reminiscent of the start of the pandemic when demand collapsed for several months.

Inventories that importers built up from frontloading over the last few months will allow many shippers to wait out the current tariff hike on Chinese goods for several months, while spiking demand for bonded US warehouses also reflects this wait and see approach. Very recent statements from the president and Treasury Secretary to the effect that negotiations, de-escalation, and a significant lowering of tariffs on China could be coming soon may be encouraging for shippers currently in a holding pattern.  

That carriers are blanking few Asia – Europe sailings despite the record capacity scheduled on this lane suggests that demand is increasing to Europe, with speculation that some orders canceled by US shippers are being diverted to the European market.

The European Commission, concerned with a potential flood of Chinese goods, has started monitoring import levels closely. A sharp increase in container traffic to Europe could also exacerbate the current port congestion at several European hubs. Alternative export markets for China, like India, are also anticipating an increase in finished Chinese goods if China is forced to diversify away from the US.

China’s decision to retaliate US tariffs – which has meant a drop in US exports as well – sets it apart from nearly all other countries opting to negotiate with the US instead. In addition to seeking commitments to lower barriers to and buy more US exports, the US may also ask partners to reduce their trade with China – an element China is warning these countries against and threatening retaliation. 

Though the tariff roll out on China has put China – US ocean demand on pause, the 90-day reprieve on all other reciprocal tariffs means that many shippers on other lanes will continue to frontload ahead of the July deadline in case negotiations fail. Carriers on these lanes may be expecting an early – and possibly short – peak season as a result, with Peak Season Surcharges of $2,000/FEU announced for May, and Maersk’s Asia – US PSS excluding shipments from China.  

Though country-to-country level data shows rates to the US have increased slightly from origins like Vietnam since the tariff pause, prices from China – despite reports of a sharp drop in demand – have surprisingly not collapsed. On the overall lane level FBX Asia – N. America rates eased only slightly last week.  The significant upcoming transpacific blanked sailings will aim to prevent a sharp rate slide despite falling volumes. Asia – Mediterranean prices increased 7% to about $3,000/FEU last week, and may reflect some diverted volumes and increased demand on this lane. 

Frontloading to date, China tariffs, and the possible introduction of more tariffs in July will likely mean a drop in US container import volumes for H2. The WTO projects the trade war in its current form will cause global trade in goods to contract by as much as 1.5% and US imports to fall by 10% or more – with import strength so far this year meaning most of that drop will come in the second half of the year. A dramatic de-escalation and lowering of tariffs would minimize these impacts, though volumes already pulled forward may nonetheless mean a somewhat slower H2 than normal. 

Finally for ocean freight, the USTR released a revised port call fee proposal targeting Chinese ship building. 

The scaled-back though still significant fees would go into effect in October, apply only to Chinese carriers or China-made vessels, and be assigned per call to the US instead of per port call. This version is also subject to change, with a hearing scheduled for May, but its current iteration would not lead to the significant port call omissions and congestion that many feared would result from the original per port call proposal.

There were more signs this week that the looming May 2nd cancellation of US de minimis eligibility for Chinese imports will have a significant impact on the air cargo market. 

UPS and FedEx are applying surcharges to China-US parcels for the rest of the month, possibly reflecting a last-minute surge in demand ahead of the expiry, and Hong Kong Post announced it will no longer handle US-bound parcels in protest to the tariffs. DHL has suspended service for imports above the $800 but below $2,500 in value which since April 5th have required a formal entry process, as the sudden rule change has overwhelmed operations.

Temu and Shein informed their US customers that they will increase prices this week due to the US policy changes. Recent increased sales on these platforms may also reflect a last-minute rush by US shoppers before the May deadline, with China-US air cargo rates level at about $5.50/kg since climbing 20% through March.  

The recent wave of tariff announcements has sent shockwaves through America’s small import businesses, creating unprecedented uncertainty in an already volatile global trade environment. These shockwaves continue with new tariffs being added (like the reciprocal tariffs), potential exclusions, and then delays. For now, this has left small businesses shocked…and confused. Fresh data from a comprehensive survey of some importers, mostly based in the US, who use the Freightos Marketplace for imports reveals the depth of concern and the tangible impacts these policy shifts are having on the ground.

The data below relies primarily on a survey conducted in the days before the 90 day freeze on tariffs across approximately 200 small business importers who are users of the Freightos Marketplace. 

Measuring the Alarm

The numbers tell a compelling story. 

Respondents rated their concern at an average of 8.9 out of 10, with 62% selecting the maximum level of 10. This extraordinary level of anxiety reflects not just the financial implications, but also the policy uncertainty—51% of importers admitted they couldn’t predict the administration’s next moves on tariffs.

This isn’t just emotion – the uncertainty has translated directly into operational decisions. One-third of respondents (33%) paused shipments entirely, while 29% are exploring alternative sourcing options outside of affected regions. But with so many swings and shifts, another 29% are in wait-and-see mode, hoping for clarification before making significant changes.

Quantifying the Import Impact

Importers believe the potential impact on freight volumes to be substantial, with 54% of importers anticipating “serious to significant” reductions in their import activity. As per Economics101, reduced demand is already doing its part. This mirrors what we’re seeing in real-time ocean freight rates from Freightos Terminal, where container rates from China to Long Beach have dropped 16% since the reciprocal tariffs went into effect on April 9th.

Interestingly, while rates from China have declined, prices from Taiwan and Vietnam have remained elevated—likely reflecting importers’ rapid pivot to alternative sourcing markets.

Cash Flow Crunch

Cash flow is always top of mind for small business, especially importers who have to front payments for their cost of goods. Perhaps most concerning of the ramifications of the tariffs are the immediate liquidity challenges facing small businesses. One respondent added that he faced $46,000 in tariffs on a single container—a significant sum for a small business. 

This business owner was not the only concerned about cash flow. As a matter of fact, multiple surveyed businesses were considering full market exits.

“If these tariffs remain in place, it will literally destroy my small business,” reported one respondent. “I cannot raise my prices enough and I cannot have my goods made in America at a reasonable price.”

Adaptive Strategies Emerging

Though the sentiment is primarily negative, some businesses are demonstrating adaptability. Creative solutions include redirecting inventory to holding warehouses, separating shipping costs from production costs on invoices to pass on costs to buyers, and accelerating shipments to beat deadline implementation.

A small minority (approximately 3%) even see opportunity in the chaos, positioning themselves as potential intermediaries between affected markets.

The Trade Landscape Ahead

The administration’s subsequent 90-day tariff freeze and electronics exemptions have provided temporary relief, but the underlying uncertainty remains. Additional proposed measures, including USTR port call fees targeting Chinese-made vessels, will likely be revised but still loom on the horizon as part of a comprehensive Maritime Action Plan requested by the president.

For air cargo, the May 3rd US de minimis cancellation for Chinese imports appears to be affecting e-commerce volume from platforms like Shein and Temu, though Freightos Air Index rates remain elevated at approximately $5.50/kg.

As one resilient importer noted, “Although we accelerated a few shipments before the stipulated timeline…the show must go on to combat with the market.” 

For America’s small importers, that show now includes navigating unprecedented tariff complexity while fighting to maintain viable business models in an increasingly unpredictable trade environment.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) increased 10% to $2,465/FEU.     
• Asia-US East Coast prices (FBX03 Weekly) increased 3% to $3,647/FEU. 
• Asia-N. Europe prices (FBX11 Weekly) fell 1% to $2,365/FEU. 
• Asia-Mediterranean prices (FBX13 Weekly) fell 5% to $2,751/FEU. 

Air rates – Freightos Air index

• China – N. America weekly prices fell 1% to $5.43/kg.
• China – N. Europe weekly prices fell 1% to $3.75/kg.
• N. Europe – N. America weekly prices fell 5% to $2.13/kg.

Analysis

It’s been another headspining week in Trump’s second trade war replete with more escalations, u-turns and confusion and uncertainty for shippers.

The president’s unprecedented reciprocal tariffs on about 60 US trading partners announced on April 2nd went into effect on the 9th, only to be paused for three months a day later. China – which chose to retaliate against the reciprocal tariffs – was excluded from this 90-day pause as a flurry of retaliations and counter retaliations ended with both countries imposing a minimum of 125% tariffs on each other. 

Trump further exempted electronics – including smartphones, computers and semiconductors – from all reciprocal tariffs late last week for an unspecified period of time. This carve out includes these types of goods from China, though the president’s 20% tariffs imposed on China earlier in the year as well as any from previous years would still apply. 

To start the month the president initiated a trade investigation into semiconductors – and the many electronics that contain them – which could mean the electronics exemption will be short lived and replaced by a separate, global, sectoral tariff in the coming weeks, with an investigation into pharmaceutical trade also underway. 

As the 90-day pause was limited to the reciprocal tariffs, it kept the 10% global tariff in place and other tariffs like the 25% levy on Canada and Mexico and 25% tariffs on vehicle imports in effect as well. Trump stated though, that he is considering a short-term exemption for vehicle imports to give companies time to shift operations to the US. 

Many countries are already pushing to negotiate with the US during this three month reprieve though no settlements have been announced yet and the EU, for example, reports that talks have not been productive. Trump has called on China to come to the negotiating table as well. With so much apparently subject to change and therefore still up in the air, importers are very hesitant to make any drastic changes to their supply chains just yet.

For freight, last week’s reciprocal tariff roll out resulted in reports of a widespread drop in container bookings out of Asia. The 90-day pause on those tariffs alongside the escalation of US trade hostilities with China however, mean that while shipments out of China remain paused, many of those sourcing from other Asian countries have already started increasing their orders again in an effort to get ahead of possible tariff resumptions in July. 

With a minimum of 125% tariffs on all goods out of China remaining in place, there are reports of an extreme drop in container export bookings out of China as shippers wait and see what will happen next, with reports of an increase of blanked sailings on this lane as demand slumps. 

Many US importers on this lane had been frontloading goods since the November election in anticipation of tariff hikes. This inventory build up should enable many shippers to hit pause for a while and see where negotiations might lead before deciding their next moves – shifting to other sourcing options or resuming shipments from China and facing higher costs. 

For shippers on other lanes, the 90-day reprieve means another window to pull forward goods ahead of possible tariff increases, with reports that frontloading is already underway. This new opportunity for frontloading will likely mean some increased demand for ocean freight on these lanes in the near term, followed by lower demand (and rates) after the deadline passes – another indication that the typical peak season months will be subdued due to demand pulled forward since late last year. 

The near term need to blank sailings out of China and possibly increase services from other origins in Asia may prove challenging for ocean carriers and cause delays for shippers, with empty containers concentrated in China likely to pose a challenge too. Transatlantic surcharges announced for May could also point to carrier expectations of frontloading ahead of the July deadline.

The overall Asia – N. America lane-level container rates increased somewhat last week, reflecting the start of the month GRIs, though daily rates so far this week have reversed much of those modest gains. But the likely pull back in demand out of China and increase in demand from other Asian origins may be reflected in diverging rates on the port-pair level. 

Freightos Terminal data shows that container rates from China, Taiwan and Vietnam to the Long Beach all climbed sharply following the April 2nd tariff announcements – possibly reflecting the rush to load goods by April 9th when the reciprocal tariffs went into effect. But while rates from Shanghai have dropped 16% since tariffs went into effect, prices from Taiwan and Vietnam have stayed elevated. 

In other trade war-related news for ocean freight, the USTR’s proposed port call fees targeting Chinese-made vessels will likely be revised to a less far-reaching version and may not be rolled out for several months, as this measure will be part of the more comprehensive Maritime Action Plan that the president last week requested that federal agencies deliver within seven months.

For air cargo, the looming May 3rd US de minimis cancellation for all Chinese imports may already be resulting in a slow down of e-commerce imports from Chinese platforms like Shein and Temu. Freightos Air Index China – US rates nonetheless remained elevated at close to $5.50/kg last week. The electronics and pharmaceuticals exemptions from reciprocal tariffs, as well as the approaching May 3rd roll out for automotive parts tariffs, could drive some short term increase in air cargo demand for these types of goods, though so far these factors have not been reflected in rate increases.   

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) increased 3% to $2,246/FEU.     
• Asia-US East Coast prices (FBX03 Weekly) increased 5% to $3,541/FEU. 
• Asia-N. Europe prices (FBX11 Weekly) fell 5% to $2,385/FEU. 
• Asia-Mediterranean prices (FBX13 Weekly) fell 10% to $2,910/FEU. 

Air rates – Freightos Air index

• China – N. America weekly prices fell 3% to $5.48/kg.
• China – N. Europe weekly prices stayed level at $3.79/kg.
• N. Europe – N. America weekly prices fell 7% to $2.24/kg.

Analysis

The initial shock of President Trump’s long-awaited tariff announcements last week are giving way to economic fallout as well as confusion on the competing messages, competing viewpoints within the White House, and sometimes competing aims of the new tariffs – protectionist or aimed at removing foreign trade barriers? Long-term or temporary?

Whatever the aims, the global 10% tariff that went into effect last week and the reciprocal tariffs of varying levels on exports from a list of nearly 60 countries that start tonight – together with the other existing duties and those rolling out shortly – dwarf Trump’s first administration tariff initiatives both in their scope and degree. 

For our full rundown on tariff details and implications click here.

The new 34% reciprocal tariff on all Chinese goods stacks on top of the 20% Trump imposed earlier this year and the 19% Trump/Biden tariffs already on the books for many goods – meaning a minimum duty of 54% for all Chinese goods and more than 70% for many items. And while the tariffs on China pushed many importers to other Asian sourcing partners since the previous trade war, this time many of these alternatives are subject to steep duties as well. 

*Canada and Mexico tariffs apply only to goods not included in the USMCA

Exemptions to these new rules include an extension of the carve out for imports from Canada and Mexico that are covered by the USCMA , though the new global automotive tariffs will still apply to the non-US share of value for each import. Likewise, any import with a minimum of 20% US-manufactured value will only pay global, reciprocal or automotive tariffs on the foreign share of value, which may lead to shippers scrambling to calculate and demonstrate US contributions to their imports.

The executive order also excluded a long list of other goods including steel and aluminum already subject to separate tariffs, and goods like semiconductors, pharmaceuticals, and lumber, which may have been spared because they will be targeted for separate sectoral tariffs soon.

China has already retaliated with new tariffs on US exports – though Trump has threatened to increase US tariffs on China by another 50% if China does not cancel its retaliation – as has Canada, with the EU considering additional measures, all of which will negatively impact US exports. Many other countries, including Vietnam, are actively trying to negotiate a resolution instead.

In the meantime, the trade war intensification is increasing the likelihood of recession in the US and beyond. 

For our full rundown on tariff details and implications click here.

For ocean freight, the time allotted between the tariff announcements last week and the reciprocal tariff roll outs tomorrow meant a short window for shippers to get some final goods loaded before the 9th to avoid the new tariffs. This final rush included a scramble not only to load containers, but some quick shift to LCL and air cargo too.  There are concerns that the sudden policy changes will also mean customs delays for arriving shipments.

With so much confusion and uncertainty – and with many shippers already holding a significant amount of inventory frontloaded over the last few months to get ahead of new tariffs – we’re likely to see a significant drop in container demand to the US in the near term, and possibly in the intra-Asia manufacturing ecosystem too, as shippers wait for the dust to settle and for the outcome of the reciprocal tariff negotiations.

Whether due to frontloading or to a possible tariff-driven drop in consumer demand the Port of LA thinks H2 volumes will be down 10%, but not collapse, even if peak season is more subdued than usual.  Other observers are less optimistic, and fear a recession – combined with growing overcapacity in the container market – could lead to a demand decrease and rate collapse like those that followed the 2008 financial crisis. 

Indeed, as capacity continues to grow from newbuild introductions on the major trade lanes, even with Red Sea diversions continuing to absorb capacity, ex-Asia rates have fallen sharply since Lunar New Year, with container prices now beneath their 2024 floor.  

Rates rebounded by a few hundred dollars per FEU on the transpacific on start of month GRIs last week, though no bump came through for Asia – Europe lanes, as carriers increase capacity management efforts. The expected tariff-driven drop in demand will only put more downward pressure on rates.

For air cargo, the tariff announcements likely meant a short burst of demand before April 9th and could mean some increased volumes in the lead up to May 3rd when tariffs on auto parts will take effect and, more significantly, the US will cancel de minimis eligibility for all Chinese goods. 

The de minimis exemption has been a big driver of the surge of B2C e-commerce goods going by air from China to the US, and its cancellation is expected to lead to a sharp drop in China – US air cargo demand and rates. Freightos Air Index data shows that China-US rates – still elevated at about $5.50/kg last week – have yet to spike ahead of the May deadline.

This absolutely dwarfs the measures implemented by his first administration and pushes US trade barriers to their highest levels since the 1930s

The bottom line

Global tariffs of 10% will go into effect April 5th while reciprocal tariffs will be applied starting April 9th. The president also issued a separate order that will suspend de minimis exemption eligibility for all Chinese goods starting May 3rd. 

The Rundown

Citing the US trade deficit in goods as a threat to national security, President Trump made unprecedentedly broad use of executive powers granted the president by the International Emergency Economic Powers Act (IEEPA) to enact the new tariffs. The executive order for these actions states that the tariffs are aimed at the (sometimes competing) goals of removing foreign barriers to US exports and creating barriers to foreign imports, both as ways to increase or restore domestic manufacturing.

The global tariff of 10% – which will not apply to countries targeted for reciprocal tariffs – will go into effect for all goods not yet in transit by April 5th. As the order states:

Except as otherwise provided in this order, all articles imported into the customs territory of the United States shall be, consistent with law, subject to an additional ad valorem rate of duty of 10 percent.  Such rates of duty shall apply with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 5, 2025

Reciprocal tariffs on exports from a list of nearly 60 countries range from a level of 11% for Congo to 50% for Lesotho. These duties will be applicable to all exports not loaded by April 9, 2025. 

The newly announced tariffs join steel and aluminum tariffs, a 25% tariff on all automotive imports, and a 25% tariff on any country that purchases oil from Venezuela already in effect – though only the Venezuelan tariff will be stacked on top of global or reciprocal tariffs.

Reciprocal Tariffs

As quickly calculated, the reciprocal tariffs were likely arrived at by dividing the value of the given country’s trade imbalance with the US by how much the US imports from that country.  

For China, this calculation resulted in a 34% reciprocal tariff, which, when applied on top of the 20% tariff on all Chinese goods Trump introduced earlier in the year, brings the base rate for all Chinese imports into the US to 54%. Specific goods already targeted with other tariffs from earlier Trump or Biden moves could face tariffs of more than 70%. The Venezuelan oil tariff could even be applied on top of that. 

These steps dwarf the first round of the Trump trade war from 2018 to 2020, when the overall tariff rate on Chinese goods was less than 20% and applied to a maximum of two thirds of all Chinese exports. 

And as Trump’s first administration focused mostly on China, it accelerated many shippers’ shift to a China+1 strategy. This trend was apparent in the increases in US trade with Mexico and Canada, and with alternatives in Asia like Vietnam, India, Taiwan and Bangladesh – at the expense of Chinese imports to the US which declined from 20% of total US imports in 2018 to 13% in 2024. 

This time though, in addition to the 10% global rate, the reciprocal tariffs make these alternatives much less attractive. For example, goods from the below countries – some of the major China alternatives – will meet accelerated tariffs:

• Vietnam: 46%
• India: 27%
• Bangladesh: 37%
• Cambodia: 49%

Canada, Mexico and Automotive 

This week’s order excludes Canada and Mexico from global or reciprocal tariffs. President Trump introduced and then paused a 25% tariff on all goods from these neighbors in February and then in March applied it only to goods not included in the USMCA. 

The 25% rate was meant to start applying to USMCA-covered goods too on April 2nd, but the executive order states that USMCA goods will continue to be exempted, without specifying an expiration for this carve out. 

In late March Trump signed an executive order that applies 25% tariffs to all automotive imports starting April 3rd. This tariff will be instead of, not in addition to, the global or reciprocal tariff. And though automotive imports are a significant share of intra-North America trade and it will be applied to imports from Canada and Mexico as well, these countries will only pay the 25% rate on the value of the non-US components in the vehicle or item.

Exemptions for US Value Created

Imports from any country for which at least 20% of its value originated in the US, will only pay the global or reciprocal tariff for the non-US value of the goods. And steel and aluminum is subject to the existing global tariff levels instead of the global or reciprocal tariffs with copper, pharmaceuticals, semiconductors, lumber articles, certain critical minerals, and energy and energy products also not subject to the new tariffs.  But the president has expressed interest in applying sectoral tariffs for some of these, possibly soon.

Retaliation, Removal… and Uncertainty

The order states that the US will respond by further raising tariffs for any country that retaliates by applying new tariffs on US exports. The EU has already stated that it will retaliate nonetheless, as has Canada. China has retaliated to Trump’s earlier tariffs and recently stated that it will respond in conjunction with Japan and South Korea. 

The text continues though, that the US could reduce or remove tariffs if the president decides that a country has taken significant steps to remove their barriers to US exports. 

The removal of foreign barriers would increase access for US exports to foreign markets, but they would also increase foreign export access to the US, which would work against Trump’s stated goal of increasing manufacturing by blocking foreign competition. 

Stating that foreign concessions could make these tariffs subject to change further adds to the uncertainty and difficulty for US and foreign importers and exporters to invest in significant changes to their trade strategies just yet.

De Minimis

The US de minimis exception allows US imports worth $800 or less to enter the country duty-free, has minimal customs filing requirements and costs, and lets imports of this time speed through customs. 

This rule has been a major driver of the surge of several million packages a day arriving via de minimis into the US – mostly B2C e-commerce goods from China, and mostly arriving by air cargo. 

Opposition to this trend has been widespread, including from the Biden administration, due to claims of facilitating unfair competition, enabling the flow of illicit goods or evading scrutiny of goods possibly made through forced labor.  

Focusing on de minimis as an avenue for fentanyl smuggling, Trump had suspended de minimis eligibility in the same executive order that applied the first tariff increase on Chinese goods in February.

This rule change took nearly immediate effect following the order in February. But the resulting jump in parcels requiring formal entry quickly overwhelmed US Customs and Border Protection, and led to Trump’s quick reinstatement of de minimis eligibility for Chinese imports.

The reciprocal tariff order states that the president will keep de minimis in place for Canada and Mexico until the USCB develops the adequate systems needed to handle these parcels as formal entries. 

Nonetheless, Trump’s other executive order signed April 2nd states that adequate systems are in place to handle imports from China and therefore he will suspend de minimis eligibility for all Chinese goods starting May 2nd.  From then on all low-value Chinese imports shipped to the US will be subject to all formal entry filing requirements, costs, and all US tariffs that apply to China. 

Shippers sending goods by postal service will have to choose between paying a 30% tariff or a $25 fee per parcel, which will climb to $50 June 1st.

Implications of the New Tariffs

Economic Implications of Trump Tariffs

There is really no comparing Trump’s trade war this year with the steps he took starting in 2017. 

Besides relying much more heavily on emergency powers instead of the more established trade laws presidents have used for tariff implementations in the past, the scope of the current duty roll outs are far larger in terms of the level of tariffs on China and in terms of the extremely high levels being applied to the rest of the US’s trading partners. 

Trade – even the US’s importing activity – continued to grow since 2017 even if trade flows shifted. Intra-Asia trade has climbed as other Asian countries increased manufacturing for the US market, and China-Mexico trade surged as China invested heavily in Mexico as an alternate route to the US market. 

This time though, the tariffs are so broad and so high that there are few duty-free alternatives. In other words, US import costs will inevitably go up. Retaliatory tariffs will also mean that demand for US exports is likely to drop, negatively affecting US agriculture and manufacturing. 

Price increases to imports – which often also result in higher prices from domestic manufacturers too – will mostly be passed on and felt by consumers, which could increase the inflation rate and depress consumer spending. 

Most economists are now predicting slower and modest US GDP growth, an increased likelihood of recessions in the US and beyond, and therefore a possible contraction of global trade as well. If things do play out this way, the freight market will suffer too. 

Freight Implications of Trump Tariffs

Air Cargo

There have already been signs that Trump’s brief pause of de minimis for China in February accelerated Chinese e-commerce platforms’ initiatives to shift away from a reliance on de minimis and air cargo. 

These companies have moved manufacturing to other countries like Vietnam, increased their use of ocean logistics to North America, and invested in warehousing and fulfillment capabilities in Mexico or even in the US. 

And on the air cargo side there have been multiple reports of canceled China-US BSAs, canceled charters, carriers shifting capacity elsewhere and other signs and expectations of volume decreases resulting from a drop in e-commerce volumes in anticipation of de minimis changes.  China – US air cargo spot rates have also eased so far this year, but certainly have not collapsed, remaining much higher than the long-term norm.

A big driver of the brief chaos caused by de minimis for China being suspended in February was the lack of warning. Millions of low value parcels were already at customs or en route, and quickly overwhelmed USCBP.

But with a one month runway this time, we can probably expect some rush of last-chance demand and then a significant drop right around the May 2nd roll out date. This pattern will likely push rates – as well as possible delays and congestion – up in the coming weeks, and then see rates on this lane drop, probably sharply, in May. Even with this change though, some e-commerce will likely still go by air, which could prevent a complete rate collapse.

As capacity is redistributed, we could also see knock-on downward pressure on rates on many other lanes. And if adequate customs systems are actually not in place yet, shippers could also face significant delays in customs warehouses.

The general economic impact of the trade war, of course, could also be a major factor in demand for air cargo and therefore volumes and rates in the near term and beyond. 

Ocean Freight

The anticipation of new Trump tariffs has driven many US importers to frontload as much inventory as possible since November. This pull forward of demand was one factor that has kept US ocean import container volumes stronger than usual since late last year. 

With the reciprocal tariffs not being applied to goods loaded before April 9th, we may see a very brief scramble that will push container rates and demand up for the next few days. 

After that though, many importers who’ve built up inventory are likely to be able to reduce or pause orders and shipments until the tariff dust settles. This move will see container volumes and rates drop, possibly significantly, soon and could be one factor that will cause a very subdued peak season period this year – similar to how a tariff-driven pull forward in 2018 led to somewhat lower container rates and demand in 2019. 

Once inventories run down, the strength of the container market will depend on the economic impacts of the trade war. Lower consumer demand will lower demand for freight. And with none of the US’s major sourcing partners spared from significant tariffs this time, containers that do move will come at higher tariff costs to shippers and then for consumers. 

These trends will put downward pressure on container rates, which have already been falling globally – despite Red Sea diversions continuing to absorb capacity, and even on the transpacific where frontloading has kept demand relatively strong – as new carrier alliance roll outs have increased competition and fleet growth is already leading to overcapacity.  Together these factors could potentially see container rates reach extremely low levels.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) decreased 2% to $2,187/FEU. 
• Asia-US East Coast prices (FBX03 Weekly) increased by 1% to $3,369/FEU.
• Asia-N. Europe prices (FBX11 Weekly) fell by 2% to $2,512/FEU.
• Asia-Mediterranean prices (FBX13 Weekly) decreased by 9% to $3,228/FEU.

Air rates – Freightos Air index

• China – N. America weekly prices increased 7% to $5.65/kg.
• China – N. Europe weekly prices decreased 2% to $3.79/kg.
• N. Europe – N. America weekly prices fell 2% to $2.41/kg.

Analysis

President Trump has scheduled a Wednesday Rose Garden event for his tariff plan unveiling, and among the things that seem destined to remain extremely uncertain right up to the last minute is whether tariffs announced on Wednesday will be effective immediately or on some future date. 

And though Trump says he’s decided on a course of action other reports have the administration vacillating still. One major question is whether the White House will opt for reciprocal tariffs of varying levels on specific trading partners or impose a global tariff on all imports. 

It also remains unclear how the policy will reconcile the stated goals of raising revenue and increasing domestic manufacturing through tariffs, with the message that tariffs are aimed at eliciting concessions from other countries which could lead to the removal of the US tariffs. 

In addition to the reciprocal/global decision, the pause of the 25% tariffs on USMCA-covered imports from Canada and Mexico is also set to expire tomorrow, and federal agencies will deliver the president’s requested state of trade report –- which, among an array of policies, could be the basis for a 60% tariff on China –- today as well.

One firm tariff roll out date – barring another last-minute shift – is April 3rd when the US will apply a 25% tariff to all automotive imports. This as well as the Mexico/Canada deadline has driven a surge in cross-border trucking as shippers rush to beat the rollouts, and a last-minute flurry of air chartering for the same reason.  Projections of continued US ocean freight import strength to start Q2 may suggest that the prevailing uncertainty is leading many ocean shippers to continue to frontload until the tariff landscape becomes clear. 

But despite the possible current demand strength, transpacific container rates have fallen below last year’s floor in recent weeks, with Asia – Europe prices also easing past last year’s low as this lane enters its slow season. Carriers will try to push prices back up with start of month GRIs and an increase in blanked sailings – which may indicate that the transition to the new alliance configurations is making progress.  Reports of year on year scheduled capacity increases on the major lanes suggest that carriers are also contending with the effects of fleet growth and voiding sailings in response.In air cargo, more signs of weakening China-US e-commerce demand include cancellations of BSAs and charters, new forwarder charters opening up, observations of increasing capacity and some forwarder expectations for lower volumes and rates in Q2.  Freightos Air Index data for China – US cargo nonetheless shows rates increased about 15% to $5.65/kg in the last month, possibly reflecting some tariff pull forward ahead of April 2nd on the spot market.  Asia – Europe prices have also increased over the past month to $3.79/kg, about 13% higher than a year ago.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 7% to $2,238/FEU.     
• Asia-US East Coast prices (FBX03 Weekly) fell 5% to $3,343/FEU. 
• Asia-N. Europe prices (FBX11 Weekly) fell 6% to $2,565/FEU. 
• Asia-Mediterranean prices (FBX13 Weekly) fell 7% to $3,529/FEU. 

Air rates – Freightos Air index

• China – N. America weekly prices increased 4% to $5.26/kg.
• China – N. Europe weekly prices stayed level at $3.88/kg.
• N. Europe – N. America weekly prices increased 2% to $2.47/kg.

Analysis

Tariff fears – as well the already significant uncertainty and confusion surrounding the White House’s trade policy – grew this week with the April 2nd deadline set for many tariff announcements approaching. 

The Trump administration indicated that it will narrow the scope of reciprocal tariffs initially proposed for all US trade partners which have tariffs or other trade barriers on US exports or businesses. Only 15% of the long list of countries with a US trade imbalance and tariffs on US goods will be assigned reciprocal tariffs, but these countries account for most of both total imports to the US and the trade deficit. Reciprocal tariffs are expected to be announced if not applied on April 2nd. 

The levels of these tariffs will depend on the foreign tariff rates for US exports and so will vary, but the list of the top 15% – aside from China, Mexico, Canada and the EU – includes ostensible alternative sourcing partners like India and Vietnam as well.

And though some reports indicated that certain planned sectoral tariffs would be postponed, yesterday President Trump stated that global duties on automotive and pharmaceutical imports would be announced soon, possibly even before April 2nd. 

The president also signed an executive order on Monday that, also effective April 2nd, will apply 25% tariffs – on top of any other applicable tariffs – on all goods from any country that purchases oil from Venezuela. In addition to China, this list could include Singapore, Vietnam and India.

Finally, the USTR’s public hearing on its proposed significant port call fees targeting Chinese-made vessels is underway, with American BCOs, exporters, port labor and ocean carriers all objecting to the rule and the significant threats it would pose to their respective businesses. 

Recently heightened fears of steep US tariffs on imported alcohol from the EU on April 2nd, were enough for the US Wine Trade Alliance to advise members to stop all shipments. But despite the April deadline for many other possible tariff announcements, demand indications suggest that, overall, US shippers continue to frontload due to the uncertainty of what and when tariffs will be implemented. This pull forward is reflected in the recent build up of empty containers in LA/Long Beach. 

Transpacific ocean container rates have eased as demand has decreased relative to the pre-Lunar New Year rush. But despite volumes estimated to be significantly stronger than a year ago due to continued frontloading, rates have continued to slide. 

At about $2,200/FEU to the West Coast and $3,300/FEU to the East Coast, prices are more than 20% lower than 2024 lows on these lanes. The likely culprits of this trend are the increased competition and less effective capacity management resulting from the new carrier alliance roll outs, as well as continued fleet growth. 

Asia – Mediterranean rates of $3,500/FEU are about 20% lower than post-LNY last year (though about even with its 2024 low), and Asia – Europe’s $2,565/FEU is 20% beneath its 2024 floor despite continued port congestion at many European hubs. With tariff frontloading not a factor on these lanes, easing demand and the impacts of the new carrier alliances are likely combining to push rates down.

In air cargo, a Heathrow electrical fire on Thursday night kept the airport closed for eighteen hours canceling more than a thousand flights and stranding more than 200,000 passengers. Though there were moderate air cargo rate increases to alternative destinations in the days following, so far there are few reports of significant resulting disruptions. 

Freightos Air Index rate data also shows that ex-China prices to the US have rebounded by about 15% since earlier this month to more than $5.25/kg, and to Europe rates have increased by more than 20% to nearly $3.90/kg.  The China – US rate recovery comes despite anticipated changes to de minimis rules that are expected to cause a significant drop in e-commerce volumes, with some reports that carriers are already gradually shifting capacity to other routes.

Weekly highlights

Ocean rates – Freightos Baltic Index

• Asia-US West Coast prices (FBX01 Weekly) fell 10% to $2,397/FEU.     
• Asia-US East Coast prices (FBX03 Weekly) fell 6% to $3,537/FEU. 
• Asia-N. Europe prices (FBX11 Weekly) fell 11% to $2,740/FEU. 
• Asia-Mediterranean prices (FBX13 Weekly) fell 9% to $3,792/FEU. 

Air rates – Freightos Air index

• China – N. America weekly prices increased 10% to $5.06/kg.
• China – N. Europe weekly prices increased 28% to $3.87/kg.
• N. Europe – N. America weekly prices increased 3% to $2.43/kg.

Analysis

Ocean container rates out of Asia continued to fall last week, slipping beneath 2024 lows on a combination of a post-Lunar New Year lull in demand, impacts from the new carrier alliance services still moving into place, and capacity growth. 

Asia – Europe prices dipped 11% to $2,740/FEU, 14% lower than their 2024 floor and Asia – Mediterranean rates eased 9% to less than $3,800/FEU, 10% lower than the nadir on this lane last year. The post-LNY demand slump may be more pronounced than usual on these lanes as shippers stocked up ahead of the holiday to account for Red Sea diversion-driven lead time increases. But rates are falling despite congestion at many European hubs, and some carriers have announced April GRIs in response though March increases were largely unsuccessful. 

There are indications of some frontloading-driven demand strength on the transpacific. Eventual tariff roll outs or enough inventory build ups would put an end to this pull forward and will likely mean a weaker than usual H2. 

And though the tariff landscape remains extremely uncertain, federal agency findings that could lead to sharp tariff increases on China, reciprocal tariffs on a long list of countries, the USTR’s proposed port fees on Chinese-made vessels, as well as the reinstatement of 25% tariffs on all Canadian and Mexican imports are due in early April. The Federal Maritime Commission also recently opened an investigation into foreign government roles in container chokepoints.

But despite the current relative demand strength, transpacific container rates continued to fall last week as well.  At about $2,400/FEU and $3,500/FEU to the West and East Coasts respectively, prices are already 18% below their 2024 lows. In addition to the alliance reshuffle, the current rate weakness on these lanes may also point to fleet growth driven overcapacity first seen in collapsing rates in 2023 but largely held at bay since early last year by Red Sea diversions absorbing capacity. 

The expected demand drop when frontloading ends and analyses that – despite the current global benchmark rate still more than 70% higher than in 2019 due to the Red Sea crisis – the market will become oversupplied even if diversions continue may be reflected in reports of transpacific ocean contracts negotiations trending toward rates lower than carriers had hoped. 

In air cargo, Freightos Air Index ex-China rates rebounded somewhat last week to above $5.00/kg to the US and to more than $3.80/kg to Europe despite some indications that e-commerce demand to North America has started to ease. Transatlantic rates of $2.43/kg last week were 15% higher than at the start of the year, possibly pointing to some frontloading ahead of expected US tariff increases on European trading partners. 

This year’s TPM conference once again brought together thousands of ocean carriers, forwarders, BCOs, tech providers and many other transportation and supply chain professionals. And once again it was a great opportunity to find out what’s most important to the industry right now and what the coming year might look like.

Trump II Trade War

US tariffs and trade barriers were obviously a major topic of discussion with “uncertainty” – a term supply chain pros disdain – cropping up often. 

In terms of tariffs, more than one expert advised BCOs not to make any drastic adjustments just yet, because the landscape is still so uncertain. And because of experience from Trump I tariffs, shippers basically know what to do: pull forward, increase prices if tariffs happen, and then determine how and to what extent to restructure sourcing in response. 

That being said, there were warnings that this time could be different since the different economic reality could see tariff pass-throughs more negatively impact consumer spending. And for freight, whereas last time tariffs shifted trading patterns around while volumes continued to grow, a tariff-fueled recession could see ocean volumes dip as well.

The US Trade Representative recently proposed a rule that would target China’s influence in shipbuilding by imposing fees ranging from $500k to $1.5 million per US port call by any Chinese carrier, vessel, or other carrier that has Chinese vessels in their fleet and that sets targets for the share of US exports to be moved by US flagged vessels in the future.

Aside from opposing this law from a cost perspective – fees would cost the industry an estimated $2B and amount to cost to shippers of $300 – $2,000/FEU – many experts also pointed to other negative knock-on effects and general infeasibility: smaller-vessel/lower volume lanes like the transatlantic would become uneconomical; carriers would only call one US port, omitting smaller ports like Oakland and overwhelming US hubs like LA/LB and Canadian alternatives like Vancouver; China’s 60% share of the current orderbook makes a near term shift away unlikely, and a lack of US flagged vessels likewise makes export targets unreachable. 

Red Sea Return and Overcapacity

While there was consensus that carriers won’t return to the Red Sea until vessel safety is assured, no one was sure when that exactly will be, though some expressed optimism that a permanent Israel-Hamas ceasefire could happen this year and see the waterway re-open some time in H2. (One interesting insight was that falling demand and freight rates could incentivize carriers to go back sooner rather than later in an effort to reduce costs.)

Though Hapag-Lloyd’s CEO thought carriers might be able to pull off a “controlled return” through the Suez Canal – avoiding the vessel bunching, congestion and equipment imbalance that could result from vessels suddenly arriving well ahead of schedule – conventional wisdom has the industry facing several months of disruptions until normalization.

Once things normalize, a lot of capacity – currently tied up in longer voyages around the Cape of Good Hope  – will be released. The global fleet will also be even larger than when spot rates crashed in 2023. And though carriers anticipate being able to manage capacity through scrapping, slow-steaming and blank sailings, most everyone else expects a period of overcapacity though the degree of overcapacity was subject of debate.  

Innovation and Tech

Logistics technology was also a key theme this year – and not just in TPMTech sessions. 

The recently finalized labor contract between the ILA and East and Gulf Coast port operators bans full automation or technology that eliminates jobs, but allows semi-automation. This development will be key to growth for many of these US ports because of simple facts of geography: with nowhere to expand physically at many of the major East Coast ports, semi-automation through tech will help ports grow through increased density and efficiency.

While index-linked ocean contracts were an aside last year, this year the topic had a well-attended panel discussion. Ocean container shipping is an inherently volatile market, with the past few years displaying extreme examples of spot price fluctuations. When spot prices climb too high above contract rates, carriers tend to roll or charge premiums to move BCOs’ long-term contracted volumes, and when spot rates crash, BCOs are motivated to no-show and shift to spot. 

Index-linked contracts remove these incentives through floating or adjusted rates. And BCOs are looking to tech not only to model index-linking, but track index-linked volumes’ performance against their other shipments and provide overall rate visibility. As the container derivative market matures, shippers will look for tools to manage this aspect of operations and finance too.

But panels dedicated to freight tech were a major feature too.  One, comprising a BCO, forwarder and tech provider and moderated by Freightos’ Ian Arroyo asked – who, given the proliferation of supply chain data sources, solutions and platforms, is responsible for bringing all these elements together into one source of truth for that elusive visibility BCOs are after?

Answer: There is no one right answer. Depending on the shipper’s preferences, expectations and capabilities, sometimes it should be the forwarder, sometimes the tech provider and others the shipper themselves.