SCFI retreats w-o-w as peak-season rally loses steam

• SCFI fell 3.3% w-o-w, extending its weekly decline
• Carrier discipline and geopolitical risks supported freight rates

The Shanghai Containerized Freight Index (SCFI) declined 3.3% w-o-w to 3,080.31 points on 17 July from 3,184.82 points a week earlier, marking its second consecutive weekly decline. The correction indicates that the traditional peak-season rally is gradually losing momentum as booking activity moderates and improving vessel availability eases pressure on freight rates across several trade lanes.

Carriers attempted to implement Freight All Kinds (FAK) rate increases effective 15 July; however, limited shipper acceptance curtailed their impact. In response, shipping lines continued to exercise disciplined capacity management through blank sailings and controlled vessel deployment to support freight levels and prevent a steeper market correction.

Despite the recent softening in the overall index, freight rates across major trade routes remain significantly above pre-rally levels, underpinned by resilient global trade flows and continued carrier discipline. While additional sailings have marginally improved capacity availability and eased congestion in some corridors, supply remains carefully managed, helping maintain a balanced market environment. Ongoing geopolitical uncertainties and elevated operating costs have also prevented a sharper decline in freight rates.

Outlook

BigMint expects container freight rates to remain broadly stable in the near term. Although the seasonal peak is showing signs of moderation and capacity is gradually returning to the market, disciplined carrier capacity management is likely to limit downside risks.

In addition, persistent geopolitical uncertainties – including U.S.-Iran tensions, security concerns in the Bab el-Mandeb Strait, and the possibility of additional transit charges through the Strait of Hormuz – are expected to continue supporting freight sentiment. However, any sustained improvement in vessel availability or further softening in cargo demand could exert downward pressure on rates in the coming weeks.