The main container carriers have shown no urgency to return to the Red Sea as the fragile truce in Gaza continues to show cracks which spurred a minor rally in the freight futures to Europe in the past week despite continued downward pressure in spot freight rates. The SCFI has slipped by 17% since the start of the year with further drops expected in February as carriers are still caught in the downward rate spiral ahead of the new Alliance network launch in February.
The worsening port congestion could provide some relief for carriers as they will be forced to remove more capacity than originally planned. Global congestion has surged to a fresh 3 month high with delays across all key regions, with a notable surge at Chinese ports ahead of the Lunar New Year holidays amidst concerns over new US import tariffs.
Johnson Leung
No immediate return to the Red Sea
Carriers will retain their current Cape of Good Hope routing in February with no immediate return planned to the Red Sea despite the Israel-Hamas ceasefire agreement concluded on 19 January 2025. According to Linerlytica’s survey of vessels diverted to the Cape route, the total number of ships have risen in the last 10 days driven by the busy shipping window before the Chinese New Year. If the fragile ceasefire in Gaza fails to hold, the vessel diversions affecting some 350 ships for 4.5m TEU currently could continue until the end of the year.
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