LA/Long Beach Watchmen Vote to Strike as Transpacific Rates Hit Year High

Transpacific spot rates hit a 2025 high of $10,565/FEU to the US East Coast last week, a 9% jump, even as a watchmen's union at the ports of Los Angeles and Long Beach voted to authorize a strike that could begin as soon as November 1. The coincidence is the story: capacity is loosening while labor risk tightens.

The Freightos weekly update, authored by Judah Levine, Head of Research at Freightos Group (Nasdaq: CRGO), captures an ocean market pulled in opposite directions — carriers pushing November general rate increases on Asia–Europe even as forwarders report discounts, and transpacific prices climbing against expectations of a post-Golden Week cooldown.

How strong are the rate moves?

Asia–North Europe rates climbed 3% to $3,551/FEU last week, while Mediterranean prices rose 8% to $4,252/FEU. Both lanes had been trending upward since mid-October, supported by lingering congestion at Chinese hub ports and blanked sailings. The caveat is immediate: some forwarders are already reporting carrier discounts and do not expect further increases to stick.

The transpacific picture is more striking. West Coast rates gained 3% to $8,368/FEU; East Coast rates jumped 9% to $10,565/FEU, the highest level of the year. Daily East Coast prices have receded this week but remain roughly $200/FEU above last week's average. Forwarders report cooling demand and more available space, and still expect seasonal easing — a reminder that a one-week spot print is not a trend.

What drives the numbers?

Three forces are at work, and each cuts a different way:

• Red Sea returns. Alphaliner estimates nearly two-thirds of total Asia–Europe capacity has now returned to the Red Sea route. Israeli carrier ZIM announced it resumed Red Sea transits for its joint Asia–US East Coast service with MSC — notable because the Houthis declared the Bab el-Mandeb Strait closed to Israel-linked vessels as recently as August.
• Storm recovery. Typhoon Champi closed container ports and airports in Taiwan on Friday and threatened, but mostly spared, East China port operations before weakening toward Japan. Major Chinese hubs are recovering from summer storm disruptions but are not fully back to normal.
• Vessel bunching. Ships taking the shorter Red Sea route are arriving ahead of schedule, which may itself be slowing the congestion recovery — an under-discussed side effect of the Suez return.

What does the strike vote mean for LA/Long Beach?

The local watchmen's union represents only about 2% of the ports' workforce. It provides security for a large share of terminals, however, so a walkout could have an outsized impact on operations. Any disruption would land on top of existing delays for containers moving by rail from the San Pedro Bay complex. Shippers with November transpacific bookings should treat November 1 as a live risk date, not a hypothetical one.

What is happening with tariffs and port fees?

The White House extended its trade truce with China in late September, pushing the expiration of the tariff status quo to early January. Most of the industry assumed US port call fees on China-linked vessels — also set for November 10 — would be deferred with it. The fees remain officially on the books, though the US Trade Representative has now released a request for comments on postponing them until January, a strong signal the policy will slip.

The USTR also said it expects to complete its Section 301 investigations into excess manufacturing capacity by China and fifteen other countries by year-end, despite earlier reports the studies were ready before the September Trump-Xi meeting. The stakes are concrete: current tariff levels on several countries, including China, sit below the negotiated January expiry levels, because duties introduced after the Supreme Court invalidated IEEPA-based tariffs did not restore IEEPA levels for all partners. The investigations are expected to recommend tariffs that would close that gap. Even a year-end conclusion leaves another couple of months for the required comment and hearing period before the administration could act on the findings.

Is air cargo confirming the peak?

Air freight rates out of China rose 4% to $7.13/kg to North America and 12% to $4.35/kg to Europe, with daily data this week showing further significant gains to North America and a sharp increase in Southeast Asia–US prices. Seasonal demand is stacking on top of already strong data center-driven volumes — the one segment in this update where demand, not just carrier discipline, is clearly doing the work.

The through-line for shippers: ocean rates are being propped up by congestion, blank sailings and labor risk rather than demand, while the January tariff cliff — port fees, Section 301 findings, and truce expiry converging in a single month — will do more to shape first-quarter booking strategy than any single weekly spot move.