Average container leasing rates on the U.S.-China trade route have increased by 223% from $535 in November 2023 to $1,730 so far through February 2024.

According to Container xChange, an executive from a California-based global logistics and freight forwarding company said that they anticipate organizations will be forced to deal with equipment shortages due to vessels being rerouted from the Red Sea around southern Africa. Additionally, they said that the ongoing crisis in the Red Sea and Panama Canal will probably lead to an increased demand for routing via the U.S. West Coast.

“Many importers are already rerouting cargo via West Coast trans-loading and trucking across to the coast, adding pressure on railways and domestic carriers,” the executive said. “We advise all clients to provide advanced forecasting, considering all routing options proactively and determining the best course of action based on cargo readiness dates and required on-site dates.” 

The global demand for containers is expected to recover over the next few months as the U.S. shows signs of resilience, with the country’s GDP rising at an annual rate of 3.3% during the fourth quarter of 2023.

The GDP growth was driven by more consumer spending, exports and government spending, among other factors. Moreover, personal income and spending reports from December found that lower inflation and solid household spending contributed to the country’s positive economic forecast.

“The gains in consumer spending and retail sales figures suggest that our industry can expect decent demand recovery for goods, which translates into relatively higher container demand on the cards, as retailers restock inventory and fulfill consumer orders.” Said Christian Roeloffs, the founder and CEO of Container xChange.