The Truth Behind the Soaring Ocean Freight Rates: Shipping Lines Feasted in 2020, Now They Can't Even Get Soup—and They're Panicking
Back in 2020, shipping lines enjoyed three years of effortless profits.
Think that was a windfall? No—it was their graduation ceremony from the school of hard knocks.
I. The Pandemic Taught Shipping Lines One Great Truth
From 2020 to 2022, ports were jammed like parking lots, containers piled to the sky, and vessels queued at sea so long that crews began to question their life choices. Freight rates skyrocketed from a few hundred dollars per container to over twenty thousand.
What was the shipping lines' state of mind back then? Passive money-making.
They didn't want the congestion either—but ports were paralyzed, boxes were scarce, workers were striking, and capacity was locked up. Raising rates was their only move.
But after three years, they had an epiphany:
"You don't actually need real capacity shortages to make money. You just need it to look like there's a shortage. That's enough."
That realization was worth a hundred billion.
II. From "Passive Windfall" to "Active Market-Making"
After the pandemic ended, new vessels launched one after another—global capacity should have been in surplus. And in 2023, the market did correct, sending shipping lines into a panic.
But they quickly figured it out: If "involuntary vessel shortages" made a killing during COVID, why not just manufacture "voluntary shortages" now?
Enter Blank Sailing—a craft now elevated to an art form.
In February this year, on Asia–Europe and Asia–US routes, carriers canceled 136 sailings—a 122% month-on-month spike. From March to April, another 47 sailings were cut, reducing capacity by a direct 15%.
Not because there were no ships. There were ships—they just chose not to sail.
These few players control 84% of global container capacity. They don't need phone calls or backroom meetings. It's an unspoken understanding: Whoever adds an extra sailing today is the idiot breaking the unwritten rules.
Customers in a rush to ship? Wait. Space tight? Good. If it weren't tight, how could prices go up?
III. The Red Sea Crisis? The Perfect Smokescreen
Some will surely say: "But there's a war in the Red Sea! Detouring via the Cape of Good Hope raises costs—rate hikes are only natural."
True, the Red Sea diversion is real, and capacity did drop by 12–15%.
But buddy—how much did freight rates actually rise? Far more than 15%, right?
The Red Sea crisis handed shipping lines a flawless, irrefutable excuse. Customers hear "Red Sea conflict" and think the increase is justified—they might even feel a little sympathetic.
What nobody tells you: even without the Red Sea mess, they'd have found another reason.
Bad weather
Port congestion
Fuel surcharges
Carbon taxes
Union strikes
There's no shortage of excuses. The Red Sea just made this round of hikes look "legitimate." Without it, blank sailings would still fly, capacity would still tighten, and rates would still climb.
The only difference? With the Red Sea, carriers don't even need to fabricate a story.
IV. Q1 Was a Bloodbath—They Must Make It Back in H2
This is the real core issue.
Think carriers are tightening capacity and raising rates because "they feasted in 2020 and won't settle for soup"?
No—it's because in Q1 2026, they didn't even get soup, and they're desperate.
Look at the Q1 earnings:
Maersk: Profit plunged 91.7%; ocean business posted a $190 million loss. JPMorgan forecasts a full-year loss of up to $2.6 billion.
CMA CGM: Profit down 77.7%; revenue $13.2 billion, but profit barely $250 million.
Hapag-Lloyd: Direct loss of $256 million; CEO says weekly extra operating costs hit $50 million.
ONE: Profit fell 82.2%.
Yang Ming: Profit dropped 81.5%.
Freight volumes are actually rising—but rates are falling harder, while fuel and insurance costs are spiking. Margins are being squeezed from both ends.
For companies that gorged on three years of feast, now even broth is out of reach. Guess what they'll do next?
Blank sailings are already scheduled through year-end. The Gemini Alliance has shrunk the notice period for cancellations from 12 weeks to just 6–8 weeks—even Christmas and New Year sailings can be axed on a whim.
What does that mean? In the future, carriers won't even bother giving you a heads-up before hiking rates.
Losses from Q1 must be recovered in Q2–Q3. Otherwise, annual reports will be a disaster, and shareholders will flip tables.
V. This Isn't Market Economics—It's Manufactured Market Economics
What's real market economics? Demand up, supply down → prices rise. Demand down, supply up → prices fall.
Now? Demand hasn't surged. Capacity isn't truly scarce. Yet rates are climbing.
Because pricing power isn't in the market's hands—it's in the carriers' hands.
They monopolize over 80% of global capacity. They decide how many ships sail, how many stay anchored, and how much to charge. After a disastrous Q1, they must regain control and push prices back up in H2.
This isn't free competition. It's oligopoly control—losses forcing artificial hikes.
What are freight forwarders in this game? Or customers? Mere pawns on the chessboard. When carriers say east, you go east. When they say pay more, you pay more.
Final Word
So next time a client asks, "Why did freight rates go up again?"—don't bother explaining.
Just send them this article.
Tell them: *It's not an act of God. It's not an accident. It's shipping lines panicking after a brutal Q1—having feasted for three years in 2020 and now unable to even sip soup—so they must rig the market and hike rates to plug the hole. They've learned to manufacture capacity hunger, use the Red Sea as a shield, and blank-sail their way through year-end.*
Rates aren't determined by the market. They're deliberately set—driven by losses, by design.
We freight forwarders don't control pricing—but at the very least, we ought to know whose pockets the money is going into, and exactly how these rates are being pushed up.
Getting fleeced is one thing. Getting fleeced blind is another.
Share this with your fellow forwarders. Let everyone see how freight rates are really going up.
P.S. I hear the carriers' blank-sailing schedules are already locked in through year-end. Guess whether freight rates are coming down anytime soon?
Think about it.