Australia
New Zealand Summary
March 2025 brings a mix of emerging challenges and strategic opportunities across global logistics. For businesses in Australia and New Zealand, the landscape remains complex—shaped by softening ocean freight rates, fluctuating schedule reliability, intensifying geopolitical tensions, and far-reaching regulatory shifts, particularly from the United States. At the same time, regional infrastructure developments are helping to build resilience and support growth. In this dynamic environment, proactive planning, supply chain agility, and informed decision-making are essential to mitigate risks and capture long-term value.
Ocean Freight Market Overview
Freight Rates and Market Trends
Drewry’s latest World Container Index (WCI) fell a further 4% to USD 2,264 per 40ft container—78% below the pandemic peak of USD 10,377 in September 2021 and the lowest level since January 2024. However, the index remains 59% higher than the pre-pandemic average of USD 1,420 in 2019, indicating continued structural pricing shifts in the global container market.
Source: Drewry World Container Index
While overall market rates remain well below pandemic-era highs, businesses should be aware of potential increases on specific trade lanes. In particular, southbound rates from Asia to Australia are expected to rise, with several carriers proposing General Rate Increases (GRIs) and additional surcharges, effective from late March through early April. These adjustments are being driven by demand patterns, capacity management, and carriers’ efforts to stabilise rates.
Proactive planning and early bookings will be critical to managing costs and securing space.
Bunker Prices
Bunker fuel prices have declined at ports worldwide, with Ship & Bunker’s G20-VLSFO Index—reflecting prices across 20 major bunkering ports—dropping by USD 4/mt to USD 549/mt, the lowest level since September 2021. Similar downward movements were recorded across other key fuel types, including HSFO and MGO.
Source: Ship & Bunker
This reduction in fuel costs may offer some short-term relief on carrier operating expenses; however, these savings are not always immediately passed on through lower freight rates due to broader market dynamics.
Schedule Reliability
Recent data indicates that global schedule reliability has remained relatively stable, fluctuating within the 50% to 55% range throughout 2024 and into early 2025. In January 2025, schedule reliability stood at 51.5%, reflecting a slight month-over-month decrease of 2.1 percentage points. Notably, Maersk emerged as the most reliable among the top 13 carriers, achieving a schedule reliability of 55%. Six additional carriers reported reliability above 50%, while the remaining six ranged between 46% and 50%, with Yang Ming and OOCL at the lower end at 46.6%.
Given the persistent variability in schedule reliability, customers are encouraged to implement strategies such as extending lead times and maintaining buffer inventories.
Red Sea Disruptions
Tensions in the Red Sea have escalated significantly following recent US airstrikes on Houthi military sites in Yemen, in response to renewed threats targeting Israeli-linked shipping. Although the Houthis lifted a ban on international shipping through the Red Sea in January—following the Israel–Hamas ceasefire—they warned that any aggression by the US or UK would result in retaliatory attacks.
Since November 2023, the Joint Maritime Information Centre (JMIC) has recorded 112 maritime incidents in the Red Sea and Gulf of Aden. These include six serious incidents, 42 minor incidents, 46 attempted attacks, and four hijackings, with four mariners killed and two seriously injured in confirmed Houthi attacks on merchant vessels.
This ongoing instability has led to widespread rerouting of maritime traffic around the Cape of Good Hope, adding approximately two weeks to typical transit times and substantially increasing operational costs. Major shipping lines are closely monitoring the security situation and are unlikely to resume Red Sea transits until long-term safety can be assured.
Carrier Profitability and Capacity
Carrier profitability has declined in recent months, driven by excess capacity, seasonal reductions in demand, and geopolitical instability. Despite this, margins remain historically strong. Major carriers such as HMM, Wan Hai Lines, and ZIM continue to demonstrate resilience, supported by strategic route performance and effective fleet management.
Looking ahead, further pressure on profitability could result in capacity adjustments, including service reductions or route rationalisation.
Port Throughput Performance
According to Drewry’s latest Port Throughput Indices, global container volumes dipped by 2.1% month-on-month in February 2025, following strong growth in January. Despite this short-term decline, the rolling 12-month growth rate stood at a healthy 6.2%, indicating ongoing strength in container trade.
Greater China: +9.4% MoM / +7.6% YoY, driven by record throughput at Shanghai and Ningbo
North America: +10.0% YoY
Europe: +9.0% YoY
Middle East and South Asia: +14.0% YoY, due to a low base following early Red Sea disruption
Major Indian ports such as Mundra and JNPT recorded year-on-year growth exceeding 23%, underscoring regional resilience.
Air Freight Market Overview
Global Trends and Regional Performance
According to IATA, global air cargo demand rose by 7.4% year-on-year in January 2025, continuing 16 consecutive months of growth. Capacity also increased by 4.6%, reflecting improving conditions across most markets. Asia-Pacific airlines saw the strongest growth at 14.3%, supported by high e-commerce and technology-sector volumes.
European carriers posted a 9.0% increase, while North America recorded a modest 0.9% rise due to capacity constraints and shifting trade patterns.
Geopolitical and Market Dynamics
Tensions between the US and China have reinforced tariff barriers and trade-related frictions, contributing to a more cautious outlook for cross-border e-commerce and high-value cargo. While air freight remains critical for time-sensitive goods, rate volatility is expected to persist in the near term.
Australian Market Developments
The Australian air freight market reached an estimated AUD 1.15 billion in 2024 and is projected to grow at a compound annual growth rate (CAGR) of 3.8% through 2034. Infrastructure improvements are expected to support this expansion:
- Western Sydney International Airport, due to open in late 2026, will increase Sydney’s air cargo capacity by 33%.
- Hobart Airport’s recent runway extension enables direct services to Southeast Asia, cutting seafood export times by up to 10 hours.
- Auckland Airport is also investing in enhanced cold chain and cargo handling infrastructure to improve service reliability and throughput.
Local Insights
Infrastructure Updates
- Queensland Rail has restored critical freight corridors between Townsville and Cairns, and from Longreach to Winton, following flood repairs.
- Port of Brisbane has resumed full operations after Cyclone Alfred, with minimal long-term impacts.
- Port of Melbourne achieved record annual throughput in 2024, handling 3.396 million TEUs, driven by strong import activity and favourable agricultural exports.
New Zealand Reefer Peak Season
New Zealand is currently experiencing its reefer peak season, with elevated export volumes of apples and kiwifruit. Exporters are advised to secure equipment and bookings early to avoid disruptions.
CODA Acquisition by ACFS NZ
ACFS Port Logistics New Zealand has acquired key assets from Coda Group, including Auckland 3PL Transport (FCL & LCL), the Auckland Freight Station (FAK), and the Rolleston Distribution Centre in Christchurch. The transition is expected to be completed by 1 May 2025. Some initial service adjustments may occur during this changeover.
U.S. Regulatory Changes
Recent regulatory actions by the United States have introduced several significant tariffs impacting global trade:
- Steel and Aluminium Tariffs: Effective 12 March 2025, the United States implemented a 25% tariff on all steel and aluminium imports, directly affecting Australian exporters by reducing their competitiveness in the US market.
- North American Trade Tariffs: Effective 4 March 2025, a 25% tariff was placed on goods imported from Canada and Mexico. However, imports qualifying under the United States-Mexico-Canada Agreement (USMCA) are exempt from these tariffs, preserving some existing trade relationships.
- Chinese Import Tariffs: The US increased tariffs on selected Chinese imports from 10% to 20%, effective 4 March 2025, significantly raising the cost of goods and prompting many businesses to reconsider sourcing strategies.
These regulatory adjustments have led to shifts in global shipping routes, increased logistics complexity, and rising operational costs.
Outlook
Strategic adaptability, proactive logistics planning, and diversified supply chain strategies remain essential for navigating global uncertainties. Seabridge Global Logistics is committed to delivering accurate insights and tailored support to help your business optimise operations and build resilience in a rapidly evolving environment.
If you would like to discuss how these developments may affect your supply chain, please reach out to your local Seabridge representative.
Sources
• Drewry’s World Container Index Weekly Update
• Sea-Intelligence – 2024 Schedule Reliability
• Ship & Bunker – Bunker Prices Update
Disclaimer:
This update consolidates data from Drewry, IATA, Sea-Intelligence and Ship & Bunker. All information is current at the time of writing but may change without notice. Seabridge disclaims liability for decisions made based on these insights and recommends further consultation with logistics professionals to discuss your individual circumstances.
