Galaxy Futures: Middle East Iran Situation Escalates, Some Shipping Companies Return to Cape of Good Hope Route

Spot freight rates have entered the traditional off-season after the holiday. The Shanghai- Rotterdam rate for MSKWK11 is $1,900 per 40HC, down $100 compared to the previous period. Other ports are quoting around $2,000. HPL in early March is around $2,200 online; OA in the first half of March is generally announced to rise above $3,000 per FEU, with OOCL quoting $3,100 in the first half of March, COSCO announcing a $3,100 increase, CMA’s online rate in the first half of February dropped to around $2,300, then announced to rise to $3,100 in March. Evergreen’s rate in the first half of March was around $3,000, then decreased to about $2,400; YML in the second week of March dropped to $2,050, and ONE in early March decreased to $1,900–$2,000. MSC’s rate in the first half of March was adjusted to around $2,100, with a target of $3,200 announced for the second half of March.

Fundamentally, on the demand side, cargo volumes are gradually reaching a peak and then declining. On the supply side, as of February 23, 2026, the weekly average shipping capacity for the Shanghai-Northern Europe 5 ports route in February, March, and April was 228,400 TEU, 266,000 TEU, and 283,100 TEU respectively, with significant capacity pressure in the latter half of March.

Traditionally, freight rates in March and April are still in the off-season. However, geopolitical tensions in the Middle East, especially the outbreak of conflict in Iran, have affected navigation through the Strait of Hormuz and the Red Sea. Some shipping companies are rerouting around the Cape of Good Hope. If the conflict persists, it could potentially drive freight rates higher. (Galaxy Futures)