Maritime 2025 Annual Review & Outlook
Unleashing growth
Rising north-south trade hinges on fluid ports , vessel capacity
By Laura Robb
Northbound South America – US spot rates spike in H2 2024
Container spot rates from East Coast South America to US Gulf , in USD per FEU
USD per FEU
$ 5,835
$ 5,000
$ 4,000 $ 1,000 $ 3,000
$ 2,000
L
The big picture : A combination of growing demand , port bottlenecks , and vessel and equipment shortages pushed 2024 rates from the East Coast of South America to the US to their highest level since the COVID-19 pandemic . This year , the inter- Americas trade is poised for more growth , but that growth will likely come with congestion at South American ports and tight capacity on northbound services from the East Coast of South America that keeps rates elevated .
A look back : Freight demand on the north-south trade connecting Latin America with North America increased in 2024 , but actual volume growth was hindered by port congestion and a lack of available vessel space . Total container volumes between the US and the Caribbean , Central America and South America rose 4.3 % in the first 10 months of the year , with northbound shipments up 3.8 % and southbound volumes up 4.8 %, according to PIERS , a sister product of the Journal of Commerce within S & P Global . Growing import demand in South America and poor vessel schedule reliability resulted in tight capacity for imports to the East Coast of South America throughout the year . At the same time , infrastructure projects at multiple ports in Latin America aimed at attracting additional volumes reduced operating capacity at those gateways . Vessel delays caused by the International Longshoremen ’ s Association ( ILA ) strike , which shut down all US East and Gulf coast ports for three days at the beginning of October , further exacerbated vessel bunching at South American ports . That , in turn , worsened existing equipment shortages , as ports and container carriers prioritized clearing the backlog of ships
$ 1,000 L Jul Jan 2024 Jul
, 2024
Source : Platts , S & P Global
ECSA – USGC spot rates soared from $ 1,800 per FEU in June to $ 5,800 per FEU in late October . byvalet / Shutterstock . com
East Coast South America to US Gulf
© 2024 S & P Global
over repositioning empty containers inland for exporters . Some carriers opted to divert ships to lesser-used ports and / or blank sailings to keep ships on schedule , which further reduced effective vessel capacity on the trade and resulted in rolled cargo . Steady growth in rates accelerated in the lead up to the ILA strike , with average spot rates from the East Coast of South America to the US Gulf Coast peaking at $ 5,800 per FEU in late October , more than double the rate recorded just three months prior and up 251.5 % from the same week in 2023 , according to Platts , also part of S & P Global . Those rates have since cooled , but only slightly , settling at $ 5,600 per FEU in the three weeks ended Dec . 13 .
A look ahead : Shippers moving cargo on the inter-Americas lane can expect to see further volume growth in 2025 , potentially reflected by increased attention and capacity from carriers . Demand for US-made products in South America continues to increase , with petrochemicals offering another source of substantial southbound volume growth . The implications of a second Trump presidency remain unclear for trade policy , but the change in administration — particularly the threat of universal tariffs on US imports — could increase costs . However , if President-elect Trump imposes much higher tariffs on imports from China , this could prompt US importers to shift some sourcing to Latin America , increasing northsouth volumes . Another potential spanner in the works for intra-Americas shippers are the still-unresolved contract talks between the ILA and port employers on the US East and Gulf coasts . If an agreement is not reached by Jan . 15 , the union will strike again , and if East and Gulf coast ports are closed for any meaningful amount of time , congestion and equipment shortages in South America are likely to flare up again .
The next inflection : With demand already growing and Trump tariffs potentially accelerating the nearshoring of US imports , the north-south trade is positioned for long-term growth . However , that growth remains dependent on ports expanding and carriers flexing up vessel capacity and equipment supply to handle the rising volumes .
email : laura . robb @ spglobal . com
34 Journal of Commerce | January 6 , 2025 www . joc . com