Market Newsletter - April 2025
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Welcome to the April Market Update.
With the Easter break and ANZAC Day public holidays ahead of us this month, many Australians will be looking forward to some downtime with family and friends. Even though the year’s only a few months in, the fast-moving pace of events overseas coupled with natural disasters here at home including cyclones, flooding and bushfires have added a level of difficulty to planning and managing some critical supply chains.
What recent weeks have also highlighted, however, is the resourcefulness of businesses and communities. Globally, experts are seeing shifts in the airfreight market as e-commerce companies respond to new tariffs and emerging geopolitical trends. Finding alternatives to the US market is resulting in new opportunities in regions including Asia, the EU, Canada and South America. This is likely to see some changes occur in pricing, space availability and frequency of air freight and a growing diversity within e-commerce and the enabling express logistics sectors.
As the coordinated response to Cyclone Alfred showed, the power of collaboration and working across sectors and organisations is enormous. That’s a familiar theme for AXIMA, as we partner with our clients and our network across the global logistics and freight sector to ensure that supply chains can function efficiently and cost-effectively.
With all the changes happening in terms of tariffs and customs, this is even more important. So please take time before the Easter break to check in with your Client Service Specialist or Client Success Manager and discuss how these changes affect your import or export planning.
Please note all Australian AXIMA offices will be closed for Easter from Friday April 18 through to Monday April 21 (inclusive) and again on Friday April 25 for ANZAC Day.
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Tomb-Sweeping Day is a very important public holiday observance in mainland China and Hong Kong, and this year it falls on Friday April 4. Please note AXIMA Shanghai and Quingdao offices will be closed for the day.
If you have any urgent inquires during the holiday, please contact:
SHANGHAI OFFICE:
- Judy Zhu/+86 18217697728
- Nina Ni /+86 15821923116
- Jane Gu/+86 13918025643
- Kitty Zhou /+86 18301739179
- Joyce Zhang/+86 18521321166
QINGDAO OFFICE:
- Kerry Chen/+86 13335091390
- Anne Sheng/+86 13026503126
DOC team:
- Anny Luo /+86 13632818802
Rates are currently on the move in this market, and the carriers are pushing them upwards. We see that long term contracts signed for 2025/26 are much higher than in 2024/25, and it is not likely carriers will allow FAK rates to sit at lower than contract rates for too long.
In March carriers announced a GRI of USD 300 per TEU from March 15 on all container types to Australia and New Zealand, and managed to get 55% of the quantum implemented due to blanked sailings reducing space availability.
Another GRI was also announced of USD 300 per TEU to take effect from April 1 and applying to all container types to Australia and New Zealand. We believe they are likely to achieve 50% of the quantum due to the Cyclone Alfred disrupting vessel rotation in the trade lane and affecting space capacity at the ports of origin. Keep an eye out for an email from us confirming any further details on this GRI if it does succeed in getting implemented.
Landside, operations from factory to ports are running efficiently and smoothly. Aside from the blip caused by Alfred, overall sailing schedule integrity has also substantially improved. Blank sailings will, however, remain a feature of the trade lane as carriers tinker with space and demand to keep rates in their favour.
For air freight, schedules are reliable, and space is easily available, however, rates have increased slightly due to demand from e-commerce.
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This is a very stable market, with no significant increase in shipping demand. There have been some minor rate adjustments between carriers, but otherwise, it’s currently calm. While some carriers have announced a GRI for April 1 of USD 300 TEU, we do not believe there is sufficient demand for it to push through and see it more as a signal from the carriers that they’d quite like rates to rise again.
There may be some shifts ahead in terms of schedules, prices and demand if there is any genuine easing of the tensions in the Red Sea, but a peaceful Suez Canal region this is still not a certainty.
The congestion that had plagued this region for most of 2024 is now considerably eased, and sailing schedule integrity has improved as a result. Blank sailings are still occurring, as the carriers try and gain control of pricing through reducing available space.
Air freight services, rates and space availability have been consistently stable, with no major issues. We are watching, however, to see if the shifts in global supply chains in response to US matters sees an increase in e-commerce activity focused on this region.
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The landside link with Nhava Sheva port (JNPA) in India has been one of the weaknesses in the logistics operations in India. Over-long vehicle turn times, congestion and an imbalance between trucker and road capacity and the increasing volume of ocean cargo has caused delays and frustration for the nation’s truckers. A $500 million road project has been approved that will hopefully ease the congestion by connecting the port’s connection to the nearest state highway.
Generally, the combination of carriers expanding their networks, larger container ships, high inventory levels ahead of the Indian end of financial year on March 31 and unpredictable vessel schedules caused persistent issues throughout the month. There may be some ongoing issues, which you can discuss with your Client Service Specialist or Client Success Manager to find solutions for your supply chain planning.
India is being tipped to become one of the world’s manufacturing superpowers. DHL’s 2025 trade atlas ranked the nation at number 3 in the league table for projected trade growth between 2024 and 2029. Before planning any shifts in your sourcing, however, do your research and consider your planning carefully.
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There’s a lot happening regarding US customs, tariffs and border matters as Executive Orders begin to take effect. Firstly, the 25% tariffs on imports from Canada and Mexico are now in effect. There was a reprieve of a few weeks for auto manufacturers in the US, but this was only a pause button, not a backflip.
In addition, tariffs on goods from China have been doubled, and there is now the likelihood of a USD 1.5 million fee for vessels built in China to enter US ports. This is currently being debated, and we are watching the situation closely.
Currently it is Australian aluminium and steel products that are being subjected to targeted tariffs of 25%, however, other goods that are shipped on vessels originating from China’s shipyards may also face cost barriers if the new fee goes ahead, as the carriers will likely want to spread the financial load across shippers.
There are already some consequences within the US due to the new tariffs, such as a slow-down in forward orders within the trucking sector for new equipment.
For Australian exporters, the FTA and the Australian Peak Shippers Association (APSA) has provided detailed information on the new tariffs via the U.S. Customs and Border Protection (CBP) Cargo Systems Messaging Service (CSMS) messages. The tariffs came into effect on March 12 and apply to steel, aluminium and derivative products. For more information see:
- CSMS 64348411 – Import Duties on Steel & Steel Derivative Products: Read more
- CSMS 64348288 – Import Duties on Aluminum & Aluminum Derivative Products: Read more
This is also a good time to speak with your Client Success manager or Client Service Specialist, to gain clarity on what the changes mean for you and what is required to comply with the new US customs requirements.
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There were some concerns for delays of air cargo entering via Heathrow Airport last month, after a fire at the substation supplying power to the terminal caused suspensions of flights. The situation was quickly resolved, with only minor backlogs for air freight.
Good news for land freight users, the UK Department of Transport has approved the £9 billion Lower Thames Crossing project. This project will deliver two 23 kilometre tunnels under the Thames, connecting Kent and Essex, alleviating congestion at Dartford Crossing and enhancing road freight capacity.
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Tropical Cyclone Alfred had a major effect across the Brisbane and wider South east Queensland region. Ports were closed, airports grounded, container parks closed and trucks and rail both at a standstill. Fortunately, the impact was generally short-lived, with normal operations beginning to resume by March 11. There were flow-on effects including delays and backlogs in cargo processing and hold ups with Department of Agriculture biosecurity inspections.
What it demonstrated, however, is the magnificent ability of relevant agencies, the private sector and industry to work together to keep everyone informed, reduce risks to lives and property, and deliver a rapid and effective recovery. That is resilience in action, and something everyone can feel proud of.
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There was a brief shutdown at Patrick Terminal Fremantle due to site shutdown for critical infrastructure works on March 24. Minor delays were caused due to the cancelling of VBS slots for that day.
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In 2024, Port of Melbourne achieved the highest annual container trade volume ever recorded, with a total of 3.396 million twenty-equivalent units (TEUs) passing through the Port, more than 9% up from 2023 volumes.
The strong container trade was driven by an increase in import trade, particularly consumer goods such as furniture. Similarly, export trade has benefitted from the robust diversity of agricultural commodities experiencing favourable growing conditions.
Air freight is also vital in the state, and resolving the impasse on a rail link has been an issue for over a decade. Last month, there was finally movement at the station, with the federal government, state government and Australia Pacific Airports (Melbourne) signing a Memorandum of Understanding to finalise the path to financing and building the Melbourne Airport Rail Link at last.
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Customs regulatory changes
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There is another new US-related customs matter that may affect Australian exporters or importers, and that is the announcement of an additional tariff on shipments into the US that contain products made in China and Hong Kong. Effective 04th March 2025, shipments with value over USD 800 will now pay an additional 20%. Please see more information below on this.
There are also new tariffs being imposed by Canada on goods that have US country of origin provenance, regardless of where they are being shipped from. The 25% Surtax will be applicable regardless of value.
China is also imposing additional tariffs on US COO products including a range of agricultural products. These will apply to any goods landed after April 12, and products include cotton, grains, dairy, pork, beef, soybeans, fruit and vegetables.
DHL has stressed the importance of accurate documentation. Shippers must provide complete and accurate Commercial Invoice data for all products, including detailed goods description, to the extent possible the HS classification, Country of Origin (COO) of the goods (where goods are manufactured).
Please speak with your Client Success Manager or Client Service Specialist for further advice if this affects your supply chain.
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Giant African Snail (Melbourne)
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Patrick’s Terminals Landside team, the Freight & Trade Alliance (FTA), the Australian Peak Shippers Association (APSA) and the Department of Agriculture Fisheries and Forests have been working on a new initiative to mitigate the impact of measures to control Giant African Snail risks. Delays on shipments requiring inspection have caused significant costs for shippers due to storage costs and in some cases detention charges. The GAS Holds apply to vessels with containers on the Country Action List.
The new initiative will assist by providing better visibility of inspection times, helping stakeholders plan accordingly and mitigate unnecessary costs. Additionally, it will highlight any delays or bottlenecks in the supply chain, ensuring greater transparency and efficiency in managing GAS-held shipments.
Key Details of the Initiative
- Scheduled Notifications: Carriers will receive updates on planned GAS inspections via OneStop, providing foresight on expected inspection times.
- Enhanced Transparency: Importers will have increased visibility through their carrier communications, reducing uncertainty about when their containers will be inspected.
- Reduction in Queries: The initiative aims to minimise unnecessary enquiries with terminals regarding GAS-held containers, allowing for smoother operations.
- Access via OneStop: Clearance statuses for GAS-held containers remain accessible through the OneStop system as usual.
- Operational Clarity: If a container is not quarantine-held in OneStop and is marked as clear, it can be collected without additional enquiries.
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Tensions remain in the Red Sea region due to missile attacks between the US and Houthi rebels in Yemen. International shipping is still affected by safety concerns as a result, however, it is worth making some early plans around what the impact might be should regular Suez Canal transits resume. Some industry experts are warning of potential detention and demurrage charges at congested ports in the region.
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The Australian Competition and Consumer Commission (ACCC) has raised concerns about DP World's proposed acquisition of Silk Logistics. The ACCC flagged potential risks to competition, including increased charges, reduced service quality, and access to sensitive data about Silk's rivals. We will keep you informed if there are any likely flow-on effects for Australian shippers.
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The federal Budget is always a mixed bag of good news and not-so-great. The Freight and Trade Alliance and Australian Peak Shippers Association compiled a primer of the main measures that may be relevant to Australian businesses.
Trade Pressure and Outlook
- There is a rising trend of tariffs and trade restrictions, however, despite global challenges, import volumes are projected to grow. Import growth is expected to moderate to 2.5% in 2024–25 due to a slowdown in service imports, while goods imports will be supported by infrastructure projects. Growth is forecasted at 4% in 2025–26 and 2.5% in 2026–27.
- The Budget also maintains expectations of a Free Trade Agreement (FTA) with the EU, though customs duty estimates indicate that any financial impact will not be felt until 2027–28. The 2025–26 Budget continues to factor in provisions for the Australia-EU FTA, while no other FTAs currently under negotiation are expected to materially impact revenue over the forward estimates.
Depart of Home Affairs
- There is an allocation of $9.6 million over four years from 2025–26 to undertake an approach to market to renew Australia’s primary sea cargo screening technology to detect and prevent the importation of illicit goods and sustain existing screening technology.
Imports from Russia and Belarus
- The measure imposing additional 35% tariffs on goods that are the produce or manufacture of Russia or Belarus will be extended by a further two years, to 24 October 2027.
Excise and Excise Equivalent Customs Duty
The indexation on draught beer excise and excise equivalent customs duty rates will be paused for a two year period, from August 2025 until August 2027.
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Transport Security amendment
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The Transport Security Amendment (Security of Australia’s Transport Sector) Bill 2025 (the Bill) passed through Parliament on March 26. The Bill and associated Explanatory Memoranda can be found here.
This legislation amends the Aviation Transport Security Act 2004 and the Maritime Transport and Offshore Facilities Security Act 2003 to enhance the security frameworks governing Australia's aviation, maritime, and offshore facility sectors. The amendments aim to implement recommendations from the Independent Review into Australia's Aviation and Maritime Transport Security Settings, promoting iterative, risk-based, and scalable regulatory approaches.
Key provisions of the bill include:
- Increased Penalties: The bill introduces higher penalties for offences related to transport security, particularly targeting airport operators and aircraft operators.
- Regulatory Enhancements: Amendments to the legislative and policy frameworks aim to enable more flexible and responsive security measures within the transport sector.
There will be further information released on the changes in the coming weeks, and we will keep you informed on how it affects your supply chain operations and import and export planning.
It’s definitely a challenging time for anyone in the import and export business, with ripple effects also hitting manufacturing, industrials, the energy sector, retail, transport and travel. What we know from experience, however, is teamwork will make the dream work. Just as everyone comes together to manage the impacts of a natural disaster and shares information and resources to support resilience, we apply the same approach to managing shifts in global affairs and trading relationships.
Your Client Success Manager or Client Service Specialist are, of course, your first port of call. Supported by our local networks and the talents and expertise of AXIMA’s Customs team, together we can plot a pathway to ongoing success for your supply chain, your customers and your business.
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To Clear Skies & Open Seas,
Matt Ward
COO International
AXIMA Pty Ltd
www.axima.com.au
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