China Shipping Update February 2026: Falling Rates, CNY & Ramadan Impact
Ocean freight rates from China fell 8-10% in early February to $2,100-2,300 per FEU on USWC lanes, defying normal pre-CNY peak season patterns. Carriers canceled 73 sailings between February 9 and March 1 to prevent further collapse. Chinese New Year (February 14-22) and Ramadan (starts February 18) now overlap, creating a 5-week logistics shutdown affecting production, port operations, and customs clearance through late March.
February 2026 Market Snapshot
Ocean rates: Fall to break-even across major routes despite peak season
CNY and Ramadan: Overlap shuts down China production and Muslim-majority customs through March
Blank sailings: 73 voyages canceled to defend rates
EU carbon tax: $75-150 per FEU mandatory surcharge on all Europe shipments
Annual contracts: 20% below 2025 levels, carriers accept index-linked clauses
These five market shifts affect February-March shipping operations for all China importers. The following updates detail current rates, operational timelines, and key dates requiring advance planning.
Update 1: Ocean Rates Fall Below Break-Even
Container shipping rates dropped 8-10% in the first two weeks of February when pre-CNY periods normally see 15-25% increases. Current spot rates as of February 9, 2026:
Transpacific Routes:
US West Coast (Shanghai/Ningbo to LA/Long Beach): $2,100-2,300 per FEU (down from $2,400-2,500 in late January)
US East Coast (Shanghai/Ningbo to New York/Savannah): $2,800-3,100 per FEU (down from $3,100-3,400)
Asia-Europe Routes:
North Europe (Shanghai to Rotterdam/Hamburg): $2,100-2,250 per FEU (at or below carrier break-even)
Mediterranean (Shanghai to Genoa/Barcelona): $2,000-2,150 per FEU
Intra-Asia Routes:
Southeast Asia: $400-550 per FEU (stable, minimal CNY impact)
Middle East: $1,200-1,400 per FEU (stable ahead of Ramadan)
Four factors drive the Transpacific and Europe decline:
Demand Evaporation: US and European importers front-loaded cargo during Q4 2025 anticipating tariff increases. February 2026 volumes run 20-30% below normal seasonal levels.
Red Sea Normalization: Several carriers resumed limited Suez Canal transits in early 2026, releasing 10-15% of global capacity previously tied up in Cape of Good Hope diversions. Round-trip times dropped from 45-50 days to 30-35 days.
Alliance Competition: 2026 marks the first operational year for restructured alliances including Gemini Cooperation (Maersk-Hapag Lloyd). Carriers prioritize market share over profitability, accepting near break-even rates.
Overcapacity: 2026 is the peak year for container ship deliveries with 2.8 million TEU entering service (15% capacity increase). Fleet capacity grows faster than trade volumes.
Europe rates at $2,100-2,250 per FEU sit at or below most carriers' operating costs. Xeneta reports USWC at $2,124 per FEU, while Drewry shows $2,239 per FEU.
Rate index movements: Shanghai Containerized Freight Index (SCFI) fell 8.7% week-over-week to 989.45 points as of February 7, 2026. Drewry World Container Index dropped 6.2% to $2,289 per FEU. Freightos Baltic Index shows similar declines across all major lanes, with Asia-USWC down 9.1% and Asia-Europe down 7.8% in the first week of February.
Update 2: CNY and Ramadan Overlap Shuts Down Logistics
Chinese New Year (February 14-22) and Ramadan (starts February 18) create an unprecedented 5-week disruption for China-to-Muslim-majority-country trade lanes with no recovery window between events.
CNY Timeline
Pre-holiday shutdown: Most factories completed final production runs by February 8-10. Workers in coastal manufacturing hubs traveled to interior provinces starting February 9. Trucking companies stopped accepting new bookings after February 12.
Holiday week (Feb 14-22): Ports operate at 40-50% capacity. Major port operating status:
Shanghai (Yangshan): 45% capacity, container terminal operations reduced to single shift
Shenzhen (Yantian, Shekou): 40% capacity, gate hours reduced to 8am-4pm
Ningbo-Zhoushan: 50% capacity, maintains limited 24-hour operations
Guangzhou (Nansha): 35-40% capacity, most terminals close February 16-20
Qingdao: 45% capacity, northern ports less affected
Inland trucking stops completely February 12-24. Major corridors affected:
Pearl River Delta (Shenzhen-Guangzhou-Dongguan): 95% capacity reduction
Yangtze River Delta (Shanghai-Suzhou-Ningbo): 90% capacity reduction
Shipping line adjustments: All major carriers skip or combine port calls during February 15-23. Normal weekly services become bi-weekly during CNY week.
Recovery period: Chinese ports resume February 24-25 but processing speeds remain below normal through early March due to container backlogs. Full production capacity returns March 15+. Coastal manufacturing provinces see 70-85% worker return rates by February 25, with electronics and machinery sectors recovering faster than labor-intensive textiles. First production batches in early March show elevated defect rates during 2-3 week training period for replacement workers.
Ramadan Impact
Ramadan begins February 18. Affected countries and their specific operational impacts:
Middle East:
Saudi Arabia: Customs processing 8-10 days (normal 2-3 days), government offices close 2 PM
UAE (Dubai, Abu Dhabi): Customs 7-9 days, port operations 60% capacity
Qatar, Kuwait, Bahrain, Oman: Similar 7-10 day clearance extensions
Southeast Asia:
Indonesia: Customs 8-10 days, Jakarta port congestion expected, Ramadan until March 19
Malaysia: Port Klang and Penang operate 65% capacity, clearance 6-8 days
South Asia:
Pakistan (Karachi): Customs 9-11 days, severe port congestion
Bangladesh (Chittagong): Clearance 8-10 days, warehouse capacity 55%
Africa:
Egypt: Suez clearance 7-9 days, Alexandria port delays
Morocco, Nigeria: 7-10 day clearance times
Customs delays: Processing extends from normal 2-3 days to 7-10 days across all Muslim-majority markets. Indonesia (230+ million Muslims) and Pakistan face particularly significant slowdowns with clearance times reaching 8-11 days.
Operating hours: Warehouses run at 60-70% capacity. Government offices and logistics providers close at 3-4 PM instead of 5-6 PM. Last-mile delivery operates at reduced capacity. Friday (Islamic holy day) sees additional disruptions with many offices closed entirely.
Transit times to affected markets:
Middle East: 12-18 days ocean freight
Indonesia: 7-12 days
Pakistan/Bangladesh: 15-20 days
Southeast Asia Hub Congestion
Singapore and Port Klang face container congestion as Chinese pre-holiday cargo meets Muslim-majority port worker schedules. Cargo transiting through Southeast Asian hubs faces additional 3-5 day delays during late February and early March.
Free storage extension: CMA CGM and Evergreen offer 14-day free storage (vs. standard 7 days) for cargo departing February 2-24.
Update 3: Carriers Cancel 73 Sailings to Defend Rates
Between February 9 and March 1, carriers announced 73 blank sailings across Transpacific and Asia-Europe lanes. This represents 10-15% of scheduled capacity withdrawn in a concentrated 3-week period.
Breakdown by route:
Transpacific (USWC): 28 blank sailings (February 12-March 1)
Transpacific (USEC): 19 blank sailings (February 15-March 1)
Asia-Europe: 26 blank sailings (February 10-28)
Carriers implementing blanks:
Maersk/MSC (2M Alliance): 22 sailings canceled
COSCO/OOCL/Evergreen (Ocean Alliance): 27 sailings canceled
Hapag-Lloyd/ONE/Yang Ming (THE Alliance): 18 sailings canceled
CMA CGM: 6 independent sailings canceled
The scale is unprecedented for a high-demand pre-CNY and post-CNY period. Carriers choose to lose revenue from canceled voyages rather than accept rates below the $2,000 per FEU psychological floor.
Capacity impact: The 73 blank sailings represent approximately 10-15% of scheduled capacity withdrawn in a concentrated 3-week period. On USWC routes alone, the 28 blanked sailings eliminate roughly 120,000-140,000 TEU of space during the critical February 12-March 1 window.
Timing: Highest concentration of blank sailings occurs in the 2-3 weeks immediately following Lunar New Year, aligning capacity reductions with natural demand lull from Chinese factory closures.
Booking impact: Reduced schedule reliability and fewer departure options during post-holiday recovery. Capacity constraint window lasts through March 10-25 as withdrawn vessels require 2-3 weeks to return to service.
Update 4: EU ETS Impact Becomes More Visible as Rates Decline
As of January 1, 2026, the EU Emissions Trading System (ETS) applies to 100% of maritime transport emissions for vessels calling at EU ports. All cargo shipped from China to European destinations includes carbon surcharges of $75-150 per FEU.
Implementation timeline: 2026 marks first year of full 100% coverage (up from 40% in 2024, 70% in 2025). Fees are mandatory and permanent.
Cost impact: At current Europe rates of $2,100-2,250 per FEU, carbon charges add 3-7% to total freight costs. This percentage grows if freight rates fall while carbon fees remain fixed. If rates drop to $1,800 per FEU, the same $75-150 surcharge represents 4.2-8.3% of total costs.
Carrier calculation methods:
Per-container flat fees: $75 for 20ft, $150 for 40ft
Emissions-based: Tied to voyage distance and cargo weight
Fuel consumption model: Based on actual bunker fuel per container slot
Carrier charge examples (February 2026):
Maersk: $135 per FEU (emissions-based calculation)
MSC: $120 per FEU (flat fee)
CMA CGM: $145 per FEU (fuel consumption model)
COSCO: $110 per FEU (flat fee)
Hapag-Lloyd: $130 per FEU (emissions-based)
Different carriers use different methods. Request detailed ETS breakdowns from freight forwarders before booking.
Update 5: Annual Contracts Drop 20%, Accept Index-Linked Terms
Carriers offer 2026 contract rates approximately 20% below 2025 levels. Spot rates now approach or undercut many annual contract rates, creating unusual leverage for importers.
Contract rate examples (2026 vs 2025):
USWC contracts: $2,400-2,600 per FEU (down from $3,000-3,200 in 2025)
USEC contracts: $3,200-3,500 per FEU (down from $4,000-4,300 in 2025)
Europe contracts: $2,400-2,600 per FEU (down from $3,000-3,300 in 2025)
With spot rates at $2,100-2,300 per FEU on USWC, many shippers find spot market pricing competitive with locked-in contract rates. This rarely occurs outside of deep market downturns.
Alliance competition: 2026 marks first operational year of Gemini Cooperation (Maersk-Hapag Lloyd) alongside other restructured alliances. Gemini controls approximately 20% of global container capacity, creating intense competition with Ocean Alliance (COSCO, OOCL, Evergreen, CMA CGM) at 30% capacity share and THE Alliance (ONE, Yang Ming) at 15% capacity share.
Index-linked clauses: Carriers accept adjustment clauses tied to public indices (SCFI or Drewry WCI) they would normally reject. If H2 2026 sees continued oversupply, contract rates adjust downward rather than locking in Q1 levels.
Typical index-linked terms being offered:
Quarterly rate reviews based on 3-month average of SCFI or Drewry WCI
Adjustment triggers when index moves ±5-10% from contract baseline
Rate floors preventing decline below 90% of initial contract rate
Rate ceilings capping increases at 115-120% of initial contract rate
Contract elements carriers now accept:
Quarterly rate adjustments based on published indices
Guaranteed equipment allocation for peak season (Q3-Q4)
Priority booking rights with 48-hour confirmation windows
Penalty clauses for rolled cargo ($500-1,000 per FEU compensation)
Volume flexibility bands allowing ±15-20% deviation from committed volumes
This represents a significant shift from normal market conditions where carriers resist index-linked terms and equipment guarantees.
Frequently Asked Questions
When is the last day to ship before CNY?
February 8-10 was the effective cutoff for most factories. Trucking companies stopped accepting new bookings after February 12. Ports operate at 40-50% capacity during February 14-22. Shanghai Yangshan operates at 45% capacity with single-shift terminal operations, Shenzhen Yantian/Shekou at 40% with reduced gate hours (8am-4pm), and Ningbo-Zhoushan at 50% capacity maintaining limited 24-hour operations. Major carriers skip or combine port calls during February 15-23, with normal weekly services reduced to bi-weekly schedules.
How should I handle first production batches after CNY?
First batches in early March show elevated defect rates as 20-30% of workers may not return and factories hire temporary replacements. Third-party QC inspections are recommended for all March shipments during the 2-3 week worker training period.
How does Ramadan affect customs clearance timelines?
Clearance times extend from 2-3 days to 7-10 days across Saudi Arabia, UAE, Indonesia, Malaysia, Pakistan, Bangladesh, Egypt, Morocco, and Nigeria. Warehouses operate at 60-70% capacity with offices closing at 3-4 PM instead of 5-6 PM.
Should I wait for rates to fall further before booking March shipments?
73 blank sailings create temporary capacity constraints during March 10-25. Withdrawn vessels require 2-3 weeks to return to service, creating artificial shortage during post-CNY recovery period.
What are current annual contract rates compared to spot rates?
2026 contracts price 20% below 2025 levels. USWC contracts range $2,400-2,600 per FEU compared to spot rates at $2,100-2,300 per FEU, creating unusual situation where spot market approaches contract pricing. Carriers accept index-linked clauses (quarterly adjustments tied to SCFI or Drewry WCI) they normally reject due to alliance competition and need to secure cargo commitments. Typical terms include ±5-10% adjustment triggers, 90% rate floors, and 115-120% rate ceilings. Contracts now include equipment guarantees, priority booking, and penalty clauses for rolled cargo. As markets stabilize through Q2, carrier willingness to accept these favorable terms will diminish.
Conclusion
February 2026 shipping from China faces unprecedented challenges with falling rates, CNY-Ramadan overlap, and 73 blank sailings creating March capacity constraints.
Contact Gerudo Logistics for professional freight forwarding support navigating these disruptions. Our China-based operations team provides real-time booking assistance, customs clearance coordination, and contingency planning for February-March shipments.
