Why are shipping costs rising in global trade?

You’re trying to move goods from A to B—same route, same volume, maybe even the same carrier—and boom: the rate has doubled. Or tripled. And no one seems to give you a straight answer why. Sound familiar? We get asked this a lot. “Why is shipping so expensive right now?” Well, settle in. It’s not one thing—it’s a cocktail of issues. Some you’d expect. Others... kind of ridiculous. Let’s break it down.

1. Demand vs. Reality (The Supply Chain’s Eternal Struggle)

Basic economics, right? More demand, not enough capacity = price goes up. But here’s the kicker: demand hasn’t been crazy lately. Not like pandemic-peak levels. Yet prices are still rising. Why? Because capacity hasn’t caught up—or worse, it's shrinking. Some carriers are idling ships or rerouting due to global messiness (we’ll get to that). Fewer ships = less space = higher rates. Even when there’s no cargo boom. Think of it like Uber surge pricing, but for 40-foot containers.

2. The Red Sea Route Mess (aka: Pirates, Drones & Detours)

If you’ve been following the news, you’ve probably heard something about ships avoiding the Red Sea.
Spoiler: that’s a huge deal. That’s the Suez Canal we’re talking about—one of the busiest routes in the world. But due to security risks (let’s just say it involves missiles and drones), a lot of vessels are now going the long way around Africa.

That adds:

• Time (7–14 days, easily)
• Fuel costs
• More ship availability being tied up

And yes, all of that gets passed down to—you guessed it—you.

3. Fuel Prices (Still a Wild Card)

One minute they’re up. Then down. Then suddenly up again because of a refinery fire in some corner of the world no one can pronounce. Fuel isn’t the only cost in shipping, but it’s a big one. And it’s unpredictable. Carriers try to stabilize it with surcharges (hello, BAF—bunker adjustment factor), but in the end, they’ll just tweak the base rates when things get wild. Moral of the story: fuel jumps = your rates jump. Often without warning.

4. Equipment Shortages (Yes, Still)

It feels like this should’ve been fixed by now, right? It’s 2025. But nope—container availability is still a thing.

Depending on where you’re shipping from, you might run into:

• Empty containers in the wrong place
• Broken or outdated equipment
• Chassis shortages at key inland hubs

So even if your goods are ready and the vessel’s at port, you might still be waiting for the literal box. And waiting costs money.

5. Port Congestion & Labor Issues (Old Problems, New Versions)

Remember those days when ships were queued outside LA like it was a Taylor Swift concert?

Well, it’s not that bad now, but congestion hasn’t vanished. It just moved.

Now it’s Rotterdam. Or Singapore. Or sometimes random inland rail terminals where containers just... sit. Because of:

• Labor shortages
• Strikes (still happening in some countries)
• New customs delays
• Just plain inefficiency

So when delays stack up, shipping lines need to recover time somehow—and they often do that by raising prices. (Also: carriers hate inefficiency more than anyone. Every idle day costs them a lot. So guess who pays for it.)

6. Carrier Strategy: Blank Sailings, Alliances & Playing Hard to Get

Here’s the behind-the-scenes part nobody likes to talk about. Carriers have gotten pretty good at managing scarcity. When rates start to fall, they cut sailings. Cancel routes. Reposition vessels somewhere “more profitable.” Sometimes they don’t even need a reason—they just want to stabilize rates. They call it “capacity management.” We call it “creating a bottleneck.” And hey, it works. If fewer ships are sailing, space gets tight. Spot rates go up. Everyone starts to panic-book. Carriers win.

7. Regulatory Shifts & Carbon Costs (The Quiet Price Hike)

Starting in 2024 and accelerating into 2025, new environmental rules kicked in—especially in the EU. Ships have to cut emissions or pay for the right to pollute. It’s called the EU Emissions Trading System, and it’s not cheap. Guess who foots the bill? (Yep, still you.) These changes don’t make headlines, but they quietly add $20–$50—or more—per container, depending on route and vessel type.

So… Is It Ever Going Back Down?

Short answer: not to the levels we saw five years ago. Those were kind of a fluke—too cheap to be sustainable. But rates do go in cycles. You will see dips. Just don’t expect the “normal” to look like it did pre-2020.

The new normal includes:

• Higher base rates
• More volatility
• And the occasional global chaos rerouting entire trade lanes

What Can You Do About It?

A few practical moves:

• Book earlier. The closer you get to the ETD, the less leverage you have.
• Negotiate longer-term rates. If you ship regularly, ask for a fixed contract—even for part of your volume.
• Work with flexible partners. Sometimes rerouting through a different port or adjusting your transit time by a few days can save thousands.
• Ask about fuel and emissions surcharges upfront. Don’t let them sneak in.

And if you’re really stuck, reach out. Seriously. We’ve had clients come to us mid-crisis, and sometimes just a second pair of eyes helps make sense of the madness.

Final Thought

Shipping isn’t just about moving stuff anymore. It’s about navigating a global maze of shifting rules, costs, and random delays. It can be frustrating. Confusing. Occasionally infuriating. But once you know what’s going on—and why—you’re better equipped to deal with it (or at least not be blindsided by the next $500 “adjustment”). And hey—when in doubt, ask questions. The only dumb question in freight? The one you ask after the container’s already sailing.