 |
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Some Elements of U.S.-Switzerland-Liechtenstein Framework Take Effect: The U.S. has implemented certain duty modifications established in the previously announced joint trade framework with Switzerland and Liechtenstein, applicable retroactive to November 14, 2025. Key provisions include: |
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Goods originating from Switzerland or Liechtenstein are subject to a minimum U.S. tariff of 15%: the higher of either the U.S. most-favored-nation (MFN) tariff rate or a 15% rate composed of the MFN tariff and a reciprocal tariff. |
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The U.S. has adjusted tariff rates on some imports from Switzerland and Liechtenstein, including certain agricultural goods, unavailable natural resources, aircraft and aircraft parts, and generic pharmaceuticals and their ingredients. |
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If the three nations do not finalize a full trade agreement by March 31, 2026, the U.S. intends to review and reconsider these duty modifications. |
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EU Announces Upcoming Duties and Fees for Low-Value Parcels: Following last month’s announcement on the upcoming end of its €150 duty-free threshold, the EU has announced specific duties and fees for low-value parcels: a €3 customs duty will take effect in July of 2026, and a separate handling fee will take effect in November of 2026. |
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On top of these bloc-wide fees, several individual EU member states intend to introduce their own handling fees for low-value parcels. The Netherlands will introduce a national handling fee sometime after February 1, 2026, while other states may introduce fees earlier in the year. The Dutch government is currently coordinating with other EU states to avoid a “waterbed effect,” or a situation in which trade shifts to countries with delayed implementation. |
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Check out our blog to learn more, including other upcoming changes in the EU and potential impacts on ecommerce businesses. |
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U.S. and Mexico Reach Agreement on Water Obligations: On December 12, the U.S. and Mexico reached an agreement on obligations related to the 1944 Water Treaty, a long-standing arrangement that regulates the cross-border allocation of water from the Rio Grande and the Colorado River. |
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Citing negative impacts on American farmers and Mexico’s apparent violation of the cross-border water treaty, President Trump had previously indicated plans to impose an additional 5% duty on Mexican goods if Mexico did not release 200,000 acre-feet of water to the U.S. before the end of the year. |
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Per the agreement reached on December 12, Mexico has agreed to release a total of 202,000 acre-feet of water, commencing deliveries earlier this week. The two nations will finalize a comprehensive plan by the end of January of 2026. |
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Upcoming Duties on Nicaragua: On December 10, the U.S. Trade Representative (USTR) announced an upcoming 10% Section 301 tariff on Nicaragua, which will take effect on January 1, 2027, and increase to 15% on January 1, 2028. |
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Goods that qualify for Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR) treatment will be exempt from the upcoming duty. |
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The upcoming tariff will stack on top of other applicable tariffs, including MFN rates and the existing 18% reciprocal tariff on Nicaraguan goods. |
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Earlier this year, the USTR concluded a Section 301 probe into Nicaragua, finding that labor rights and the rule of law in Nicaragua “burden or restrict U.S. commerce.” |
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A Potential United States-Mexico-Canada Agreement (USMCA) Overhaul: On December 10, U.S. Trade Representative Jamieson Greer stated that the U.S. may attempt to overhaul some aspects of the USMCA next year, during the first joint review of the agreement in July. Greer indicated that the U.S. will specifically focus on re-negotiating rules of origin for non-automobile products. |
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According to Greer, the U.S. was particularly focused on domestic auto production when negotiating rules of origin ahead of the initial launch of the USMCA in 2018. With those rules of origin for autos in effect, and given the introduction of Section 232 auto tariffs this year, the Trump administration is now looking to prioritize U.S. production in other sectors by taking a “similar approach” to non-auto rules of origin. |
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Other Recent Developments: |
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In January of 2026, the Mexican government will implement tariffs of up to 50% on China and a number of other nations without a trade agreement with Mexico. Mexico’s upcoming duties will significantly impact Chinese auto exports in particular, with 20% of all cars sold in Mexico last month originating from China. |
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The trade agreement that the U.S. and Indonesia struck in July is undergoing ongoing negotiation, given a lack of agreement between the two nations on certain binding terms. Specifically, U.S. trade officials indicated that Indonesia is “backtracking” on its earlier commitment to eliminating non-tariff barriers on U.S. industrial and agricultural exports, as well as barriers to digital trade. |
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On December 8, President Trump stated that he may impose “severe tariffs” on Canadian fertilizer products in an attempt to bolster U.S. production. Canada is the U.S.’s largest supplier of potash, a potassium-based fertilizer. Currently subject to a 10% duty rate, Canadian-origin potash has accounted for more than 80% of all potash imported into the U.S. since 2020. |
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Find the latest tariff and trade developments on our live blog. |
TRANS-PACIFIC EASTBOUND (TPEB)
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Capacity levels remain relatively high, stabilized at 80-87% for the remainder of December and into January. |
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Demand remains stable. Volumes have slightly increased, especially on the Pacific Southwest (PSW) gateway. |
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The December 15 General Rate Increase (GRI) is holding. |
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The Peak Season Surcharge (PSS) remains postponed until January. |
FAR EAST WESTBOUND (FEWB)
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Bookings have accelerated as clients race to ship cargo before the full implementation of carbon taxation next year. This urgency is compounded by a rush to move goods ahead of Chinese New Year, resulting in increased demand and fully utilized space. |
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Operational efficiency across Northern Europe has not improved due to a combination of factors. Severe winter weather in the English Channel and the Bay of Biscay is forcing vessel slowdowns. Meanwhile, major hubs like Rotterdam face critical yard density (80-85%), while nationwide strikes in France and labor disputes in Germany have resulted in delays. This combination is slowing vessel and container turnover, driving knock-on impacts on the Far East. |
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Effective capacity remains tight. To prevent theoretical oversupply from transferring into available space and to maintain vessel utilization, carriers are aggressively managing supply through strategic blank sailings, canceling ~9% of capacity for December and January. |
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Earlier market trends remain firm with upward momentum. Major carriers have successfully established a new, higher rate floor for the second half of December; high utilization levels related to ongoing operational disruptions have pushed the market to accept these increased rates. The Shanghai Containerized Freight Index (SCFI) has stabilized at elevated levels, indicating that the late December Freight All Kinds (FAK) rate increases have successfully taken hold. |
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The rate outlook for January is aggressive. Given tight capacity and the pressure of the pre-holiday rush, carriers are announcing further rate hikes for January to elevate the market to a significantly higher baseline than December levels. |
TRANS-ATLANTIC WESTBOUND (TAWB)
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North Europe and West Mediterranean: Given weak demand, carriers are gradually easing rates while managing capacity (5–10% of sailings blanked in December). |
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East Mediterranean: Demand is firmer, supporting planned General Rate Increases (GRIs) and Peak Season Surcharges (PSSs) on January 1, 2026. |
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Critical container and chassis shortages persist, especially in Austria, Slovakia, Hungary, Southern and Eastern Germany, and Portugal. This has led to ongoing delays. |
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North Europe and West Mediterranean: Given weak demand and high capacity, rates remain stable, with no basis for a PSS or GRI. |
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East Mediterranean: Strong demand has prompted carriers to apply PSSs, GRIs, and emergency operation surcharges (EOSs) in January of 2026. |
INDIAN SUBCONTINENT TO NORTH AMERICA
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Supply continues to outstrip demand on routes from the Indian subcontinent to the U.S., related to August’s tariff escalation. A U.S.-India trade deal framework is reportedly progressing toward agreement, and may result in increased demand if finalized and confirmed. |
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Activity remains positive from other countries in the region, such as Pakistan, Bangladesh, and Sri Lanka. |
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To the U.S. East Coast: Blank sailings are ongoing. |
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To the U.S. West Coast: Capacity remains available, given supply dynamics on the TPEB into the U.S. West Coast. |
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To the U.S. East Coast: Heading into the back half of the month, rates are holding steady as is. |
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To the U.S. West Coast: August’s tariff increases and oversupply on core TPEB lanes continue to maintain low rate levels. |
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The TPEB market reached its highest rate levels of the year last week, supported by strong demand in both general cargo and ecommerce. |
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However, market dynamics are shifting as the holiday period approaches. Demand is now decreasing daily, signaling the end of the peak season surge. As market activity cools heading into the end of the year, a gradual decline in rates is expected to begin this week. |
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Peak season pressures are easing, though some backlog remains in the market. |
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Rates have begun to soften and are expected to decline further in the coming week, reducing strain on both pricing and available capacity. With the peak now subsiding, discounts and more flexible schedule options are anticipated toward late December. |
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Market rates are likely to remain elevated through the end of the year, driven by sustained demand for technology-related cargo. |
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High-volume shipments continue to support strong utilization across major long-haul routes. |
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Northern region: Demand remains firm, with limited space on connecting flights via key regional hubs. Transit times remain extended, and some carriers are limiting express cargo acceptance due to backlogs. Shippers are encouraged to book at least one week in advance. |
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Southern region: Demand has eased slightly. However, space availability remains constrained, particularly on routes to the U.S. West Coast. Shippers are encouraged to book at least one week in advance. |
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Demand continues to increase, driving higher rates on major trade lanes. |
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Limited capacity and connectivity constraints have extended booking lead times to roughly 10 to 12 days in advance. |
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Current rate levels remain elevated for both TPEB and FEWB routes. |
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Market conditions remain stable compared to the previous week, with a gradual easing anticipated toward the end of the year. |
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As seasonal demand trends moderate, rates continue to hold within previous ranges across U.S. and European destinations. |
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Congestion across key export lanes has resulted in transit delays of 5 to 8 days on most routes. |
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Tight capacity has pushed rates higher, while currency fluctuations have added pressure to export costs. Forwarders expect improved flight connectivity after the third week of December. |
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Shippers should plan bookings at least 10 days ahead of cargo readiness to secure lift and minimize further disruptions. |
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Demand on routes to North America and Europe remains exceptionally strong, with limited capacity driving continued rate pressure. |
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Backlogs at major airports have resulted in transit delays of about one week. |
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Currently, only limited express capacity is available. Shippers are encouraged to book at least 10 days in advance to maintain service reliability through the year-end period. |
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Efforts to clear accumulated backlogs at major terminals have resulted in gradual progress, with the situation expected to improve further in the coming week. |
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Local demand remains robust, but should begin to ease as the year closes. |
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Space on TPEB and FEWB routes remains tight, but may loosen slightly toward the end of December. |
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Rate levels have remained steady over the past week. |
(Source: Flexport)
Please reach out to your account representative for details on any impacts on your shipments.
Transit time decreased from China to the U.S. West Coast and China to North Europe, and increased from China to the U.S. East Coast.
Week to December 15, 2025
Transit time decreased from 34.9 to 32.6 days from China to the U.S. West Coast; increased from 52.5 to 61.7 days from China to the U.S. East Coast; and decreased from 60.8 to 54.2 days from China to North Europe.
Stay in the loop—read past newsletters here. For more information, connect with one of our logistics experts here.
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