Freight Rates Explained: Data, Volatility, and Demand

Container freight rates are no longer governed purely by the traditional supply and demand factors, but increasingly by geopolitical shocks and the speed at which information moves through the market, according to Freightos chief strategy officer Ian Arroyo.

While supply and demand remain the “macroeconomic base” for pricing, Mr Arroyo told news outlets at Manifest 2026 that the volatility seen since January 2020 had fundamentally altered how rates are formed.

“Supply and demand should be what governs pricing,” he said.

“However, supply and demand isn’t the only thing anymore, because you’ve got supply chain shocks that can happen at any given moment that you and I can’t predict. And most of that is geopolitical.”

He pointed to the scale of disruption over the past six years as historically unprecedented, adding: “If you look historically backwards… and then you look at January 2020 to today, I mean, it’s unprecedented, right?

“Now, rates are far and away more volatile than they ever were before.”
According to Mr Arroyo, the difference is not only the frequency of shocks – from pandemics to tariffs and weather – but also the way markets now absorb information.

“Twenty years ago, people didn’t have the same access to data they have today. News didn’t travel as fast,” he said. “The fact that data is instantaneous and consumable by… a billion people in almost real time means that creates market dynamics in and of itself.”

He explained that that real-time consumption of information could move markets before underlying supply or demand fundamentals had materially shifted.

“What’s happening now is you’re seeing supply and demand become a base… but then real-time consumption of data can be, and is, making changes to supply and demand in almost real time.

“The geopolitical side of that is the part that’s got everybody jumpy,” he added.

Tariff announcements, sudden policy shifts or disruptions in key transhipment hubs can quickly alter demand patterns, trigger blanked sailings or capacity withdrawals, and push rates up or down.

Indeed, Seko Logistics’ CCO, Brian Bourke, informed news outlets that the IEEPA tariffs being ruled unconstitutional could trigger a surge in volumes “for people that are looking to maybe beat the clock for whatever new tariff provisions are going to be coming down the line”.

“They might be rethinking their POs [purchase orders] because there’s an assumption of a cash infusion. So that could create a surge in demand,” he explained, and added that this would subsequently have a knock-on effect on rates.

Volatility and real-time data continue to play a crucial role in shaping supply and demand dynamics across the freight market. As market conditions shift, companies that leverage accurate data insights can better anticipate rate movements and adjust their logistics strategies accordingly. In an increasingly unpredictable environment, informed decision-making remains key to maintaining efficiency and competitiveness in freight operations.

Source: Volatility and data in supply and demand