Ryan Petersen, as CEO of the freight forwarder Flexport, sees a constant flow of shipping prices every day. But two weeks ago, he heard a number that stopped him short:

$150.

That’s a spot rate offered by an unnamed Chinese carrier to ship 20-foot containers from Shenzhen to Rotterdam. That may seem low to the layman, and Petersen can confirm:

“It’s mind-blowingly cheap.”

Cheaper than a fancy dinner. Cheaper than a new phone.

“It’s probably the lowest shipping has been in the history of planet Earth.”

Though the trough has since ticked back up slightly, the ocean freight market as a whole is still at a historic low, thanks in part to aggressive moves by Chinese shipping companies. In fact, rates are so far beyond cheap that the best bargains are almost certainly below shippers’ fuel and manpower costs.

The aggressive moves come as China’s COSCO and CSCL shippers are merging, set to become the world’s fourth largest container operator.

They also come with a dose of irony. Maersk and the other biggest shippers have been pushing prices down aggressively for years, says Petersen, to weaken smaller, less efficient competitors. Post-consolidation, the big boys theoretically would be able to raise rates.

But to have the Chinese undercut them now could threaten the big shippers’ strategy—especially because the merged Chinese megashipper, like its predecessors, will be state-owned. Loss-inducing or zero-profit rates could be sustainable for them, if the Chinese government decides it’s a worthwhile investment to goose Chinese exports. Even a behemoth like Maersk could end up humbled.

“You’re not bigger than the Chinese government,” says Petersen. “You can’t go deeper than them.”

Maersk in particular is already on its back heel, because of both falling global demand, and self-reinforcing industry trends towards overcapacity. But the real headaches are going to be for smaller shippers, who have less price flexibility. Other big losers in the crunch could be air freight services, as industry tracker Drewry says the gap between air and ocean rates hit record levels this year.

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