Container Shipping Quarterly

Special Report

Strong demand , fewer blanks extend trans-Pacific peak season

By Bill Mongelluzzo and Laura Robb

Trans-Pacific carriers blanking fewer sailings in November

Asia – US West Coast container ship capacity , deployed and blanked , with forecast

TEU capacity

990.8k 1M

500k -500k

0

-500k

L

An extended peak season on the eastbound trans-Pacific is manifesting in unusual strength in imports from Asia , coming as carriers signal atypically low blank sailings for November and seek higher rates .

Volumes of imports from Asia , which typically taper off ahead of Black Friday sales , is holding steady , fueled by resilient retail sales , tariff concerns and the mid-January expiration of the tentative labor agreement at US East and Gulf coast ports .

Carriers are expected to blank 5.4 % of total capacity from Asia to the US West Coast and 8.1 % to the East Coast in November , according to data from maritime intelligence firm eeSea . That ’ s down from the 11.5 % of available capacity blanked from Asia to both coasts in November 2023 .

Skipped sailings in November are also down sharply from the 16 % of available capacity to the West Coast and 21 % to the East Coast blanked in October , according to the eeSea data .

Trans-Pacific spot rates tick up from October lows

Container spot rates from North Asia to US West and East coasts , in USD per FEU

USD per FEU

$ 10,000

$ 8,000 $ 6,935 $ $ 10,000 6,000

L

$ 4,000

$ 2,000

“ What we are seeing is a fairly robust November .”

$ 0

Source : Platts , S & P Global

L Jan 2023 Jul Jan 2024 Jul

North Asia to US East Coast North Asia to US West Coast

Oct , 2024

© 2024 S & P Global

“ What we are seeing is a fairly robust November ,” a carrier executive who asked not to be identified told the Journal of Commerce in late October . “ For four weeks out , bookings look strong .”

And that is keeping rates afloat and far higher than where they were a year ago .

The spot / freight-all-kinds ( FAK ) rate from Asia to the US West Coast as of Nov . 1 was $ 4,450 per FEU , up 147.2 % year over year , according to Platts , a sister product of the Journal of Commerce within S & P Global . The Asia – US East Coast rate of $ 4,780 per FEU was up 107.8 % from the same week in November 2023 .

Despite the elevated rates , carriers are notifying forwarders of general rate increases ( GRIs ) of about $ 500 to $ 600 per FEU they will attempt to pass on starting Nov . 1 . Normally , spot and FAK rates drop in the final two months of the year after holiday merchandise has been shipped from Asia .

Peak season demand and vessel load factors have been strong this summer and fall . US imports from Asia in September totaled 1.72 million TEUs , up 16.7 % year

www . joc . com over year and hovering near a two-year high , according to PIERS , a sister product of the Journal of Commerce within S & P Global .

‘ Surprising ’ demand

Forwarders and carriers say import volumes have remained robust in October .

“ I think carriers are surprised at how full they were in October ,” said Rachel Shames , vice president of pricing and procurement at the forwarder CV International .

The National Retail Federation ’ s Global Port Tracker has forecast a year-over-year increase of 3.1 % in US imports in October .

“ Ships are full , especially to the West Coast ,” said a second US-based carrier executive .

Forwarders attribute the strong volumes to the frontloading of shipments to East and Gulf coast ports ahead of a possible second strike by the International Longshoremen ’ s Association ( ILA ) when its extended contract expires

November 18 , 2024 | Journal of Commerce 21