Container Shipping Quarterly
Special Report
trans-Pacific trades in 2024 when spot and freight-allkinds( FAK) rates surged as high as $ 7,800 per FEU to the US West Coast and $ 10,000 per FEU to the East Coast, according to PIERS, a Journal of Commerce sister product within S & P Global.
Niche carriers account for about 4.5 % of total capacity on the trans-Pacific trade to the West Coast, about the same percentage in the post-COVID-19 import surge in 2021 – 22, Alan Murphy, CEO of Sea-Intelligence Maritime Analysis, said in the firm’ s Sunday Spotlight newsletter.
“ The niche carriers, like all lines, have fixed costs.”
While that market share is not enough to prevent a further slide in spot rates, the continued presence of the niche lines in the trans-Pacific indicates they are not just“ opportunistic” carriers that came into the trade when spot rates were high and plan to leave if rates drop too low, he said.“ These carriers are seemingly staying on the trade lane... and it seems as if they are continuing to introduce capacity on the trade lane,” Murphy said.
Given the volatile nature of the trans-Pacific market so far this year, with major rate spikes in January and June followed by plunging prices in subsequent months, the niche lines apparently have ample cash on hand to weather the current downturn. Average spot rates from Asia to the US West Coast as measured by Platts, a sister product of the Journal of Commerce within S & P Global, fell as low as $ 1,400 per FEU in late September; Drewry pegged the Shanghai – Los Angeles rate at $ 2,561 per FEU.
“ Pulling the plug is a tough decision because the money, when available, was so lucrative there’ s the hope such margins will return,” said Stephen Nothdurft, vice president of sales at the forwarder MOL Consolidation Service.
“ It seems the current operators are taking a hard look at their commitments and calculating a longer-term strategy,” he said.“ Maybe the new normal is continued chaos, so the smaller players are staying in place, building a viable clientele, [ and ] preparing to pounce when another catastrophe hits the liner market.”
Still, if spot / FAK rates continue to drift below $ 1,500 to the West Coast, and possibly lower, some niche lines will find it difficult to sustain the losses for very long, an executive at an alliance carrier told the Journal of Commerce.
“ Even with an upcharge of $ 500- $ 600 [ per FEU ], it’ s not going to be enough,” said the executive, who did not want to be identified.“ The niche carriers, like all lines, have fixed costs such as bunker fuel, port fees and crew costs.”
The source said $ 2,000 per FEU is the breakeven spot for most carriers’ West Coast business, adding their presence on the eastbound trans-Pacific“ can’ t last forever.”
The challenge these carriers face is that rates are also depressed in the intra-Asia trade, and the small vessels they deploy in the range of 3,000-TEU capacity are not suited for the long-distance Asia-Europe trades, he said.
email: bill. mongelluzzo @ spglobal. com email: laura. robb @ spglobal. com
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20 Journal of Commerce | October 6, 2025 www. joc. com