Situation

Similar to other export corridors from Asia, there is very strong demand for space on this trade lane. An early peak season has begun, driven largely by shippers trying to load more cargo prior to the start of the new contract season and by carriers’ successful capacity management since mid-April. Through strategic blank sailings, carriers have tightened supply, reducing capacity on the Asia to US West Coast route by approximately 18%. This has led to significant space shortages. Now, some shippers on FMC-regulated trades appear to be using intentional delays as a tactic to bypass the usual peak season pattern or fuel surcharges.

Obstacles

Space will remain tight and equipment availability may be an issue, but Transpacific Eastbound trades will probably be prioritized over other trades, especially when bunker surcharges are higher. The upcoming typhoon season will also affect reliability over the next four months.

Outlook

The constrained space situation will continue at least in June and July, despite the relatively modest forecast on this trade. Carriers are expected to manage the supply in order to further increase rates. We also expect that some niche carriers may come back with one or two sailings, especially between Asia and the US West Coast, as soon as the rates reach economically reasonable levels.

Main Ports: Far East to US West Coast

^{Source: Market average rates for 40‘ containers according to www.xeneta.com}

Main Ports: Far East to US East Coast