After April imposed a series of temporary cuts to trans-Pacific ship services to boost spot rates, ocean shipping companies backed down in May with smaller cuts and adopted a more conventional model, switching weekly service to two-week service.
According to Jon Monroe Consulting's blank navigation data and shipping company's May 18th to 22nd week schedule analysis, shipping companies canceled 32 trans-Pacific voyages per week, and these voyages accounted for 285,655 TEUs of ship space.
By contrast, in April's 13th to 17th weeks, 46 flights were canceled, accounting for 416,350 TEUs.
As a result of these service shifts, rates appear to have found their bottom line, although until demand becomes stronger, they are not expected to see significant upside.
James Caradonna, vice president of MCL Multi Container Line, said that as capacity was cut, ocean carriers made a general rate increase (GRls) for trans-Pacific services, which took effect in April. These factors prompted shippers to book more cabins, contributing to higher utilization of ships heading to the U.S. West Coast in April, pushing Asian imports in April to their highest level since October 2022. But due to the reduction of space sailing in May, utilization rate 7 also decreased.
Caradonna said ocean shipping lines appear to have moved into a more regular pattern of eliminating every other flight from weekly service rather than randomly cutting service as they did in April.
"Stable production capacity"
due to better demand for the U.S. Gulf Coast than other coasts, shipping services have been cut less. But in the West Coast service, Caradon na mentioned the Alliance PS4 service and 2M TP2/Jaguar service. Caradonna said that on the east coast, COSCO's AWE7 service is effective every two weeks from April to May, while the Alliance's EC4 service is effective from April to May.
with the current capacity deployment, operators have been able to prevent further declines in spot rates, helping them to at least approach break-even levels. Over the past two months, the capacity of shipping companies has more or less stabilized.
Vespucci Maritime's Lars Jensen said that since the April GRIs were released, the spot exchange rate has been at a "standstill".
Drewry's Shanghai to Los Angeles World Containers Index was unchanged over the past month at $1,823 per FEU as of May 18, compared to $1,856 per FEU shortly after the GRls went into effect in April. On May 18, the freight rate from Shanghai to New York was assessed at US $2,825/FEU, compared with US $2.849/FEU before the April GRIs.
's other forecasts for the second half of 2023 are also mixed. By late June and early July, Caradonna expect trans-Pacific shipments to pick up as shippers bring in year-end holiday merchandise.
However, Marine Intelligence Maritime Analytics's Alan Murphy said the process of cleaning up U.S. inventories is "slow" and inventory levels are "stagnant and certainly not going down", so the upcoming 2023 peak season may not happen.
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