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Yahoo
6 days ago
- Business
- Yahoo
Carriers Ramp Up Trans-Pacific Capacity on Expected Demand Rally
As importers continue to race for cargo space on the trans-Pacific trade lane, more capacity is kicking back in to capitalize on the demand. According to data from container shipping analysis firm Linerlytica published Monday, the next four weeks are expected to average 560,000 20-foot equivalent units (TEUs) in cargo departing from Asia to the U.S., a 48.5 percent increase over the low of 377,000 TEUs in the first full week of May. More from Sourcing Journal CMA CGM's $600M Vietnam Port Project Reflects 'Sharp' Container Demand Trans-Pacific Cargo Space Vanishing Fast Ahead of Tariff Deadlines LA Port Director Predicts 'Muted' Peak Season Despite Expected Cargo Surge Over the past week, ocean carriers have already injected 5 percent more capacity into the trans-Pacific trade lane for sailings between May 26 and July 28, according to data from Sea-Intelligence. The Port of Long Beach thus far is the primary destination of the uptick in capacity. Gemini Cooperation partners Maersk and Hapag-Lloyd will introduce a new direct trans-Pacific service with a rotation of Xiamen, China; Busan, South Korea; and Long Beach. The first sailing will take place out of Xiamen on June 24. China United Lines is getting back in on the action after exiting the trade lane in summer 2023, launching the Trans Pacific West Coast 1 (TP1) service line starting in Shekou, China and dropping off cargo at the Port of Long Beach. The first service will depart Shekou on June 7 and is scheduled to arrive on June 29. These announcements come after prior revelations from South Korea's KMTC that it would return to the trans-Pacific in June for the first time in 40 years, with the Long Beach port being its lone West Coast stop. Although the dearth of trans-Pacific sailings in May suppressed volumes at California's San Pedro Bay ports and raised concerns about expectations for the peak shipping season, the 90-day easing of tariffs between the U.S. and China has given way to more optimistic forecasts than had been imagined just one month ago. Paul Bingham, director of transportation consulting at S&P Global Market Intelligence, still forecasts the twin ports of Los Angeles and Long Beach to see year-over-year volume growth in 2025. 'It's possible that if many deals are made and you have stability in the trading relationships later on in the second half of the year that volumes would actually be higher than our baseline forecast is right now,' Bingham said during a Tuesday briefing held by the Port of Long Beach. 'We have a forecast where the volume of trade slows—still growing, but growing very slowly compared to last year through the port complex.' S&P Global Market Intelligence does not currently forecast a recession despite the supply chain disruption and geopolitical uncertainty. The benchmarking firm is still baking in falling demand as a potential downside risk, but it would be unlikely to reach the brief early pandemic-level dips when shipments weren't leaving China for the U.S. 'We wouldn't forecast something that would echo that completely, but you could be in a period where the second half of the year sees lower volume than were handled in the first half of the year—very unusually,' Bingham said. Echoing Port of Los Angeles executive director Gene Seroka, Bingham shoved aside any concerns of a redux of pandemic-era port congestion at the ports. 'As far as the congestion fears go, there's none there,' Bingham said. 'Even with the likely surge that's coming right now out of mainland China, which hasn't gotten here yet, it's unlikely that the ports would run into a problem of performance that would divert volumes somewhere else.' If anything, Bingham said the 90-day tariff pause could accelerate some market share gains for the California ports, as they remain the shortest route on the trans-Pacific, and the likely first destination of any eastbound cargo. Port of Long Beach CEO Mario Cordero did not speak directly to congestion, but said there would be a 'slight surge' in cargo headed toward the port system. 'There's a lot of cargo that was held up in China that did not come,' Cordero said. 'If you're a shipper, why would you send your cargo to be subject to a 145-percent tariff? We also know that cargo is going to start coming as we now approach peak season in July.' Vessels have already started to build up on both sides of the Pacific in the wake of the post-tariff delay rush. According to the Drewry Container Capacity Insight service, the number of ships waiting at the Shenzhen port complex increased from 17 to 31 between weeks 16 and 20. During the same period, vessels waiting outside the L.A./L.B. twin ports more than doubled from 17 to 42.
Business Times
27-05-2025
- Business
- Business Times
Asian ports reported to be congested; average waiting time in Singapore is up to 1.5 days
[SINGAPORE] Port congestion has been reported at Asian ports, with Singapore being one of those affected: The waiting time for a berth at the world's top transhipment hub is said to be between 12 and 36 hours. Tan Hua Joo, a box shipping analyst at data provider Linerlytica, told The Business Times that the longer waiting times in Singapore in recent weeks stem from changes in vessel deployments following the United States' imposition of tariffs and delays at upstream ports. He added, however, that congestion in Asia ports is an ongoing issue, not a recent one. Liner Hapag-Lloyd told its customers that, as at May 26, some Asian ports were facing increased waiting times because of congested berths. The Chinese ports of Shanghai and Qingdao are among the worst hit, with the average hold-up ranging from 24 to 72 hours. The average waiting time at China's Ningbo port is between 24 and 36 hours; over at South Korea's Busan and Japan's Yokohama ports, waiting times are 18 hours and between 12 and 24 hours, respectively. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The longer waiting times at Singapore are being caused by vessel bunching and congestion, the liner said. Kuehne+Nagel has similarly described operations in the ports of Singapore and Klang as 'heavily disrupted'. Vessels calling at the Republic's port have had an average waiting time of around 1.82 days over the last seven days, said the freight forwarder in its weekly update. Several vessels are arriving at once, and transshipment cargo is being delayed by a week or two, it said. At Port Klang, congestion in the berths has raised the average vessel waiting time to around 1.46 days, Kuehne+Nagel reported. 'Some vessels can wait up to 2.5 days. Yard congestion is around 90 per cent, reducing productivity.' Data service EconDB numbers point to dwell times for transhipments at the Singapore port averaging 9.5 days as at May 19, against the peak of 10.8 days in late May 2024 and the average of 7.6 days since March 2022. PSA Singapore acknowledged on Tuesday (May 27) that a high concentration of container vessels have arrived in recent weeks. It attributed this to service reconfigurations by shipping lines in response to business changes and global issues. Delays and congestion at other locations have also caused vessels to bunch up in Singapore, a spokesperson for PSA Singapore said. The port authority said it would ensure the optimal turnaround of container vessels to ease the situation with added capacity and resources. Last year, port congestion prompted some liners to skip Singapore after berthing delays at the South-east Asian transhipment hub hit a historic high; this was caused by some operators discharging more containers in the Republic and scrapping subsequent voyages in order to catch up on their next schedules amid forced detours in the Red Sea. Port congestion in Singapore peaked in the second quarter of 2024, Linerlyica's Tan noted. The situation has since eased, but not been fully resolved. The congestion is not expected to hit the critical levels of 2024 because additional capacity has since been added at the Singapore port, he added. Earlier, analysts had cautioned that port congestion in Europe might have a spillover impact on Asian ports. Meanwhile, cargo from places other than mainland China that were given a 90-day reprieve from reciprocal tariffs by the United States have been rushed out of ports since the pause was announced on Apr 9. Mainland China got its truce with the US on May 12, unleashing a wave of shipments, including those had been held back from April to mid-May. Total capacity on the trans-Pacific route – primarily from Asia to the US – is set to rebound sharply in the coming four weeks, with an average of over 560,000 twenty-foot-equivalent units (TEUs, a measure of freight capacity) departing from Asia to the US weekly. This is about 50 per cent more than in the previous fortnight. The higher supply is expected to rein in the rise in freight rates for the trans-Pacific trade lanes, after the US-China trade detente arrested the decline in the shipping costs.
South China Morning Post
13-05-2025
- Business
- South China Morning Post
Shipping demand set to explode as firms rush to exploit US-China tariff pause
Transpacific shipping routes are set to witness a dramatic uptick in container traffic over the coming weeks, as businesses rush to front-load shipments to take advantage of a temporary reduction in US and Chinese tariffs, analysts said. The 90-day truce announced by China and the United States on Monday is expected to trigger an immediate surge in demand for container shipping, with some analysts warning the increase in shipments could be so large that it creates bottlenecks at American ports. The de-escalation of the trade war came earlier than many expected, container shipping intelligence firm Linerlytica said in a note on Monday, which is 'setting the stage for a surge in transpacific cargo volumes in the next three months'. The wave of demand will be even more intense due to the fact that many companies already have significant backlogs of goods ready to ship, with US importers adopting a 'wait-and-see' strategy in recent weeks as they watched for any potential move to roll back tariffs, said Lars Jensen, the founder of Vespucci Maritime, in an online post. Following trade talks in Switzerland over the weekend, the US has agreed to reduce its recently imposed tariffs on Chinese imports from 145 per cent to 30 per cent, with 91 percentage points of those tariffs scrapped and 24 percentage points suspended for a period of 90 days. China, in turn, has agreed to cut its retaliatory tariffs on US imports from 125 per cent to 10 per cent. The deal will come into effect on Wednesday.
Yahoo
09-05-2025
- Business
- Yahoo
Maersk Expects No Cost Impact From Port Fees, Assures ‘Unchanged' Service
U.S. port docking fees may have spooked the container shipping industry and the retail industry alike, among many others, before they were finalized in mid-April. But Maersk is brushing the concerns aide, assuring its customers it won't see any direct impacts. 'At this time, we do not see a direct cost from this initiative impacting Maersk or our customers,' said the ocean carrier in a customer advisory Thursday. 'We do not anticipate changes to our U.S. port rotations due to the new fees. Your current service plans remain unchanged.' More from Sourcing Journal India-Pakistan Port Bans Trigger Delays, Rate Hikes and Capacity Crunch Maersk Cuts 2025 Container Outlook: China Capacity 'Not Available Elsewhere' Vietnam-to-US Exports, Freight Rates Soar on Tariff Drama Maersk, which moves product for retail giants including Walmart, Target, Nike and Gap, Inc., is seeking to quell concerns that range from higher container prices to fewer port calls and lengthier delivery times. Starting Oct. 14, fees on Chinese-owned and -operated ships will be based on net tonnage per U.S. voyage, and will be set at $50 per net ton. From there, an extra $30 per net ton will be tacked on each year through 2028. But Chinese-built ships owned by non-Chinese companies, which Maersk falls under, will be charged $18 per net ton, with annual fee increases of $5 over the same period. The penalties were levied by the U.S. Trade Representative (USTR) after it ruled that China had an 'unreasonable' state-subsidized dominance of the maritime, logistics and shipbuilding sectors, concluding a nine-month long investigation. Of the major non-Chinese ocean carriers, Maersk had the most U.S. calls using Chinese-built vessels. Out of a total of 214 Maersk ships sailing to U.S. ports, 38 were built in China, ahead of ZIM's 37, CMA CGM's 36 and MSC's 34, according to data from Alphaliner. But the container shipping firm's wider fleet of 737 ships, along with its vessel-sharing alliance with Hapag-Lloyd, will likely ensure that the company can more easily switch USTR-compliant ships in to call at U.S. ports once the fees go into effect. Across the industry, only 20 percent of the current fleet of container ships calling at U.S. ports would be affected. Those vessels are expected to be swapped with exempt ships over the next six months, according to an April 21 blog from container shipping analysis firm Linerlytica. 'All of the main carriers have sufficient exempt ships available to make the switch without severe operational disruptions,' said Linerlytica. As the Maersk-Hapag Lloyd Gemini Cooperation further phases in, schedule reliability has remained a top priority for both carriers as they call at fewer ports. In March, Gemini recorded a 90.3 percent schedule reliability across all alliance port calls, according to Sea-Intelligence. This marked the second month in a row the carriers have adhered to their 90-percent reliability goal the companies set when they entered the alliance last year. In a Thursday earnings call, CEO Vincent Clerc said the modularization of the Gemini network has enabled the companies to cater to the lower China-to-U.S. demand without resorting to blank sailings—a forward-looking indicator of its ability to shift Chinese-built ships out of rotation before docking at American ports. 'So you have an 8,000-20-foot equivalent unit (TEU) ship, and the demand drops by 40 percent—you swap the 8,000 with a 6,000-TEU ship that helps soften that,' Clerc said. 'Then you deploy your 8,000-TEU ship in another trade where the 6,000 was before and where there is better demand and where you can get better asset utilization going forward…But I want to be clear on the fact that we are managing capacity down to demand. We'll continue to do that, and we're doing it as aggressively as any other alliance.' The revised port fees will have the biggest impact on Chinese carriers like Cosco Shipping and its subsidiary Orient Overseas Container Line (OOCL), with the former calling the penalties 'discriminatory.' The two carriers made over 1,300 U.S. port calls in the 12 months through March, according to data from S&P Global Market Intelligence. This throws some wrenches into the plans of the Ocean Alliance, which is the shared network that also consists of CMA CGM and Evergreen. Those two carriers are likely to have a bigger presence on the trans-Pacific trade lane in place of Cosco and OOCL as the fees kick in. While a shift in which vessels use certain service loops will prevent the company from having to pay fines, it would still put the wider alliance in a more precarious position to ensure service levels are not negatively affected.
Yahoo
09-05-2025
- Business
- Yahoo
Maersk Expects No Cost Impact From Port Fees, Assures ‘Unchanged' Service
U.S. port docking fees may have spooked the container shipping industry and the retail industry alike, among many others, before they were finalized in mid-April. But Maersk is brushing the concerns aide, assuring its customers it won't see any direct impacts. 'At this time, we do not see a direct cost from this initiative impacting Maersk or our customers,' said the ocean carrier in a customer advisory Thursday. 'We do not anticipate changes to our U.S. port rotations due to the new fees. Your current service plans remain unchanged.' More from Sourcing Journal India-Pakistan Port Bans Trigger Delays, Rate Hikes and Capacity Crunch Maersk Cuts 2025 Container Outlook: China Capacity 'Not Available Elsewhere' Vietnam-to-US Exports, Freight Rates Soar on Tariff Drama Maersk, which moves product for retail giants including Walmart, Target, Nike and Gap, Inc., is seeking to quell concerns that range from higher container prices to fewer port calls and lengthier delivery times. Starting Oct. 14, fees on Chinese-owned and -operated ships will be based on net tonnage per U.S. voyage, and will be set at $50 per net ton. From there, an extra $30 per net ton will be tacked on each year through 2028. But Chinese-built ships owned by non-Chinese companies, which Maersk falls under, will be charged $18 per net ton, with annual fee increases of $5 over the same period. The penalties were levied by the U.S. Trade Representative (USTR) after it ruled that China had an 'unreasonable' state-subsidized dominance of the maritime, logistics and shipbuilding sectors, concluding a nine-month long investigation. Of the major non-Chinese ocean carriers, Maersk had the most U.S. calls using Chinese-built vessels. Out of a total of 214 Maersk ships sailing to U.S. ports, 38 were built in China, ahead of ZIM's 37, CMA CGM's 36 and MSC's 34, according to data from Alphaliner. But the container shipping firm's wider fleet of 737 ships, along with its vessel-sharing alliance with Hapag-Lloyd, will likely ensure that the company can more easily switch USTR-compliant ships in to call at U.S. ports once the fees go into effect. Across the industry, only 20 percent of the current fleet of container ships calling at U.S. ports would be affected. Those vessels are expected to be swapped with exempt ships over the next six months, according to an April 21 blog from container shipping analysis firm Linerlytica. 'All of the main carriers have sufficient exempt ships available to make the switch without severe operational disruptions,' said Linerlytica. As the Maersk-Hapag Lloyd Gemini Cooperation further phases in, schedule reliability has remained a top priority for both carriers as they call at fewer ports. In March, Gemini recorded a 90.3 percent schedule reliability across all alliance port calls, according to Sea-Intelligence. This marked the second month in a row the carriers have adhered to their 90-percent reliability goal the companies set when they entered the alliance last year. In a Thursday earnings call, CEO Vincent Clerc said the modularization of the Gemini network has enabled the companies to cater to the lower China-to-U.S. demand without resorting to blank sailings—a forward-looking indicator of its ability to shift Chinese-built ships out of rotation before docking at American ports. 'So you have an 8,000-20-foot equivalent unit (TEU) ship, and the demand drops by 40 percent—you swap the 8,000 with a 6,000-TEU ship that helps soften that,' Clerc said. 'Then you deploy your 8,000-TEU ship in another trade where the 6,000 was before and where there is better demand and where you can get better asset utilization going forward…But I want to be clear on the fact that we are managing capacity down to demand. We'll continue to do that, and we're doing it as aggressively as any other alliance.' The revised port fees will have the biggest impact on Chinese carriers like Cosco Shipping and its subsidiary Orient Overseas Container Line (OOCL), with the former calling the penalties 'discriminatory.' The two carriers made over 1,300 U.S. port calls in the 12 months through March, according to data from S&P Global Market Intelligence. This throws some wrenches into the plans of the Ocean Alliance, which is the shared network that also consists of CMA CGM and Evergreen. Those two carriers are likely to have a bigger presence on the trans-Pacific trade lane in place of Cosco and OOCL as the fees kick in. While a shift in which vessels use certain service loops will prevent the company from having to pay fines, it would still put the wider alliance in a more precarious position to ensure service levels are not negatively affected. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
