Carriers’ strong capacity growth and low blank sailings indicate optimism for the peak season on the Asia-North America West Coast trade route, reports Sea-Intelligence.
The firm noted that examining the levels of blank sailings and capacity deployment planned by the carriers for the remainder of the third quarter can give a good indication of their confidence in the 2024 peak season.
Figure 1 depicts the proportion of blanked capacity scheduled for the remainder of the peak season (weeks 29-39), for the two most major East/West trades: Asia-North America West Coast and Asia-North Europe.
READ: Carriers’ low rates fail to gain shippers’ loyalty
Carriers on the Asia-North America West Coast have planned to blackout 3.9 per cent of total capacity, which is comparable to the pre-pandemic average of 2020.
It is, however, substantially lower than in the pandemic years (when blank sailings were required owing to port congestion).
Capacity increase during the same weeks in 2024 is expected to be 24.6 per cent higher than in 2023, and 10.2 per cent higher than in 2020 (when peak capacity was deployed in terms of TEU).
Sea-Intelligence highlighted that due to the substantial capacity expansion and the relatively low blank sailings level, carriers are seemingly optimistic about the peak season on this trade path.
Blanked capacity in Asia-North Europe is expected to be 5.9 per cent during the next 11 weeks, which is only slightly higher than 2020 and the pre-pandemic norm, while the difference from 2020 is not significant. In 2024, there is no year-on-year (YoY) increase in deployed capacity.
READ: Global schedule reliability reaches highest 2024 figure
However, in 2023, YoY capacity growth on the trade was 13.1 per cent, which was not only excessive in comparison to historical reference points, but also too high for the trade’s demand levels (as demonstrated by declining freight rates).
Alan Murphy, CEO of Sea Intelligence, explained: “The fact that carriers are willing to maintain that level of elevated capacity on Asia-North Europe in 2024, coupled with the relatively low level of blank sailings, indicates the carriers have a confident strong outlook for the peak season on Asia-North Europe.”