Transpac carriers may have the advantage as contract season looms

Transpacific ocean carriers are holding on to as much of their Red Sea crisis-induced gains as they can, heading into contract talks with BCOs, shippers and forwarders.

Drewry’s WCI Asia-US west coast container spot rate component was flat this week, at an average rate of $4,754 per 40ft, and remains some 140% higher than at the beginning of December.

Rates on the tradelane are being supported by strong US consumer demand, which saw import volumes at the San Pedro Bay ports of Los Angeles and Long Beach spike in January, year on year, by 19% and 23%, respectively.

Moreover, carriers have been judicious with their capacity management in and around Chinese New Year, blanking sailings and allowing other voyages to ‘slide’.

According to Simon Heaney, senior manager container research at Drewry, “it can be claimed as a success story for carriers”.

He added: “The timing of the market resurgence couldn’t have been better for lines, with the annual contracting season fast approaching.”

Indeed, carriers will be on the front foot this year at the JOC TPM conference in early March, the traditional starting point for the annual transpacific contract negotiations.