Midyear Container Shipping Report: Analyzing the Peak Season

The intensity of the early peak season on the trans-Pacific trade could drain the rest of volumes in the second half, or the shipping industry might surprise. US imports from Asia in May jumped to 1.68 million TEUs, up 13% from April, almost 20% higher year over year, and the highest since last August, according to PIERS. The National Retail Federation (NRF) has upgraded its forecast for June imports, confirming that the peak shipping season has come early this year. But the NRF says that spike is expected to be short-lived, with the group lowering its prior forecast for imports landing through the rest of the summer and into early fall. In the meantime, large and midsize retailers in the US face the possibility of having their newly agreed service contract rates more than double this summer due to increased bunker fuel costs and hefty peak season surcharges. Last summer, US imports from Asia climbed rapidly in June, peaked in July and then fell just as quickly as they rose. Comparing the current environment to last summer isn’t a good guide, however, as to what to expect this year. The fundamental difference is that growth last summer was confined to the US, so carriers were able to redeploy vessels from other trade lanes to the trans-Pacific. That’s why the price spikes lasted only two months. This year, demand is also strong and rates are moving higher in the Asia-Europe, Asia-Mediterranean and South American trades, and that is limiting the capacity and equipment that can be deployed into the trans-Pacific