To Our Valued Customers:


Market Conditions – Impacts from all of the late April and May blank sailings are now evident in the market place as rollovers and booking delays have exploded since last week. Capacity was reduced by approximately 25% or greater within some ocean alliances into Southern California in the month of May and it didn’t take long for capacity to become scarce. The surge in PPE cargo is a contributing factor as the spike in PPE cargo availability aligned with the blank sailings, unfortunately. Other sub-trades such as the Gulf and East Coast are also experiencing tight capacity however the majority of blank sailings were on the West Coast and reason for the extremely tight capacity conditions. Pacific Northwest is facing tight capacity as discretionary cargo shifts North to ports that can service US inland rail points such as Vancouver & Prince Rupert. We expect tight capacity for the next few weeks until the backlog is cleared out.


Blank Sailings  Many blank sailings announced for June have now been retracted along with extra loaders sailing out this week and next that to help clear out the backlog. We expect conditions to improve during the 2nd half of June as the majority of carriers 2020 expected capacity is deployed into service on the Transpacific Eastbound market. Carriers have yet to announce any plans for blank sailings in July as of yet and were sure volume forecasts market-wide will be under the microscope as we move forward into the summer months.


Market Rates – Tight capacity usually translates into a market-rate increase and that is what we expect on June 1st. The majority of carriers have announced increases of approximately $500 per 40’container into Southern California with similar varying amounts on other sub-trades. The increase will only be glaring to West Coast and inland point destinations via the West Coast as other sub-trades saw rates fall off during the 2nd half of May. A GRI of this magnitude on June 1st is historically rare and will most likely face downward pressure by July.


Need for Speed on PPE’s – Before COVID-19 surfaced back in early 2020 ocean carriers were already introducing additional premium ocean freight services to the marketplace however outside of the niche carrier Matson Navigation few were catching much attention. The rush on PPE orders from primarily China has quickly changed this mentality as shippers scrambling to meet the sharp increase in demand. With airfreight capacity being squeezed due to the lack of passenger liners an alternative service with a reasonable guarantee on product availability has been in the spotlight and should remain for the foreseeable future.

Two additional carriers from Ocean Alliance both introduced premium services from Asia to Long Beach & Los Angeles, CA over the last couple of months at varying costs over “FAK” market rates. Both CMA and COSCO are now offering a similar service to Matson Navigation. Both carriers offer a service that provides expedited vessel discharge, guarantee on appointment along with equipment being pre-mounted on chassis. APL (brand of CMA) introduced the Eagle Express service back in early 2018 with an 11-day service from Shanghai to Los Angeles. Matson Navigation offers the fastest transit time from China with a 10-day transit from Shanghai. Currently all speed to market guarantee services sail from Central China ports, Japan & Korea to Southern California.