For this week’s transpacific logistics market update, as we close out June, ocean carriers appear to be adding another rate increase across Transpacific routes, come July 1st. This is following the full implementation of the June 1 General Rate Increase (GRI) and Peak Season Surcharge (PSS) of $1,000 per 40-foot container, carriers introduced an additional $1,500 per 40-foot increase effective June 15.
Market Conditions Breakdown
- Strong import demand continues to support elevated freight rates.
- Capacity into the U.S. West Coast has improved slightly, but rates remain firm.
- U.S. East Coast and Gulf Coast services remain heavily constrained.
- Capacity reductions include:
- Some carriers have implemented weight restrictions on East Coast services due to Panama Canal draft limitations.
- Additional GRI announcements are expected for July 1.
ONE Adjusts East Coast Service
Ocean Network Express (ONE) will stop accepting bookings to and via the Port of New York from its EC2 service beginning in Week 28 to improve schedule reliability.
- New bookings to New York on EC2 are no longer being accepted.
- Existing bookings will be transferred to EC1 and EC3 services, and any cargo rolled from EC2 before Week 28 will be redirected to EC1 and EC3.
- This change comes with extended transit times, with some shipments from Cai Mep reaching 50 days.
Capacity Outlook
- Space availability is improving into Pacific Southwest destinations.
- Pacific Northwest, East Coast, and Gulf Coast capacity remains extremely tight as a result of blank sailings and vessel deployment challenges
- Importers are accelerating bookings ahead of anticipated July rate increases.
- A modest increase in shipping activity is expected during the final week of June.
Equipment Availability Tightens as Middle East Disruptions Continue
Ongoing disruptions in the Middle East are beginning to impact global container availability as congestion throughout the Arabian Gulf and Indian Subcontinent slows the repositioning of empty containers back to Asia and other export markets.
Vessel movements through the Strait of Hormuz remain significantly reduced, and a large number of containers and vessels remain tied up in the Gulf, contributing to severe congestion at regional ports.
Key Impacts:
- Port utilization across major Gulf gateways is approaching capacity, with vessel delays of two to three days becoming common.
- Empty container repositioning has slowed considerably, creating tighter equipment availability in Asia and other export regions.
- Congestion is spreading beyond the Middle East, adding pressure to already strained global supply chains.
- Strong import demand into North America continues to absorb available equipment as shippers front-load cargo ahead of potential tariff and rate changes.
- Carriers are increasingly relying on container leasing companies as equipment inventories tighten. While equipment lead times have increased in some markets, global container inventories remain healthy and manufacturers are expected to meet demand.
Plan Ahead for Peak Season
With freight rates expected to remain elevated, capacity constraints continuing on key trade lanes, and equipment availability tightening, early planning is more important than ever.
If you have upcoming import or export shipments, our team can help you secure space, navigate the complex market changes, and avoid potential delays.
