2018 Peak Season: Capacity and Rate Pressures

Please be advised that, due to a number of conditions in the current global trade landscape, trans-Pacific capacity for both Air and Ocean is expected to experience significant tightening in advance of and during the 2018 peak season with potential impact to both service levels and cost.

As shippers rush to import goods prior to further tariff increases, and prior to the busy 2018 peak season, ports throughout China and Thailand in particular are already reporting backlogs. This, coupled with a rush by Ocean carriers to recuperate lost profits prior to year-end by reducing capacity, voiding sailings, and increasing spot rates at previously unseen rates, is driving the demand for air freight.  Additionally, new product releases announced by both Apple and Samsung are expected to further constrict air capacity availability and continue driving prices upward.

As a precaution, we advise importers to notify their supply chain service providers of bookings at least 10-14 days in advance of the cargo-ready dates.

AGL is monitoring what many industry experts are referring to as a “perfect storm” during a challenging peak season and will continue to advise you of anything that may impact your operations and business.