Transpac Capacity and Rates Changes

As part of our continued effort to keep you informed about events that could have an impact on your supply chain, we would like to provide you with the following update concerning the ocean freight market.

Within the past few days, we have been observing Transpacific spot rate increases of 3.3 percent to the East Coast and 8.4 percent to the West Coast. This follows double digit increases seen last week as part of the recent trend by carriers to reduce capacity; most recently, on the part of the Ocean Alliance which announced a restructuring of its Pacific Southwest services, including the elimination of one weekly service.

Though these capacity decreases are primarily driven by concerns over Transpacific volume slowdowns due to tariffs recently announced by the Trump administration, national retailers are predicting imports reaching record levels in July, August, and September. The net effect of the rising demand for space on vessels, coupled with reduced supply of the same, is leading to an increase in carriers’ leverage over Transpacific spot rates.

AGL will continue to monitor supply chain related events and advise you of any changes that may impact the efficiency and planning of your supply chain operations.