It’s supposed to be the
peak season for seaborne trade — just before the Golden Week holiday in China
where shipments need to leave ports for US and Europe, filling warehouses so
retailers are stocked up heading into the fourth quarter.
Instead, global demand for Chinese goods is waning
as consumers from the US to Europe cut back on spending because of inflation
and the post-pandemic shift away from goods toward services. That’s causing the
container shipping industry to trim capacity by canceling sailings. Otherwise,
spot rates will continue to tumble.
Part of the slump can be
blamed on human behavior: Peak season arrived early, so companies refilled
inventories in May and June rather than risk further delays tied to Beijing’s
strict Covid Zero policies, the war in Ukraine or some other unpredictable
But now there are broader economic forces at work. In its latest advisory on North America, Maersk said volumes on
its transpacific and transatlantic trade routes are softening from August
levels, though they’re staying more elevated than pre-pandemic periods.
patterns have both softened and shifted away from goods-heavy pandemic-era
patterns and more towards the services and experiences unavailable during the
Covid outbreaks,” the world’s No. 2 container carrier said. “We are in the
process of actively adjusting our shipping network to align to customer
Hong Kong’s exports contracted the most since the pandemic first
began in early 2020, as global demand eased and
shipments with mainland China were disrupted.
Honolulu-based shipping line, recently discontinued one of its three
transpacific services, where space on its smaller, faster ships costs a
premium. The China-California Express, or CCX, was launched in 2021 and made
Oakland its first US stop.
According to a
conference call with analysts in early August, CCX was expected to operate
through peak season into October. Matson discontinued it a little earlier than
planned to better balance capacity with the market, a spokesman said, but
demand for the other two remains strong.