Posts Tagged ‘container ships’

Import Containers From China Surge Upward

June 12, 2020

Import traffic from China to the United States took a big jump in May with officials saying this has helped to mitigate the effects of volume declines at U.S. West Coast ports.

The Port of Long Beach said that during May its inbound twenty-foot equivalent unit (TEU) containers were up 7.6 percent compared to May 2019 and up 23.3 percent from April.

The e-newsletter FreightWaves reported that inbound container volumes from China are greater than they were before the COVID-19 pandemic began.

Officials said demand for Chinese goods has driven up freight rates in an unusual occurrence during a global pandemic.

“It has been a tough few weeks . . . unless you’re an ocean liner on the China-U.S. West Coast, where rates just shot up,” said Freightos Chief Marketing Officer Eytan Buchman.

Also pushing up rates in the China-U.S. shipping lanes has been tight capacity.

Rates for moving containers between the two countries have reached levels not seen since January 2019.

The surge in imports from China has caused what had been expected to be a weakening market through June to instead plateau at above the levels of February and March.

Container Imports Ticked Up in May

June 9, 2020

Trans-Pacific container traffic showed an unexpected uptick in May which could be good news for intermodal traffic.

However, it is unclear what prompted the increase although there are a number of theories as to what prompted it.

The uptick came after container traffic plunged in late March and throughout April amid an economic downturn linked to the COVID-19 pandemic.

But now shipping companies are reinstating canceled sailing from China and are adding extra sailings.

During the depths of the pandemic, shipping lines had canceled 20 percent of sailings of container ships between China and the United States.

One theory for the uptick is that shippers canceled too many sailing after overestimating the near-term demand declines stemming from stay at home orders issued in numerous states.

Another theory is that consumer demand is stronger than predicted after states began relaxing and removing stay at home orders and allowed businesses and other activities to reopen.

Yet a third theory is that buyers of imported goods anticipate the collapse of a U.S.-China trade deal that could lead to new tariffs imposed by both countries.

At other times during the global trade war importers have ramped up buying in advance of tariffs and the same might be playing out now.

The e-newsletter FreightWaves repoprted market watchers saying this moving orders forward behavior is still being tempered by reduced demand due to the economic downturn.

Some observers have theorized that the upturn in shipping is temporary and will fall in early summer.