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Dive Brief:
Capacity on the Transpacific lane is up 20% YoY, as carriers have injected resources into the trade lane resulting in "unprecedented capacity increases in Q4," according to a release from Sea-Intelligence.
Capacity levels on the Transpacific have been a roller coaster ride throughout 2020 — plunging as carriers blanked sailings in the early days of the pandemic, only to be met with unexpected demand that resulted in shipping companies bringing resources back online. The capacity cuts earlier in the year brought deployment levels lower than any seen since 2015, according to Sea-Intelligence.
"In some weeks, we are seeing capacity grow by as much as 30% compared to last year at the same time," Sea-Intelligence CEO Alan Murphy said in the release.
Dive Insight:
Container shipping demand has surged in the back half of 2020 as companies catch up on restocking and consumer spending rose through the summer.
Shippers have thus had to suffer the dual blow of tight capacity and high spot rates. Carriers have deployed a record amount of capacity, but it has still not been enough to keep up with demand. Shippers have described procuring freight as a "nightmare." Demand has driven costs up not only on the spot market, but also for equipment like containers and chassis.
"The pace and magnitude of the trade recovery have generally exceeded our customers’ expectations, and virtually all of the major shipping lines have needed to add significant container capacity," Brian Sondey, CEO of Triton International, the world's largest container leasing company, said in a statement in a recent earnings release.