Sea-Intelligence analysis: Shortage of blanks in Golden week0 (0)

Sea-Intelligence analysis: Shortage of blanks in Golden week
0 (0)

August 30, 2023

Sea-Intelligence reports that we are currently 5 weeks away from the Chinese National Holiday known as Golden Week, and carriers may turn to blank sailings to manage supply as a result of a significant drop in demand.

“Source: Sea-Intelligence.com, Sunday Spotlight, issue 629”

“However, no significant capacity reductions have been reported by carriers this year,” stated Alan Murphy, CEO of Sea-Intelligence.

Looking at the current combined Transpacific capacity reductions for the 4-week Golden Week period (Golden Week plus the next three weeks), carriers have booked capacity reductions of only 3%, compared to a 12.4% drop in 2019 and a 10% decline on average from 2017 to 2019.

Individually, 3.7% is slated to be taken out on the Asia-North America West Coast and 2.2% on the Asia-North America East Coast, both amounts are the lowest in comparison to the pre-pandemic years.

“If we compare the current percentage reductions to pre-pandemic levels, then 10-13 extra Transpacific sailings and 6-10 additional Asia-Europe sailings will need to be blanked to match 2019,” explained Alan Murphy.

According to a statement, with Golden Week only 5 weeks away, there isn’t much time left for carriers to announce more blank sailings, because the closer they are to Golden Week, the less time there is for shippers to plan exception handling, and there is already a lot of discontent among shippers due to freight rates and a lack of promised vessel allocation in recent years.

Furthermore, with slow peak season demand, it might be claimed that the blank sailings required to maintain the market steady would have to exceed what was done in 2017-2019, putting additional pressure on the carriers’ blank sailings strategy in October 2023.

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