Shipping consultancy Drewry has warned there could be a nasty shock in store for boxship owners currently enjoying booming transpacific rates.
Earnings have soared since July, as service withdrawals and new tariffs sent the market into "hyper-drive", it said.
Rates between Asia and the US West Coast rose 2% by the end of October to $2,530 per feu, nearly double last year’s level, according to the Freightos Baltic Index.
"The transpacific trade – the world’s largest deep-sea market – is once again a money printing factory for carriers," it added.
US importers were spurred to bring forward supplies ahead of US president Donald Trump's tariffs on Chinese goods.
Container shipments from Asia to the US rose 5% in the third quarter, but not as fast as in the first quarter ahead of the first tariffs, when growth was about 13%, Drewry said.
With US tariffs slated to be increased to 25% on 1 January 2019, there is clearly scope for yet another artificially-stimulated shipping season in November and early December, the company added.
"The danger is that there won’t be much left in the system for the early months of next year when carriers will depend on having a strong market to support negotiations for annual contracts, generally to be signed for 1 May," it said.
Thanking Trump - for now
Drewry said: "The transpacific – sometimes stop, sometimes go – is currently the most unpredictable container trade.
"Carriers may be thanking President Trump right now but they may come to rue the day if the trade conflict sees volumes disappear during crucial contract negotiations next year."
There is however the possibility of further tariffs to come, which could instigate yet another cargo rush, but if there is a dearth of demand in the first quarter, carriers will be forced to consider service suspensions to prop up ship utilisation and boost their hand for contract talks, the company believes.
Drewry said that in retrospect it would appear that it was reductions to eastbound Asia-west coast North America capacity that had a greater influence on the "soaraway" spot freight rates.
"It would seem that carriers are banking on a prolonged cargo boom in the transpacific, as Maersk Line is reportedly about to phase two ships of 17,800 teu into the 2M TP6/Pearl service serving Los Angeles exclusively that presently deploys six 13,000-teu units," it said.
"How long those ships, and indeed other smaller units, remain in the trade is an open question and will largely be decided by geo-politics over the coming months."
