Demand remains strong, and the suspension of shipping announced by shipping companies during the Spring Festival has been significantly reduced

In previous years, with the arrival of the Spring Festival holiday, factories were suspended for holidays, and the volume of marine transportation dropped sharply, and shipping companies would cancel some voyages. Foreign importers will ship the goods in advance before the Spring Festival holiday to ensure sufficient inventory. But the number of suspended flights this year seems to have decreased. Alan Murphy, Chief Executive Officer of Sea-Intelligence, a shipping consultancy, said: “Shipping companies may encounter difficulties in planning capacity management in 2021. There are less than six weeks left before the Spring Festival.” As of last Friday, shipping companies announced that during the Spring Festival period, there were only 5 suspensions on trans-Pacific routes and 7 suspensions on Asia-Europe routes. During the Spring Festival last year, there were 73 suspensions on these routes, excluding suspensions caused by the outbreak of the new crown epidemic, and 67 suspensions in 2019.

Murphy commented: "At present, there are almost no signs of reducing voyages in 2021." This year, the capacity drop on the Asia-US West Coast route was only 2.1%, and the Asia-East Coast drop was only 3.6%. In sharp contrast, the average decline in 2016-2019 was 20.4% and 19.2%, respectively.

Shipping companies can still free up more voyages, Murphy pointed out: "If in order to achieve the relative capacity cut in previous years, shipping companies will need to suspend 37-41 voyages on the Asia-West Coast and 12-15 voyages on the Asia-East Coast. " He said: "It is clear that the number of scheduled suspensions is far less than in previous years. If you want to reach the level of previous years, you must announce a series of empty flights soon." Regarding this question, a Maersk spokesperson replied: "We continue to see strong demand from North American customers. This is a continuation of the peak season of 2020. Our purpose is to support customer needs and our proximity to the needs of US exporters."

The Wall Street Journal recently reported that Chinese exporters are facing unprecedented delays in shipping their goods, and the drastic reduction in the number of suspensions will help clear cargo congestion in Asia. Lars Jensen, CEO of SeaIntelligence Consulting, said: “Any kind of demand will continue to be strong, which is good. In this case, capacity is definitely needed. When there is a usual seasonal slowdown in demand, this will help alleviate container shortages and Imbalance helps a lot." If the normal voyage is cancelled, it can help the ports of Los Angeles and Long Beach to clear the backlog of ships lining up in San Pedro Bay. As of Monday, there are 33 container ships at anchor, which can also ease congestion. However, shipping companies are unlikely to significantly cut services, one of the reasons is regulation. Freight rates are at historically high levels and have attracted the attention of regulators. From late November last year, the Federal Maritime Commission will monitor the suspension of shipping companies and increase the reporting requirements for shipping companies.