Trans-Pacific Capacity Reverses as Demand Fluctuates

Trans-Pacific container capacity is falling again after a surge, as carriers cancel sailings in response to an unexpected slowdown in import demand due to tariff policy changes.

container-shipping

he trans-Pacific container shipping market is experiencing a period of significant volatility, with carriers adjusting capacity in response to unexpected changes in demand. After recording a surge in capacity in late May, the latest data from Sea-Intelligence shows that trend is reversing rapidly, with carriers canceling many of their planned sailings.

Initially, on April 9, 2025, the imposition of 145% US tariffs on Chinese goods caused a slowdown in container demand on the trans-Pacific. Carriers responded by reducing capacity on the trade route. However, the situation changed abruptly when on May 12, 2025, the US announced a 90-day suspension of tariffs on China. This decision immediately triggered a surge in container demand, causing a capacity shortage in the trans-Pacific market and a sharp increase in spot rates. In response, shipping lines quickly redeployed capacity back to the route.

Initially, experts predicted that the tariff suspension would push the traditional August peak season back into June/July, as US importers scrambled to get cargo in before the tariff suspension ended. However, throughout June, US importers slowed down somewhat, apparently in response to uncertainty about the future regulatory environment. This drop in container demand, combined with shipping lines adding capacity, led to a sharp decline in spot rates.

Planned-Weekly-Capacity-for-Jun-July-2025-on-Asia-USWC

Source: Sea-Intelligence

The Asia to North America West Coast (NAWC) capacity projections for June and July, taken at different times, clearly show a shift: June capacity additions planned for late May quickly gave way to capacity cuts in June. Capacity projections for July also peaked in mid-June, and are now falling further as carriers cancel scheduled sailings.

Compared to the base capacity level on May 9 (before the tariff suspension announcement), by May 30, carriers had planned to add 770,000 TEU to the market for both June and July. However, as of July 4, this additional capacity had fallen to just 590,000 TEU. This means that, during June, carriers removed 23% of their planned additional capacity on the Asia-West Coast of North America trade, in response to importers abruptly reversing their plans to import massive volumes from China.

Similarly, on the Asia-East Coast of North America trade, carriers initially planned to add 348,000 TEUs for both June and July. However, as of July 4, this figure had been reduced by 24% to 265,000 TEUs of additional capacity.

The flexibility and quick response of carriers in adjusting capacity shows that they are working hard to balance supply and demand and maintain stability in a volatile market where political and economic factors can change the landscape at a moment’s notice.

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