Pacific small box carrier share normalised

A fully loaded container ship heading toward the Port of Houston from the Gulf of Mexico.

Recent data gathered by Sea-Intelligence conveyed that non-alliance carriers returned to their pre-pandemic market share.

Before the start of the pandemic, the non-alliance carriers were offering 16,000 TEU per week on average on the Asia-North America West Coast trade lane, dropping to 10,000 TEU per week at the onset of the pandemic reported Sea-Intelligence.

According to the Danish maritime data analysis firm, this was followed by a sharp upward swing to 40-50,000 TEU per week, as the non-alliance carriers poured capacity into the trade lane.

Regarding the market share of total weekly deployed capacity on the trade lane, the non-alliance carriers increased from a pre-pandemic figure of 10 per cent to around 15 per cent during the peak.

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As freight rates began to normalise and capacity gradually became available again in the market during 2022, the non-alliance market share also began to decline.

In essence, for most of 2023, their share has reverted back to the 10 per cent levels. This is shown in the figure below:

© Sea-Intelligence

The data shown in this figure is based on a three-week rolling average, to eliminate the worst of the volatility and to better ascertain the underlying trends.

According to Sea-Intelligence: “If this was not done, the non-alliance would have, in some weeks, offered more than 20 per cent of the capacity in the market.”

Based on the totality of the period i.e., from January 2020 to July 2023, there is a clear difference in scale between the carriers, with Wan Hai, Matson, and SM Line substantially larger than the other non-alliance carriers operating on the trade.

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“If we however look at the development over time, the pattern becomes a bit more complex” said Alan Murphy, CEO, Sea-Intelligence.

Murphy added “For example, Wan Hai reacts very sharply to the initial pandemic shock, followed by an equally sharp reaction once the market tightens and freight rates go up.”

“SM Line show elements of the same behaviour although not to the same degree as Wan Hai,” Murphy explained.

Sea-Intelligence analysed that SM Line consistently offered more capacity in the trade than Wan Hai entering 2023.

Sea-Intelligence finally notes that: “The plethora of new carriers, who entered the market at the peak of the freight rate bonanza, are mostly equally quick to exit the market, as conditions have been normalising in 2023.”

In April 2023, Sea-Intelligence found a strong Y/Y volume decline in both the Transpacific and Asia-Europe regions, with all reporting carriers experiencing varying degrees of volume contraction on a global level.

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