Flexport: Trans-Pacific Space Constrained

TRANS-PACIFIC EASTBOUND (TPEB) Capacity and Demand: • Carriers canceled approximately 7% of scheduled Trans-Pacific Eastbound (TPEB) capacity in Week 26, down from approximately 9% in Week 25. Space remains constrained across all gateways. S. East Coast and Gulf services are more restricted than West Coast lanes, with ongoing cargo rollings on multiple strings.

S. East Coast and Gulf destinations. Several carriers have implemented weight restrictions on Panama strings in anticipation. • Global container demand reached record levels in April 2026, with volumes above any prior April on record.

On the Transpacific, shippers advanced bookings earlier than in prior seasons, moving cargo ahead of the June 15 rate increases. S. East Coast and Gulf services is largely committed through the end of June. S.

West Coast lanes in Week 26, extending a run of consecutive weekly increases now spanning six weeks. S. East Coast lanes also rose approximately 10% in Week 26. Other market indices confirm the same directional trend.

Carriers have implemented a rate increase on floating and increased Peak Season Surcharge (PSS) on fixed rates effective June 15, both of which are broadly holding across all gateways. • Recommendation: • Book 4-5 weeks ahead. S. East Coast and Gulf destinations should consider premium service levels to reduce the risk of rolling.

FAR EAST WESTBOUND (FEWB) • Capacity and Demand: • Carriers canceled approximately 8% of scheduled Far East Westbound (FEWB) capacity in Week 26, up from approximately 4% in Weeks 24 and 25. • Cape of Good Hope routing extends each voyage by 10 or more days compared to Suez Canal routing and reduces the effective number of vessel rotations available per year. Transshipment hubs along the Cape route are experiencing multi-day berthing delays, compounding the supply constraint and contributing to equipment shortages at Chinese and Southeast Asian origin ports. • Global container volumes reached record levels in April 2026.

Demand on Asia-Europe lanes remains strong, with vessel utilization near full capacity for June sailings. -Iran framework agreement could give some relief to the situation as carriers could potentially start returning to Suez in the medium term but as of now too early to tell. • Freight Rates: • The Shanghai Containerized Freight Index (SCFI) for North Europe rose approximately 20% in Week 25 and held broadly flat in Week 26, following seven consecutive weeks of increases. Mediterranean lanes saw similar movement in Week 25, with broadly stable rates in Week 26.

Other market indices confirm rates are holding at elevated levels. Carriers have announced an increase to Peak Season Surcharges (PSS) effective July 1. • Recommendation: • Book 5-6 weeks ahead. For time-sensitive or high-value cargo, secured premium services are advisable through at least the end of July.

TRANS-ATLANTIC WESTBOUND (TAWB) • Capacity and Demand: • Carriers canceled approximately 9% of scheduled Trans-Atlantic Westbound (TAWB) capacity in Week 26, up from approximately 4% in Week 25. S. S. East Coast lanes have more available space.

Equipment shortages persist across Northern European origins, particularly Germany, Benelux, and Central Europe. Major Northern European ports are operating at high utilization, with vessel wait times of two to three days at key hubs. Schedule reliability on westbound Atlantic services currently stands at approximately 44-55%, meaning a material share of sailings are arriving behind schedule. • June and July are expected to be the last strong demand months before traditional European summer warehouse closures reduce shipping volumes in August.

Import volumes on TAWB declined year-over-year in April as the tariff-driven front-loading of Q1 faded. Underlying demand remains steady ahead of the seasonal slowdown. • Container and chassis shortages persist across all major TAWB export origins, including Germany, Benelux, Austria, Hungary, and Slovakia. S.

S. West Coast lanes. A Peak Season Surcharge (PSS) remains active across Northern European and Mediterranean origins. The Q3 Bunker Adjustment Factor (BAF) already reflects current fuel cost relative to Q2; as a result, carriers have removed the Emergency Fuel Surcharge/Emergency Bunker Surcharge effective July 1.

• Recommendation: • Book 3-4 weeks ahead. S. West Coast and Gulf destinations. July sailings are expected to fill quickly as shippers target the last major shipping window before the European Summer slowdown.

INDIAN SUBCONTINENT TO NORTH AMERICA • Capacity and Demand: • Capacity on the Indian Subcontinent (ISC) to North America services remains constrained. S. East Coast services in Weeks 25 through 29. • Booking demand on the Indian Subcontinent (ISC) to North America trade lane has increased heading into the summer peak.

Shippers are advancing cargo ahead of announced rate increases, and booking lead times at major Indian Subcontinent origin ports are extending as backlogs grow. Origin lead times will increase into July due to the backlog of cargo moving through major Indian ports. • Freight Rates: • Carriers have implemented a rate increase and a Peak Season Surcharge (PSS) effective June 15 on Indian Subcontinent (ISC) to North America services. Further rate incre