Freight for Thought: 30% of ocean capacity to be replaced by newer vessels beginning next month

The following insights are provided by Sunset’s Strategic Account Management team.

Trends and discussions range from seasonal manufacturing and agriculture trends that affect available capacity to general insight into outside factors affecting freight volumes.

Below is a summary of the May 2023 industry insights:

  • The Teamsters and UPS are still in discussions around a new work contract, expiry of their current contract is July 31.  UPS’s workforce is about 70% unionized. (source)
  • A severe drought is affecting the Panama Canal and is forcing container vessels to lighten their loads and pay higher fees.
  • A slow booming produce season is tightening refrigerated trucking capacity in southern markets.
  • DAT is predicting that truckload spot rates, which were down more than 25% YoY in April, is slowing.  The May truckload spot average was down just 1 cent from April’s average, potentially indicating the floor has been reached.
  • New ocean vessels on-order will replace about 30% of total ocean capacity; over 7.3 million TEUs.  These new vessels will be replacing older models as the International Maritime Organization (IMO) begins implementation in June 2023. This rollout will continue over the next 5+ years. (source)
  • The ongoing imbalance between ocean supply and demand is causing an increase in slow steaming.  Average sailing speeds are currently 4% slower than 2019. Blank sailings, however, have decreased recently.  Experts say ocean rates may have already hit their floor.
  • Ocean Carrier’s schedule reliability rose 1.7% in April due to decreasing volumes.



  • U.S. average cost of Diesel is $3.855 as of 5/29  – up $.028 from the week prior, and down $1.684 from a year ago.
  • With refiners building stockpiles ahead of the summer travel season in the northern hemisphere, crude imports by China in May are moving towards 11 million barrels per day, versus 10.67 million bpd in April, Refinitiv Oil Research said.
  • The Brent crude oil spot price averages $79 per barrel (b) YTD – down -7.5% from last month’s forecast.

Sunset expects fuel prices will remain steady until summer, then retract towards Q4.

Industry data is pulled and summarized weekly from key proprietors and industry experts using multiple publications and sources. Sources include, but not limited to: FreightWaves, U.S. Energy Information Administration (EIA), DAT, Journal of Commerce (JOC), Reuters, PYMNTS, NRF, Bloomberg. The information is discussed with Sunset Managing Directors and validated prior to publication of summary data in this posting.

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