Carriers Announce 112 Blank Sailings Over Five Weeks as Lunar New Year and Overcapacity Converge
Ocean carriers announced 112 blank sailings for mid-February through late March 2026, canceling 16% of scheduled East-West sailings. The Transpacific accounts for 63% of cancellations, with Asia-Europe at 27% and Transatlantic at 11%. The aggressive capacity withdrawal responds to the Lunar New Year demand slump and structural overcapacity, as the industry faces a projected $10 billion in losses for 2026 with fleet growth at 3.6% versus demand growth of 3%.
48 views
What Happened
Carriers announced 112 blank sailings for the five-week period from mid-February to late March 2026, canceling approximately 16% of total scheduled sailings on major East-West routes, according to Drewry. The distribution reveals concentrated pressure on specific trades: Transpacific Eastbound accounts for 63% of all cancellations, Asia-Europe/Mediterranean for 27%, and Transatlantic Westbound for 11%.
The timing coincides with the Lunar New Year holiday (beginning February 17, 2026) and the need to re-synchronize vessel schedules disrupted by prolonged Cape of Good Hope diversions. Sea-Intelligence documented the speed of carrier response to market shifts, noting that planned blanked capacity on the Transpacific surged from 60,000 TEU to over 367,000 TEU in just three weeks following the implementation of new US tariffs in 2025.
The idle fleet remains relatively constrained at approximately 175 vessels (516,800 TEU) as of mid-January 2026, representing just 3% of total global capacity. Carriers are preferring flexible capacity management through blank sailings over extended layups, maintaining the option to quickly redeploy vessels if demand recovers.
Slow steaming continues as a critical capacity absorption tool, with the Red Sea crisis currently absorbing an estimated 6% of the global fleet through extended Cape of Good Hope routing. Analysts estimate that normalization of Suez Canal transits would release approximately 1.75 million TEU back into the market. The EU Emissions Trading System (ETS) requirement for carriers to pay for 70% of their emissions in 2026 provides additional economic incentive for reduced speeds.
Service network adjustments are ongoing despite the oversupplied market. MSC is launching its "Eagle Service" to the US East Coast in March 2026, while the Port of Portland launched the Oregon Container Terminal (OCT) in January 2026, restoring direct container service to the state. The new Gemini Cooperation (Maersk and Hapag-Lloyd) added Antwerp to its Europe-Far East network and announced plans for its India/Middle East-Mediterranean service to be the first to resume Red Sea transits. The Ocean Alliance and ONE are consolidating North and South Atlantic loops.
Hapag-Lloyd is in advanced negotiations to acquire ZIM Integrated Shipping Services for a reported $4.2 billion, which would make it the world's fifth-largest carrier and significantly impact network sharing agreements on Transpacific and Transatlantic trades.
The timing coincides with the Lunar New Year holiday (beginning February 17, 2026) and the need to re-synchronize vessel schedules disrupted by prolonged Cape of Good Hope diversions. Sea-Intelligence documented the speed of carrier response to market shifts, noting that planned blanked capacity on the Transpacific surged from 60,000 TEU to over 367,000 TEU in just three weeks following the implementation of new US tariffs in 2025.
The idle fleet remains relatively constrained at approximately 175 vessels (516,800 TEU) as of mid-January 2026, representing just 3% of total global capacity. Carriers are preferring flexible capacity management through blank sailings over extended layups, maintaining the option to quickly redeploy vessels if demand recovers.
Slow steaming continues as a critical capacity absorption tool, with the Red Sea crisis currently absorbing an estimated 6% of the global fleet through extended Cape of Good Hope routing. Analysts estimate that normalization of Suez Canal transits would release approximately 1.75 million TEU back into the market. The EU Emissions Trading System (ETS) requirement for carriers to pay for 70% of their emissions in 2026 provides additional economic incentive for reduced speeds.
Service network adjustments are ongoing despite the oversupplied market. MSC is launching its "Eagle Service" to the US East Coast in March 2026, while the Port of Portland launched the Oregon Container Terminal (OCT) in January 2026, restoring direct container service to the state. The new Gemini Cooperation (Maersk and Hapag-Lloyd) added Antwerp to its Europe-Far East network and announced plans for its India/Middle East-Mediterranean service to be the first to resume Red Sea transits. The Ocean Alliance and ONE are consolidating North and South Atlantic loops.
Hapag-Lloyd is in advanced negotiations to acquire ZIM Integrated Shipping Services for a reported $4.2 billion, which would make it the world's fifth-largest carrier and significantly impact network sharing agreements on Transpacific and Transatlantic trades.
Why It Matters
The 112 blank sailings over five weeks represent the most aggressive capacity withdrawal since the pandemic era, signaling carriers' recognition that the market has fundamentally shifted from tight to oversupplied. The 16% cancellation rate on East-West trades is a dramatic intervention that reveals the severity of the demand-supply imbalance carriers are confronting.
The concentration of cancellations on the Transpacific (63%) reflects both the trade's importance to carrier profitability and its vulnerability to demand fluctuations. The rapid escalation from 60,000 TEU to 367,000 TEU in blanked capacity following tariff implementation demonstrates carriers' willingness to sacrifice volume to protect rates, a significant strategic shift from the market-share-at-all-costs approach that characterized previous cycles.
The structural challenge is stark: fleet growth of 3.6% in 2026 against demand growth of only 3% creates a persistent 0.6 percentage point gap that compounds over time. With 10 million TEU on order (one-third of the existing fleet), this imbalance will persist for years. The industry-wide projected losses of $10 billion in 2026 indicate that even aggressive capacity management may be insufficient to maintain profitability in this environment.
The low scrapping rate—falling to a twenty-year low in 2025—means carriers are retaining older, less efficient tonnage as a buffer, but this prevents the natural fleet rationalization that would help rebalance the market. The 3% idle fleet level, while seemingly low, is artificially suppressed by Red Sea diversions. The potential release of 1.75 million TEU (6% of global fleet) from Suez normalization would overwhelm current capacity management efforts.
The slow steaming strategy serves dual purposes: absorbing excess capacity while reducing emissions to comply with EU ETS requirements (70% of emissions in 2026). This alignment of economic and regulatory incentives makes slow steaming a sustainable long-term strategy, but it also signals carriers' expectation that overcapacity will persist, requiring structural rather than temporary solutions.
The concentration of cancellations on the Transpacific (63%) reflects both the trade's importance to carrier profitability and its vulnerability to demand fluctuations. The rapid escalation from 60,000 TEU to 367,000 TEU in blanked capacity following tariff implementation demonstrates carriers' willingness to sacrifice volume to protect rates, a significant strategic shift from the market-share-at-all-costs approach that characterized previous cycles.
The structural challenge is stark: fleet growth of 3.6% in 2026 against demand growth of only 3% creates a persistent 0.6 percentage point gap that compounds over time. With 10 million TEU on order (one-third of the existing fleet), this imbalance will persist for years. The industry-wide projected losses of $10 billion in 2026 indicate that even aggressive capacity management may be insufficient to maintain profitability in this environment.
The low scrapping rate—falling to a twenty-year low in 2025—means carriers are retaining older, less efficient tonnage as a buffer, but this prevents the natural fleet rationalization that would help rebalance the market. The 3% idle fleet level, while seemingly low, is artificially suppressed by Red Sea diversions. The potential release of 1.75 million TEU (6% of global fleet) from Suez normalization would overwhelm current capacity management efforts.
The slow steaming strategy serves dual purposes: absorbing excess capacity while reducing emissions to comply with EU ETS requirements (70% of emissions in 2026). This alignment of economic and regulatory incentives makes slow steaming a sustainable long-term strategy, but it also signals carriers' expectation that overcapacity will persist, requiring structural rather than temporary solutions.
What It Affects
Schedule Reliability: The 16% cancellation rate on East-West trades creates significant uncertainty for shippers' supply chain planning. Blank sailings reduce service frequency and increase the risk of cargo rollovers, forcing shippers to build additional buffer time into their logistics planning. The concentration on Transpacific (63% of cancellations) particularly impacts US importers who rely on predictable weekly sailings for inventory management.
Rate Volatility: While blank sailings are intended to support rates, they create short-term spikes followed by rapid declines. The January 2026 pre-Lunar New Year surge drove Far East to US West Coast spot rates up 60% month-over-month to $2,835 per FEU, only to see the Drewry WCI fall to $1,933 per FEU by mid-February. This volatility complicates budgeting and makes spot market procurement risky for shippers without strong carrier relationships.
Port Operations: Concentrated blank sailings disrupt port labor planning and terminal operations. When multiple carriers blank sailings in the same week, ports experience feast-or-famine cargo flows that strain handling capacity during peak weeks and leave resources underutilized during blank weeks. The 112 cancellations over five weeks create uneven workload distribution that impacts port efficiency.
Carrier-Shipper Relationships: The aggressive capacity management tests the balance between carriers' need to protect rates and shippers' need for reliable service. Beneficial cargo owners (BCOs) with long-term contracts may find their guaranteed space allocations compromised by blank sailings, potentially driving them to diversify carrier relationships or shift more volume to the spot market.
Alliance Dynamics: The consolidation of Ocean Alliance and ONE's Atlantic loops, combined with Gemini Cooperation's network adjustments, signals that alliances are rationalizing services to match reduced demand. The potential Hapag-Lloyd acquisition of ZIM would further concentrate capacity control, potentially improving industry discipline but reducing shipper options.
Trade Lane Economics: The 11% cancellation rate on Transatlantic (versus 63% on Transpacific) indicates carriers are using the Atlantic as a release valve for excess capacity, potentially depressing rates on that trade even if its own demand fundamentals are stable. This cross-trade capacity redeployment creates ripple effects across the global network.
Service Differentiation: New service launches like MSC's Eagle Service and the Oregon Container Terminal despite overcapacity suggest carriers are pursuing niche opportunities and geographic diversification rather than competing head-to-head on mainline trades. This could lead to improved service options in secondary markets while mainline trades face continued capacity discipline.
Rate Volatility: While blank sailings are intended to support rates, they create short-term spikes followed by rapid declines. The January 2026 pre-Lunar New Year surge drove Far East to US West Coast spot rates up 60% month-over-month to $2,835 per FEU, only to see the Drewry WCI fall to $1,933 per FEU by mid-February. This volatility complicates budgeting and makes spot market procurement risky for shippers without strong carrier relationships.
Port Operations: Concentrated blank sailings disrupt port labor planning and terminal operations. When multiple carriers blank sailings in the same week, ports experience feast-or-famine cargo flows that strain handling capacity during peak weeks and leave resources underutilized during blank weeks. The 112 cancellations over five weeks create uneven workload distribution that impacts port efficiency.
Carrier-Shipper Relationships: The aggressive capacity management tests the balance between carriers' need to protect rates and shippers' need for reliable service. Beneficial cargo owners (BCOs) with long-term contracts may find their guaranteed space allocations compromised by blank sailings, potentially driving them to diversify carrier relationships or shift more volume to the spot market.
Alliance Dynamics: The consolidation of Ocean Alliance and ONE's Atlantic loops, combined with Gemini Cooperation's network adjustments, signals that alliances are rationalizing services to match reduced demand. The potential Hapag-Lloyd acquisition of ZIM would further concentrate capacity control, potentially improving industry discipline but reducing shipper options.
Trade Lane Economics: The 11% cancellation rate on Transatlantic (versus 63% on Transpacific) indicates carriers are using the Atlantic as a release valve for excess capacity, potentially depressing rates on that trade even if its own demand fundamentals are stable. This cross-trade capacity redeployment creates ripple effects across the global network.
Service Differentiation: New service launches like MSC's Eagle Service and the Oregon Container Terminal despite overcapacity suggest carriers are pursuing niche opportunities and geographic diversification rather than competing head-to-head on mainline trades. This could lead to improved service options in secondary markets while mainline trades face continued capacity discipline.
What to Watch Next
Post-Lunar New Year Demand Recovery: The traditional demand slump following Lunar New Year (February 17, 2026) will test whether the 112 blank sailings are sufficient to prevent further rate declines. Historical patterns suggest March-April is the weakest period; any earlier-than-expected recovery would allow carriers to reduce blank sailing intensity.
Suez Canal Normalization: The Gemini Cooperation's announcement that its India/Middle East-Mediterranean service will be first to resume Red Sea transits is a critical signal. Monitor the pace and scale of other carriers following suit. A large-scale return to Suez would release 1.75 million TEU (6% of global fleet) and overwhelm current capacity management efforts, likely triggering a sharp rate decline.
Blank Sailing Announcements for Q2: Carriers typically announce second-quarter capacity plans in late February/early March. The scale of Q2 blank sailings will indicate whether carriers expect demand recovery or are preparing for extended weakness. An increase above the current 16% cancellation rate would signal deepening pessimism.
Idle Fleet Levels: Currently at 3% (516,800 TEU), but artificially suppressed by Red Sea diversions. A rise above 5% would indicate that blank sailings alone are insufficient and carriers are resorting to extended layups, a sign of severe market stress. Monitor weekly idle fleet reports from Alphaliner and other analysts.
Spot Rate Trajectory: Track whether the mid-February Drewry WCI level of $1,933 per FEU represents a floor or if rates continue declining through March. The effectiveness of blank sailings in establishing a rate floor will determine carrier strategy for the remainder of 2026.
Hapag-Lloyd/ZIM Acquisition: The $4.2 billion deal's completion would create the world's fifth-largest carrier and significantly impact Transpacific and Transatlantic capacity control. Monitor regulatory approvals and the integration plan, particularly how the combined entity manages its network and alliance commitments.
Alliance Service Announcements: Watch for further consolidation or rationalization of services by the Ocean Alliance, 2M, THE Alliance, and Gemini Cooperation. Service suspensions would signal carriers are moving beyond temporary blank sailings to structural network reduction.
Slow Steaming Adoption: Monitor average vessel speeds on major trades. Increased slow steaming would indicate carriers are preparing for extended overcapacity and prioritizing emissions compliance over speed. This would be a structural shift with long-term implications for supply chain transit times.
Carrier Financial Results: Q1 2026 earnings reports (released in April-May) will reveal whether the aggressive capacity management preserved profitability or if the $10 billion industry loss projection is materializing. Weak results could trigger more aggressive consolidation or service rationalization.
New Service Launches vs. Suspensions: Track the balance between new services (like MSC's Eagle Service) and suspensions. A shift toward net service reductions would indicate the market is deteriorating faster than carriers anticipated.
Suez Canal Normalization: The Gemini Cooperation's announcement that its India/Middle East-Mediterranean service will be first to resume Red Sea transits is a critical signal. Monitor the pace and scale of other carriers following suit. A large-scale return to Suez would release 1.75 million TEU (6% of global fleet) and overwhelm current capacity management efforts, likely triggering a sharp rate decline.
Blank Sailing Announcements for Q2: Carriers typically announce second-quarter capacity plans in late February/early March. The scale of Q2 blank sailings will indicate whether carriers expect demand recovery or are preparing for extended weakness. An increase above the current 16% cancellation rate would signal deepening pessimism.
Idle Fleet Levels: Currently at 3% (516,800 TEU), but artificially suppressed by Red Sea diversions. A rise above 5% would indicate that blank sailings alone are insufficient and carriers are resorting to extended layups, a sign of severe market stress. Monitor weekly idle fleet reports from Alphaliner and other analysts.
Spot Rate Trajectory: Track whether the mid-February Drewry WCI level of $1,933 per FEU represents a floor or if rates continue declining through March. The effectiveness of blank sailings in establishing a rate floor will determine carrier strategy for the remainder of 2026.
Hapag-Lloyd/ZIM Acquisition: The $4.2 billion deal's completion would create the world's fifth-largest carrier and significantly impact Transpacific and Transatlantic capacity control. Monitor regulatory approvals and the integration plan, particularly how the combined entity manages its network and alliance commitments.
Alliance Service Announcements: Watch for further consolidation or rationalization of services by the Ocean Alliance, 2M, THE Alliance, and Gemini Cooperation. Service suspensions would signal carriers are moving beyond temporary blank sailings to structural network reduction.
Slow Steaming Adoption: Monitor average vessel speeds on major trades. Increased slow steaming would indicate carriers are preparing for extended overcapacity and prioritizing emissions compliance over speed. This would be a structural shift with long-term implications for supply chain transit times.
Carrier Financial Results: Q1 2026 earnings reports (released in April-May) will reveal whether the aggressive capacity management preserved profitability or if the $10 billion industry loss projection is materializing. Weak results could trigger more aggressive consolidation or service rationalization.
New Service Launches vs. Suspensions: Track the balance between new services (like MSC's Eagle Service) and suspensions. A shift toward net service reductions would indicate the market is deteriorating faster than carriers anticipated.