The 'Helen May is importing barrels of petroleum into Liverpool in thick fog. A barrel is leaking and the ship explodes when a seaman, holding a lantern, investigates. Baines believes more effort should have been made to look for survivors, Onedin insists there were none. One sailor, however, does survive, and gives evidence at the inquest. The ship was sailing too fast and the blame is attached to its dead captain. Elizabeth, meanwhile, learns that Albert has died in South America.

Steam is now in the ascendancy and sail looks as if it is danger of becoming obsolete. James' main rival Briggs is investing heavily in steam-ships and Elizabeth urges Frazer to build some more for him. Briggs also buys the 'Anne Onedin' from James but James buys a fleet of six sailing ships from elderly Captain Fowey in the knowledge that a miners' strike is sending coal prices rocketing, giving sail the temporary advantage.

Jack Frazer dies. He is angry and bitter to learn that his supposed grandchild was Fogarty's. Elizabeth becomes instrumental in running the Frazer line. She and James and Pierre Legrande, an old associate of Albert's, travel out to South America in order to bring back his plans for refrigerated holds, allowing meat to stay fresh for days.

Elizabeth takes over as head of the Frazer Line. Several other owners aim to take advantage of her sex and try and persuade her to join them in a cartel but, putting into effect her know-how as a shop-keeper's daughter, she undercuts them all and starts to profit, as well as romancing Matt Harvey, one of the line captains. James is persuaded by Letty Gaunt, the nanny for his young daughter Charlotte, to spend more time with his child and the three of them have a picnic together.

The 'Prince Edward', a Frazer Line ship, is put in quarantine by order of strict new medical officer Dr. Darling after its captain, Corcoran, and his daughter fall ill. James is concerned that if he cannot move the ship he will be sued for breach of contact. Lucy dies but ultimately it is shown that she had the plague, caught from fleas on her pet guinea pig, and the Onedins are exonerated. The port is still closed but this is 'force majeure', beyond Onedin's control, so the contract is not broken after all.

Baines and Onedin find an uncharted island, rich in guano, which they intend to mine without telling anybody. However, Matt Harvey learns about it and sets sail in a Frazer Line ship but fails to locate the island. Instead he returns with valuable whale-bone and claims that the guano was too acidic for use. Elizabeth believes she has got one over on her brother until she discovers that he already knew this fact.

Five pounds is stolen from the office of the Frazer Line and Uncle Percy Spendilow is accused, found guilty and sentenced to six months in prison. Elizabeth finds this hard to believe and so she sets a honey trap, leaving money lying around. It is taken by Drumond, a clerk, and, as a result, Uncle Percy is freed. However, he has an unpleasant surprise in store for Elizabeth.

Elizabeth and Matt are in Falmouth to buy a tug, the 'Alice', which she wants to turn into a ferry but James arrives with Robert, also interested in the boat, hopeful for a quick deal and departure. However the 'Charlotte Rhodes' gets stuck on a submerged wreck. Elizabeth buys the tug and offers to pull the 'Charlotte Rhodes' clear but, as James let the insurance lapse, he would be unable to claim the expense and finally the ship is floated off, thanks to the underwater skills of its carpenter. Matt, however, is annoyed that again Onedin places cost-cutting over the risk to human life.

James is anxious to buy the Salt Line, a fleet of six ships which seem to belong to a foppish dandy, Sinclair, who does nothing with them. In fact they are owned by his aunt, captain's widow Mrs. Salt, now old and bed-ridden but reluctant to sell as she has promised them to her nephew. James discovers that Sinclair has huge gambling debts, which he pays off in return for being given the ships. He and Sinclair go to see Mrs. Salt for her approval but she has died in her sleep and so James takes over the Salt Line, putting Captain Baines in charge of it.

Sarah is suspicious when Robert visits mystery woman Beatie Mays, though it turns out he is only helping her regain possession of her hat shop and is not being unfaithful. Her trust in him gives him the self-confidence which he feels the rest of his family undermine. Meanwhile on a voyage home from Brazil, Matt takes over captaincy when Baines is injured and, when the ship is becalmed, the crew put it down to the presence of an albatross. However they return to Liverpool in time for Christmas. Matt accepts a partnership with the Frazer Line but Captain Baines is outraged that James has evicted his niece and her children to make way for his expansion plans and quits the Onedin Line.