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<div class="phx-topic abstract-wrapper">A regulation change that went into effect over the weekend allows Beijing to penalize and block vessels from countries that it accuses of targeting its own shipping activities. </div>

A regulation change that went into effect over the weekend allows Beijing to penalize and block vessels from countries that it accuses of targeting its own shipping activities.

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<div class="phx-topic">China has amended its maritime regulations to allow it to penalize and restrict vessels of countries accused of targeting its shipping operations, flexing its power and raising the stakes just two weeks before a US tax on Chinese operators and shipbuilding takes effect. China Premier Li Qiang has signed into law an amendment that took effect Sunday, laying the groundwork for China to block not just vessels, but also data, information and other maritime services of other countries it wishes to target, according to an order from China’s State Council seen by the Journal of Commerce. The amendment keeps the door open for conciliation through treaties and agreements, which comes as the Trump administration seeks to negotiate a larger trade deal with China. The move by Beijing comes ahead of the Oct. 14 date when US Customs and Border Protection will begin collecting special taxes on ships calling US ports that are operated by China-based companies or were built in China. The US has accused China of unfairly subsidizing its shipbuilding industry to establish global maritime dominance and is leveling the sharpest taxes on Cosco Shipping and its OOCL subsidiary. Container lines not based in China <a href="https://www.joc.com/article/chinese-tonnage-moving-out-of-us-container-trade-ahead-of-new-fees-xeneta-6081320">have shifted China-built ships out of US services</a> and replaced them with vessels from South Korea and elsewhere to avoid the new fees. Major carriers including <a href="https://www.joc.com/article/msc-ready-for-us-port-fees-after-network-changes-ceo-6079762">Maersk and Mediterranean Shipping Co.</a> have said in recent weeks they won’t need to levy a surcharge to recoup costs from the new fee. Cosco and OOCL, which together handle the largest share of US imports from Asia, have signaled they will continue to operate in the US trades. The port fees, <a href="https://www.joc.com/article/us-port-fees-could-exceed-2b-for-cosco-oocl-hsbc-6077305">estimated by investment bank HSBC to cost the two Chinese carriers at least $2 billion in the first year</a>, will rise incrementally over the next four years. The US Trade Representative (USTR) is expected in the coming week to release an FAQ regarding the so-called Section 301 investigation into China’s maritime activities and respond to requests for clarifications and changes on the US new tax, according to one person close to the matter. The investigation targets Chinese-built chassis, container equipment and cranes, some of which are being <a href="https://www.joc.com/article/freeport-pays-crane-tariffs-to-avoid-ustr-fee-risk-6087337">received by US ports this month before the Oct. 14 deadline</a>. Contact Mark Szakonyi at <a href="mailto:mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>. </div>

China has amended its maritime regulations to allow it to penalize and restrict vessels of countries accused of targeting its shipping operations, flexing its power and raising the stakes just two weeks before a US tax on Chinese operators and shipbuilding takes effect. China Premier Li Qiang has signed into law an amendment that took effect Sunday, laying the groundwork for China to block not just vessels, but also data, information and other maritime services of other countries it wishes to target, according to an order from China’s State Council seen by the Journal of Commerce. The amendment keeps the door open for conciliation through treaties and agreements, which comes as the Trump administration seeks to negotiate a larger trade deal with China. The move by Beijing comes ahead of the Oct. 14 date when US Customs and Border Protection will begin collecting special taxes on ships calling US ports that are operated by China-based companies or were built in China. The US has accused China of unfairly subsidizing its shipbuilding industry to establish global maritime dominance and is leveling the sharpest taxes on Cosco Shipping and its OOCL subsidiary. Container lines not based in China have shifted China-built ships out of US services and replaced them with vessels from South Korea and elsewhere to avoid the new fees. Major carriers including Maersk and Mediterranean Shipping Co. have said in recent weeks they won’t need to levy a surcharge to recoup costs from the new fee. Cosco and OOCL, which together handle the largest share of US imports from Asia, have signaled they will continue to operate in the US trades. The port fees, estimated by investment bank HSBC to cost the two Chinese carriers at least $2 billion in the first year , will rise incrementally over the next four years. The US Trade Representative (USTR) is expected in the coming week to release an FAQ regarding the so-called Section 301 investigation into China’s maritime activities and respond to requests for clarifications and changes on the US new tax, according to one person close to the matter. The investigation targets Chinese-built chassis, container equipment and cranes, some of which are being received by US ports this month before the Oct. 14 deadline . Contact Mark Szakonyi at mark.szakonyi@spglobal.com .

China flexes maritime power in response to coming US port fee

<div class="phx-topic abstract-wrapper">US truckload carriers are likely to see a 2% increase in contract rates next year as shippers focus on doing more with less, Arrive Logistics says. </div>

US truckload carriers are likely to see a 2% increase in contract rates next year as shippers focus on doing more with less, Arrive Logistics says.

<div class="phx-topic">A significant increase in US truckload contract rates in 2026 is “improbable,” with rates likely to rise by low single-digit percentages, a new market forecast claims. Contract rates should rise about 2% by the end of 2026, while transactional truckload spot rates claw their way up 6% from this year’s bottom, according to Arrive Logistics. Oversupply, weak demand and low spot prices will keep a lid on contract rate hikes, with shippers retaining pricing power well into 2026, the brokerage provider said. “We see a little bit of an upward movement next year, but not a great disruption,” David Spencer, Arrive’s vice president of market intelligence, told the Journal of Commerce. That forecast should please shippers enjoying an unprecedented period of pricing power and frustrate truckload carriers whose margins are under pressure from rising costs. Carriers have told the Journal of Commerce they need a rate hike of 4% to 6% just to keep up with inflation and operating costs. Shippers, Spencer said, aren’t ready for that leap. “The major shippers are looking to do more with less,” he said in an interview after the release of Arrive’s 2025–26 North American Truckload Freight Forecast last week. In conversations between Arrive and more than a dozen shippers, “the consensus was that 2% to 4% is a fair range” for truckload rate increases in 2026, Spencer said. “A lot of them felt that if they had the flexibility, [their rate increases] would be closer to flat in the first half and high single-digit in the back half [of 2026],” he said. Currently, the market is highly competitive, with many truckload carriers willing to bid below cost to obtain freight and keep tractor-trailers rolling. “Even lanes we cover well [as a broker] are being under bid,” Spencer said, adding that in such a market, “there’s more appetite for shippers to leverage non-asset providers” offering lower-priced rates. <h3>Spot-contract delta </h3>Arrive’s annual forecast is the latest report to predict a relatively stable year for truckload rates in 2026 with modest growth in pricing capped by low truck freight demand. In August, C.H. Robinson Worldwide forecast a <a href="https://www.chrobinson.com/en-us/resources/insights-and-advisories/north-america-freight-insights/aug-2025-freight-market-update/na-truckload/">2% increase</a> in spot truckload pricing in 2026. “There’s little evidence of a catalyst on the horizon that would suggest freight volumes will increase materially next year,” the largest US truckload broker said. Logistics provider RXO, publisher of the quarterly RXO Curve report on truckload pricing, found “no momentum” in truckload spot pricing <a href="https://www.joc.com/article/us-truckload-market-mired-in-malaise-as-import-surge-wanes-6075566">during the third quarter</a>. Truckload pricing, as measured by the US long-haul truckload producer price index (PPI), did rise 1.8% in August from July but was still 0.2% lower than a year earlier. The PPI represents final selling prices and is weighted toward contract rates. “The biggest reason why contract rates aren’t going to go up is how low spot rates are,” Spencer said. Arrive’s data put the average US spot rate at $1.61 per mile in August, down from $1.75 in January and up 2 cents from August 2024. The broker’s average dry-van contract rate in August was $2 per mile. Contract rates usually rise after spot rates rise above them, but the size of the gap makes that less likely without a market shock, Spencer said. “If there’s a 40-cent delta [between spot and contract rates], what’s going to create a sustained 40-cent increase in spot rates?” he said. The Arrive forecast does show that delta narrowing by December 2026, but only to 22 cents — $1.81 per mile for spot rates and $2.03 per mile for contract pricing. Truckload capacity attrition “is real,” Spencer said. Not only are carriers exiting trucking, but fewer trucks are being purchased and put on the road, he said. ACT Research reported Class 8 heavy truck net orders were down 21% year over year in August, the eighth consecutive month of declining orders. But truckload capacity hasn’t tightened enough to affect truck availability or pricing heading into the fourth quarter, trucking’s peak shipping season. “Demand has been pretty stable and isn’t heading toward a cliff,” said Spencer. “The available capacity will support it.” Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. </div>

A significant increase in US truckload contract rates in 2026 is “improbable,” with rates likely to rise by low single-digit percentages, a new market forecast claims. Contract rates should rise about 2% by the end of 2026, while transactional truckload spot rates claw their way up 6% from this year’s bottom, according to Arrive Logistics. Oversupply, weak demand and low spot prices will keep a lid on contract rate hikes, with shippers retaining pricing power well into 2026, the brokerage provider said. “We see a little bit of an upward movement next year, but not a great disruption,” David Spencer, Arrive’s vice president of market intelligence, told the Journal of Commerce. That forecast should please shippers enjoying an unprecedented period of pricing power and frustrate truckload carriers whose margins are under pressure from rising costs. Carriers have told the Journal of Commerce they need a rate hike of 4% to 6% just to keep up with inflation and operating costs. Shippers, Spencer said, aren’t ready for that leap. “The major shippers are looking to do more with less,” he said in an interview after the release of Arrive’s 2025–26 North American Truckload Freight Forecast last week. In conversations between Arrive and more than a dozen shippers, “the consensus was that 2% to 4% is a fair range” for truckload rate increases in 2026, Spencer said. “A lot of them felt that if they had the flexibility, [their rate increases] would be closer to flat in the first half and high single-digit in the back half [of 2026],” he said. Currently, the market is highly competitive, with many truckload carriers willing to bid below cost to obtain freight and keep tractor-trailers rolling. “Even lanes we cover well [as a broker] are being under bid,” Spencer said, adding that in such a market, “there’s more appetite for shippers to leverage non-asset providers” offering lower-priced rates. Spot-contract delta Arrive’s annual forecast is the latest report to predict a relatively stable year for truckload rates in 2026 with modest growth in pricing capped by low truck freight demand. In August, C.H. Robinson Worldwide forecast a 2% increase in spot truckload pricing in 2026. “There’s little evidence of a catalyst on the horizon that would suggest freight volumes will increase materially next year,” the largest US truckload broker said. Logistics provider RXO, publisher of the quarterly RXO Curve report on truckload pricing, found “no momentum” in truckload spot pricing during the third quarter . Truckload pricing, as measured by the US long-haul truckload producer price index (PPI), did rise 1.8% in August from July but was still 0.2% lower than a year earlier. The PPI represents final selling prices and is weighted toward contract rates. “The biggest reason why contract rates aren’t going to go up is how low spot rates are,” Spencer said. Arrive’s data put the average US spot rate at $1.61 per mile in August, down from $1.75 in January and up 2 cents from August 2024. The broker’s average dry-van contract rate in August was $2 per mile. Contract rates usually rise after spot rates rise above them, but the size of the gap makes that less likely without a market shock, Spencer said. “If there’s a 40-cent delta [between spot and contract rates], what’s going to create a sustained 40-cent increase in spot rates?” he said. The Arrive forecast does show that delta narrowing by December 2026, but only to 22 cents — $1.81 per mile for spot rates and $2.03 per mile for contract pricing. Truckload capacity attrition “is real,” Spencer said. Not only are carriers exiting trucking, but fewer trucks are being purchased and put on the road, he said. ACT Research reported Class 8 heavy truck net orders were down 21% year over year in August, the eighth consecutive month of declining orders. But truckload capacity hasn’t tightened enough to affect truck availability or pricing heading into the fourth quarter, trucking’s peak shipping season. “Demand has been pretty stable and isn’t heading toward a cliff,” said Spencer. “The available capacity will support it.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

Modest hike but no ‘great disruption’ seen for truckload pricing in 2026

<div class="phx-topic abstract-wrapper">The move by CSX to relieve Joe Hinrichs of his duties comes after Ancora Holdings urged the railroad’s board of directors to seek a merger with BNSF Railway or Canadian Pacific Kansas City in response to the UP-NS deal. </div>

The move by CSX to relieve Joe Hinrichs of his duties comes after Ancora Holdings urged the railroad’s board of directors to seek a merger with BNSF Railway or Canadian Pacific Kansas City in response to the UP-NS deal.

<div class="phx-topic">Joe Hinrichs was ousted as CEO of CSX Transportation on Sunday by the railroad’s board of directors, just over a month after an activist investor called for him to step down amid competitive pressures brought on by the proposed merger of Union Pacific Railroad and Norfolk Southern Railway. The CSX board named veteran business executive Steve Angel as CEO effective Sept. 28. “It has been a privilege to serve as CEO of CSX,” Hinrichs said in a statement from CSX. “I am proud of the progress we have made in improving performance, strengthening customer relationships, and building a culture centered on safety and collaboration.” While the move itself isn’t surprising, the timing of it was because Hinrichs attended a grand reopening of the Howard Street Tunnel in Baltimore last Friday and was scheduled to host another event this Thursday at the Blue Ridge Subdivision on the Tennessee-North Carolina border. At the Friday event, Hinrichs talked about how he was celebrating his third anniversary with CSX and looked forward to all the opportunities ahead in 2026 with both projects completed. Multiple sources told the Journal of Commerce that Hinrichs was unaware of his fate when attending the event in Baltimore and only learned of the decision afterward. Angel is an executive with over 45 years of experience leading large companies, including Praxair and Linde, two industrial gas companies that merged in 2018. Similar to Hinrichs, he has no prior railroading experience. “My top priorities will be to ensure the safety of the railroad and our employees, deliver reliable service to our customers, and increase value for our shareholders,” Angel said in the CSX statement. “We believe [Angel’s] track record of driving operational excellence and cultivating strong relationships with key stakeholders, including partners and customers, makes him the ideal CEO to lead CSX into its next chapter,” Kevin Boone, CSX’s executive vice president and chief commercial officer, wrote in a letter to customers that was obtained by the Journal of Commerce. “Importantly ... [the] announcement does not change anything about our valued relationship with you. Our top priority remains delivering the reliable service you have come to expect from CSX.” <h3>Investor urged CSX to act </h3>The move by CSX to relieve Hinrichs of his duties comes after Ancora Holdings, an activist investor, urged the railroad’s board of directors in August to seek a merger with BNSF Railway or Canadian Pacific Kansas City in response to the UP-NS transaction. Without such a deal, Ancora called for a leadership change at CSX. “[We] urged the board to terminate [Hinrichs] if he could not quickly position CSX to catch up to the railroads that have embraced the need for transcontinental service in the United States,” Ancora said in a statement Monday. “As we expected, Mr. Hinrichs botched the opportunity and, if anything, appeared to try to fight the tailwinds of consolidation.” BNSF and CPKC have since stated they are not looking to merge or acquire any railroads, leaving Angel with the immediate responsibility of responding to the UP-NS transaction. Nevertheless, Ancora said Angel “is an initial step in the right direction for CSX.” Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

Joe Hinrichs was ousted as CEO of CSX Transportation on Sunday by the railroad’s board of directors, just over a month after an activist investor called for him to step down amid competitive pressures brought on by the proposed merger of Union Pacific Railroad and Norfolk Southern Railway. The CSX board named veteran business executive Steve Angel as CEO effective Sept. 28. “It has been a privilege to serve as CEO of CSX,” Hinrichs said in a statement from CSX. “I am proud of the progress we have made in improving performance, strengthening customer relationships, and building a culture centered on safety and collaboration.” While the move itself isn’t surprising, the timing of it was because Hinrichs attended a grand reopening of the Howard Street Tunnel in Baltimore last Friday and was scheduled to host another event this Thursday at the Blue Ridge Subdivision on the Tennessee-North Carolina border. At the Friday event, Hinrichs talked about how he was celebrating his third anniversary with CSX and looked forward to all the opportunities ahead in 2026 with both projects completed. Multiple sources told the Journal of Commerce that Hinrichs was unaware of his fate when attending the event in Baltimore and only learned of the decision afterward. Angel is an executive with over 45 years of experience leading large companies, including Praxair and Linde, two industrial gas companies that merged in 2018. Similar to Hinrichs, he has no prior railroading experience. “My top priorities will be to ensure the safety of the railroad and our employees, deliver reliable service to our customers, and increase value for our shareholders,” Angel said in the CSX statement. “We believe [Angel’s] track record of driving operational excellence and cultivating strong relationships with key stakeholders, including partners and customers, makes him the ideal CEO to lead CSX into its next chapter,” Kevin Boone, CSX’s executive vice president and chief commercial officer, wrote in a letter to customers that was obtained by the Journal of Commerce. “Importantly ... [the] announcement does not change anything about our valued relationship with you. Our top priority remains delivering the reliable service you have come to expect from CSX.” Investor urged CSX to act The move by CSX to relieve Hinrichs of his duties comes after Ancora Holdings, an activist investor, urged the railroad’s board of directors in August to seek a merger with BNSF Railway or Canadian Pacific Kansas City in response to the UP-NS transaction. Without such a deal, Ancora called for a leadership change at CSX. “[We] urged the board to terminate [Hinrichs] if he could not quickly position CSX to catch up to the railroads that have embraced the need for transcontinental service in the United States,” Ancora said in a statement Monday. “As we expected, Mr. Hinrichs botched the opportunity and, if anything, appeared to try to fight the tailwinds of consolidation.” BNSF and CPKC have since stated they are not looking to merge or acquire any railroads, leaving Angel with the immediate responsibility of responding to the UP-NS transaction. Nevertheless, Ancora said Angel “is an initial step in the right direction for CSX.” Contact Ari Ashe at ari.ashe@spglobal.com .

CSX CEO removed amid activist pressure in wake of UP-NS merger

<div class="phx-topic abstract-wrapper">The shipbuilding interest would follow the carrier’s recent trio of container vessel reflaggings in India as it looks to develop a stronger profile in the subcontinent market. </div>

The shipbuilding interest would follow the carrier’s recent trio of container vessel reflaggings in India as it looks to develop a stronger profile in the subcontinent market.

<div class="phx-topic">CMA CGM is set to become the first major ocean carrier to build container ships in India, ordering three short-haul box ships with Cochin Shipyard Ltd. (CSL), India’s largest facility, industry sources tell the Journal of Commerce. While the final details are still being worked out, the planned newbuildings will most likely be liquefied natural gas (LNG)-powered vessels. An official announcement is expected in the coming weeks, but a CSL executive who did not want to be identified confirmed ongoing talks with CMA CGM, who did not respond to a request for comment. The shipbuilding interest builds on the carrier’s recent trio of container vessel reflaggings in India, with the CMA CGM Vitoria, CMA CGM Manaus and CMA CGM Diamond now part of a regional India-Red Sea “BIGEX” loop it runs jointly with two Middle East-based feeder operators. <h3>Government investing in shipbuilding </h3>The Indian government has been seeking industry support to rev up the country’s shipbuilding ecosystems through liberalization policies and incentive schemes, a push turbo-charged this week with the announcement of a whopping $8 billion maritime investment package. “The package introduces a four-pillar approach designed to strengthen domestic capacity, improve long-term financing, promote greenfield and brownfield shipyard development, enhance technical capabilities and skilling, and implement legal, taxation and policy reforms to create a robust maritime infrastructure,” an official statement from the government said. CSL has already agreed to collaborate with South Korea’s HD Korea Shipbuilding &amp; Offshore Engineering on shipbuilding projects, with those efforts having yielded some positive results. Maersk in early 2025 struck a deal with CSL for ship repair/drydocking services in a near-term diversification strategy, with the potential to pursue shipbuilding opportunities in the longer term. “Our partnership with CSL is progressing well,” a Maersk spokesperson said. “We endeavor to have our first ship repair soon.” Mediterranean Shipping Co., the largest global operator of container tonnage, has also shown interest in Indian shipbuilding. MSC CEO Soren Toft in February met with Piyush Goyal, India’s minister of commerce and industry, to discuss a number of items, including shipbuilding and repair, according to local reports. Still, shipbuilding is not a “low-hanging fruit” opportunity for India to reap quickly because of its vast infrastructure and cost gaps with traditional marketplaces in East Asia, industry observers say. “Except for two yards, none of the [Indian] yards have a capacity of more than 10,000 deadweight tons, so the ships that we build will be limited to that size only,” said a local shipowner who did not want to be identified. “We have made some inquiries and found that our yards are completely priced out.” Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

CMA CGM is set to become the first major ocean carrier to build container ships in India, ordering three short-haul box ships with Cochin Shipyard Ltd. (CSL), India’s largest facility, industry sources tell the Journal of Commerce. While the final details are still being worked out, the planned newbuildings will most likely be liquefied natural gas (LNG)-powered vessels. An official announcement is expected in the coming weeks, but a CSL executive who did not want to be identified confirmed ongoing talks with CMA CGM, who did not respond to a request for comment. The shipbuilding interest builds on the carrier’s recent trio of container vessel reflaggings in India, with the CMA CGM Vitoria, CMA CGM Manaus and CMA CGM Diamond now part of a regional India-Red Sea “BIGEX” loop it runs jointly with two Middle East-based feeder operators. Government investing in shipbuilding The Indian government has been seeking industry support to rev up the country’s shipbuilding ecosystems through liberalization policies and incentive schemes, a push turbo-charged this week with the announcement of a whopping $8 billion maritime investment package. “The package introduces a four-pillar approach designed to strengthen domestic capacity, improve long-term financing, promote greenfield and brownfield shipyard development, enhance technical capabilities and skilling, and implement legal, taxation and policy reforms to create a robust maritime infrastructure,” an official statement from the government said. CSL has already agreed to collaborate with South Korea’s HD Korea Shipbuilding & Offshore Engineering on shipbuilding projects, with those efforts having yielded some positive results. Maersk in early 2025 struck a deal with CSL for ship repair/drydocking services in a near-term diversification strategy, with the potential to pursue shipbuilding opportunities in the longer term. “Our partnership with CSL is progressing well,” a Maersk spokesperson said. “We endeavor to have our first ship repair soon.” Mediterranean Shipping Co., the largest global operator of container tonnage, has also shown interest in Indian shipbuilding. MSC CEO Soren Toft in February met with Piyush Goyal, India’s minister of commerce and industry, to discuss a number of items, including shipbuilding and repair, according to local reports. Still, shipbuilding is not a “low-hanging fruit” opportunity for India to reap quickly because of its vast infrastructure and cost gaps with traditional marketplaces in East Asia, industry observers say. “Except for two yards, none of the [Indian] yards have a capacity of more than 10,000 deadweight tons, so the ships that we build will be limited to that size only,” said a local shipowner who did not want to be identified. “We have made some inquiries and found that our yards are completely priced out.” Contact Bency Mathew at bencyvmathew@gmail.com .

CMA CGM eyes shipbuilding plans for India in trade diversification strategy: sources

<div class="phx-topic abstract-wrapper">But the expansion of data processing power and storage to facilitate AI algorithms and cloud data will not be an explosive game changer in the manner of e-commerce, according to analysts. </div>

But the expansion of data processing power and storage to facilitate AI algorithms and cloud data will not be an explosive game changer in the manner of e-commerce, according to analysts.

<div class="phx-topic">Fast-growing demand for cloud infrastructure and the development of huge AI data centers around the world are helping air cargo to offset the loss of e-commerce volume on the trans-Pacific. China-US cross-border e-commerce from January through August is down 16%, according to data from Sydney-based research consultancy Trade and Transport Group. The US in May eliminated its “de minimis” exemption for imports valued at under $800 from China and <a href="https://www.joc.com/article/elimination-of-us-de-minimis-rule-hits-smes-hardest-6078319">extended the removal of duty-free access to low-value products</a> to all its trading partners in August. While the drop in China-US e-commerce is being compensated for by a sharp increase in low-value traffic to other parts of Asia and Europe, the rising demand for components to support the AI industry is also feeding into air cargo demand. Tim van Leeuwen, vice president and head of consulting at air cargo analyst Rotate, said the growth in demand for data processing power and storage to facilitate AI algorithms and cloud data storage was boosting air cargo volumes. “Data processing racks and servers are flown due to their high value and the often-urgent demand for the products,” van Leeuwen told the Journal of Commerce. The sheer scale of investment being poured into AI-related infrastructure, particularly in the US and China, by tech giants is a welcome growth pipeline for air freight after the US elimination of the de minimis exemption turned off the lucrative e-commerce spigot on the trans-Pacific. Dozens of freighters serving the China-US corridor every day had to be relocated to other trade lanes as the Chinese online platforms saw demand tumble. But Frederic Horst, managing director of Trade and Transport Group, cautioned that growth in air cargo volume from the rapid expansion of AI and its high-tech components will not be explosive in the manner of e-commerce. Horst pointed out that the bulk of shipments required to construct data centers will be moved by ocean. “For sure it will drive traffic, but the key issue is that the supply of hardware will be an orderly process, so speed doesn’t matter,” he told the Journal of Commerce. “The reason sea is important is because given the time it takes to build a data center, there is not really a huge requirement for air — if you are looking at 12 months or so for construction and fit out, there is no hurry to get things in.” <h3>Forwarders targeting tech-focused business </h3>Still, technology majors are pouring billions into information and communication technology (ICT), developing vast networks of data centers that provide on-demand computing, storage and advanced services such as AI and machine learning on an international scale. It is an area being targeted by global forwarders such as Kuehne + Nagel, whose CEO Stefan Paul said recently that K+N was actively growing the tech-focused part of its business. “This vertical ... is growing significantly and we expect it will bring high single-digit growth to the air freight business going into the fourth quarter,” Paul said during an August earnings call. Supply chain and e-commerce service provider Arvato has opened a new 10,000-square-meter high-tech logistics center in Frankfurt that specializes in handling hyperscalers and high-tech businesses. Hyperscalers refer to cloud computing providers such as Amazon Web Services (AWS), Microsoft Azure and Google Cloud that operate the global data processing and storage centers providing advanced AI services. Nvidia founder and CEO Jensen Huang said in a recent statement outlining a collaboration with Intel Corp. that global spending on AI infrastructure will surge from $600 billion this year to as much as $4 trillion by the end of the decade. “AI is powering a new industrial revolution and reinventing every layer of the computing stack — from silicon to systems to software,” Huang said. For their part, Nvidia and Intel will jointly develop multiple generations of custom data centers and PC products aimed at accelerating applications and workloads across the hyperscaler, enterprise and consumer markets. Oracle chairman and CTO Larry Ellison said the company’s MultiCloud database revenue from hyperscalers Amazon, Google and Microsoft grew by 1,529% year over year. “We expect MultiCloud revenue to grow substantially every quarter for several years as we deliver another 37 data centers to our three hyperscaler partners, for a total of 71,” Ellison said during an earnings call earlier this month. Oracle invested $27.4 billion in capital expenditure in the past 12 months and $8.5 billion has been earmarked for the first quarter of fiscal year 2026, with a significant portion directed toward cloud infrastructure and AI-related projects. <h3>Chip demand on the rise </h3>At the heart of AI processes are air cargo-friendly semiconductors; the world’s leading manufacturer of these chips is Taiwan Semiconductor Manufacturing. Huge demand for the AI chips saw its revenue for January through August increasing 37% compared with the same period last year to $80 billion, the company said. A regional competitor in this sector is Malaysia, which controls 7% of the global semiconductor market with six out of the 12 largest semiconductor companies globally operating in the country. The National Semiconductor Strategy (NSS) launched by Malaysia in 2024 aims to capitalize on investment in the sector that grew 18.7% year over year in the first half of the year to $45.2 billion. Malaysia’s market share is expected to increase because of the US-China trade war and ongoing fears of a Taiwan takeover by Beijing, with semiconductor players worldwide turning to Southeast Asia for stable microchip supply chains. Competition in the chip-making business is also expected to come from Vietnam. Although the country only has a small share of the global business and is mostly involved in packaging and testing semiconductors, significant investment from industry majors such as Intel and Amkor Technology, supported by government initiatives, aims to expand production. Vietnam’s Ministry of Information and Communications has forecast that the ICT industry will achieve US$169.3 billion in total revenue in 2025, up 11.4% year over year. Hardware and electronics exports are expected to grow by 12.3% this year, reaching $148.5 billion. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Fast-growing demand for cloud infrastructure and the development of huge AI data centers around the world are helping air cargo to offset the loss of e-commerce volume on the trans-Pacific. China-US cross-border e-commerce from January through August is down 16%, according to data from Sydney-based research consultancy Trade and Transport Group. The US in May eliminated its “de minimis” exemption for imports valued at under $800 from China and extended the removal of duty-free access to low-value products to all its trading partners in August. While the drop in China-US e-commerce is being compensated for by a sharp increase in low-value traffic to other parts of Asia and Europe, the rising demand for components to support the AI industry is also feeding into air cargo demand. Tim van Leeuwen, vice president and head of consulting at air cargo analyst Rotate, said the growth in demand for data processing power and storage to facilitate AI algorithms and cloud data storage was boosting air cargo volumes. “Data processing racks and servers are flown due to their high value and the often-urgent demand for the products,” van Leeuwen told the Journal of Commerce. The sheer scale of investment being poured into AI-related infrastructure, particularly in the US and China, by tech giants is a welcome growth pipeline for air freight after the US elimination of the de minimis exemption turned off the lucrative e-commerce spigot on the trans-Pacific. Dozens of freighters serving the China-US corridor every day had to be relocated to other trade lanes as the Chinese online platforms saw demand tumble. But Frederic Horst, managing director of Trade and Transport Group, cautioned that growth in air cargo volume from the rapid expansion of AI and its high-tech components will not be explosive in the manner of e-commerce. Horst pointed out that the bulk of shipments required to construct data centers will be moved by ocean. “For sure it will drive traffic, but the key issue is that the supply of hardware will be an orderly process, so speed doesn’t matter,” he told the Journal of Commerce. “The reason sea is important is because given the time it takes to build a data center, there is not really a huge requirement for air — if you are looking at 12 months or so for construction and fit out, there is no hurry to get things in.” Forwarders targeting tech-focused business Still, technology majors are pouring billions into information and communication technology (ICT), developing vast networks of data centers that provide on-demand computing, storage and advanced services such as AI and machine learning on an international scale. It is an area being targeted by global forwarders such as Kuehne + Nagel, whose CEO Stefan Paul said recently that K+N was actively growing the tech-focused part of its business. “This vertical ... is growing significantly and we expect it will bring high single-digit growth to the air freight business going into the fourth quarter,” Paul said during an August earnings call. Supply chain and e-commerce service provider Arvato has opened a new 10,000-square-meter high-tech logistics center in Frankfurt that specializes in handling hyperscalers and high-tech businesses. Hyperscalers refer to cloud computing providers such as Amazon Web Services (AWS), Microsoft Azure and Google Cloud that operate the global data processing and storage centers providing advanced AI services. Nvidia founder and CEO Jensen Huang said in a recent statement outlining a collaboration with Intel Corp. that global spending on AI infrastructure will surge from $600 billion this year to as much as $4 trillion by the end of the decade. “AI is powering a new industrial revolution and reinventing every layer of the computing stack — from silicon to systems to software,” Huang said. For their part, Nvidia and Intel will jointly develop multiple generations of custom data centers and PC products aimed at accelerating applications and workloads across the hyperscaler, enterprise and consumer markets. Oracle chairman and CTO Larry Ellison said the company’s MultiCloud database revenue from hyperscalers Amazon, Google and Microsoft grew by 1,529% year over year. “We expect MultiCloud revenue to grow substantially every quarter for several years as we deliver another 37 data centers to our three hyperscaler partners, for a total of 71,” Ellison said during an earnings call earlier this month. Oracle invested $27.4 billion in capital expenditure in the past 12 months and $8.5 billion has been earmarked for the first quarter of fiscal year 2026, with a significant portion directed toward cloud infrastructure and AI-related projects. Chip demand on the rise At the heart of AI processes are air cargo-friendly semiconductors; the world’s leading manufacturer of these chips is Taiwan Semiconductor Manufacturing. Huge demand for the AI chips saw its revenue for January through August increasing 37% compared with the same period last year to $80 billion, the company said. A regional competitor in this sector is Malaysia, which controls 7% of the global semiconductor market with six out of the 12 largest semiconductor companies globally operating in the country. The National Semiconductor Strategy (NSS) launched by Malaysia in 2024 aims to capitalize on investment in the sector that grew 18.7% year over year in the first half of the year to $45.2 billion. Malaysia’s market share is expected to increase because of the US-China trade war and ongoing fears of a Taiwan takeover by Beijing, with semiconductor players worldwide turning to Southeast Asia for stable microchip supply chains. Competition in the chip-making business is also expected to come from Vietnam. Although the country only has a small share of the global business and is mostly involved in packaging and testing semiconductors, significant investment from industry majors such as Intel and Amkor Technology, supported by government initiatives, aims to expand production. Vietnam’s Ministry of Information and Communications has forecast that the ICT industry will achieve US$169.3 billion in total revenue in 2025, up 11.4% year over year. Hardware and electronics exports are expected to grow by 12.3% this year, reaching $148.5 billion. Contact Greg Knowler at greg.knowler@spglobal.com .

Growing appetite for AI technology feeds into air cargo demand

<div class="phx-topic abstract-wrapper">Cost pressures are raising inventory management to new levels at shippers, highlighting the need for integration of multiple fulfillment channels, says ITS Logistics. </div>

Cost pressures are raising inventory management to new levels at shippers, highlighting the need for integration of multiple fulfillment channels, says ITS Logistics.

<div class="phx-topic">Higher tariff costs are pushing US retailers toward leaner inventory management at the same time that consumers are still seeking faster delivery of goods through more fulfillment channels. Target, for example, announced last week it will expand next-day delivery of online orders <a href="https://www.cbsnews.com/news/target-expands-next-day-delivery-to-compete-with-amazon-walmart/">to 35 US markets</a> by the end of October. Amazon in June said it will <a href="https://www.aboutamazon.com/news/transportation/rural-small-town-america-us-prime-same-next-day-delivery">expand its same-day and next-day services</a> to more than 4,000 small towns and rural areas by 2026. Those dual pressures will reshape retail logistics in 2026, with even greater blending of multiple fulfillment channels forcing closer alignment of inventory and transportation management, said Kasia Wenker, vice president of solutions engineering at ITS Logistics. “We’re at a major inflection point,” Wenker told the Journal of Commerce. “Retail as we understand it is already becoming e-commerce fulfillment, and the variety of delivery methods is mind-blowing. Far more logistics support is needed to fulfill the needs.” ITS Logistics is launching a network of retail logistics hubs from existing facilities in Nevada, Indiana and Texas aimed at smaller retail companies. The hubs will use integrated inventory management and transportation systems for fulfillment and distribution. “The goal is to give them a network that allows them to compete with the big retailers who can deliver to customers within under an hour,” Wenker said. ITS plans to add additional retail logistics hubs in the next two to three years, and other types of hubs as well. The “inflection” Wenker sees is becoming evident as US retailers look to inventory management for help with rising costs induced by high US tariffs. In recent earnings calls, retailers highlighted a more “disciplined” approach to inventory management. “We did not repurchase any of our shares during the quarter, instead choosing to allocate capital to manage inventory,” Earl Carlton Ford, CFO of Academy Sports, said during an earnings call this month. “This decision led to a strong inventory position.” Many companies chose to build up stocks ahead of tariffs. US retail inventories were up 1.7% year over year in July, at $809.8 billion, and up 0.7% from April and the introduction of reciprocal tariffs, according to data from the US Census Bureau. Despite that build up, the average US retailer inventory-to-sales ratio (ISR) dropped to 1.29 in July from 1.32 a year earlier. The average merchant wholesaler ISR fell from 1.35 to 1.28 in the same period, indicating goods are flowing through warehouses faster. <h3>Drilling into costs, sales </h3>Home improvement retailer Lowe’s cut inventory by $499 million — about 3% — year over year to $16.3 billion in the second quarter. “We continue to manage our inventory replenishment in line with demand trends,” said CFO Brandon J. Sink. Speaking during an earnings call in August, Sink attributed that success in part to “tools and processes” that use data to align sourcing, inventory and sales. New planning tools are helping the retailer optimize inventory allocation across its network. Urban Outfitters is one retailer intentionally building higher inventory levels. “We ended the second quarter with slightly elevated inventory levels as we intentionally brought in product early to reduce the impact of announced tariff increases,” Melanie Marein-Efron, CFO of the apparel retailer, said during an earnings call in August. Besides pulling imports forward, the apparel retailer also said it localized inventory management and aligned it more closely with sales data, reducing markdowns. A tight focus on per unit costs and sales is key to keeping inventory in balance as tariff-induced costs rise. “Our inventory per store is elevated, with units per store up 4.6%,” Academy Sports’ Ford said in early September. “We have purposely pulled forward domestic inventory receipts at pre-tariff prices,” Ford said. But Academy Sports is also adding new stores and spreading goods drawn from domestic US and international sources throughout its retail network. All of this requires increasing use of technology to contain costs while meeting customer demands for faster service across multiple fulfillment channels, Wenker said. “The biggest problem we see is fragmentation; you can’t have separate infrastructure for fulfillment from your stores and through e-commerce,” she said. There’s also a divide to be bridged at many companies between inventory and transportation management. “There are transportation people and there are inventory people and they don’t always have the same KPIs [key performance indicators],” Wenker explained. That may be truer for smaller, regional retailers than larger, national companies with enterprise-wide supply chain systems, she added. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. Journal of Commerce Research Editor Cathy Morrow Roberson contributed to this report. </div>

Higher tariff costs are pushing US retailers toward leaner inventory management at the same time that consumers are still seeking faster delivery of goods through more fulfillment channels. Target, for example, announced last week it will expand next-day delivery of online orders to 35 US markets by the end of October. Amazon in June said it will expand its same-day and next-day services to more than 4,000 small towns and rural areas by 2026. Those dual pressures will reshape retail logistics in 2026, with even greater blending of multiple fulfillment channels forcing closer alignment of inventory and transportation management, said Kasia Wenker, vice president of solutions engineering at ITS Logistics. “We’re at a major inflection point,” Wenker told the Journal of Commerce. “Retail as we understand it is already becoming e-commerce fulfillment, and the variety of delivery methods is mind-blowing. Far more logistics support is needed to fulfill the needs.” ITS Logistics is launching a network of retail logistics hubs from existing facilities in Nevada, Indiana and Texas aimed at smaller retail companies. The hubs will use integrated inventory management and transportation systems for fulfillment and distribution. “The goal is to give them a network that allows them to compete with the big retailers who can deliver to customers within under an hour,” Wenker said. ITS plans to add additional retail logistics hubs in the next two to three years, and other types of hubs as well. The “inflection” Wenker sees is becoming evident as US retailers look to inventory management for help with rising costs induced by high US tariffs. In recent earnings calls, retailers highlighted a more “disciplined” approach to inventory management. “We did not repurchase any of our shares during the quarter, instead choosing to allocate capital to manage inventory,” Earl Carlton Ford, CFO of Academy Sports, said during an earnings call this month. “This decision led to a strong inventory position.” Many companies chose to build up stocks ahead of tariffs. US retail inventories were up 1.7% year over year in July, at $809.8 billion, and up 0.7% from April and the introduction of reciprocal tariffs, according to data from the US Census Bureau. Despite that build up, the average US retailer inventory-to-sales ratio (ISR) dropped to 1.29 in July from 1.32 a year earlier. The average merchant wholesaler ISR fell from 1.35 to 1.28 in the same period, indicating goods are flowing through warehouses faster. Drilling into costs, sales Home improvement retailer Lowe’s cut inventory by $499 million — about 3% — year over year to $16.3 billion in the second quarter. “We continue to manage our inventory replenishment in line with demand trends,” said CFO Brandon J. Sink. Speaking during an earnings call in August, Sink attributed that success in part to “tools and processes” that use data to align sourcing, inventory and sales. New planning tools are helping the retailer optimize inventory allocation across its network. Urban Outfitters is one retailer intentionally building higher inventory levels. “We ended the second quarter with slightly elevated inventory levels as we intentionally brought in product early to reduce the impact of announced tariff increases,” Melanie Marein-Efron, CFO of the apparel retailer, said during an earnings call in August. Besides pulling imports forward, the apparel retailer also said it localized inventory management and aligned it more closely with sales data, reducing markdowns. A tight focus on per unit costs and sales is key to keeping inventory in balance as tariff-induced costs rise. “Our inventory per store is elevated, with units per store up 4.6%,” Academy Sports’ Ford said in early September. “We have purposely pulled forward domestic inventory receipts at pre-tariff prices,” Ford said. But Academy Sports is also adding new stores and spreading goods drawn from domestic US and international sources throughout its retail network. All of this requires increasing use of technology to contain costs while meeting customer demands for faster service across multiple fulfillment channels, Wenker said. “The biggest problem we see is fragmentation; you can’t have separate infrastructure for fulfillment from your stores and through e-commerce,” she said. There’s also a divide to be bridged at many companies between inventory and transportation management. “There are transportation people and there are inventory people and they don’t always have the same KPIs [key performance indicators],” Wenker explained. That may be truer for smaller, regional retailers than larger, national companies with enterprise-wide supply chain systems, she added. Contact William B. Cassidy at bill.cassidy@spglobal.com . Journal of Commerce Research Editor Cathy Morrow Roberson contributed to this report.

Tariff costs, need for speed seen reshaping retail inventory strategies

<div class="phx-topic abstract-wrapper">The LTL world of 2025 does not reward those who guess, but rather those who know — and knowing begins with visibility. </div>

The LTL world of 2025 does not reward those who guess, but rather those who know — and knowing begins with visibility.

<div class="phx-topic">The US less-than-truckload (LTL) sector stands at a critical crossroads. Faced with depressed demand, high operating costs, economic uncertainty and rising customer expectations, LTL carriers, brokers and shippers are under mounting pressure to do more with less. Efficiency, accuracy and transparency have never been more vital. Even as some aspects of LTL have modernized, persistent blind spots still drain time, revenue and customer satisfaction. Accessorial management and location visibility remain at the heart of operational performance and profitability in the LTL sector, and companies must solve these challenges to thrive in this freight environment. Accessorial charges are often treated as the fine print of freight, but their financial impact is anything but small. These additional fees, covering services such as liftgate usage, residential delivery, limited-access sites and inside delivery are frequently not accounted for until after a delivery is completed. At that point, shippers receive unexpected invoices, brokers scramble to reconcile charges, and carriers are left fielding disputes that strain valuable relationships and negatively impact their bottom line. Without an accurate, upfront method of identifying potential accessorials, companies lose control over cost predictability. This unpredictability does more than damage budgets. It undermines long-term rate negotiations and muddies performance metrics such as cost per shipment and gross margin. Billing disputes over accessorials can also slow down cash flow and stretch out time-to-payment cycles. As the logistics sector faces tighter margins and rising customer expectations, these seemingly minor charges can add up to major financial consequences. Location data is another underestimated factor that directly impacts LTL performance. While most transportation management systems (TMSs) offer basic shipment tracking, they often lack granular location insights. This includes data points such as whether a site is residential or commercial, whether there is dock access or a forklift onsite, or if the delivery site has limited hours or requires specialized entry. These details may seem minor, but their absence leads to service mismatches, re-delivery attempts, extended dwell times and more accessorial charges. For example, failing to flag a residential delivery that requires a liftgate can result in a surprise fee and an unhappy customer. A shipment bound for a military base or an airport without the right equipment or credentials can create costly delays and failed deliveries. Inaccurate or incomplete location information does more than increase costs — it erodes operational agility. <h3>Technology can ease challenges </h3>The good news is that technology now exists to solve these challenges at scale. New platforms that leverage AI, machine learning and geospatial data are transforming how logistics professionals manage LTL freight. These tools can identify potential accessorial charges before the freight is tendered, analyze delivery site characteristics in real time and deliver a unified accessorial view across all stakeholders. By automating accessorial identification during order entry and integrating precise location attributes such as limited access, loading dock availability, forklifts on site or gated entry, these platforms allow teams to move from reactive firefighting to proactive planning. With real-time alerts and API integrations that connect directly into a TMS, shippers, brokers and carriers can operate from a shared source of accessorial truth. The impact of smarter accessorial identification and location visibility delivers measurable results. Companies that have adopted these advanced solutions have reported a 75% reduction in unexpected accessorial fees, leading to cleaner invoices and faster dispute resolution. Customers have also seen improved on-time in-full (OTIF) performance, driving higher customer satisfaction and stronger service-level agreement (SLA) compliance. This shift is particularly timely in 2025, as the LTL industry grapples with economic volatility, rising operating costs and major classification changes. Freight volumes are inconsistent, carriers are prioritizing profitability over market share, and the new National Motor Freight Traffic Association density-based classification system is forcing shippers to re-evaluate how they package and price freight. In this environment, hidden costs such as accessorials and inefficiencies tied to poor location visibility can erode already thin margins. With shifting demand, cost inflation and operational headwinds, the ability to forecast costs, identify risks and plan accordingly has become a key competitive advantage. In the past, accessorial management and granular location visibility may have been viewed as optional enhancements. Today, they are essential for any company that relies on LTL shipping as a core part of its logistics strategy. When customer expectations are rising and disruptions are the new norm, having visibility into every shipment detail and every delivery site is table stakes. The LTL world of 2025 does not reward those who guess. It rewards those who know, and knowing begins with visibility. North Winship is president of Shiplify. Contact him at <a href="mailto:northw@shiplify.com">northw@shiplify.com</a>. Bart De Muynck is a strategic advisor for Drewry. Contact him at <a href="mailto:bart@bartdemuynck.com">bart@bartdemuynck.com</a>. </div>

The US less-than-truckload (LTL) sector stands at a critical crossroads. Faced with depressed demand, high operating costs, economic uncertainty and rising customer expectations, LTL carriers, brokers and shippers are under mounting pressure to do more with less. Efficiency, accuracy and transparency have never been more vital. Even as some aspects of LTL have modernized, persistent blind spots still drain time, revenue and customer satisfaction. Accessorial management and location visibility remain at the heart of operational performance and profitability in the LTL sector, and companies must solve these challenges to thrive in this freight environment. Accessorial charges are often treated as the fine print of freight, but their financial impact is anything but small. These additional fees, covering services such as liftgate usage, residential delivery, limited-access sites and inside delivery are frequently not accounted for until after a delivery is completed. At that point, shippers receive unexpected invoices, brokers scramble to reconcile charges, and carriers are left fielding disputes that strain valuable relationships and negatively impact their bottom line. Without an accurate, upfront method of identifying potential accessorials, companies lose control over cost predictability. This unpredictability does more than damage budgets. It undermines long-term rate negotiations and muddies performance metrics such as cost per shipment and gross margin. Billing disputes over accessorials can also slow down cash flow and stretch out time-to-payment cycles. As the logistics sector faces tighter margins and rising customer expectations, these seemingly minor charges can add up to major financial consequences. Location data is another underestimated factor that directly impacts LTL performance. While most transportation management systems (TMSs) offer basic shipment tracking, they often lack granular location insights. This includes data points such as whether a site is residential or commercial, whether there is dock access or a forklift onsite, or if the delivery site has limited hours or requires specialized entry. These details may seem minor, but their absence leads to service mismatches, re-delivery attempts, extended dwell times and more accessorial charges. For example, failing to flag a residential delivery that requires a liftgate can result in a surprise fee and an unhappy customer. A shipment bound for a military base or an airport without the right equipment or credentials can create costly delays and failed deliveries. Inaccurate or incomplete location information does more than increase costs — it erodes operational agility. Technology can ease challenges The good news is that technology now exists to solve these challenges at scale. New platforms that leverage AI, machine learning and geospatial data are transforming how logistics professionals manage LTL freight. These tools can identify potential accessorial charges before the freight is tendered, analyze delivery site characteristics in real time and deliver a unified accessorial view across all stakeholders. By automating accessorial identification during order entry and integrating precise location attributes such as limited access, loading dock availability, forklifts on site or gated entry, these platforms allow teams to move from reactive firefighting to proactive planning. With real-time alerts and API integrations that connect directly into a TMS, shippers, brokers and carriers can operate from a shared source of accessorial truth. The impact of smarter accessorial identification and location visibility delivers measurable results. Companies that have adopted these advanced solutions have reported a 75% reduction in unexpected accessorial fees, leading to cleaner invoices and faster dispute resolution. Customers have also seen improved on-time in-full (OTIF) performance, driving higher customer satisfaction and stronger service-level agreement (SLA) compliance. This shift is particularly timely in 2025, as the LTL industry grapples with economic volatility, rising operating costs and major classification changes. Freight volumes are inconsistent, carriers are prioritizing profitability over market share, and the new National Motor Freight Traffic Association density-based classification system is forcing shippers to re-evaluate how they package and price freight. In this environment, hidden costs such as accessorials and inefficiencies tied to poor location visibility can erode already thin margins. With shifting demand, cost inflation and operational headwinds, the ability to forecast costs, identify risks and plan accordingly has become a key competitive advantage. In the past, accessorial management and granular location visibility may have been viewed as optional enhancements. Today, they are essential for any company that relies on LTL shipping as a core part of its logistics strategy. When customer expectations are rising and disruptions are the new norm, having visibility into every shipment detail and every delivery site is table stakes. The LTL world of 2025 does not reward those who guess. It rewards those who know, and knowing begins with visibility. North Winship is president of Shiplify. Contact him at northw@shiplify.com . Bart De Muynck is a strategic advisor for Drewry. Contact him at bart@bartdemuynck.com .

Visibility transforming accessorial and location insights in LTL shipping

<div class="phx-topic abstract-wrapper">There are measures carriers can take around the edges, but if they really want to take control of supply — and thus price — collectively sidelining some high-caliber tonnage is the standout solution, writes Jeremy Masters. </div>

There are measures carriers can take around the edges, but if they really want to take control of supply — and thus price — collectively sidelining some high-caliber tonnage is the standout solution, writes Jeremy Masters.

<div class="phx-topic">The laws of supply and demand dictate that prices will move in accordance with the relativity of the two. Container carriers can marginally move the dial between what is containerized and what is bulk or breakbulk by offering very attractive (low contribution) rates. An innovative product — for example, Gemini Cooperation’s high reliability network or an express service — might lure some air freight to sea freight. For the most part, however, carriers have very little control over demand. The key price lever that carriers have is slot supply, and current fundamentals point to heavy surplus, even as diversions around southern Africa continue. Are the carriers, then, sprinting to the edge of the cliff with newbuild deliveries, fresh orders, second-hand buying and chartering of what little spare capacity is left, followed by a freefall? Or do they at least have a parachute to slow down their momentum? There are some things they can do to help themselves in trades with overcapacity. <h3>Pushing pause </h3>The most obvious and dramatic way would be to park ships. To be impactful, that would mean collectively taking out multiple strings rather than tinkering with single strings or blank sailings. Understandably, there is a mental block in the big east-west trades when it comes to parking high-capacity, high-value, newer ships. But if the carriers get supply even minimally below demand, the economics are massively in their favor. Let's assume that, in the Asia-to-Europe trade, each consortium (for these purposes, Mediterranean Shipping Co. would be considered a consortium) ties up one string of ultra-large container vessels (ULCVs) that was forecasted to make a minimal contribution to fixed cost because of declining rates. If, because of removing these strings, freight rates were a very conservative $500 per TEU higher on average on the headhaul than they would have been, based on 20,000 TEU per week and 50 weeks, all consortiums would accumulate an additional $500,000 million per annum on all remaining loops. There would be, of course, some incremental lay-up costs, but other costs would remain similar. Parking some $3 billion worth of assets per consortium is easier in theory than in practice, especially for those carriers who need to justify some heavy investments to their boards. If the carriers accept that drastic action is required, however, and there is enough collective action — not orchestrated action, of course, in contravention of competition rules — then the results will be dramatically better, and the ships will be readily available for an upturn. <h3>Beyond parking </h3>Are there less capacity-eating measures that carriers could undertake? The catalyst for a major dive in multi-trade rates would be a return to the Red Sea and Suez Canal for Asia-to-Europe strings, but it's unlikely that we will go overnight from high-risk Red Sea transits to totally safe ones. Given the disruption and risk — for carriers and their clients — of moving all strings back to the Red Sea only to find that further issues arise, it would be entirely justifiable to keep some strings moving around the Cape of Good Hope. Big beneficial cargo owners (BCOs) and forwarders/non-vessel operating common carriers (NVOCCs) have — forcefully — adjusted to the Cape routing. And while there is higher on-the-water inventory cost, the weekly pipeline of arrivals are established. They would naturally lean towards the faster Red Sea routing, but at the same time, would want to strenuously avoid a situation where production lines are stopped or shelves empty because they have put all their eggs in the Red Sea basket that has turned bad again. This may be counterintuitive, given more expensive ship systems around the Cape, but carriers could also implement two-tier pricing to re-enforce this prudence — essentially, a premium for Red Sea risk or a deficit for longer transits, whichever you prefer. Slow-steaming is another area of capacity control where a systematic approach could eat up more capacity. This means not just applying it in over-tonnaged trades, but in all trades. Tonnage can then be moved from trades where there is oversupply to those that are short because of slow-steaming. Finally, there is the scrapping of older vessels. If we look at carriers' desire to hold onto bigger, newer assets and their purchase of relatively old smaller tonnage to run regional and feeder networks, this does not look to be a particularly encouraging area for capacity shedding. There are measures the carriers can take around the edges, but if they really want to take control of supply – and thus price – collectively sidelining some high-caliber tonnage is the standout solution. Contact Jeremy Masters at <a href="mailto:jeremy@shippingmastershk.com">jeremy@shippingmastershk.com</a>. </div>

The laws of supply and demand dictate that prices will move in accordance with the relativity of the two. Container carriers can marginally move the dial between what is containerized and what is bulk or breakbulk by offering very attractive (low contribution) rates. An innovative product — for example, Gemini Cooperation’s high reliability network or an express service — might lure some air freight to sea freight. For the most part, however, carriers have very little control over demand. The key price lever that carriers have is slot supply, and current fundamentals point to heavy surplus, even as diversions around southern Africa continue. Are the carriers, then, sprinting to the edge of the cliff with newbuild deliveries, fresh orders, second-hand buying and chartering of what little spare capacity is left, followed by a freefall? Or do they at least have a parachute to slow down their momentum? There are some things they can do to help themselves in trades with overcapacity. Pushing pause The most obvious and dramatic way would be to park ships. To be impactful, that would mean collectively taking out multiple strings rather than tinkering with single strings or blank sailings. Understandably, there is a mental block in the big east-west trades when it comes to parking high-capacity, high-value, newer ships. But if the carriers get supply even minimally below demand, the economics are massively in their favor. Let's assume that, in the Asia-to-Europe trade, each consortium (for these purposes, Mediterranean Shipping Co. would be considered a consortium) ties up one string of ultra-large container vessels (ULCVs) that was forecasted to make a minimal contribution to fixed cost because of declining rates. If, because of removing these strings, freight rates were a very conservative $500 per TEU higher on average on the headhaul than they would have been, based on 20,000 TEU per week and 50 weeks, all consortiums would accumulate an additional $500,000 million per annum on all remaining loops. There would be, of course, some incremental lay-up costs, but other costs would remain similar. Parking some $3 billion worth of assets per consortium is easier in theory than in practice, especially for those carriers who need to justify some heavy investments to their boards. If the carriers accept that drastic action is required, however, and there is enough collective action — not orchestrated action, of course, in contravention of competition rules — then the results will be dramatically better, and the ships will be readily available for an upturn. Beyond parking Are there less capacity-eating measures that carriers could undertake? The catalyst for a major dive in multi-trade rates would be a return to the Red Sea and Suez Canal for Asia-to-Europe strings, but it's unlikely that we will go overnight from high-risk Red Sea transits to totally safe ones. Given the disruption and risk — for carriers and their clients — of moving all strings back to the Red Sea only to find that further issues arise, it would be entirely justifiable to keep some strings moving around the Cape of Good Hope. Big beneficial cargo owners (BCOs) and forwarders/non-vessel operating common carriers (NVOCCs) have — forcefully — adjusted to the Cape routing. And while there is higher on-the-water inventory cost, the weekly pipeline of arrivals are established. They would naturally lean towards the faster Red Sea routing, but at the same time, would want to strenuously avoid a situation where production lines are stopped or shelves empty because they have put all their eggs in the Red Sea basket that has turned bad again. This may be counterintuitive, given more expensive ship systems around the Cape, but carriers could also implement two-tier pricing to re-enforce this prudence — essentially, a premium for Red Sea risk or a deficit for longer transits, whichever you prefer. Slow-steaming is another area of capacity control where a systematic approach could eat up more capacity. This means not just applying it in over-tonnaged trades, but in all trades. Tonnage can then be moved from trades where there is oversupply to those that are short because of slow-steaming. Finally, there is the scrapping of older vessels. If we look at carriers' desire to hold onto bigger, newer assets and their purchase of relatively old smaller tonnage to run regional and feeder networks, this does not look to be a particularly encouraging area for capacity shedding. There are measures the carriers can take around the edges, but if they really want to take control of supply – and thus price – collectively sidelining some high-caliber tonnage is the standout solution. Contact Jeremy Masters at jeremy@shippingmastershk.com .

Ocean carriers are not helpless when it comes to managing capacity

East Coast of South America to US

West Coast of South America to US

eeSea collects and centralizes liner network data from dozens of public sources including carriers’ vessel tracking portals, long-term schedules, customer advisories, port and terminal operator schedules, and pilot schedules. These disparate datasets are continually inspected, cleaned, and carefully structured. eeSea synthesizes this refined public data with AIS positions from a third-party provider and its datasets spanning schedule reliability, transit times, trade capacity evolution, and 60-day vessel forecasts. Capacity is measured based on the last load port in Asia [eeSea](https://www.eesea.com/https://www.eesea.com)

South America to US ocean reliability (eeSea)

On-Time Performance West and East Coasts of South America to US (eeSea) Gateway

<div class="phx-topic abstract-wrapper">The Port of Los Angeles is meeting with California state officials to promote its plan to extend the Vincent Thomas Bridge repair project to allow 23,000-TEU ships to call all six of its marine terminals. </div>

The Port of Los Angeles is meeting with California state officials to promote its plan to extend the Vincent Thomas Bridge repair project to allow 23,000-TEU ships to call all six of its marine terminals.

<div class="phx-topic">The Port of Los Angeles and its industry stakeholders are trying to convince the California Department of Transportation (Caltrans) to expand a key bridge project to allow ships up to 23,000 TEUs to call the other half of its terminals. The port says expanding the Vincent Thomas Bridge redecking project to include raising the height of the bridge by 26 feet will increase the total cost from $1.5 billion to $2.2 billion and extend its timeline — and, in turn, disruptions to truck traffic in and out of the port — from 16 months to 28 months. The Vincent Thomas Bridge is crossed daily by 53,000 vehicles, about 3,400 of which are heavy-duty trucks, according to Caltrans. But without the additional clearance under the bridge, access to three of Los Angeles’ six container terminals will remain limited to vessels with 15,000 TEUs of capacity. Increasing the clearance to 211 feet will allow super-post-Panamax vessels with up to 23,000 TEUs of capacity to serve Yusen Terminals, TraPac and the West Basin Container Terminal, according to Gene Seroka, executive director at the Port of Los Angeles. Terminal operators and industry representatives joined Seroka in Sacramento on Friday to discuss the details of the port’s proposal with Caltrans officials. “We believe they’re willing to listen. We began talking about this months ago,” Seroka told the Journal of Commerce Thursday, adding that he expects Caltrans to announce a decision “soon.” <h3>One fell swoop? </h3>Caltrans representatives in late May told the Propeller Club of Los Angeles the agency <a href="https://www.joc.com/article/la-port-stakeholders-warming-to-plan-to-mitigate-impact-of-bridge-project-6013847">must address the 62-year-old bridge’s structural defects</a>, which have been judged to be a safety hazard. Caltrans’ initial plans included resurfacing the deck of the bridge and replacing its railings, fences and median barrier. At the Propeller Club meeting, Caltrans representatives said construction would begin in early 2026 and would involve one-directional lane closures at night, followed by complete closure of the bridge from November 2026 to March 2028. The port estimates its proposal to raise the height of the bridge will delay completion of the project into 2029. However, Seroka said it would make more sense to do the bridge repairs and raise the structure all at once rather than having to return some years later to finish the job. He pointed to the project to <a href="https://www.joc.com/article/us-gulf-trade-momentum-puts-focus-on-houston-port-channel-widening-5251013">raise the height of the Bayonne Bridge</a> that connects New Jersey with Staten Island as the model that could be used in Los Angeles. Caltrans said it is well along in designating and repaving detour routes in the harbor area to prepare for when construction shuts down the bridge. Caltrans said it is also developing a real-time communications network to update motorists and truckers on traffic conditions. Seroka said access by the largest and most efficient ships in use today will not only increase the effective capacity of Yusen, TraPac and West Basin by 20%, but will also attract the newest, greenest vessels afloat. Those container ships are often equipped with fuel tanks that carry alternatives to traditional higher-emission bunker fuel, he said. As for the increased cost, Seroka said he has lined up commitments of private equity financing, including from banks, pension funds and industry sources, which he planned to detail at Friday’s meeting with Caltrans in Sacramento. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

The Port of Los Angeles and its industry stakeholders are trying to convince the California Department of Transportation (Caltrans) to expand a key bridge project to allow ships up to 23,000 TEUs to call the other half of its terminals. The port says expanding the Vincent Thomas Bridge redecking project to include raising the height of the bridge by 26 feet will increase the total cost from $1.5 billion to $2.2 billion and extend its timeline — and, in turn, disruptions to truck traffic in and out of the port — from 16 months to 28 months. The Vincent Thomas Bridge is crossed daily by 53,000 vehicles, about 3,400 of which are heavy-duty trucks, according to Caltrans. But without the additional clearance under the bridge, access to three of Los Angeles’ six container terminals will remain limited to vessels with 15,000 TEUs of capacity. Increasing the clearance to 211 feet will allow super-post-Panamax vessels with up to 23,000 TEUs of capacity to serve Yusen Terminals, TraPac and the West Basin Container Terminal, according to Gene Seroka, executive director at the Port of Los Angeles. Terminal operators and industry representatives joined Seroka in Sacramento on Friday to discuss the details of the port’s proposal with Caltrans officials. “We believe they’re willing to listen. We began talking about this months ago,” Seroka told the Journal of Commerce Thursday, adding that he expects Caltrans to announce a decision “soon.” One fell swoop? Caltrans representatives in late May told the Propeller Club of Los Angeles the agency must address the 62-year-old bridge’s structural defects , which have been judged to be a safety hazard. Caltrans’ initial plans included resurfacing the deck of the bridge and replacing its railings, fences and median barrier. At the Propeller Club meeting, Caltrans representatives said construction would begin in early 2026 and would involve one-directional lane closures at night, followed by complete closure of the bridge from November 2026 to March 2028. The port estimates its proposal to raise the height of the bridge will delay completion of the project into 2029. However, Seroka said it would make more sense to do the bridge repairs and raise the structure all at once rather than having to return some years later to finish the job. He pointed to the project to raise the height of the Bayonne Bridge that connects New Jersey with Staten Island as the model that could be used in Los Angeles. Caltrans said it is well along in designating and repaving detour routes in the harbor area to prepare for when construction shuts down the bridge. Caltrans said it is also developing a real-time communications network to update motorists and truckers on traffic conditions. Seroka said access by the largest and most efficient ships in use today will not only increase the effective capacity of Yusen, TraPac and West Basin by 20%, but will also attract the newest, greenest vessels afloat. Those container ships are often equipped with fuel tanks that carry alternatives to traditional higher-emission bunker fuel, he said. As for the increased cost, Seroka said he has lined up commitments of private equity financing, including from banks, pension funds and industry sources, which he planned to detail at Friday’s meeting with Caltrans in Sacramento. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

LA port wants California to raise bridge to accommodate big ships

<div class="phx-topic abstract-wrapper">The Gulf Coast port faced the potential that later US actions against Chinese ship-to-shore cranes would raise costs more if it deferred delivery. </div>

The Gulf Coast port faced the potential that later US actions against Chinese ship-to-shore cranes would raise costs more if it deferred delivery.

<div class="phx-topic">Port Freeport is taking direct delivery of two Chinese-made ship-to-shore cranes, determining that the cost of the current US tariffs against China outweigh the risk of further punitive tariffs against that country’s maritime industry. Port Freeport said in a statement to the Journal of Commerce that it plans to install and commission two new super-Post-Panamax cranes manufactured by China’s ZPMC before the end of the calendar year. The cranes arrived at the port this week, were entered into US Customs, and the “applicable tariff has been paid.”<a href="https://www.joc.com/article/ports-america-to-pay-30-tariff-on-china-made-ship-to-shore-crane-6080582">Chinese cranes are subject to a 30% import duty</a> that is the result of an August trade truce between the US and China, with the Trump administration agreeing to that baseline tariff before the Nov. 10 deadline for a new trade deal. Port Freeport will face a $7.5 million bill at the current tariff rate. The cranes are arriving as Freeport prepares for a deepening project that will bring its ship channel down to 56 feet from 51 feet. Port Freeport prepared to put the cranes into a bonded warehouse to defer any import duties, according to meeting minutes of Port Freeport’s commission. That would give the port time for US-China trade negotiations to take place or the US Supreme Court to rule that Trump’s tariffs were illegal. However, commission staff said the port faced the risk of an additional tariff up to 100% from the US Trade Representative’s (USTR’s) proposed action against Chinese crane makers. While the USTR has not made a final decision on the proposed action, commission staff said they understand a decision is coming in October. Port Freeport was among those that <a href="https://www.joc.com/article/ports-look-to-delay-proposed-us-tariffs-on-chinese-made-cranes-6007628">provided feedback to the USTR</a> about its proposal, saying in May that it would face a $25 million USTR tariff bill on cranes ordered in November 2023. “Port Freeport and other U.S. seaports with cranes under contract are in an untenable situation,” according to its written report. “If the cranes are put in customs bonded warehouse status, it’s unlikely that tariffs will go lower than 30%; however, there is a greater risk the rates could go higher,” commission staff said. Contact Michael Angell at <a href="mailto: michael.angell@spglobal.com">michael.angell@spglobal.com</a> </div>

Port Freeport is taking direct delivery of two Chinese-made ship-to-shore cranes, determining that the cost of the current US tariffs against China outweigh the risk of further punitive tariffs against that country’s maritime industry. Port Freeport said in a statement to the Journal of Commerce that it plans to install and commission two new super-Post-Panamax cranes manufactured by China’s ZPMC before the end of the calendar year. The cranes arrived at the port this week, were entered into US Customs, and the “applicable tariff has been paid.” Chinese cranes are subject to a 30% import duty that is the result of an August trade truce between the US and China, with the Trump administration agreeing to that baseline tariff before the Nov. 10 deadline for a new trade deal. Port Freeport will face a $7.5 million bill at the current tariff rate. The cranes are arriving as Freeport prepares for a deepening project that will bring its ship channel down to 56 feet from 51 feet. Port Freeport prepared to put the cranes into a bonded warehouse to defer any import duties, according to meeting minutes of Port Freeport’s commission. That would give the port time for US-China trade negotiations to take place or the US Supreme Court to rule that Trump’s tariffs were illegal. However, commission staff said the port faced the risk of an additional tariff up to 100% from the US Trade Representative’s (USTR’s) proposed action against Chinese crane makers. While the USTR has not made a final decision on the proposed action, commission staff said they understand a decision is coming in October. Port Freeport was among those that provided feedback to the USTR about its proposal, saying in May that it would face a $25 million USTR tariff bill on cranes ordered in November 2023. “Port Freeport and other U.S. seaports with cranes under contract are in an untenable situation,” according to its written report. “If the cranes are put in customs bonded warehouse status, it’s unlikely that tariffs will go lower than 30%; however, there is a greater risk the rates could go higher,” commission staff said. Contact Michael Angell at michael.angell@spglobal.com

Freeport pays crane tariffs to avoid USTR fee risk

<div class="phx-topic abstract-wrapper">The jump in blank sailings comes as spot rates to the West Coast have fallen 30% over the past three weeks, with East Coast prices down almost 20%.</div>

The jump in blank sailings comes as spot rates to the West Coast have fallen 30% over the past three weeks, with East Coast prices down almost 20%.

<div class="phx-topic">Trans-Pacific container lines will accelerate blank sailings over the next four weeks in an effort to stabilize spot rates that are continuing to fall amid an unusually soft pre-Golden Week market. The reduction in planned capacity for October has increased from 3.8% to 13.6% on the Asia-North America West Coast trade and from 4.8% to 14.4% on the Asia to East Coast lane, Alan Murphy, CEO of Sea-Intelligence Maritime Analysis, said in this week’s Sunday Spotlight newsletter. That comes as spot rates to the West Coast have fallen 30% over the past three weeks, with East Coast prices down almost 20%. “The blanks won’t increase the [spot] rates, they will just prevent a further freefall, and with all of the announced blank sailings, there will probably be some ad hoc blank sailings that haven’t been announced yet,” Sanjay Tejwani, CEO of consulting firm 365 Logistics, told the Journal of Commerce. “We could still see more action.” When compared with capacity reductions in recent years, “the current level of capacity reductions have fully met that threshold on Asia-North America East Coast ... while partially meeting that threshold on Asia-North America West Coast,” Murphy said. Almost 17% of capacity from Asia into North America will be blanked in October, up from about 10% in September, according to maritime intelligence provider eeSea. Spot rates from Asia to the West Coast had fallen to $1,400 per FEU as of Sept. 24, down from $2,025 on Sept. 5, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. East Coast rates of $2,433 per FEU are down from $3,000 on Sept. 5. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e8c13a3e-9f5a-412f-8741-adbf5e1a7779"></dynamic-object></div>Forwarders this week said some larger carriers have already begun to undercut those rates. One forwarder told the Journal of Commerce some larger lines are offering $1,350 per FEU to the West Coast and sub-$2,400 per FEU to the East Coast. “Are we getting near the bottom? I would think so,” the source said, adding those rates have been extended through Oct. 14. “How much lower can they go? They’ve been going down on almost a daily basis,” said Chris Sur, executive vice president of ocean freight logistics at Unique Logistics International. A carrier executive said some of the smaller lines are also contributing to the falling spot rates by offering sub-$1,400 rates to the West Coast. “They want to grab what cargo they can,” the source said. <h3>Further capacity reductions in Q4? </h3>Amid the current capacity reductions, Tejwani said the global idle fleet may begin to increase in the fourth quarter “now that there won’t be much demand for the next three to four months.” Forwarders and carriers anticipate a soft fourth quarter because the frontloading of peak season cargo prevented what is normally a busy September–October period in the trans-Pacific. Also, because Lunar New Year falls on Feb. 17, 2026, retailers are expected to shorten their inventory carrying period by waiting until January to ship their spring merchandise. “[Carriers] continue to pull capacity out of this market and it won’t be brought back into service,” Tejwani said. The idle fleet is just 0.5% of total liner capacity, according to a Sept. 1 report from the maritime intelligence company AXS Marine, which owns Alphaliner. Midsize retailers have access now to spot rates that are lower than the fixed rates they signed for in their 2025–26 service contracts in May. The service contract rates for midsize shippers <a href="https://www.joc.com/article/ocean-carriers-flex-tonnage-control-but-overcapacity-is-mounting-6030004">approached $2,000 per FEU to the West Coast</a> and about $1,000 per FEU higher to the East Coast. The breakeven rate in terms of covering carriers’ fixed costs varies from carrier to carrier based on their operating efficiency and the size of the vessels they deploy, but at the current spot rate levels, some lines may not be covering their fixed costs. “At $1,350, some may already be there,” said the forwarder source. Sur said how carriers respond to the Golden Week factory closures in Asia will be crucial in their attempt to find a bottom for spot rates. “I think [spot rates] have gone low enough,” he said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. Contact Laura Robb at <a href="mailto:laura.robb@spglobal.com">laura.robb@spglobal.com</a>. </div>

Trans-Pacific container lines will accelerate blank sailings over the next four weeks in an effort to stabilize spot rates that are continuing to fall amid an unusually soft pre-Golden Week market. The reduction in planned capacity for October has increased from 3.8% to 13.6% on the Asia-North America West Coast trade and from 4.8% to 14.4% on the Asia to East Coast lane, Alan Murphy, CEO of Sea-Intelligence Maritime Analysis, said in this week’s Sunday Spotlight newsletter. That comes as spot rates to the West Coast have fallen 30% over the past three weeks, with East Coast prices down almost 20%. “The blanks won’t increase the [spot] rates, they will just prevent a further freefall, and with all of the announced blank sailings, there will probably be some ad hoc blank sailings that haven’t been announced yet,” Sanjay Tejwani, CEO of consulting firm 365 Logistics, told the Journal of Commerce. “We could still see more action.” When compared with capacity reductions in recent years, “the current level of capacity reductions have fully met that threshold on Asia-North America East Coast ... while partially meeting that threshold on Asia-North America West Coast,” Murphy said. Almost 17% of capacity from Asia into North America will be blanked in October, up from about 10% in September, according to maritime intelligence provider eeSea. Spot rates from Asia to the West Coast had fallen to $1,400 per FEU as of Sept. 24, down from $2,025 on Sept. 5, according to Platts, a sister company of the Journal of Commerce within S&P Global. East Coast rates of $2,433 per FEU are down from $3,000 on Sept. 5. Forwarders this week said some larger carriers have already begun to undercut those rates. One forwarder told the Journal of Commerce some larger lines are offering $1,350 per FEU to the West Coast and sub-$2,400 per FEU to the East Coast. “Are we getting near the bottom? I would think so,” the source said, adding those rates have been extended through Oct. 14. “How much lower can they go? They’ve been going down on almost a daily basis,” said Chris Sur, executive vice president of ocean freight logistics at Unique Logistics International. A carrier executive said some of the smaller lines are also contributing to the falling spot rates by offering sub-$1,400 rates to the West Coast. “They want to grab what cargo they can,” the source said. Further capacity reductions in Q4? Amid the current capacity reductions, Tejwani said the global idle fleet may begin to increase in the fourth quarter “now that there won’t be much demand for the next three to four months.” Forwarders and carriers anticipate a soft fourth quarter because the frontloading of peak season cargo prevented what is normally a busy September–October period in the trans-Pacific. Also, because Lunar New Year falls on Feb. 17, 2026, retailers are expected to shorten their inventory carrying period by waiting until January to ship their spring merchandise. “[Carriers] continue to pull capacity out of this market and it won’t be brought back into service,” Tejwani said. The idle fleet is just 0.5% of total liner capacity, according to a Sept. 1 report from the maritime intelligence company AXS Marine, which owns Alphaliner. Midsize retailers have access now to spot rates that are lower than the fixed rates they signed for in their 2025–26 service contracts in May. The service contract rates for midsize shippers approached $2,000 per FEU to the West Coast and about $1,000 per FEU higher to the East Coast. The breakeven rate in terms of covering carriers’ fixed costs varies from carrier to carrier based on their operating efficiency and the size of the vessels they deploy, but at the current spot rate levels, some lines may not be covering their fixed costs. “At $1,350, some may already be there,” said the forwarder source. Sur said how carriers respond to the Golden Week factory closures in Asia will be crucial in their attempt to find a bottom for spot rates. “I think [spot rates] have gone low enough,” he said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com . Contact Laura Robb at laura.robb@spglobal.com .

Trans-Pacific capacity cuts on the rise as carriers look to stem rate slide

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Transform Barge Operations with Total Visibility

At SSA Marine Mexico, we firmly believe that business development must go hand in hand with social and environmental well-being. Our vision is not solely focused on operating efficiently, but also on creating a meaningful and positive impact in the communities where we are present. Since 1995, we have reaffirmed this commitment through tangible actions that reflect our core values of responsibility, solidarity, and sustainability. <span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-3_2 joc_admin__inline-image-position-left joc_admin__inline-image-size-medium" data-figure-size="medium" data-figure-position="left" data-figure-aspect-ratio="3:2"><img src="/content-assets/1752584535914_Photo%201.jpg" alt="" class="joc_admin__inline-image-inherit"> A Year of Major Achievements Over the past year, we allocated more than $107,000 USD to the implementation of 60 social and environmental projects, positively impacting over 7,800 people across various regions of Mexico. Each initiative was designed with a holistic approach, addressing key areas that contribute to long-term community development. Education: Laying the Foundation for the Future Education is one of the most powerful tools to promote social mobility and equitable development. At SSA Marine Mexico, we support academic initiatives that inspire and empower the next generation of leaders. One of our most impactful partnerships was with the University of Colima, where we sponsored the “Reto Camp” program. This initiative encourages university students to develop innovative solutions in the fields of sustainability, logistics, and port operations, offering them mentorship, tools, and real-world challenges to solve. In addition, we donated microscopes, school supplies, and educational materials to institutions in underserved communities, helping to improve the learning environment and provide students with the resources they need to succeed. Health and Sports: Promoting Wellness We believe that healthy communities are strong communities. We have supported several local sporting events and provided direct assistance to talented athletes, enabling them to pursue their passions and represent their regions with pride. Beyond sports, we also strengthened our collaboration with critical emergency response organizations such as the Mexican Red Cross and Civil Protection. Our contributions helped enhance their readiness and capabilities in times of crisis, ensuring better outcomes for those affected by emergencies. Supporting Vulnerable Groups: Reaching Those Who Need It Most A core part of our social responsibility efforts is directed toward supporting vulnerable populations. We have contributed to a range of initiatives focused on children, migrants, and at-risk families. These efforts included donations to orphanages and shelters, as well as support for the National Institute of Migration and grassroots organizations dedicated to protecting and empowering people facing adversity. By standing with those in need, we reinforce our commitment to inclusion and social justice, values that are central to our identity as a responsible company. <span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-3_2 joc_admin__inline-image-position-left joc_admin__inline-image-size-medium" data-figure-size="medium" data-figure-position="left" data-figure-aspect-ratio="3:2"><img src="/content-assets/1752584944645_Photo%202.png" alt="" class="joc_admin__inline-image-inherit">Culture: Strengthening Community Identity Cultural identity is a key element in building resilient and united communities. At SSA Marine Mexico, we actively participate in the organization and sponsorship of cultural events that celebrate local traditions and foster civic pride. Working alongside port authorities and municipal governments, we helped bring music, art, and heritage to the forefront, creating spaces for community engagement and intercultural dialogue. Environment: Investing in the Planet Our commitment to sustainability goes beyond operations—it’s a philosophy that drives every decision we make. We have partnered with environmental institutions to carry out reforestation campaigns, beach cleanups, and conservation efforts. In collaboration with the Institute for the Environment, we supported initiatives aimed at decarbonization, biodiversity protection, and environmental education. By involving our employees and local volunteers in these actions, we also foster a culture of environmental stewardship throughout our organization and our surrounding communities. Innovation for a Sustainable Future Sustainability is not just about doing good—it’s also about doing things better. In 2024, we invested $22 million USD in the acquisition of 11 state-of-the-art E-RTG cranes. These electric rubber-tired gantry cranes represent a significant technological advancement in port equipment. Seven of them are already operating on clean electric energy, resulting in a reduction of nearly 4,000 tons of CO₂ emissions and improving operational efficiency by 7%. The remaining four cranes are fully compatible with future electrification, underscoring our long-term strategy to modernize our operations in an environmentally responsible way. This investment is part of a broader innovation roadmap that includes digitalization, automation, and cleaner energy sources—all designed to ensure that our ports continue to grow without compromising the health of our planet. Building a Better Tomorrow, Together At SSA Marine Mexico, we understand that sustainability is a shared and ongoing responsibility. True impact requires collaboration across sectors, long-term vision, and unwavering commitment. That is why we continue to work hand-in-hand with local authorities, non-profit organizations, universities, and our own employees to create solutions that are both scalable and sustainable. Our journey is far from over. In the years ahead, we will continue to deepen our community engagement, explore cleaner technologies, and strengthen the social fabric of the regions where we operate. Each initiative, no matter the size, is a step toward building a future where business success goes hand-in-hand with human and environmental prosperity. We are proud of what we have achieved in 2024, but we are even more excited about what lies ahead. SSA Marine Mexico — Moving the World, Caring for People and Planet. LINK: <a href="https://www.ssamarine.mx/" rel="noreferrer" class="joc_admin__link">https://www.ssamarine.mx/</a>

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SSA Marine Mexico: True Commitment to Sustainability

The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

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Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

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Filling the Supply Chain Education Gap with LTL Education Courses

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<div class="phx-topic abstract-wrapper">Supply chain control, not just cost, is the priority for shippers that have built up in-house truck fleets and increasingly are using them for more than outbound deliveries. </div>

Supply chain control, not just cost, is the priority for shippers that have built up in-house truck fleets and increasingly are using them for more than outbound deliveries.

<div class="phx-topic">US shippers are expanding their use of private, in-house truck fleets, hauling more goods in their own trucks despite favorable for-hire spot market and contract rates. Growth in private fleets is slowing compared with a peak experienced during the COVID-19 pandemic, but it hasn’t stopped, industry experts told the Journal of Commerce. Shipments handled by private fleets increased 11.7% year over year in 2024, according to data released last week by the National Private Truck Council (NPTC). The need for more precise supply chain control and truck capacity is the reason given for greater reliance by shippers on in-house assets, and it is being enabled by technology. “The importance of the private fleet has become more elevated as shippers take greater control of supply chains,” especially since the COVID-19 pandemic, said Tom Moore, NPTC’s executive vice president. The change has been noted by industry analysts and for-hire carriers. Schneider National, a major truckload carrier and provider of dedicated fleet services, has seen the growth of private, shipper-owned fleets outpace the for-hire carrier market, Mark Rourke, CEO and president, told a Morgan Stanley investor conference Sept. 11. “For a number of years, we’ve kind of assessed the full truckload market to be about 50% for-hire, 50% private fleet,” Rourke said at the event. Coming out of COVID-19, “there’s been a shift” to 55% private fleet, 45% for-hire, Rourke said. “That’s a pretty big movement,” he said, although he thinks there are opportunities “to move the needle back toward 50-50” as truck fleet operating costs rise. “We’ve seen private fleets grow to the point where last year there were more employee truck drivers in private fleets than in for-hire truck transportation,” Avery Vise, vice president of trucking at FTR Transport Intelligence, said at an FTR conference Sept. 9. The total number of US private fleets, both interstate and intrastate, rose 15.9% from December 2019 through August 2025, according to Federal Motor Carrier Safety Administration (FMCSA) data, reaching 776,588, according to data published last month. Rising fleet operating costs and continuing low rates will probably shift more freight toward for-hire carriers, “but that will certainly be an incremental thing,” Vise said. “It’s not that some of these private fleets will just shut down.” The choice of whether to use for-hire or in-house trucking isn’t about choosing either one or the other, and it’s not only about costs, experts told the Journal of Commerce. “Most of our customers, especially our larger ones, use all their options — private fleets, outsourced capacity, dedicated and for-hire trucking,” said Jim Lager, executive vice president of Penske Truck Leasing, an equipment and logistics supplier. “Technology is having a huge impact” on shippers’ decisions, Lager said. “The ability to track vehicles and product in route is at people’s fingertips now.” The common factor among Penske’s private fleet customers is “they want control,” he said. “They want their product to end up in their customers’ hands the way they want it to.” <h3>An inbound shift </h3>Traditionally, private fleets have been used more to haul outbound freight to customers. Now, shippers are working more closely with vendors and suppliers on the inbound side of transportation and distribution to find ways to move more freight in their in-house fleets. The shift is evident in data NPTC collected from a diverse group of more than 100 shippers with private fleets in its most recent annual benchmarking survey report, released Monday. Those shippers moved 43% of their inbound freight by private fleet last year. That compares with 35% the previous year and 31% in 2022, according to NPTC. The last time shippers relied as heavily on private fleets for inbound transportation was in 2021, when COVID-19 supply chain disruption hit its peak, NPTC’s data indicated. Greater use of private fleets for inbound transportation requires more sophisticated collaboration between shippers and their vendors and suppliers, Moore said. “Often they both will have private fleets,” as well as brokers and for-hire carriers, he said. When a vendor uses a customer’s private fleet to deliver to that customer’s warehouse, “that shows they’ve increased their understanding of the inbound logistics side.” Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.Senior Editor Ari Ashe contributed to this report. </div>

US shippers are expanding their use of private, in-house truck fleets, hauling more goods in their own trucks despite favorable for-hire spot market and contract rates. Growth in private fleets is slowing compared with a peak experienced during the COVID-19 pandemic, but it hasn’t stopped, industry experts told the Journal of Commerce. Shipments handled by private fleets increased 11.7% year over year in 2024, according to data released last week by the National Private Truck Council (NPTC). The need for more precise supply chain control and truck capacity is the reason given for greater reliance by shippers on in-house assets, and it is being enabled by technology. “The importance of the private fleet has become more elevated as shippers take greater control of supply chains,” especially since the COVID-19 pandemic, said Tom Moore, NPTC’s executive vice president. The change has been noted by industry analysts and for-hire carriers. Schneider National, a major truckload carrier and provider of dedicated fleet services, has seen the growth of private, shipper-owned fleets outpace the for-hire carrier market, Mark Rourke, CEO and president, told a Morgan Stanley investor conference Sept. 11. “For a number of years, we’ve kind of assessed the full truckload market to be about 50% for-hire, 50% private fleet,” Rourke said at the event. Coming out of COVID-19, “there’s been a shift” to 55% private fleet, 45% for-hire, Rourke said. “That’s a pretty big movement,” he said, although he thinks there are opportunities “to move the needle back toward 50-50” as truck fleet operating costs rise. “We’ve seen private fleets grow to the point where last year there were more employee truck drivers in private fleets than in for-hire truck transportation,” Avery Vise, vice president of trucking at FTR Transport Intelligence, said at an FTR conference Sept. 9. The total number of US private fleets, both interstate and intrastate, rose 15.9% from December 2019 through August 2025, according to Federal Motor Carrier Safety Administration (FMCSA) data, reaching 776,588, according to data published last month. Rising fleet operating costs and continuing low rates will probably shift more freight toward for-hire carriers, “but that will certainly be an incremental thing,” Vise said. “It’s not that some of these private fleets will just shut down.” The choice of whether to use for-hire or in-house trucking isn’t about choosing either one or the other, and it’s not only about costs, experts told the Journal of Commerce. “Most of our customers, especially our larger ones, use all their options — private fleets, outsourced capacity, dedicated and for-hire trucking,” said Jim Lager, executive vice president of Penske Truck Leasing, an equipment and logistics supplier. “Technology is having a huge impact” on shippers’ decisions, Lager said. “The ability to track vehicles and product in route is at people’s fingertips now.” The common factor among Penske’s private fleet customers is “they want control,” he said. “They want their product to end up in their customers’ hands the way they want it to.” An inbound shift Traditionally, private fleets have been used more to haul outbound freight to customers. Now, shippers are working more closely with vendors and suppliers on the inbound side of transportation and distribution to find ways to move more freight in their in-house fleets. The shift is evident in data NPTC collected from a diverse group of more than 100 shippers with private fleets in its most recent annual benchmarking survey report, released Monday. Those shippers moved 43% of their inbound freight by private fleet last year. That compares with 35% the previous year and 31% in 2022, according to NPTC. The last time shippers relied as heavily on private fleets for inbound transportation was in 2021, when COVID-19 supply chain disruption hit its peak, NPTC’s data indicated. Greater use of private fleets for inbound transportation requires more sophisticated collaboration between shippers and their vendors and suppliers, Moore said. “Often they both will have private fleets,” as well as brokers and for-hire carriers, he said. When a vendor uses a customer’s private fleet to deliver to that customer’s warehouse, “that shows they’ve increased their understanding of the inbound logistics side.” Contact William B. Cassidy at bill.cassidy@spglobal.com .Senior Editor Ari Ashe contributed to this report.

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