<div class="phx-topic abstract-wrapper">The carrier’s first direct service to Halifax comes as Canada looks to pivot its trade networks and as low water levels affect Montreal’s container business.</div>

The carrier’s first direct service to Halifax comes as Canada looks to pivot its trade networks and as low water levels affect Montreal’s container business.

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<div class="phx-topic">OOCL is adding the Port of Halifax to a trans-Atlantic Mediterranean service, marking the carrier’s first direct service to the port. The new port call comes as Canada looks outside the US for more trade and as low water levels on the St. Lawrence River make Halifax an offtake point for Montreal-bound cargo. OOCL said its West Mediterranean America service from Italy and Spain would add Halifax as the first call before US East Coast ports, noting in a statement the move “unlocks direct access to Montreal and Toronto.” The OOCL service joins three other Mediterranean-North American East Coast services that also call Halifax; this will be the Hong Kong-based carrier’s first service to the port. While Halifax’s overall cargo volumes have yet to approach their 2022 peak, the port has seen some uptick this year. First-half 2025 import volumes are up 13.6% to 131,980 TEUs and export volumes have risen 8.9% to 126,937 TEUs compared to the first half of 2024. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="09c4541c-c611-4969-af40-74647b74b5fd"></dynamic-object></div>Halifax, meanwhile, has been providing relief to the Port of Montreal this year due to navigational challenges on the St. Lawrence Seaway. One portion of Montreal’s harbor has been hovering at about a 17-foot depth since September, according to the International Lake Ontario-St. Lawrence River Board, among the historical lows recorded for the area. “For the carriers, the biggest problem is low water on the Seaway,” Grace Liang, president of OOCL Canada, said at a conference in Toronto last month. “The impact of low water is pretty substantial.” Paul Bird, chief commercial officer of the Montreal Port Authority, said Montreal’s current water levels are part of the La Niña weather cycle that occurs approximately every 12 years. As a result, container ships have to offload cargo prior to entering the Seaway to reduce their draft, which serves as a temporary measure until water levels rise again. “Carriers have to top off either at Saint John or Halifax before they come into Montreal,” Bird said at the Toronto conference. “But there’s a cycle here. We don’t expect these low water levels to return for another 10 or 12 years.” <h3>Canadian ports handled frontloaded imports </h3>Liang said at the conference that Canada’s ports handled frontloaded imports, either from US-bound freight or as inputs for other Canadian goods shipped to the US. But she said Canadian ports are likely to see the same cargo slowdown as US ports in the fourth quarter. “When it comes to demand, it’s affected by the trade wars and tariffs,” Liang said. “We’ve seen a lot of frontloading both in the US and Canada.” In the long term, Canada’s international trade also faces a restructuring that favors enlarged port coverage. Back in March, Prime Minister Mark Carney said Canada’s traditional reliance on the US export market is now over due to the tariffs imposed by the Trump administration. Carney’s 2025 budget proposes C$5 billion in spending for Transport Canada to develop new trade and infrastructure projects, as well as other funds to help Canadian businesses tap overseas markets. Contact Michael Angell at <a href="mailto: michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

OOCL is adding the Port of Halifax to a trans-Atlantic Mediterranean service, marking the carrier’s first direct service to the port. The new port call comes as Canada looks outside the US for more trade and as low water levels on the St. Lawrence River make Halifax an offtake point for Montreal-bound cargo. OOCL said its West Mediterranean America service from Italy and Spain would add Halifax as the first call before US East Coast ports, noting in a statement the move “unlocks direct access to Montreal and Toronto.” The OOCL service joins three other Mediterranean-North American East Coast services that also call Halifax; this will be the Hong Kong-based carrier’s first service to the port. While Halifax’s overall cargo volumes have yet to approach their 2022 peak, the port has seen some uptick this year. First-half 2025 import volumes are up 13.6% to 131,980 TEUs and export volumes have risen 8.9% to 126,937 TEUs compared to the first half of 2024. Halifax, meanwhile, has been providing relief to the Port of Montreal this year due to navigational challenges on the St. Lawrence Seaway. One portion of Montreal’s harbor has been hovering at about a 17-foot depth since September, according to the International Lake Ontario-St. Lawrence River Board, among the historical lows recorded for the area. “For the carriers, the biggest problem is low water on the Seaway,” Grace Liang, president of OOCL Canada, said at a conference in Toronto last month. “The impact of low water is pretty substantial.” Paul Bird, chief commercial officer of the Montreal Port Authority, said Montreal’s current water levels are part of the La Niña weather cycle that occurs approximately every 12 years. As a result, container ships have to offload cargo prior to entering the Seaway to reduce their draft, which serves as a temporary measure until water levels rise again. “Carriers have to top off either at Saint John or Halifax before they come into Montreal,” Bird said at the Toronto conference. “But there’s a cycle here. We don’t expect these low water levels to return for another 10 or 12 years.” Canadian ports handled frontloaded imports Liang said at the conference that Canada’s ports handled frontloaded imports, either from US-bound freight or as inputs for other Canadian goods shipped to the US. But she said Canadian ports are likely to see the same cargo slowdown as US ports in the fourth quarter. “When it comes to demand, it’s affected by the trade wars and tariffs,” Liang said. “We’ve seen a lot of frontloading both in the US and Canada.” In the long term, Canada’s international trade also faces a restructuring that favors enlarged port coverage. Back in March, Prime Minister Mark Carney said Canada’s traditional reliance on the US export market is now over due to the tariffs imposed by the Trump administration. Carney’s 2025 budget proposes C$5 billion in spending for Transport Canada to develop new trade and infrastructure projects, as well as other funds to help Canadian businesses tap overseas markets. Contact Michael Angell at michael.angell@spglobal.com .

Trans-Atlantic

North American ports

Container lines

OOCL adds Halifax call to trans-Atlantic Med service

<div class="phx-topic abstract-wrapper">The consortium of nine liner carriers has launched its first product to facilitate the adoption of electronic bills of lading and other digital standards it is developing.</div>

The consortium of nine liner carriers has launched its first product to facilitate the adoption of electronic bills of lading and other digital standards it is developing.

<div class="phx-topic">The Digital Container Shipping Association (DCSA) has launched an identity management tool aimed at helping companies involved in global shipping and international trade perform internal compliance checks and vet prospective business partners. The product, called Identity Exchange, expands the reach of the DCSA, a nonprofit consortium of nine container lines whose broader goal is to standardize and digitize the shipping industry. Niels Nuyens, DCSA’s chief product officer, told the Journal of Commerce Tuesday the new product was developed over the past 12 to 15 months as the group was doing work to <a href="https://www.joc.com/article/key-supply-chain-stakeholders-commit-to-electronic-bills-of-lading-5226286">advance electronic bill of lading</a> (eBL) adoption among members and their customers. “As part of shipping and international trade, it’s necessary to be 100% sure about who you’re working with,” Nuyens said. “We learned it’s being done differently across different organizations and felt there was a way to provide better onboarding and compliance processes.” Electronic bill of lading adoption is contingent on making the issuing and transmitting of electronic documents more streamlined, and that quickly led to a discussion around ensuring that the eBL was being submitted to a trusted party. Bills of lading convey titles to recipients and have associated banking implications for suppliers using letters of credit to fund the manufacturing and transportation of goods. Those conversations with members, forwarders and shippers led DCSA to determine there was no unified identity management process to ensure that customers or partners were compliant with internal controls. The means of checking potential business partners are sometimes sophisticated, involving an identity management system and local teams that can verify entities, and sometimes rudimentary, involving nothing more than a Google search of a prospective partner or customer. The demand for vetting is a result of companies’ internal compliance processes, which, in turn, are often driven by customs or banking regulatory mandates, depending on the industry or country. The patchwork of those requirements creates an uneven landscape where some companies are screening for things such as restricted entities and others lack the means to do so. <h3>Product development part of DCSA strategy </h3>The development of a product is a bit of a new direction for DCSA, which has to this point focused on building industry standards for processes such as tracking and tracing, eBLs, and just-in-time port calls. More recently, the group has <a href="https://www.joc.com/article/dcsa-turns-to-industry-partners-to-drive-shipping-standards-adoption-6070237">built a partnership network</a> of terminals, feeders, freight forwarders, shippers, and tech providers to support the adoption of standards and contribute to what DCSA develops. Nuyens said product development is the third pillar in DCSA’s strategy. The identity product, unlike everything else DCSA has developed to date, is not free to use. Companies wanting to use the exchange pay for a certain number of lookups, with the cost-per-lookup going down based on usage. Nuyens said the revenue from the Identity Exchange will be funneled into DCSA’s other initiatives to promote shipping industry standards. More than 150 early users completed over 30,000 identity checks through Identity Exchange, DCSA said in a statement, with match rates above 95% and reports of less manual review time and stronger data accuracy. DCSA called the development of its first product a move into “digital infrastructure that strengthens trust across the container shipping industry.” The product is intended to be used in any business-to-business situation in shipping or trade, Nuyens said. The ocean carrier members of DCSA are Mediterranean Shipping Co., Hapag-Lloyd, Maersk, CMA CGM, Evergreen, HMM, Yang Ming, Zim Integrated Shipping Services and PIL. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

The Digital Container Shipping Association (DCSA) has launched an identity management tool aimed at helping companies involved in global shipping and international trade perform internal compliance checks and vet prospective business partners. The product, called Identity Exchange, expands the reach of the DCSA, a nonprofit consortium of nine container lines whose broader goal is to standardize and digitize the shipping industry. Niels Nuyens, DCSA’s chief product officer, told the Journal of Commerce Tuesday the new product was developed over the past 12 to 15 months as the group was doing work to advance electronic bill of lading (eBL) adoption among members and their customers. “As part of shipping and international trade, it’s necessary to be 100% sure about who you’re working with,” Nuyens said. “We learned it’s being done differently across different organizations and felt there was a way to provide better onboarding and compliance processes.” Electronic bill of lading adoption is contingent on making the issuing and transmitting of electronic documents more streamlined, and that quickly led to a discussion around ensuring that the eBL was being submitted to a trusted party. Bills of lading convey titles to recipients and have associated banking implications for suppliers using letters of credit to fund the manufacturing and transportation of goods. Those conversations with members, forwarders and shippers led DCSA to determine there was no unified identity management process to ensure that customers or partners were compliant with internal controls. The means of checking potential business partners are sometimes sophisticated, involving an identity management system and local teams that can verify entities, and sometimes rudimentary, involving nothing more than a Google search of a prospective partner or customer. The demand for vetting is a result of companies’ internal compliance processes, which, in turn, are often driven by customs or banking regulatory mandates, depending on the industry or country. The patchwork of those requirements creates an uneven landscape where some companies are screening for things such as restricted entities and others lack the means to do so. Product development part of DCSA strategy The development of a product is a bit of a new direction for DCSA, which has to this point focused on building industry standards for processes such as tracking and tracing, eBLs, and just-in-time port calls. More recently, the group has built a partnership network of terminals, feeders, freight forwarders, shippers, and tech providers to support the adoption of standards and contribute to what DCSA develops. Nuyens said product development is the third pillar in DCSA’s strategy. The identity product, unlike everything else DCSA has developed to date, is not free to use. Companies wanting to use the exchange pay for a certain number of lookups, with the cost-per-lookup going down based on usage. Nuyens said the revenue from the Identity Exchange will be funneled into DCSA’s other initiatives to promote shipping industry standards. More than 150 early users completed over 30,000 identity checks through Identity Exchange, DCSA said in a statement, with match rates above 95% and reports of less manual review time and stronger data accuracy. DCSA called the development of its first product a move into “digital infrastructure that strengthens trust across the container shipping industry.” The product is intended to be used in any business-to-business situation in shipping or trade, Nuyens said. The ocean carrier members of DCSA are Mediterranean Shipping Co., Hapag-Lloyd, Maersk, CMA CGM, Evergreen, HMM, Yang Ming, Zim Integrated Shipping Services and PIL. Contact Eric Johnson at eric.johnson@spglobal.com .

Forwarding

Logistics Technology News

DCSA broadens reach with identity exchange for shipping industry

<div class="phx-topic abstract-wrapper">‘Spectacular’ growth at the Persian Gulf terminal has brought forward expansion plans that will increase handling capacity by almost 50%.</div>

‘Spectacular’ growth at the Persian Gulf terminal has brought forward expansion plans that will increase handling capacity by almost 50%.

<div class="phx-topic">CMA CGM and joint venture partner AD Ports said Tuesday they will add almost 1 million TEUs of capacity to their terminal in Abu Dhabi’s Khalifa Port, with the facility already at full capacity just 11 months after opening. Strong demand since the December 2024 launch of CMA Terminals Khalifa Port brought forward expansion plans by joint venture partners CMA Terminals (70%) and Abu Dhabi-based AD Ports Group (30%). Christine Cabau, executive vice president of operations and assets at CMA CGM, said the growth at the Persian Gulf terminal has been “spectacular.” “After 10 months of operations, the terminal has already reached full capacity and has led us to the decision of accelerating phase two deployment to meet the demand,” Cabau said in a statement. The $115 million cost of the expansion will be shared pro-rata between the partners. It is scheduled for completion in early 2028 and will grow the terminal’s capacity by almost 50% from 1.8 million TEUs to 2.7 million TEUs, increasing Khalifa Port’s overall container handling by 9% to 10.5 million TEUs annually. The work will extend the quay wall length by 50% from 800 meters to 1,200 meters and expand the yard area by more than 40% from 46 hectares to 67 hectares. Advanced reefer racks will be added to support refrigerated container storage. <h3>AD Ports growth </h3>The Khalifa Port expansion comes just a week after AD Ports took a 20% stake in the CMA CGM-operated <a href="https://www.joc.com/article/cma-cgm-accelerates-232-million-syrian-med-port-expansion-project-6066188">Latakia International Container Terminal in Syria</a>. The two companies are also involved in the joint venture development of a multipurpose cargo terminal in Pointe Noire, Republic of Congo. AD Ports acquired Spain’s Noatum Logistics in 2023, and through its strategic partnerships with CMA CGM, the Abu Dhabi group is following in the footsteps of larger Dubai-based neighbor DP World in growing its end-to-end reach across the container shipping sector. Former DB Schenker CEO Jochen Thewes has been appointed CEO of AD Ports’ logistics cluster and will take office in December. Thewes’ role will be “to build on the success of Noatum Logistics ... unlocking the full potential of its integrated trade and logistics ecosystem,” AD Ports said in a statement. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

CMA CGM and joint venture partner AD Ports said Tuesday they will add almost 1 million TEUs of capacity to their terminal in Abu Dhabi’s Khalifa Port, with the facility already at full capacity just 11 months after opening. Strong demand since the December 2024 launch of CMA Terminals Khalifa Port brought forward expansion plans by joint venture partners CMA Terminals (70%) and Abu Dhabi-based AD Ports Group (30%). Christine Cabau, executive vice president of operations and assets at CMA CGM, said the growth at the Persian Gulf terminal has been “spectacular.” “After 10 months of operations, the terminal has already reached full capacity and has led us to the decision of accelerating phase two deployment to meet the demand,” Cabau said in a statement. The $115 million cost of the expansion will be shared pro-rata between the partners. It is scheduled for completion in early 2028 and will grow the terminal’s capacity by almost 50% from 1.8 million TEUs to 2.7 million TEUs, increasing Khalifa Port’s overall container handling by 9% to 10.5 million TEUs annually. The work will extend the quay wall length by 50% from 800 meters to 1,200 meters and expand the yard area by more than 40% from 46 hectares to 67 hectares. Advanced reefer racks will be added to support refrigerated container storage. AD Ports growth The Khalifa Port expansion comes just a week after AD Ports took a 20% stake in the CMA CGM-operated Latakia International Container Terminal in Syria . The two companies are also involved in the joint venture development of a multipurpose cargo terminal in Pointe Noire, Republic of Congo. AD Ports acquired Spain’s Noatum Logistics in 2023, and through its strategic partnerships with CMA CGM, the Abu Dhabi group is following in the footsteps of larger Dubai-based neighbor DP World in growing its end-to-end reach across the container shipping sector. Former DB Schenker CEO Jochen Thewes has been appointed CEO of AD Ports’ logistics cluster and will take office in December. Thewes’ role will be “to build on the success of Noatum Logistics ... unlocking the full potential of its integrated trade and logistics ecosystem,” AD Ports said in a statement. Contact Greg Knowler at greg.knowler@spglobal.com .

International ports

Maritime

CMA CGM to expand Abu Dhabi terminal as capacity maxes out

<div class="phx-topic abstract-wrapper">Cargo owners typically balk at paying more for ocean transport, but the significantly improving schedule reliability from the Maersk and Hapag-Lloyd partnership is getting the attention of the market.</div>

Cargo owners typically balk at paying more for ocean transport, but the significantly improving schedule reliability from the Maersk and Hapag-Lloyd partnership is getting the attention of the market.

<div class="phx-topic">Talk of a premium charge from Gemini Cooperation partners Maersk and Hapag-Lloyd for the superior schedule reliability being achieved by the alliance since its launch in February is receiving a mixed reaction from the market. Executives from the two carriers have recently been extolling the value created by allowing customers to take one or two weeks’ worth of inventory out of their supply chains, but not all shippers are convinced. At a Hamburg conference for beneficial cargo owners (BCOs) organized by shipper network ShiftX last week, attendees appeared to be split into two camps — those who question why they should pay more to have their containers delivered on time, and those who ship products where on-time delivery represents value. “But it’s all about plannability,” Antonios Rigalos, managing partner of ShiftX, told the Journal of Commerce. “BCOs would rather build up inventory than be left with not enough stock, so the transit time is important, but the schedules need to be reliable.” The supply chain director for a European retailer said even though planning was crucial, a premium charge simply for delivering on time in a scheduled weekly service would not be well received. “As long as we can plan, it’s manageable,” the source said. “What doesn’t work is if we plan for 40 days and our containers arrive in 70 days, or the other way around. Accurate is more important than faster and we need to be able to predict arrivals.” The opposite held true for a European furniture importer. He agreed that accurate schedules were important, but added that there was significant value to be unlocked by carriers providing shorter lead times and ocean transits. “From the purchase order to delivery, the faster the goods arrive in Europe, the faster our customers get their deliveries,” the importer said. “Our products are seasonal, so there are narrow timelines ahead of the high season as well as in the low season when we build up stocks. “These are high volumetric products so there are not that many products in a container or stored in destination warehouses, and any extension of the lead time will have a significant price impact on the final customer,” he added. Gemini was designed to achieve a target of 90% schedule reliability with its fully phased in network. According to Sea-Intelligence Maritime Analysis, Gemini’s on-time performance across all arrivals was at 89.1% in September, while global schedule reliability was about 65%. <h3>Reliability ‘a fundamental cost of service’ </h3>While shippers are typically resistant to paying more for ocean transport, improved schedule reliability came with significant cost benefits, according to Wolfgang Lehmacher, a global supply chain strategist. “Reliability has long commanded a premium in the express sector, where I invested for years, because predictability drives value creation,” Lehmacher told the Journal of Commerce. “In ocean freight, resistance to [Gemini’s] stance reveals an industry still habituated to mediocrity,” he said. “As performance becomes measurable and differentiation clear, the debate shifts from being about paying more to recognizing that reliability is a fundamental cost of service, not an unexpected ask.” The delta between the reliability of Gemini and its rivals will allow Maersk and Hapag-Lloyd to place a price on the improved service levels, Hapag-Lloyd CEO Rolf Habben Jansen said <a href="https://www.joc.com/article/hapag-lloyd-refining-gemini-network-to-improve-efficiencies-habben-jansen-6115582">during a third-quarter earnings call with analysts last week</a>. “We will come with the introduction of a new quality promise for on-time delivery on a box level because that’s, in the end, the ultimate promise to customers that we will deliver their box on time,” Habben Jansen said. “The next step is to make sure we continue to grow volume on the back of an excellent product and also make sure we get adequately paid for that,” he added. “Because if we can help our customers to run their supply chains a lot better, then that must be more efficient for them as it allows them to take out inventory. And of course, we would like also to be adequately paid for that.” Maersk CEO Vincent Clerc had the same message in his <a href="https://www.joc.com/article/value-unlocked-by-gemini-will-clear-path-for-premium-charge-maersk-ceo-6111339">third-quarter earnings call earlier this month</a>. He said conversations with customers around a premium were already underway, but the current on-time performance would need to be sustained before such a charge could be rolled out. “We need to be certain that we have a long enough track record that it unlocks value for them [shippers], that we can then capture some of that value for us,” Clerc told analysts. “For instance, today every customer has buffer stock, and that reliability needs to unlock a reduction in that buffer stock,” he added. “They need to trust that [Gemini] has weathered sufficient ups and downs and is steady [so] that they can take out some of that buffer stock.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Talk of a premium charge from Gemini Cooperation partners Maersk and Hapag-Lloyd for the superior schedule reliability being achieved by the alliance since its launch in February is receiving a mixed reaction from the market. Executives from the two carriers have recently been extolling the value created by allowing customers to take one or two weeks’ worth of inventory out of their supply chains, but not all shippers are convinced. At a Hamburg conference for beneficial cargo owners (BCOs) organized by shipper network ShiftX last week, attendees appeared to be split into two camps — those who question why they should pay more to have their containers delivered on time, and those who ship products where on-time delivery represents value. “But it’s all about plannability,” Antonios Rigalos, managing partner of ShiftX, told the Journal of Commerce. “BCOs would rather build up inventory than be left with not enough stock, so the transit time is important, but the schedules need to be reliable.” The supply chain director for a European retailer said even though planning was crucial, a premium charge simply for delivering on time in a scheduled weekly service would not be well received. “As long as we can plan, it’s manageable,” the source said. “What doesn’t work is if we plan for 40 days and our containers arrive in 70 days, or the other way around. Accurate is more important than faster and we need to be able to predict arrivals.” The opposite held true for a European furniture importer. He agreed that accurate schedules were important, but added that there was significant value to be unlocked by carriers providing shorter lead times and ocean transits. “From the purchase order to delivery, the faster the goods arrive in Europe, the faster our customers get their deliveries,” the importer said. “Our products are seasonal, so there are narrow timelines ahead of the high season as well as in the low season when we build up stocks. “These are high volumetric products so there are not that many products in a container or stored in destination warehouses, and any extension of the lead time will have a significant price impact on the final customer,” he added. Gemini was designed to achieve a target of 90% schedule reliability with its fully phased in network. According to Sea-Intelligence Maritime Analysis, Gemini’s on-time performance across all arrivals was at 89.1% in September, while global schedule reliability was about 65%. Reliability ‘a fundamental cost of service’ While shippers are typically resistant to paying more for ocean transport, improved schedule reliability came with significant cost benefits, according to Wolfgang Lehmacher, a global supply chain strategist. “Reliability has long commanded a premium in the express sector, where I invested for years, because predictability drives value creation,” Lehmacher told the Journal of Commerce. “In ocean freight, resistance to [Gemini’s] stance reveals an industry still habituated to mediocrity,” he said. “As performance becomes measurable and differentiation clear, the debate shifts from being about paying more to recognizing that reliability is a fundamental cost of service, not an unexpected ask.” The delta between the reliability of Gemini and its rivals will allow Maersk and Hapag-Lloyd to place a price on the improved service levels, Hapag-Lloyd CEO Rolf Habben Jansen said during a third-quarter earnings call with analysts last week . “We will come with the introduction of a new quality promise for on-time delivery on a box level because that’s, in the end, the ultimate promise to customers that we will deliver their box on time,” Habben Jansen said. “The next step is to make sure we continue to grow volume on the back of an excellent product and also make sure we get adequately paid for that,” he added. “Because if we can help our customers to run their supply chains a lot better, then that must be more efficient for them as it allows them to take out inventory. And of course, we would like also to be adequately paid for that.” Maersk CEO Vincent Clerc had the same message in his third-quarter earnings call earlier this month . He said conversations with customers around a premium were already underway, but the current on-time performance would need to be sustained before such a charge could be rolled out. “We need to be certain that we have a long enough track record that it unlocks value for them [shippers], that we can then capture some of that value for us,” Clerc told analysts. “For instance, today every customer has buffer stock, and that reliability needs to unlock a reduction in that buffer stock,” he added. “They need to trust that [Gemini] has weathered sufficient ups and downs and is steady [so] that they can take out some of that buffer stock.” Contact Greg Knowler at greg.knowler@spglobal.com .

Container Shipping News

Shippers split as Gemini floats premium charge on reliability

<div class="phx-topic abstract-wrapper">The move represents the latest effort by the two railroads to jointly convince shippers to shift more truckload freight to rail by addressing intermodal’s slower transits. </div>

The move represents the latest effort by the two railroads to jointly convince shippers to shift more truckload freight to rail by addressing intermodal’s slower transits.

<div class="phx-topic">BNSF Railway and CSX Transportation on Monday partnered to launch service upgrades featuring new trains and faster transits from Southern California to the Ohio Valley and Northeast, in most cases slashing more than a day off prior transits. The moves represent <a href="https://www.joc.com/article/bnsf-csx-unveil-new-joint-intermodal-lanes-in-aftermath-of-up-ns-merger-6067789">the latest effort by the two railroads to jointly convince shippers</a> to shift more truckload freight to rail by addressing intermodal’s slower transits. Nine lanes are covered in the latest upgrades, including a new service from Southern California to Louisville and Philadelphia. The other seven pre-existing routes will see an average savings of nearly 32 hours less in transit. Trains will run five days per week, originating from BNSF’s Hobart terminal just outside of downtown Los Angeles. The new BNSF-CSX partnership comes months after the two railroads announced a joint “single-line like” service from Los Angeles to Charlotte and Jacksonville and Phoenix to Atlanta. Unlike that service, however, which is a straight train all the way through, the latest partnership will include breaking down trains and building new ones in CSX’s terminal in North Baltimore, Ohio. The joint upgrades come as Union Pacific Railroad and Norfolk Southern Railway seek to merge in an $85 billion transaction that would create a single-line railroad covering the US coast to coast. Major, high-volume lanes will benefit from the BNSF-CSX moves. From Los Angeles to Columbus, Ohio, the expedited service will be 28 hours faster, to Newark (Kearny) 32 hours, and to Springfield, Massachusetts, 52 hours faster. “These new schedules offer even more immediate value for our customers today by increasing speed, flexibility and optionality while delivering integrated service for freight moving across the US,” BNSF <a href="https://www.bnsf.com/news-media/customer-notifications/notification.page?notId=faster-coast-to-coast-solutions-bnsf-and-csx-launch-new-intermodal-schedules-to-ohio-valley-and-northeast">wrote in an advisory</a> announcing the service upgrades. <h3>Using trains with fewer crew changes </h3>BNSF and CSX say they will provide the better service in two ways. First, BNSF has converted trains to expedited trains, known as “Z” trains, which have fewer crew changes along the way and may travel at faster speeds. Secondly, BNSF and CSX will take all trains to a CSX terminal in Northwest Ohio where major work will be done to reconfigure the trains. No work will occur in Chicago, where cross-town drays between two rail terminals often add a day or more to the transit. The BNSF intermodal trains will still run through Chicago, being handed off to a CSX crew at 59th Street before continuing onward to Ohio. Upon reaching Northwest Ohio, CSX would then build trains for Columbus and Louisville, a train for Newark (Kearny) with a stop in Philadelphia, and a train to Springfield with a stop in Syracuse. BNSF and CSX will also be able to ramp up service to Newark and Philadelphia next year once double-stack intermodal service through Baltimore launches next spring. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

BNSF Railway and CSX Transportation on Monday partnered to launch service upgrades featuring new trains and faster transits from Southern California to the Ohio Valley and Northeast, in most cases slashing more than a day off prior transits. The moves represent the latest effort by the two railroads to jointly convince shippers to shift more truckload freight to rail by addressing intermodal’s slower transits. Nine lanes are covered in the latest upgrades, including a new service from Southern California to Louisville and Philadelphia. The other seven pre-existing routes will see an average savings of nearly 32 hours less in transit. Trains will run five days per week, originating from BNSF’s Hobart terminal just outside of downtown Los Angeles. The new BNSF-CSX partnership comes months after the two railroads announced a joint “single-line like” service from Los Angeles to Charlotte and Jacksonville and Phoenix to Atlanta. Unlike that service, however, which is a straight train all the way through, the latest partnership will include breaking down trains and building new ones in CSX’s terminal in North Baltimore, Ohio. The joint upgrades come as Union Pacific Railroad and Norfolk Southern Railway seek to merge in an $85 billion transaction that would create a single-line railroad covering the US coast to coast. Major, high-volume lanes will benefit from the BNSF-CSX moves. From Los Angeles to Columbus, Ohio, the expedited service will be 28 hours faster, to Newark (Kearny) 32 hours, and to Springfield, Massachusetts, 52 hours faster. “These new schedules offer even more immediate value for our customers today by increasing speed, flexibility and optionality while delivering integrated service for freight moving across the US,” BNSF wrote in an advisory announcing the service upgrades. Using trains with fewer crew changes BNSF and CSX say they will provide the better service in two ways. First, BNSF has converted trains to expedited trains, known as “Z” trains, which have fewer crew changes along the way and may travel at faster speeds. Secondly, BNSF and CSX will take all trains to a CSX terminal in Northwest Ohio where major work will be done to reconfigure the trains. No work will occur in Chicago, where cross-town drays between two rail terminals often add a day or more to the transit. The BNSF intermodal trains will still run through Chicago, being handed off to a CSX crew at 59th Street before continuing onward to Ohio. Upon reaching Northwest Ohio, CSX would then build trains for Columbus and Louisville, a train for Newark (Kearny) with a stop in Philadelphia, and a train to Springfield with a stop in Syracuse. BNSF and CSX will also be able to ramp up service to Newark and Philadelphia next year once double-stack intermodal service through Baltimore launches next spring. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

North-American rail

Surface

BNSF, CSX launch faster cross-country intermodal service

<div class="phx-topic abstract-wrapper">Stephen Edwards’ five-year tenure at Norfolk is marked by major capacity expansions at its two marine terminals, along with new vessel and rail services. </div>

Stephen Edwards’ five-year tenure at Norfolk is marked by major capacity expansions at its two marine terminals, along with new vessel and rail services.

<div class="phx-topic">Stephen Edwards is stepping down as leader of the Port of Virginia after having overseen the port during its recent push to serve ultra-large container ships. The Virginia Port Authority (VPA) said Monday that Edwards will vacate his role as the port’s chief executive at the end of 2025, with Chief Administrative Office Sarah McCoy assuming the role on an interim basis. Edwards, who will be taking a role in the private sector, has led the port since January 2021 after a three-year stint as the head of West Coast marine terminal operator TraPac. During his time at Norfolk, Edwards oversaw more than $1 billion in capital spending that expanded the port’s capacity. In 2022, the port completed $800 million in upgrades to its two container terminals, including new cranes for handling ultra-large container ships. In May 2023, the port’s board of commissioners approved another $150 million for the expansion of container service to Norfolk International Terminals’ (NIT’s) north berth. After securing <a href="https://www.joc.com/article/federal-funds-kickstart-virginias-inner-harbor-dredging-project-5243365">the federal funding two years earlier</a>, the Port of Virginia completed <a href="https://www.joc.com/article/capital-upgrades-ready-usec-ports-for-another-year-of-growth-5913772">the dredging of its harbor to 55 feet</a> in 2024, making it the deepest port on the East Coast. The port has also become a major intermodal gateway along the US East Coast after having completed <a href="https://www.joc.com/article/port-of-virginia-to-begin-nit-rail-expansion-in-february-5219652">an $80 million expansion of the NIT’s rail capacity</a>. Following that expansion, Hapag-Lloyd started offering <a href="https://www.joc.com/article/hapag-lloyd-offering-new-westbound-rail-service-from-port-of-virginia-5218837">trans-Atlantic shippers inland intermodal service to the US West Coast</a> via the Virginia gateway. Edwards also played a role in renegotiating the port’s lease for the Virginia International Gateway (VIG) terminal with its owner Alinda Capital Partners through 2065. In February, the VPA secured an option to buy VIG at a pre-determined price and have greater investment and operational control of the site. Thanks to the pandemic-era surge, Virginia’s container volumes have grown at an average annual rate of 5.7% between 2021 and 2024. Virginia has also been <a href="https://www.joc.com/article/chinas-ports-still-lead-performance-rankings-while-indias-move-higher-cppi-5213974">one of the top ranked US ports</a> in the annual Container Port Performance Index published by the World Bank and S&amp;P Global, parent company of the Journal of Commerce. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Stephen Edwards is stepping down as leader of the Port of Virginia after having overseen the port during its recent push to serve ultra-large container ships. The Virginia Port Authority (VPA) said Monday that Edwards will vacate his role as the port’s chief executive at the end of 2025, with Chief Administrative Office Sarah McCoy assuming the role on an interim basis. Edwards, who will be taking a role in the private sector, has led the port since January 2021 after a three-year stint as the head of West Coast marine terminal operator TraPac. During his time at Norfolk, Edwards oversaw more than $1 billion in capital spending that expanded the port’s capacity. In 2022, the port completed $800 million in upgrades to its two container terminals, including new cranes for handling ultra-large container ships. In May 2023, the port’s board of commissioners approved another $150 million for the expansion of container service to Norfolk International Terminals’ (NIT’s) north berth. After securing the federal funding two years earlier , the Port of Virginia completed the dredging of its harbor to 55 feet in 2024, making it the deepest port on the East Coast. The port has also become a major intermodal gateway along the US East Coast after having completed an $80 million expansion of the NIT’s rail capacity . Following that expansion, Hapag-Lloyd started offering trans-Atlantic shippers inland intermodal service to the US West Coast via the Virginia gateway. Edwards also played a role in renegotiating the port’s lease for the Virginia International Gateway (VIG) terminal with its owner Alinda Capital Partners through 2065. In February, the VPA secured an option to buy VIG at a pre-determined price and have greater investment and operational control of the site. Thanks to the pandemic-era surge, Virginia’s container volumes have grown at an average annual rate of 5.7% between 2021 and 2024. Virginia has also been one of the top ranked US ports in the annual Container Port Performance Index published by the World Bank and S&P Global, parent company of the Journal of Commerce. Contact Michael Angell at michael.angell@spglobal.com .

Port News

CEO Edwards leaving Port of Virginia at end of year

<div class="phx-topic abstract-wrapper">With the proposed Union Pacific-Norfolk Southern merger, the US rail industry finds itself facing a new future but the same historical set of challenges.</div>

With the proposed Union Pacific-Norfolk Southern merger, the US rail industry finds itself facing a new future but the same historical set of challenges.

<div class="phx-topic">Oct. 14 marked the 45th anniversary of President Jimmy Carter signing The Harley O. Staggers Rail Act of 1980, named for the chairman of the House Committee on Interstate and Foreign Commerce (today the Committee on Energy and Commerce). However, the real “heavy lifting” to get the bill passed was by Rep. Jim Florio, the New Jersey Democrat who chaired the House Subcommittee on Commerce, Transportation, and Tourism. The Association of American Railroads (AAR) frequently points out how, by 1980, the railroad industry was on the brink of collapse until Congress passed bipartisan legislation to partially deregulate the industry, thereby allowing market-driven pricing, customer-specific contracts and the ability to shed unprofitable routes. However, this neglects the tortured decade of the 1970s when Congress was repeatedly drawn into legislating railroad matters. It started with The Rail Passenger Service Act of 1970, creating Amtrak. This relieved private railroads from their losses operating passenger service. But it was not enough to save Penn Central, so Congress passed the Regional Rail Reorganization Act of 1973 (the “3R Act”) to salvage viable freight operations from Penn Central and other failing rail lines in the Northeast, mid-Atlantic and Midwest. It created the United States Railway Association (USRA) to develop a “Final System Plan” for the reorganization into a single entity — Conrail. Finally, The Railroad Revitalization and Regulatory Reform Act of 1976 (The “4R Act”) approved the Final System Plan, enabling Conrail to start operations on April 1, 1976. It provided what it thought was sufficient funding — an initial federal “investment” of $2.026 billion for Conrail to acquire the assets of bankrupt Northeast and Midwest railroads and get its operations started. This funding turned out to be insufficient. Conrail subsequently sought and received an additional $3 billion. However, by 1979, it had almost exhausted that amount. Under the leadership of a new CEO, L. Stanley Crane, Conrail claimed that it could succeed as a private entity if the rail marketplace was deregulated. <h3>Regulation intended to perpetuate monopolies </h3>Railroads had been operating under a regulated system since the Interstate Commerce Act of 1887. This legislation was an early initiative of the Progressive era and preceded other efforts at regulation, such as the Sherman Antitrust Act three years later. The Interstate Commerce Commission (ICC) became the model for rate-of-return regulation of public utilities. The microeconomic theory is that a monopoly business can be regulated by having the government control the prices charged by the market to a level equal to the efficient costs of production, plus a government-permitted rate of return on capital. This model became the norm for oversight of many asset-based, network-operating businesses such as communications, utilities, and other transportation modes. What is overlooked by many is that — by design — regulation was intended to perpetuate monopolies because it ensured that excess capacity would be available in the event of war or other national emergencies. The monopoly license was maintained through a series of operating authorities that determined which providers could serve which markets. Consumers paid more — but hopefully not too much more. This legislation was passed when railroads were the primary means of freight and passenger transportation. However, the subsequent development of the Interstate Highway System and air traffic changed that dominant position. Meanwhile, the onset of persistent stagflation during the 1970s encouraged deregulatory efforts in many regulated industries. The Airline Deregulation Act of 1978 was a predecessor. However, the Interstate Commerce Commission, under Chairman Dan O’Neal, had already taken initiatives, permitted by the 4R Act, to deregulate certain rail sectors, such as intermodal. <h3>Key components of Staggers Act </h3>The Staggers Act had three key components: Railroads were able to negotiate contracts with a customer at market-based rates; reduced regulatory oversight over mergers and abandonments was enacted; and a regulatory backstop was established to protect shippers lacking effective competition. These legislative efforts completely inverted the commercial process. Regulation was cost-based pricing. Shippers were price takers. Deregulation begat price-based costing. The market determined the competitive price, and the carrier needed to find a way to produce the service so as to be profitable. This was accomplished in numerous ways: Railroad mergers enabled increased economies of scale and reduced overhead; technology supported cost reductions (e.g., end of train devices replacing the caboose); significant amounts of the networks were spun off to short line operations; and a reduction in train crew size from five to two and extending crew districts reduced costs significantly. The final step of this reduction required Congressional help in 1991, with the imposition of Presidential Emergency Board 219. But downsizing could only do so much. Topline growth was necessary. Into this opportunity stepped intermodal. As international traffic grew with globalization, a large part of the volume growth came from ocean carriers. Traditional domestic customers increased their volume, and major new customers, such as J.B. Hunt, entered as well. It was a win-win situation for everyone. Railroads filled excess capacity, and intermodal customers enjoyed reliable and cost-effective service. Everything went well until the summer of 1993. The weather that summer caused terrible service problems. As an industry, we missed the wakeup call. We were too eager to attribute the problems to a fluke weather condition, not recognizing that capacity utilization was nearing maximum. Since then, the industry has been dealing with the challenge of increasing the top and bottom lines simultaneously. This has frequently proven elusive. The advent of activist investors has only raised the stakes. With the proposed Union Pacific-Norfolk Southern merger, the industry finds itself facing a new future but the same historical set of challenges. In retrospect, it is clear to see how we got here, but it is less clear where we are going. Contact Ted Prince at <a href="mailto:ted@tricitiesintermodal.com">ted@tricitiesintermodal.com</a>.</div>

Oct. 14 marked the 45th anniversary of President Jimmy Carter signing The Harley O. Staggers Rail Act of 1980, named for the chairman of the House Committee on Interstate and Foreign Commerce (today the Committee on Energy and Commerce). However, the real “heavy lifting” to get the bill passed was by Rep. Jim Florio, the New Jersey Democrat who chaired the House Subcommittee on Commerce, Transportation, and Tourism. The Association of American Railroads (AAR) frequently points out how, by 1980, the railroad industry was on the brink of collapse until Congress passed bipartisan legislation to partially deregulate the industry, thereby allowing market-driven pricing, customer-specific contracts and the ability to shed unprofitable routes. However, this neglects the tortured decade of the 1970s when Congress was repeatedly drawn into legislating railroad matters. It started with The Rail Passenger Service Act of 1970, creating Amtrak. This relieved private railroads from their losses operating passenger service. But it was not enough to save Penn Central, so Congress passed the Regional Rail Reorganization Act of 1973 (the “3R Act”) to salvage viable freight operations from Penn Central and other failing rail lines in the Northeast, mid-Atlantic and Midwest. It created the United States Railway Association (USRA) to develop a “Final System Plan” for the reorganization into a single entity — Conrail. Finally, The Railroad Revitalization and Regulatory Reform Act of 1976 (The “4R Act”) approved the Final System Plan, enabling Conrail to start operations on April 1, 1976. It provided what it thought was sufficient funding — an initial federal “investment” of $2.026 billion for Conrail to acquire the assets of bankrupt Northeast and Midwest railroads and get its operations started. This funding turned out to be insufficient. Conrail subsequently sought and received an additional $3 billion. However, by 1979, it had almost exhausted that amount. Under the leadership of a new CEO, L. Stanley Crane, Conrail claimed that it could succeed as a private entity if the rail marketplace was deregulated. Regulation intended to perpetuate monopolies Railroads had been operating under a regulated system since the Interstate Commerce Act of 1887. This legislation was an early initiative of the Progressive era and preceded other efforts at regulation, such as the Sherman Antitrust Act three years later. The Interstate Commerce Commission (ICC) became the model for rate-of-return regulation of public utilities. The microeconomic theory is that a monopoly business can be regulated by having the government control the prices charged by the market to a level equal to the efficient costs of production, plus a government-permitted rate of return on capital. This model became the norm for oversight of many asset-based, network-operating businesses such as communications, utilities, and other transportation modes. What is overlooked by many is that — by design — regulation was intended to perpetuate monopolies because it ensured that excess capacity would be available in the event of war or other national emergencies. The monopoly license was maintained through a series of operating authorities that determined which providers could serve which markets. Consumers paid more — but hopefully not too much more. This legislation was passed when railroads were the primary means of freight and passenger transportation. However, the subsequent development of the Interstate Highway System and air traffic changed that dominant position. Meanwhile, the onset of persistent stagflation during the 1970s encouraged deregulatory efforts in many regulated industries. The Airline Deregulation Act of 1978 was a predecessor. However, the Interstate Commerce Commission, under Chairman Dan O’Neal, had already taken initiatives, permitted by the 4R Act, to deregulate certain rail sectors, such as intermodal. Key components of Staggers Act The Staggers Act had three key components: Railroads were able to negotiate contracts with a customer at market-based rates; reduced regulatory oversight over mergers and abandonments was enacted; and a regulatory backstop was established to protect shippers lacking effective competition. These legislative efforts completely inverted the commercial process. Regulation was cost-based pricing. Shippers were price takers. Deregulation begat price-based costing. The market determined the competitive price, and the carrier needed to find a way to produce the service so as to be profitable. This was accomplished in numerous ways: Railroad mergers enabled increased economies of scale and reduced overhead; technology supported cost reductions (e.g., end of train devices replacing the caboose); significant amounts of the networks were spun off to short line operations; and a reduction in train crew size from five to two and extending crew districts reduced costs significantly. The final step of this reduction required Congressional help in 1991, with the imposition of Presidential Emergency Board 219. But downsizing could only do so much. Topline growth was necessary. Into this opportunity stepped intermodal. As international traffic grew with globalization, a large part of the volume growth came from ocean carriers. Traditional domestic customers increased their volume, and major new customers, such as J.B. Hunt, entered as well. It was a win-win situation for everyone. Railroads filled excess capacity, and intermodal customers enjoyed reliable and cost-effective service. Everything went well until the summer of 1993. The weather that summer caused terrible service problems. As an industry, we missed the wakeup call. We were too eager to attribute the problems to a fluke weather condition, not recognizing that capacity utilization was nearing maximum. Since then, the industry has been dealing with the challenge of increasing the top and bottom lines simultaneously. This has frequently proven elusive. The advent of activist investors has only raised the stakes. With the proposed Union Pacific-Norfolk Southern merger, the industry finds itself facing a new future but the same historical set of challenges. In retrospect, it is clear to see how we got here, but it is less clear where we are going. Contact Ted Prince at ted@tricitiesintermodal.com .

A look back at the ‘Staggers Act’ and where the US rail industry is today

<div class="phx-topic abstract-wrapper">If the proposed Union Pacific–Norfolk Southern merger proceeds, the balance of power inside a little-known cooperative that serves as the industry’s shared equipment pool could shift dramatically.</div>

If the proposed Union Pacific–Norfolk Southern merger proceeds, the balance of power inside a little-known cooperative that serves as the industry’s shared equipment pool could shift dramatically.

<div class="phx-topic">When your railroad says “no cars available,” the problem usually isn’t a shortage. It’s a cooperative most shippers have never heard of — one that controls nearly every intermodal container, autorack and flatcar in North America. And if the proposed Union Pacific (UP)–Norfolk Southern (NS) merger proceeds, the balance of power inside that cooperative could shift dramatically. That cooperative is TTX Company. While shippers and unions debate potential service disruptions and job losses from the $85 billion merger announced in July, a more fundamental question has gone unasked: What happens when one railroad becomes the dominant voice in the industry’s shared equipment pool? <h3>The system you didn’t know existed </h3>TTX manages approximately 177,000 well cars, flats, autoracks and boxcars, representing about $17 billion in assets. It’s a neutral pool owned collectively by the Class I railroads, operating under Surface Transportation Board (STB) oversight since 1974. The concept is simple: Competing railroads share rolling stock rather than hoarding it. When a car finishes one move, it can be loaded again immediately, regardless of whose track it’s on next. This model has saved the industry billions in duplicate investment and given shippers a measure of reliability in an otherwise fragmented system. Cars flow to demand, not ownership. Repairs are standardized. Procurement is centralized. Until now, no single railroad has had enough control to tilt the playing field. <h3>Why the merger changes everything </h3>The combined Union Pacific–Norfolk Southern network would span nearly 60% of US rail route miles across 43 states, likely making them TTX’s largest shareholder by a significant margin. On paper, neutrality is guaranteed through the STB’s pooling agreement. In practice, concentration of influence can change incentives subtly, but powerfully. Who prioritizes which lanes for car replacement? Who decides where limited heavy-duty flats or autoracks are deployed first? When I was at Maersk negotiating large-scale rail contracts, we constantly ran into a black hole of visibility. Equipment was technically available, but no one could pinpoint where it was or who controlled the next move. The pooling model made coordination possible, but it also made accountability diffuse. Now imagine that opacity combined with ownership concentration. A railroad controlling the largest stake in TTX doesn’t need to explicitly starve competitors of equipment. It just needs to optimize for its own network first. Repairs get prioritized in its lanes. New equipment gets spec’d for its corridors. Allocation algorithms favor its terminals. The result isn’t dramatic — it’s death by a thousand micro-decisions that tilt velocity in one direction. <h3>What gravity looks like </h3>Every time a major shipper changes carriers, the math inside the TTX pool shifts. Steel doesn’t teleport. Cars must physically migrate through the network, a process that can take weeks. Shortages often follow commercial wins because the new carrier gains the freight before it gains the equipment. Even in a neutral pool, gravity takes time to reset. Post-merger, that shock absorption could become selective. If car allocation subtly favors the combined UP-NS lanes, competitors lose not just freight; they lose the equipment velocity needed to compete for the next contract. <h3>What the STB should do </h3>The STB received formal notice of the merger on July 30, 2025. The railroads plan to file their full application by Jan. 29, 2026, triggering a 16-month statutory review. The STB has broad authority to preserve equilibrium through independent TTX governance, fleet-allocation audits and service-performance metrics tied to pooling access. Whether those powers are used will determine if TTX remains the stabilizer it was built to be, or becomes another lever of competitive advantage hidden inside consolidation. The 1996 Union Pacific-Southern Pacific merger produced what the head of the nation’s largest rail union called a “massive meltdown.” Service disruptions lasted months. The STB should apply those lessons to equipment pooling now, before approval — not after the damage is done. <h3>What shippers should ask now </h3>Most customers never deal directly with TTX, but they feel its influence in every service metric. Don’t wait until after the merger is approved. Start asking pointed questions now: How do you measure car velocity in my lanes? Who controls the pool cars that serve my freight? What protections ensure neutrality if ownership concentration shifts? If your railroad can’t answer clearly, you’re not buying transportation, you’re buying uncertainty. <h3>The bottom line </h3>TTX doesn’t appear in marketing campaigns, but its model — shared steel, shared access — keeps the industry balanced. The merger debate has focused on jobs, rates and service promises. But the real test will be whether a system designed for competition can survive when one player holds the dominant stake. Because when the pool tips, everyone feels it. And once gravity shifts, it doesn’t shift back. Paul Tonsager has held executive roles at Maersk, CN Rail, CN Worldwide, Coyote (RXO), and Patriot Rail. He is the founder of Integrated Multimodal Solutions LLC and author of the Substack newsletter Signals &amp; Switches. Contact him at  <a href="mailto:paul.tonsager@multimodalsolutions.io">paul.tonsager@multimodalsolutions.io</a>. </div>

When your railroad says “no cars available,” the problem usually isn’t a shortage. It’s a cooperative most shippers have never heard of — one that controls nearly every intermodal container, autorack and flatcar in North America. And if the proposed Union Pacific (UP)–Norfolk Southern (NS) merger proceeds, the balance of power inside that cooperative could shift dramatically. That cooperative is TTX Company. While shippers and unions debate potential service disruptions and job losses from the $85 billion merger announced in July, a more fundamental question has gone unasked: What happens when one railroad becomes the dominant voice in the industry’s shared equipment pool? The system you didn’t know existed TTX manages approximately 177,000 well cars, flats, autoracks and boxcars, representing about $17 billion in assets. It’s a neutral pool owned collectively by the Class I railroads, operating under Surface Transportation Board (STB) oversight since 1974. The concept is simple: Competing railroads share rolling stock rather than hoarding it. When a car finishes one move, it can be loaded again immediately, regardless of whose track it’s on next. This model has saved the industry billions in duplicate investment and given shippers a measure of reliability in an otherwise fragmented system. Cars flow to demand, not ownership. Repairs are standardized. Procurement is centralized. Until now, no single railroad has had enough control to tilt the playing field. Why the merger changes everything The combined Union Pacific–Norfolk Southern network would span nearly 60% of US rail route miles across 43 states, likely making them TTX’s largest shareholder by a significant margin. On paper, neutrality is guaranteed through the STB’s pooling agreement. In practice, concentration of influence can change incentives subtly, but powerfully. Who prioritizes which lanes for car replacement? Who decides where limited heavy-duty flats or autoracks are deployed first? When I was at Maersk negotiating large-scale rail contracts, we constantly ran into a black hole of visibility. Equipment was technically available, but no one could pinpoint where it was or who controlled the next move. The pooling model made coordination possible, but it also made accountability diffuse. Now imagine that opacity combined with ownership concentration. A railroad controlling the largest stake in TTX doesn’t need to explicitly starve competitors of equipment. It just needs to optimize for its own network first. Repairs get prioritized in its lanes. New equipment gets spec’d for its corridors. Allocation algorithms favor its terminals. The result isn’t dramatic — it’s death by a thousand micro-decisions that tilt velocity in one direction. What gravity looks like Every time a major shipper changes carriers, the math inside the TTX pool shifts. Steel doesn’t teleport. Cars must physically migrate through the network, a process that can take weeks. Shortages often follow commercial wins because the new carrier gains the freight before it gains the equipment. Even in a neutral pool, gravity takes time to reset. Post-merger, that shock absorption could become selective. If car allocation subtly favors the combined UP-NS lanes, competitors lose not just freight; they lose the equipment velocity needed to compete for the next contract. What the STB should do The STB received formal notice of the merger on July 30, 2025. The railroads plan to file their full application by Jan. 29, 2026, triggering a 16-month statutory review. The STB has broad authority to preserve equilibrium through independent TTX governance, fleet-allocation audits and service-performance metrics tied to pooling access. Whether those powers are used will determine if TTX remains the stabilizer it was built to be, or becomes another lever of competitive advantage hidden inside consolidation. The 1996 Union Pacific-Southern Pacific merger produced what the head of the nation’s largest rail union called a “massive meltdown.” Service disruptions lasted months. The STB should apply those lessons to equipment pooling now, before approval — not after the damage is done. What shippers should ask now Most customers never deal directly with TTX, but they feel its influence in every service metric. Don’t wait until after the merger is approved. Start asking pointed questions now: How do you measure car velocity in my lanes? Who controls the pool cars that serve my freight? What protections ensure neutrality if ownership concentration shifts? If your railroad can’t answer clearly, you’re not buying transportation, you’re buying uncertainty. The bottom line TTX doesn’t appear in marketing campaigns, but its model — shared steel, shared access — keeps the industry balanced. The merger debate has focused on jobs, rates and service promises. But the real test will be whether a system designed for competition can survive when one player holds the dominant stake. Because when the pool tips, everyone feels it. And once gravity shifts, it doesn’t shift back. Paul Tonsager has held executive roles at Maersk, CN Rail, CN Worldwide, Coyote (RXO), and Patriot Rail. He is the founder of Integrated Multimodal Solutions LLC and author of the Substack newsletter Signals & Switches. Contact him at   paul.tonsager@multimodalsolutions.io .

Intermodal providers

UP-NS merger could mean new dominant voice inside rail industry cooperative

Year-over-year % change

PIERS containerized US import and export volumes is the transportation industry’s largest US waterborne trade data set, covering all US ports. Every day, the PIERS team processes an average of about 60,000 bills of lading filed with US Customs and Border Protection (CBP) and integrates this transactional trade data with standardized company details. PIERS contains US trade data going back to 2003. [PIERS](https://www.spglobal.com/marketintelligence/en/mi/products/piers.html)

Asia to US container volumes (PIERS)

PIERS Total US imports from Asia (Monthly) (year-over-year change) Gateway

<div class="phx-topic abstract-wrapper">The carrier’s CEO also confirmed Gemini is mulling a price premium, which he forecast would be a “small three-digit number per TEU” to reflect the inventory cost savings customers achieve through the alliance’s consistent on-time delivery.</div>

The carrier’s CEO also confirmed Gemini is mulling a price premium, which he forecast would be a “small three-digit number per TEU” to reflect the inventory cost savings customers achieve through the alliance’s consistent on-time delivery.

<div class="phx-topic">Hapag-Lloyd is refining the Gemini Cooperation hub-and-spoke network with partner Maersk that will likely see some extra port calls and others removed from Gemini services, CEO Rolf Habben Jansen said Thursday. The review is considering “what worked well and what could be improved,” Habben Jansen said during the carrier’s third-quarter results briefing. “We’ll wrap up the review, then ... inform the market, but don’t expect anything revolutionary,” he said. The changes will “strengthen reliability and unlock cost efficiencies, with full cost savings run rate expected by 2026,” Hapag-Lloyd said. Habben Jansen also confirmed <a href="https://www.joc.com/article/value-unlocked-by-gemini-will-clear-path-for-premium-charge-maersk-ceo-6111339">Gemini is mulling a price premium</a>, which he forecast would be a “small three-digit number per TEU” to reflect the inventory cost savings customers achieve through Gemini’s consistent on-time delivery. The CEO gave no further details of the changes, but said Gemini has consistently delivered monthly schedule reliability of 89% to 95% since its launch in February, citing data from Sea-Intelligence Maritime Analysis. That is significantly better than its closest competitors, who had schedule reliability ranging between 70% and 80% from February through September. “We are very happy with [Gemini],” Habben Jansen said. “We hit 90% schedule reliability almost from Day 1.” <h3>Possible expansion of hub-and-spoke model </h3>That reliability helped drive an above-market increase in container volumes for Hapag-Lloyd, growing 9% to 10.2 million TEUs in the first nine months of the year. Most of the increase was on trans-Pacific and Asia-Europe trades, while volumes on the trans-Atlantic, Africa and inter-regional trades were stable. Highlighting the gains, the carrier said trans-Pacific volumes rose to 3 million TEUs this year through September, from 2.5 million TEUs in the same period last year, while Asia-Europe liftings climbed to 3 million TEUs from 2.7 million TEUs. Habben Jansen said while the focus over the next 12 to 18 months is to improve reliability of the current Gemini network schedule, there is potential to adopt Gemini’s hub-and-spoke model in other trades. He said if Hapag-Lloyd did decide to expand the concept, it would have to assess how and where it could be done and “with whom.” Habben Jansen also confirmed the carrier is in talks to add 22 ships to its fleet that would be a mix of newbuildings ordered direct from shipyards and vessels taken on long-term charter. “Final negotiations are going on” with details likely confirmed “in the next 30 days,” he said. The new ships would vary between 1,800 TEUs, 3,000 TEUs and 4,500 TEUs and replace older, less fuel-efficient vessels in the carrier’s 305-strong fleet. “We have a fair number of ships that are reaching 25 years,” Habben Jansen said. The carrier is also planning to continue expanding its terminals business “through acquisitions and synergies with our liner business,” although Habben Jansen said there were no further details to give at this stage. The CEO forecast full-year 2025 revenues at $23 billion. “Rates came back from early October,” he said. “In the last couple of weeks, bookings have been really strong.” Habben Jansen, meanwhile, said the carrier had no immediate plans to return to the Red Sea and Suez Canal region following the latest Houthi ceasefire. “We always said we’d like to see some stability,” he said, pointing out that previous ceasefires were later broken. Hapag-Lloyd saw group net profit fall 86% to $161 million in the third quarter, down from $1.1 billion in the prior year. Revenue fell 11% to $5.4 billion in the third quarter, with liner shipping contributing $5.3 billion and terminals $130 million. The carrier’s average freight rate in the quarter slipped to $1,391 per TEU from $1,612/TEU. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Hapag-Lloyd is refining the Gemini Cooperation hub-and-spoke network with partner Maersk that will likely see some extra port calls and others removed from Gemini services, CEO Rolf Habben Jansen said Thursday. The review is considering “what worked well and what could be improved,” Habben Jansen said during the carrier’s third-quarter results briefing. “We’ll wrap up the review, then ... inform the market, but don’t expect anything revolutionary,” he said. The changes will “strengthen reliability and unlock cost efficiencies, with full cost savings run rate expected by 2026,” Hapag-Lloyd said. Habben Jansen also confirmed Gemini is mulling a price premium , which he forecast would be a “small three-digit number per TEU” to reflect the inventory cost savings customers achieve through Gemini’s consistent on-time delivery. The CEO gave no further details of the changes, but said Gemini has consistently delivered monthly schedule reliability of 89% to 95% since its launch in February, citing data from Sea-Intelligence Maritime Analysis. That is significantly better than its closest competitors, who had schedule reliability ranging between 70% and 80% from February through September. “We are very happy with [Gemini],” Habben Jansen said. “We hit 90% schedule reliability almost from Day 1.” Possible expansion of hub-and-spoke model That reliability helped drive an above-market increase in container volumes for Hapag-Lloyd, growing 9% to 10.2 million TEUs in the first nine months of the year. Most of the increase was on trans-Pacific and Asia-Europe trades, while volumes on the trans-Atlantic, Africa and inter-regional trades were stable. Highlighting the gains, the carrier said trans-Pacific volumes rose to 3 million TEUs this year through September, from 2.5 million TEUs in the same period last year, while Asia-Europe liftings climbed to 3 million TEUs from 2.7 million TEUs. Habben Jansen said while the focus over the next 12 to 18 months is to improve reliability of the current Gemini network schedule, there is potential to adopt Gemini’s hub-and-spoke model in other trades. He said if Hapag-Lloyd did decide to expand the concept, it would have to assess how and where it could be done and “with whom.” Habben Jansen also confirmed the carrier is in talks to add 22 ships to its fleet that would be a mix of newbuildings ordered direct from shipyards and vessels taken on long-term charter. “Final negotiations are going on” with details likely confirmed “in the next 30 days,” he said. The new ships would vary between 1,800 TEUs, 3,000 TEUs and 4,500 TEUs and replace older, less fuel-efficient vessels in the carrier’s 305-strong fleet. “We have a fair number of ships that are reaching 25 years,” Habben Jansen said. The carrier is also planning to continue expanding its terminals business “through acquisitions and synergies with our liner business,” although Habben Jansen said there were no further details to give at this stage. The CEO forecast full-year 2025 revenues at $23 billion. “Rates came back from early October,” he said. “In the last couple of weeks, bookings have been really strong.” Habben Jansen, meanwhile, said the carrier had no immediate plans to return to the Red Sea and Suez Canal region following the latest Houthi ceasefire. “We always said we’d like to see some stability,” he said, pointing out that previous ceasefires were later broken. Hapag-Lloyd saw group net profit fall 86% to $161 million in the third quarter, down from $1.1 billion in the prior year. Revenue fell 11% to $5.4 billion in the third quarter, with liner shipping contributing $5.3 billion and terminals $130 million. The carrier’s average freight rate in the quarter slipped to $1,391 per TEU from $1,612/TEU. Contact Keith Wallis at keithwallis@hotmail.com .

Asia-Europe

Trans-Pacific

Hapag-Lloyd refining Gemini network to improve efficiencies: Habben Jansen

<div class="phx-topic abstract-wrapper">With 196,000 TEUs of new capacity added to its fleet, the latest orders mean Evergreen will leapfrog both Hapag-Lloyd and Ocean Network Express in global capacity to become the fifth-largest container line.</div>

With 196,000 TEUs of new capacity added to its fleet, the latest orders mean Evergreen will leapfrog both Hapag-Lloyd and Ocean Network Express in global capacity to become the fifth-largest container line.

<div class="phx-topic">Taiwan’s Evergreen Marine on Wednesday confirmed an order for 14 14,000-TEU liquefied natural gas (LNG)-fueled ships that could cost almost $3 billion, with the vessels split between South Korea’s Samsung Heavy Industries and China’s Guangzhou Shipyard International. Evergreen said each ship would cost between $175 million and $205 million, taking the total cost to between $2.45 billion and $2.9 million. The two shipbuilders will construct seven vessels each. The deals were approved at an Evergreen Marine (Asia) board of directors meeting Wednesday, the carrier said in a filing to the Taiwan stock exchange, ending recent speculation by shipbrokers that Evergreen was readying a massive order. With 196,000 TEUs of new capacity added to its fleet, the latest orders mean Evergreen will leapfrog both Hapag-Lloyd and Ocean Network Express in global capacity to become the fifth-largest container line, up from seventh place. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="82b6ff12-d7ca-420a-abbe-7b9998b29e56"></dynamic-object></div>Fleet data from Sea-web, a sister company of the Journal of Commerce within S&amp;P Global, shows the latest deals boost Evergreen’s total capacity to 2,747,549 TEUs, against 2,606,972 TEUs for ONE and 2,360,562 TEUs for Hapag-Lloyd. The orders also reinforce LNG as the next generation fuel of choice for carriers, increasing the total number of LNG-fueled container ships on order to about 380, according to S&amp;P Global Market Intelligence. <h3>Q3 financials up from Q2, but down from year-ago period </h3>The green light for the new ships came as Evergreen, together with Taiwan’s two other top carriers — Yang Ming Marine Transport and Wan Hai Lines — announced a rebound in third-quarter net profits compared with the second quarter, buoyed by a recovery in freight rates in July as shippers frontloaded cargo to beat US tariffs. But third-quarter financials were lower across the board compared with the 2024 third quarter. Evergreen led the pack with net profit of $700 million, the carrier said in a separate exchange filing Wednesday, up from $403 million in the second quarter but down 63% compared with $1.9 billion in the third quarter last year. Operating revenues fell 34% to $3.1 billion in the third quarter from $4.7 billion a year earlier, the filing showed. Yang Ming Marine saw third-quarter net profit climb to $194 million, the carrier said Wednesday, up from $31 million in the second quarter but down from $890 million in the third quarter last year. Third-quarter operating revenues of almost $1.4 billion were similar to the previous two quarters, although down 39% from $2.3 billion in the prior year. “Compared with the same period in 2024, weaker freight rates resulted in softer profitability,” Yang Ming said in a statement. Yang Ming, the only one of the three carriers to comment on the market, said it was hopeful that the temporary pause in US-China tariff tensions “may help stimulate pre-Lunar New Year shipment demand on trans-Pacific routes.” The carrier said the intra-Asia and Middle East markets were “expected to remain steady, supported by stable demand.” “Despite persistent global trade policy uncertainty and elevated geopolitical risks, Yang Ming has continued to maintain schedule reliability and enhance operational efficiency, supporting steady business performance,” it said. Meanwhile, intra-Asia-focused Wan Hai Lines saw third-quarter net profit climb to $363 million, up from $41 million in the second quarter but almost half the $600 million reported in the third quarter last year. Operating revenues in the third quarter were $1.1 billion, in line with the previous two quarters but down 35% from $1.7 billion a year earlier. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Taiwan’s Evergreen Marine on Wednesday confirmed an order for 14 14,000-TEU liquefied natural gas (LNG)-fueled ships that could cost almost $3 billion, with the vessels split between South Korea’s Samsung Heavy Industries and China’s Guangzhou Shipyard International. Evergreen said each ship would cost between $175 million and $205 million, taking the total cost to between $2.45 billion and $2.9 million. The two shipbuilders will construct seven vessels each. The deals were approved at an Evergreen Marine (Asia) board of directors meeting Wednesday, the carrier said in a filing to the Taiwan stock exchange, ending recent speculation by shipbrokers that Evergreen was readying a massive order. With 196,000 TEUs of new capacity added to its fleet, the latest orders mean Evergreen will leapfrog both Hapag-Lloyd and Ocean Network Express in global capacity to become the fifth-largest container line, up from seventh place. Fleet data from Sea-web, a sister company of the Journal of Commerce within S&P Global, shows the latest deals boost Evergreen’s total capacity to 2,747,549 TEUs, against 2,606,972 TEUs for ONE and 2,360,562 TEUs for Hapag-Lloyd. The orders also reinforce LNG as the next generation fuel of choice for carriers, increasing the total number of LNG-fueled container ships on order to about 380, according to S&P Global Market Intelligence. Q3 financials up from Q2, but down from year-ago period The green light for the new ships came as Evergreen, together with Taiwan’s two other top carriers — Yang Ming Marine Transport and Wan Hai Lines — announced a rebound in third-quarter net profits compared with the second quarter, buoyed by a recovery in freight rates in July as shippers frontloaded cargo to beat US tariffs. But third-quarter financials were lower across the board compared with the 2024 third quarter. Evergreen led the pack with net profit of $700 million, the carrier said in a separate exchange filing Wednesday, up from $403 million in the second quarter but down 63% compared with $1.9 billion in the third quarter last year. Operating revenues fell 34% to $3.1 billion in the third quarter from $4.7 billion a year earlier, the filing showed. Yang Ming Marine saw third-quarter net profit climb to $194 million, the carrier said Wednesday, up from $31 million in the second quarter but down from $890 million in the third quarter last year. Third-quarter operating revenues of almost $1.4 billion were similar to the previous two quarters, although down 39% from $2.3 billion in the prior year. “Compared with the same period in 2024, weaker freight rates resulted in softer profitability,” Yang Ming said in a statement. Yang Ming, the only one of the three carriers to comment on the market, said it was hopeful that the temporary pause in US-China tariff tensions “may help stimulate pre-Lunar New Year shipment demand on trans-Pacific routes.” The carrier said the intra-Asia and Middle East markets were “expected to remain steady, supported by stable demand.” “Despite persistent global trade policy uncertainty and elevated geopolitical risks, Yang Ming has continued to maintain schedule reliability and enhance operational efficiency, supporting steady business performance,” it said. Meanwhile, intra-Asia-focused Wan Hai Lines saw third-quarter net profit climb to $363 million, up from $41 million in the second quarter but almost half the $600 million reported in the third quarter last year. Operating revenues in the third quarter were $1.1 billion, in line with the previous two quarters but down 35% from $1.7 billion a year earlier. Contact Keith Wallis at keithwallis@hotmail.com .

Evergreen says will spend almost $3 billion on 14 new LNG-fueled ships

<div class="phx-topic abstract-wrapper">While premium pricing has long been elusive for ocean carriers, the cost benefits from the Maersk-Hapag Lloyd alliance may prove to be enough to justify overhauling the network.</div>

While premium pricing has long been elusive for ocean carriers, the cost benefits from the Maersk-Hapag Lloyd alliance may prove to be enough to justify overhauling the network.

<div class="phx-topic">More than nine months into the Gemini Cooperation’s journey — possibly the most radical reinvention ever attempted in container shipping — two things are becoming clear: stated schedule reliability that is well above industry averages has largely been achieved and doubts about its sustainability are fading. A hub-and-spoke network able to keep feeder ships filled is lowering costs, mimicking the common-feeder model in place for decades in Asia and other regions. The one big unanswered question that remains is whether, or to what extent, premium revenue can be extracted from shippers by Gemini partners Maersk and Hapag-Lloyd. Maersk, <a href="https://www.joc.com/article/value-unlocked-by-gemini-will-clear-path-for-premium-charge-maersk-ceo-6111339">during its third-quarter earnings release last week</a>, provided the clearest picture to date on that very question. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6113169_0.1.jpg"></img></div>CEO Vincent Clerc said he believed premium pricing is coming, but that trust in Gemini’s reliability needed to be more firmly entrenched beyond the standards established thus far. “We need to be certain that we have a long enough track record that it unlocks value for them [shippers], that we can then capture some of that value for us,” Clerc told analysts. But a tantalizing possibility may be emerging: It might not actually matter. The reason is that while premium pricing has long been elusive for ocean carriers, the cost benefits from Gemini may themselves prove to be enough to justify overhauling the network. Maersk cited annualized cost savings of $720 million to $950 million through the implementation of the Gemini network as a result of lower bunker costs and greater asset utilization. This is coming from higher utilization of ships and shorter sailing distances, which resulted in 6% higher capacity but 3% lower total fuel consumption. Running ships at a higher utilization in the network, Clerc said, allows the carrier to transport more volumes at the same capacity. Carriers such as Singapore-based X-Press Feeders and Bengal Tiger Line handle large carriers’ feeder volumes by keeping costs lower through higher utilization than the carriers have been able to achieve on their own. On the cost structure, “we are opening up a gap now with Gemini that is going to be ... quite handy, especially in the current rate environment,” Clerc said. “It’s a pretty significant lever that we have unlocked here,” stemming in part from using “fit-for-purpose shuttles rather than underutilized mainliners,” he added. The revenue side is less clear. It is unclear how much of a premium revenue opportunity exists by offering high schedule reliability. In prior eras, carriers invested significant sums in fuel to stay on schedule only for a weak market to undercut their argument for premium rates. Indeed, whether investing more in fuel to keep ships on schedule, deploying 53-foot ocean containers to allow customs to load more cargo or departing every day on time as was envisioned in Daily Maersk, there has been little in terms of premium pricing over a period of decades to show for it. <h3>Premium appetites? </h3>A market exists; the question is how big. The existence of high-reliability, premium-priced services offered by Matson, UWL, Zim Integrated Shipping Services and Tailwind on the Asia-Europe trade point to a segment of the shipper market able to capture supply chain value from reliable schedules. Also, in limited cases, some large shippers have shown themselves willing to pay a premium for preferential stowage, leading to expedited movement of containers off the ship and through the terminal, including for so-called peel-off stacks. The Gemini partners, however, believe a fundamental value proposition continues to exist by enabling customers to slash costs by reducing inventory. “I am optimistic that if someone can remove $10 million a day and [they can] save two weeks in that, that I can get a premium,” Stuart Sandlin, Hapag-Lloyd’s regional president for the Americas, told the South Carolina International Trade Conference on Oct. 29. “I candidly think [Gemini is] a premium product and should command some sort of premium price.” As Clerc put it on the earnings call: “Today, every customer has a buffer stock and that reliability needs to unlock a reduction of that buffer stock. They need to trust that [Gemini] has weathered sufficient ups and downs and is steady [so] that they can take out some of that buffer stock. And if they do, they pocket that savings and then we can capture some of it in form of a premium.” For both Maersk and Hapag-Lloyd, the Gemini network fits respective strategies and approaches to the market. It harks back to hub-and-spoke networks of an earlier day and is true to Maersk’s historic DNA of running on time, a source of tension within the former 2M alliance with Mediterranean Shipping Co. For Hapag-Lloyd, it can’t promote itself as the best major carrier in terms of service quality, its stated objective, and not run on time. Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>.</div>

More than nine months into the Gemini Cooperation’s journey — possibly the most radical reinvention ever attempted in container shipping — two things are becoming clear: stated schedule reliability that is well above industry averages has largely been achieved and doubts about its sustainability are fading. A hub-and-spoke network able to keep feeder ships filled is lowering costs, mimicking the common-feeder model in place for decades in Asia and other regions. The one big unanswered question that remains is whether, or to what extent, premium revenue can be extracted from shippers by Gemini partners Maersk and Hapag-Lloyd. Maersk, during its third-quarter earnings release last week , provided the clearest picture to date on that very question. CEO Vincent Clerc said he believed premium pricing is coming, but that trust in Gemini’s reliability needed to be more firmly entrenched beyond the standards established thus far. “We need to be certain that we have a long enough track record that it unlocks value for them [shippers], that we can then capture some of that value for us,” Clerc told analysts. But a tantalizing possibility may be emerging: It might not actually matter. The reason is that while premium pricing has long been elusive for ocean carriers, the cost benefits from Gemini may themselves prove to be enough to justify overhauling the network. Maersk cited annualized cost savings of $720 million to $950 million through the implementation of the Gemini network as a result of lower bunker costs and greater asset utilization. This is coming from higher utilization of ships and shorter sailing distances, which resulted in 6% higher capacity but 3% lower total fuel consumption. Running ships at a higher utilization in the network, Clerc said, allows the carrier to transport more volumes at the same capacity. Carriers such as Singapore-based X-Press Feeders and Bengal Tiger Line handle large carriers’ feeder volumes by keeping costs lower through higher utilization than the carriers have been able to achieve on their own. On the cost structure, “we are opening up a gap now with Gemini that is going to be ... quite handy, especially in the current rate environment,” Clerc said. “It’s a pretty significant lever that we have unlocked here,” stemming in part from using “fit-for-purpose shuttles rather than underutilized mainliners,” he added. The revenue side is less clear. It is unclear how much of a premium revenue opportunity exists by offering high schedule reliability. In prior eras, carriers invested significant sums in fuel to stay on schedule only for a weak market to undercut their argument for premium rates. Indeed, whether investing more in fuel to keep ships on schedule, deploying 53-foot ocean containers to allow customs to load more cargo or departing every day on time as was envisioned in Daily Maersk, there has been little in terms of premium pricing over a period of decades to show for it. Premium appetites? A market exists; the question is how big. The existence of high-reliability, premium-priced services offered by Matson, UWL, Zim Integrated Shipping Services and Tailwind on the Asia-Europe trade point to a segment of the shipper market able to capture supply chain value from reliable schedules. Also, in limited cases, some large shippers have shown themselves willing to pay a premium for preferential stowage, leading to expedited movement of containers off the ship and through the terminal, including for so-called peel-off stacks. The Gemini partners, however, believe a fundamental value proposition continues to exist by enabling customers to slash costs by reducing inventory. “I am optimistic that if someone can remove $10 million a day and [they can] save two weeks in that, that I can get a premium,” Stuart Sandlin, Hapag-Lloyd’s regional president for the Americas, told the South Carolina International Trade Conference on Oct. 29. “I candidly think [Gemini is] a premium product and should command some sort of premium price.” As Clerc put it on the earnings call: “Today, every customer has a buffer stock and that reliability needs to unlock a reduction of that buffer stock. They need to trust that [Gemini] has weathered sufficient ups and downs and is steady [so] that they can take out some of that buffer stock. And if they do, they pocket that savings and then we can capture some of it in form of a premium.” For both Maersk and Hapag-Lloyd, the Gemini network fits respective strategies and approaches to the market. It harks back to hub-and-spoke networks of an earlier day and is true to Maersk’s historic DNA of running on time, a source of tension within the former 2M alliance with Mediterranean Shipping Co. For Hapag-Lloyd, it can’t promote itself as the best major carrier in terms of service quality, its stated objective, and not run on time. Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

Gemini delivers cost savings as it marks a path to premium pricing

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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

In 1995, we began operations with a clear vision: to grow alongside Mexico and connect the world through our terminals. Our priority has always been to deliver excellence in service, foster economic development, and strengthen our communities. We firmly believe that progress is not only measured in tons of cargo moved, but in the opportunities we create. _______________________________________________________________ This year marks a significant milestone: SSA Marine Mexico celebrates 30 years of presence in the country, having established itself from day one as the leading port operator nationwide. Over the past three decades, we have built a legacy of reliability, innovation, and commitment to Mexico’s growth. Our journey has been defined by continuous evolution and a steadfast dedication to our mission. SSA Marine México currently operates in six of the country’s most important ports: Cozumel, Lazaro Cardenas, Manzanillo, Progreso, Tuxpan, and Veracruz. Additionally, we have signed a concession to operate a new multipurpose terminal in Guaymas, Sonora, expanding our footprint to the north of the country. We serve a wide range of segments including containers, general cargo, automobiles, cruise ships, hydrocarbons, and asphalt. As part of this ongoing commitment, SSA Marine Mexico continues to strengthen its infrastructure and capabilities. International trade remains a key driver of global economic growth, and we are proud to support this momentum. Through our continuous improvement strategy, we invest in cutting-edge technology and equipment to deliver more efficient and competitive services, contributing to the success of Mexican businesses. •	Manzanillo, Colima- Specialized Container Terminal I: On October 13, we celebrated the arrival of two new STS (Ship To Shore) Super Post Panamax dockside cranes. This $21.2 million USD investment significantly boosts our operational capacity, streamlining cargo reception and delivery processes. In line with our modernization efforts, we will also retire four of our oldest cranes, paving the way for a more sustainable and technologically advanced fleet that meets the evolving demands of international trade. With these upgrades, SSA Marine México now operates a total of 16 cranes along our 1,350-meter dock, reaffirming our position as a national benchmark in port <span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-4_3 joc_admin__inline-image-position-left joc_admin__inline-image-size-large" data-figure-size="large" data-figure-position="left" data-figure-aspect-ratio="4:3"><img src="/content-assets/1760982635607_Manzanillo.jpg" alt="Image provided by SSA Marine" class="joc_admin__inline-image-inherit"> •	As for the Multipurpose Terminal and Specialized Facility, also in Manzanillo, Colima, improvement and conditioning works are planned, along with the acquisition of four E-RTG (Electric Rubber-Tyred Gantry) cranes to enhance operational efficiency and sustainability. •	At our Automobile and General Cargo Terminal in the port of Veracruz, we continue to lead with specialized value-added services that support our clients’ growth. Recent investments include a new washing cabin and a general cargo warehouse, increasing indoor storage capacity by 67%. •	Lazaro Cardenas, Michoacan – Specialized Automobile Terminal: we are working on the development of an additional 4-hectare storage space within our bonded area and a 10-hectare Vehicle Distribution Center (VDC). These enhancements, along with ongoing personnel and system improvements, will reinforce our leadership in automotive handling across the Mexican Pacific coast.<span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-4_3 joc_admin__inline-image-position-left joc_admin__inline-image-size-large" data-figure-size="large" data-figure-position="left" data-figure-aspect-ratio="4:3"><img src="/content-assets/1760982742240_Lazaro.jpg" alt="Image provided by SSA Marine" class="joc_admin__inline-image-inherit"> Through these strategic investments, SSA Marine Mexico reaffirms its commitment to the sustained growth of Mexico’s foreign trade. By expanding capacity, modernizing infrastructure, and diversifying services, we continue to strengthen the country’s competitiveness in global logistics. Today, we celebrate three decades of dedication, innovation, and leadership, with deep gratitude to our employees, clients, and partners for being part of this incredible journey. LINK: https://www.ssamarine.mx/<span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-16_9 joc_admin__inline-image-position-left joc_admin__inline-image-size-small" data-figure-size="small" data-figure-position="left" data-figure-aspect-ratio="16:9"><img src="/content-assets/1760982787360_SSA%20Marine%20Mexico%20logo%20150pxW.png" alt="" class="joc_admin__inline-image-inherit">

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SSA Marine Mexico: 30 years growing together.

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Quarterly Intelligence

<div class="phx-topic abstract-wrapper">The comments from Joe Hinrichs follow a report that CSX’s board of directors was displeased that UP allegedly contacted Hinrichs first about a potential UP-CSX combination and only turned to Norfolk Southern after receiving a tepid response. </div>

The comments from Joe Hinrichs follow a report that CSX’s board of directors was displeased that UP allegedly contacted Hinrichs first about a potential UP-CSX combination and only turned to Norfolk Southern after receiving a tepid response.

<div class="phx-topic">Former CSX CEO Joe Hinrichs, who was ousted from the company in late September, has repudiated a published report claiming that Union Pacific Railroad (UP) reached out to him earlier this year on a possible acquisition before UP hooked up with Norfolk Southern Railway (NS). Hinrichs’ remarks, which came in response <a href="https://www.linkedin.com/posts/ariashe_i-had-a-great-time-with-jim-vena-eric-gehringer-activity-7394791477358379008-F3Km/?utm_source=share&amp;utm_medium=member_desktop&amp;rcm=ACoAAALKEPMBiWV_z6vaO3hg8YwYfGScgW-oeOI">to a LinkedIn post Thursday by a Journal of Commerce editor</a>, follow an Oct. 21 report in <a href="https://www.semafor.com/article/10/21/2025/the-inside-story-of-csxs-ceo-shakeup">online news publication Semafor</a> stating that CSX’s board of directors was displeased that UP CEO Jim Vena allegedly contacted Hinrichs first about a potential UP-CSX combination and only turned to Norfolk Southern after receiving a tepid response from Hinrichs. But Hinrichs denied that version of events via a response to the LinkedIn post. “Jim Vena never reached out to me regarding UP-CSX,” Hinrichs wrote. “Jim and I discussed this very subject [why UP never talked to CSX] after the UP-NS announcement that they were in ‘advanced talks’ as I asked him why they did not. I will keep that conversation private.” CSX announced Hinrich’s dismissal on Sept. 28, just over a month after an activist investor called for him to step down amid competitive pressures brought on by the UP-NS deal, <a href="https://www.joc.com/article/up-confirms-in-advanced-discussions-on-deal-with-norfolk-southern-6049046">which was unveiled in late July</a>. In an <a href="https://www.sec.gov/Archives/edgar/data/100885/000119312525204376/d908896ds4.htm">S-4 filing</a> made with the US Securities and Exchange Commission two weeks prior to Hinrich’s dismissal, UP stated that Vena contacted Hinrichs only after UP was in advanced talks with Norfolk Southern. Hinrichs said the SEC filing accurately captures the chain of events. <h3>No clarity at UP media event </h3>The Journal of Commerce, during a UP-sponsored media event in Chicago on Wednesday, asked Vena to comment on the Semafor report and to clarify which CEO he approached first for a potential merger: Hinrichs at CSX or Norfolk Southern’s Mark George. Vena declined to provide specifics. “We looked at everybody. We looked at the Canadian railroads and we looked at the Eastern railroads,” Vena responded. “I wasn’t in the boardroom at CSX. I have no idea what happened there.” Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

Former CSX CEO Joe Hinrichs, who was ousted from the company in late September, has repudiated a published report claiming that Union Pacific Railroad (UP) reached out to him earlier this year on a possible acquisition before UP hooked up with Norfolk Southern Railway (NS). Hinrichs’ remarks, which came in response to a LinkedIn post Thursday by a Journal of Commerce editor , follow an Oct. 21 report in online news publication Semafor stating that CSX’s board of directors was displeased that UP CEO Jim Vena allegedly contacted Hinrichs first about a potential UP-CSX combination and only turned to Norfolk Southern after receiving a tepid response from Hinrichs. But Hinrichs denied that version of events via a response to the LinkedIn post. “Jim Vena never reached out to me regarding UP-CSX,” Hinrichs wrote. “Jim and I discussed this very subject [why UP never talked to CSX] after the UP-NS announcement that they were in ‘advanced talks’ as I asked him why they did not. I will keep that conversation private.” CSX announced Hinrich’s dismissal on Sept. 28, just over a month after an activist investor called for him to step down amid competitive pressures brought on by the UP-NS deal, which was unveiled in late July . In an S-4 filing made with the US Securities and Exchange Commission two weeks prior to Hinrich’s dismissal, UP stated that Vena contacted Hinrichs only after UP was in advanced talks with Norfolk Southern. Hinrichs said the SEC filing accurately captures the chain of events. No clarity at UP media event The Journal of Commerce, during a UP-sponsored media event in Chicago on Wednesday, asked Vena to comment on the Semafor report and to clarify which CEO he approached first for a potential merger: Hinrichs at CSX or Norfolk Southern’s Mark George. Vena declined to provide specifics. “We looked at everybody. We looked at the Canadian railroads and we looked at the Eastern railroads,” Vena responded. “I wasn’t in the boardroom at CSX. I have no idea what happened there.” Contact Ari Ashe at ari.ashe@spglobal.com .

Former CSX CEO denies that UP came to him first on potential merger

<div class="phx-topic abstract-wrapper">Beijing is expected to soon announce the start date of its own 12-month pause on reciprocal port fees on US ships, a deal that was agreed to last week as part of a broad trade framework hammered out by the two superpowers.</div>

Beijing is expected to soon announce the start date of its own 12-month pause on reciprocal port fees on US ships, a deal that was agreed to last week as part of a broad trade framework hammered out by the two superpowers.

<div class="phx-topic">The year-long pause on US port fees for Chinese-operated or -built ships, <a href="https://www.joc.com/article/us-china-suspend-reciprocal-port-fees-as-part-of-wider-trade-deal-6105849">agreed to last week between US and Chinese officials</a>, will start on Nov. 10, the White House announced Saturday. The move will pave the way for China to lift its retaliatory port fees on US-owned and -controlled vessels, although there was no immediate response from Beijing whether its suspension of port charges will occur on the same day as the US action. But one Hong Kong-based analyst expected China to end its charges on Nov. 10 or shortly after, repeating what happened when China followed the US in imposing reciprocal port call charges on Oct. 14. During the 12-month pause in port fees, “the US will negotiate with China” over Beijing’s alleged dominance in the maritime, logistics and shipbuilding sectors, the White House statement said, without giving further details. Those talks would take place while the US continued “its historic cooperation with the Republic of Korea and Japan on revitalizing American shipbuilding,” the statement added. The Nov. 10 date was announced in a statement that also gave further details of the trade concessions agreed to by both sides during talks in Kuala Lumpur, Malaysia, on Oct. 26 and confirmed by presidents Donald Trump and Xi Jinping at their meeting in South Korea last Thursday. The broad agreement will see China purchase at least 12 million metric tons of US soybeans during the last two months of this year and buy at least 25 million metric tons a year in 2026, 2027 and 2028. Additionally, China will resume purchases of US sorghum and hardwood logs. China will also suspend all the retaliatory tariffs announced since March 4, including levies “on a vast swath of US agricultural products including chicken, wheat, corn, cotton, sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables and dairy products,” the White House statement said. China will suspend or remove all retaliatory non-tariff countermeasures taken against the US since March, the statement added. “China will further extend the expiration of its market-based tariff exclusion process for imports from the United States and exclusions will remain valid until Dec. 31, 2026,” the White House said. “China will terminate its various investigations targeting US companies in the semiconductor supply chain, including its antitrust, anti-monopoly, and anti-dumping investigations." The White House did not give any timeframe for China’s implementation of the trade concessions. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="a08410a8-0b00-4c48-9ef6-78b6354f0678"></dynamic-object></div>For its part, the US will end the 10% so-called “fentanyl tariffs” on Nov. 10 and maintain its suspension of heightened reciprocal tariffs on Chinese imports until Nov. 10, 2026. The current 10% reciprocal tariff will remain in effect during the suspension period, the statement said. US imports from China have fallen sharply since mid-year amid the trade dispute. Imports hit 984,280 TEUs in July, the second-highest mark in 2025, then fell in August and September, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. <h3>Questions remain </h3>Despite the US-China deal on port fees, Brian Maloney, a partner at New York-based law firm Seward &amp; Kissel’s maritime and transportation group, said there are still many questions to be answered. “Will this apply to foreign-built vehicle carriers and ro/ro vessels or will the pause apply only to the fees for Chinese-owned, -operated or -built vessels?,” Maloney said. “When will the Chinese response pause kick in, which could matter for vessels actively trading? And will either country extend retroactive relief to Oct. 14?” Lars Jensen, CEO of consultant Vespucci Maritime and a Journal of Commerce contributor, said the lower tariffs open a window of opportunity for US shippers. “The question is whether it will prompt a boost in shipments — effectively pulling the seasonal boost from Chinese New Year forward by more than a month,” Jensen said <a href="https://www.linkedin.com/feed/update/urn:li:activity:7391046713332875264/">in a LinkedIn post Monday</a>. “The coming weeks will show whether this is going to happen, or whether US importers see the upside of lower tariffs more than counteracted by a risk of consumer spending slowdown in the US.” Jensen pointed out that shippers will have to go through the details of how the deal impacts them specifically. “But it is important to note here that almost all US actions are temporary in the sense that actions are merely paused until Nov. 10, 2026,” he wrote. “This means that more trade talks will have to happen prior to that date, and with this comes the risk of more changes [positive or negative]." Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

The year-long pause on US port fees for Chinese-operated or -built ships, agreed to last week between US and Chinese officials , will start on Nov. 10, the White House announced Saturday. The move will pave the way for China to lift its retaliatory port fees on US-owned and -controlled vessels, although there was no immediate response from Beijing whether its suspension of port charges will occur on the same day as the US action. But one Hong Kong-based analyst expected China to end its charges on Nov. 10 or shortly after, repeating what happened when China followed the US in imposing reciprocal port call charges on Oct. 14. During the 12-month pause in port fees, “the US will negotiate with China” over Beijing’s alleged dominance in the maritime, logistics and shipbuilding sectors, the White House statement said, without giving further details. Those talks would take place while the US continued “its historic cooperation with the Republic of Korea and Japan on revitalizing American shipbuilding,” the statement added. The Nov. 10 date was announced in a statement that also gave further details of the trade concessions agreed to by both sides during talks in Kuala Lumpur, Malaysia, on Oct. 26 and confirmed by presidents Donald Trump and Xi Jinping at their meeting in South Korea last Thursday. The broad agreement will see China purchase at least 12 million metric tons of US soybeans during the last two months of this year and buy at least 25 million metric tons a year in 2026, 2027 and 2028. Additionally, China will resume purchases of US sorghum and hardwood logs. China will also suspend all the retaliatory tariffs announced since March 4, including levies “on a vast swath of US agricultural products including chicken, wheat, corn, cotton, sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables and dairy products,” the White House statement said. China will suspend or remove all retaliatory non-tariff countermeasures taken against the US since March, the statement added. “China will further extend the expiration of its market-based tariff exclusion process for imports from the United States and exclusions will remain valid until Dec. 31, 2026,” the White House said. “China will terminate its various investigations targeting US companies in the semiconductor supply chain, including its antitrust, anti-monopoly, and anti-dumping investigations." The White House did not give any timeframe for China’s implementation of the trade concessions. For its part, the US will end the 10% so-called “fentanyl tariffs” on Nov. 10 and maintain its suspension of heightened reciprocal tariffs on Chinese imports until Nov. 10, 2026. The current 10% reciprocal tariff will remain in effect during the suspension period, the statement said. US imports from China have fallen sharply since mid-year amid the trade dispute. Imports hit 984,280 TEUs in July, the second-highest mark in 2025, then fell in August and September, according to PIERS, a sister product of the Journal of Commerce within S&P Global. Questions remain Despite the US-China deal on port fees, Brian Maloney, a partner at New York-based law firm Seward & Kissel’s maritime and transportation group, said there are still many questions to be answered. “Will this apply to foreign-built vehicle carriers and ro/ro vessels or will the pause apply only to the fees for Chinese-owned, -operated or -built vessels?,” Maloney said. “When will the Chinese response pause kick in, which could matter for vessels actively trading? And will either country extend retroactive relief to Oct. 14?” Lars Jensen, CEO of consultant Vespucci Maritime and a Journal of Commerce contributor, said the lower tariffs open a window of opportunity for US shippers. “The question is whether it will prompt a boost in shipments — effectively pulling the seasonal boost from Chinese New Year forward by more than a month,” Jensen said in a LinkedIn post Monday . “The coming weeks will show whether this is going to happen, or whether US importers see the upside of lower tariffs more than counteracted by a risk of consumer spending slowdown in the US.” Jensen pointed out that shippers will have to go through the details of how the deal impacts them specifically. “But it is important to note here that almost all US actions are temporary in the sense that actions are merely paused until Nov. 10, 2026,” he wrote. “This means that more trade talks will have to happen prior to that date, and with this comes the risk of more changes [positive or negative]." Contact Keith Wallis at keithwallis@hotmail.com .

Transport, Trade and Regulation News

Year-long pause on US port fees targeting China vessels to start Nov. 10

<div class="phx-topic abstract-wrapper">The rebels are incentivized to keep up some level of threat in the Red Sea because they are loathe to give up leverage that generates financial and military support, according to an S&amp;P Global analyst.</div>

The rebels are incentivized to keep up some level of threat in the Red Sea because they are loathe to give up leverage that generates financial and military support, according to an S&P Global analyst.

<div class="phx-topic">The announcement this week by Houthi rebels operating in Yemen that they will pause attacks on Israel and commercial shipping is the latest development pointing to the potential resumption of most container trade through the Red Sea and Suez Canal. But while the development can be viewed as a de-escalation of regional tensions, shipping through the Red Sea “remains a severe risk,” and the last six weeks with no attacks has coincided with the rebels rebuilding damaged infrastructure and rearming, warns Jack Kennedy, head of Middle East and North Africa country risk at S&amp;P Global Market Intelligence. Container ship diversions away from the Red Sea began in late 2023 following the first Houthi attacks soon after the start of the Israel-Hamas war, soaking up between 8% and 12% of global tonnage — depending on varying estimates from analysts and carriers — due to longer transits around southern Africa. “We think that the ceasefire is likely to stay in place for as long as there is commitment for the hostage exchanges to continue,” Kennedy told the Journal of Commerce on Tuesday. But he added that he expected some form of military operations to begin again in Gaza in the medium term, which would then likely trigger a Houthi response. A posting on X, formerly Twitter, on Sunday of an undated Houthi letter stated that the group would resume attacks in the Red Sea if the Gaza ceasefire ended. Major ocean carriers have welcomed the ceasefire that was struck on Oct. 18, but have been cautious on giving any timeline other than ruling out a return in the short term. The ceasefire hasn’t entirely stopped Israel’s attacks on Hamas forces. <h3>Carriers continue to monitor developments </h3>Maersk CEO Vincent Clerc last week said that the carrier was encouraged by the Gaza ceasefire but would need to make sure the agreement “is entrenched and doesn’t risk going backward at some point.” CMA CGM, along with some small container lines, is the only major ocean carrier to operate a single continued service via the Red Sea through the Suez Canal, with its ships often escorted by the French Navy. CMA CGM’s <a href="https://www.joc.com/article/cma-cgm-alliance-megaships-test-red-sea-waters-on-return-to-asia-6105787">two 18,000-TEU ships</a> that transited the Red Sea last week, however, were ad hoc sailings that returned to their southern Africa loops. The carrier said it had no plans to deploy larger ships through the Suez regularly. CMA CGM and SeaLead last month expanded the coverage of each of their services that pass through the narrow Bab al-Mandab Strait at the southern end of the Red Sea. CMA CGM routed nearly 1.5 million TEUs of tonnage through the Suez Canal in the first 10 months of the year, while SeaLead routed nearly 600,000 TEUs of tonnage in the same period, according to an Alphaliner analysis. After the US Department of the Treasury on Aug. 1 sanctioned Iran-linked individuals and organizations, Singapore-based ocean carrier <a href="https://www.joc.com/article/new-us-sanctions-on-iran-cut-sealeads-vessel-fleet-by-one-third-6055714">SeaLead was forced to terminate charters</a> for 16 vessels.Judging that the recent Houthi announcement of a pause in attacks is likely tactical, Kennedy said the fighters are incentivized to keep up some level of threat. That’s because they are loathe to give up leverage generating financial and military support, or cede ground in their simmering stalemate with the Yemeni government. In exchange for safe passage through the region, the Houthis <a href="https://www.arabnews.com/node/2577909/middle-east">collect approximately $180 million monthly from shipping agencies</a>, according to an unreleased United Nations report. S&amp;P Global is the parent company of the Journal of Commerce. Contact Mark Szakonyi at <a href="https://www.joc.com/article/mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>.</div>

The announcement this week by Houthi rebels operating in Yemen that they will pause attacks on Israel and commercial shipping is the latest development pointing to the potential resumption of most container trade through the Red Sea and Suez Canal. But while the development can be viewed as a de-escalation of regional tensions, shipping through the Red Sea “remains a severe risk,” and the last six weeks with no attacks has coincided with the rebels rebuilding damaged infrastructure and rearming, warns Jack Kennedy, head of Middle East and North Africa country risk at S&P Global Market Intelligence. Container ship diversions away from the Red Sea began in late 2023 following the first Houthi attacks soon after the start of the Israel-Hamas war, soaking up between 8% and 12% of global tonnage — depending on varying estimates from analysts and carriers — due to longer transits around southern Africa. “We think that the ceasefire is likely to stay in place for as long as there is commitment for the hostage exchanges to continue,” Kennedy told the Journal of Commerce on Tuesday. But he added that he expected some form of military operations to begin again in Gaza in the medium term, which would then likely trigger a Houthi response. A posting on X, formerly Twitter, on Sunday of an undated Houthi letter stated that the group would resume attacks in the Red Sea if the Gaza ceasefire ended. Major ocean carriers have welcomed the ceasefire that was struck on Oct. 18, but have been cautious on giving any timeline other than ruling out a return in the short term. The ceasefire hasn’t entirely stopped Israel’s attacks on Hamas forces. Carriers continue to monitor developments Maersk CEO Vincent Clerc last week said that the carrier was encouraged by the Gaza ceasefire but would need to make sure the agreement “is entrenched and doesn’t risk going backward at some point.” CMA CGM, along with some small container lines, is the only major ocean carrier to operate a single continued service via the Red Sea through the Suez Canal, with its ships often escorted by the French Navy. CMA CGM’s two 18,000-TEU ships that transited the Red Sea last week, however, were ad hoc sailings that returned to their southern Africa loops. The carrier said it had no plans to deploy larger ships through the Suez regularly. CMA CGM and SeaLead last month expanded the coverage of each of their services that pass through the narrow Bab al-Mandab Strait at the southern end of the Red Sea. CMA CGM routed nearly 1.5 million TEUs of tonnage through the Suez Canal in the first 10 months of the year, while SeaLead routed nearly 600,000 TEUs of tonnage in the same period, according to an Alphaliner analysis. After the US Department of the Treasury on Aug. 1 sanctioned Iran-linked individuals and organizations, Singapore-based ocean carrier SeaLead was forced to terminate charters for 16 vessels. Judging that the recent Houthi announcement of a pause in attacks is likely tactical, Kennedy said the fighters are incentivized to keep up some level of threat. That’s because they are loathe to give up leverage generating financial and military support, or cede ground in their simmering stalemate with the Yemeni government. In exchange for safe passage through the region, the Houthis collect approximately $180 million monthly from shipping agencies , according to an unreleased United Nations report. S&P Global is the parent company of the Journal of Commerce. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Houthi pause on shipping attacks lowers tensions, but risk remains

<div class="phx-topic abstract-wrapper">The United States Trade Representative also confirmed in a statement Sunday that planned 100% tariffs on China-built ship-to-shore cranes and other cargo handling equipment, due to take effect Monday, have also been suspended for a year.</div>

The United States Trade Representative also confirmed in a statement Sunday that planned 100% tariffs on China-built ship-to-shore cranes and other cargo handling equipment, due to take effect Monday, have also been suspended for a year.

<div class="phx-topic">The deal struck by the US and China to pause reciprocal port fees for one year starting Monday has generally been welcomed by shipping, agricultural and manufacturing interests as well as port industry players, the US Trade Representative said, although the move has been criticized by labor unions. The USTR said in a statement Sunday it received 73 responses during a 48-hour comment period it held last Thursday and Friday to garner feedback from the <a href="https://www.joc.com/article/us-china-suspend-reciprocal-port-fees-as-part-of-wider-trade-deal-6105849">pause in port fees and tariffs targeting China</a>.“Many [respondents] noted that suspension of the action would lower shipping costs and avoid commercial disruption,” the USTR said, adding the pause would provide an opportunity for the US to negotiate with China “on the issues raised in this investigation and permit additional time to find solutions to increase investment in US shipbuilding.” The USTR also confirmed in its statement that planned 100% tariffs on China-built ship-to-shore cranes and other cargo handling equipment, due to take effect Monday, have also been suspended for a year. It said it is still accepting comments until Tuesday on proposals to impose tariffs of up to 150% on certain cargo handling equipment produced in China, including rubber tire gantry cranes and related components. But any action is likely to be stayed in the wake of the broad trade deal announced Oct. 30 between Washington and Beijing. Highlighting the advantages of the port fee suspension, Joe Kramek, president and CEO of the Washington, DC-based World Shipping Council, said the pause would support the "continued use of US small and medium-sized ports, and contribute to lower costs for US farmers and manufacturers who rely on ocean liner transportation to move $335 billion in American exports each year." Kramek was one of several respondents to call for the USTR to make the suspension permanent. More than 20 agricultural and farmer groups including cotton, citrus, almond, potato and dairy producers welcomed the port fee and tariff freeze, pointing out their ability to compete overseas would be otherwise undercut. “Additional costs from port fees or equipment tariffs would directly harm US farmers and exporters, reduce export opportunities and weaken rural economies that depend heavily on agricultural trade,” USA Pulses CEO Tim McGreevy said in the group’s submission. He also recommended agriculture’s “complete exemption from all related Section 301 fees, including port fees, vessel sourcing requirements, and tariffs on critical port equipment and components.” China’s Transport Ministry, meanwhile, confirmed it had suspended its reciprocal port fees on US-linked ships from 1 p.m. local time Monday. The measure applies to US-owned, -operated, -flagged or -controlled ships. <h3>Unions unhappy </h3>Not all those responding to the USTR welcomed the US pause in port fees, with shipyard-related unions saying US workers will be “pushed aside” by the decision. Suspending the port fee and related action “will continue to give China a free pass on its predatory behavior and will have far-reaching negative consequences as we attempt to restore America’s maritime sector,” four unions, including the United Steel Workers, the International Brotherhood of Electrical Workers, and the International Brotherhood of Boilermakers, said in a joint submission. The groups said there were early signs of a revitalization in US shipbuilding investment since the USTR announced its measures targeting China’s maritime sector last April, while order books at China’s shipyards have “declined at a more significant rate than during the COVID-19 pandemic.” The pause now means US workers “are again being pushed aside, even as new commercial orders — worth billions of dollars — flow back into Chinese shipyards,” the labor groups said. The unions were among five labor groups that filed a petition with the USTR in March 2024 that led to the USTR’s investigation into China’s dominance in the maritime and shipbuilding sectors, which subsequently resulted in October’s implementation of US port fees — and the reciprocal fees from China. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

The deal struck by the US and China to pause reciprocal port fees for one year starting Monday has generally been welcomed by shipping, agricultural and manufacturing interests as well as port industry players, the US Trade Representative said, although the move has been criticized by labor unions. The USTR said in a statement Sunday it received 73 responses during a 48-hour comment period it held last Thursday and Friday to garner feedback from the pause in port fees and tariffs targeting China . “Many [respondents] noted that suspension of the action would lower shipping costs and avoid commercial disruption,” the USTR said, adding the pause would provide an opportunity for the US to negotiate with China “on the issues raised in this investigation and permit additional time to find solutions to increase investment in US shipbuilding.” The USTR also confirmed in its statement that planned 100% tariffs on China-built ship-to-shore cranes and other cargo handling equipment, due to take effect Monday, have also been suspended for a year. It said it is still accepting comments until Tuesday on proposals to impose tariffs of up to 150% on certain cargo handling equipment produced in China, including rubber tire gantry cranes and related components. But any action is likely to be stayed in the wake of the broad trade deal announced Oct. 30 between Washington and Beijing. Highlighting the advantages of the port fee suspension, Joe Kramek, president and CEO of the Washington, DC-based World Shipping Council, said the pause would support the "continued use of US small and medium-sized ports, and contribute to lower costs for US farmers and manufacturers who rely on ocean liner transportation to move $335 billion in American exports each year." Kramek was one of several respondents to call for the USTR to make the suspension permanent. More than 20 agricultural and farmer groups including cotton, citrus, almond, potato and dairy producers welcomed the port fee and tariff freeze, pointing out their ability to compete overseas would be otherwise undercut. “Additional costs from port fees or equipment tariffs would directly harm US farmers and exporters, reduce export opportunities and weaken rural economies that depend heavily on agricultural trade,” USA Pulses CEO Tim McGreevy said in the group’s submission. He also recommended agriculture’s “complete exemption from all related Section 301 fees, including port fees, vessel sourcing requirements, and tariffs on critical port equipment and components.” China’s Transport Ministry, meanwhile, confirmed it had suspended its reciprocal port fees on US-linked ships from 1 p.m. local time Monday. The measure applies to US-owned, -operated, -flagged or -controlled ships. Unions unhappy Not all those responding to the USTR welcomed the US pause in port fees, with shipyard-related unions saying US workers will be “pushed aside” by the decision. Suspending the port fee and related action “will continue to give China a free pass on its predatory behavior and will have far-reaching negative consequences as we attempt to restore America’s maritime sector,” four unions, including the United Steel Workers, the International Brotherhood of Electrical Workers, and the International Brotherhood of Boilermakers, said in a joint submission. The groups said there were early signs of a revitalization in US shipbuilding investment since the USTR announced its measures targeting China’s maritime sector last April, while order books at China’s shipyards have “declined at a more significant rate than during the COVID-19 pandemic.” The pause now means US workers “are again being pushed aside, even as new commercial orders — worth billions of dollars — flow back into Chinese shipyards,” the labor groups said. The unions were among five labor groups that filed a petition with the USTR in March 2024 that led to the USTR’s investigation into China’s dominance in the maritime and shipbuilding sectors, which subsequently resulted in October’s implementation of US port fees — and the reciprocal fees from China. Contact Keith Wallis at keithwallis@hotmail.com .

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