<div class="phx-topic abstract-wrapper">Cities and towns along the northern U.S. border have long drawn Canadian shoppers seeking lower-priced U.S. goods. Now Canadians are shopping for companies. 
 
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Cities and towns along the northern U.S. border have long drawn Canadian shoppers seeking lower-priced U.S. goods. Now Canadians are shopping for companies.

<div>Cities and towns along the northern U.S. border have long drawn Canadian shoppers seeking lower-priced U.S. goods. Now Canadians are shopping for companies. Canadian businesses that have the cash are increasingly turning to the U.S. for investment and acquisition opportunities, taking advantage of a strong Canadian dollar and readily available financing while betting on a U.S. rebound. December and January saw two major cross-border transportation deals, with Canada's <a>TransForce buying Dynamex</a> and <a>Vitran acquiring Milan Express</a>. Both deals secured a broader U.S. footprint for the Canadian trucking firms. The U.S. market is drawing more than transportation providers south -- Canadian...

Cities and towns along the northern U.S. border have long drawn Canadian shoppers seeking lower-priced U.S. goods. Now Canadians are shopping for companies. Canadian businesses that have the cash are increasingly turning to the U.S. for investment and acquisition opportunities, taking advantage of a strong Canadian dollar and readily available financing while betting on a U.S. rebound. December and January saw two major cross-border transportation deals, with Canada's TransForce buying Dynamex and Vitran acquiring Milan Express . Both deals secured a broader U.S. footprint for the Canadian trucking firms. The U.S. market is drawing more than transportation providers south -- Canadian firms are buying up or buying into everything from technology companies ( CGI buying Stanley in Arlington, Va. ) to real estate ( Brookfield Asset Management ). Cross-border mergers and acquisitions helped make the third quarter of last year the strongest quarter for Canadian M&A activity in three years, according to the Financial Post Crosbie: Mergers and Acquisitions in Canada database . In the first nine months of 2010, Canadian companies acquired 126 U.S. firms, an almost 50 percent increase over the same period in 2009. The U.S. was the top target country of Canadian firms looking beyond their borders for bargains. These purchases are being powered by an economy that has weathered the global recession much better than the U.S. economy. The Bank of Canada said Wednesday it expects the nation's economy will return to full capacity by the end of 2012. Potential Canadian buyers also have more access to capital -- the banking industry in Canada largely escaped the financial crisis suffered by U.S. banks. The availability of liquidity helped Canada return to economic growth in the third quarter of 2009. And don't forget, the U.S. is Canada's biggest export market. The U.S. imported $252.2 billion in Canadian goods last year through November, according to the U.S. Census Bureau, an 11.5 percent increase over the entire previous year. Those Canadian firms that believe the U.S. recovery is getting stronger -- despite poor employment numbers -- see opportunity in the U.S. market now. -- Contact William B. Cassidy at wcassidy@joc.com .

Trucking News

Maritime

Corporate Canada Comes Shopping

<div class="phx-topic abstract-wrapper">Tirschwell, who most recently served as vice president of the Journal of Commerce, announced his plans to leave the business and continue work as an independent shipping journalist. </div>

Tirschwell, who most recently served as vice president of the Journal of Commerce, announced his plans to leave the business and continue work as an independent shipping journalist.

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<div class="phx-topic">Peter Tirschwell this week ended a 34-year tenure at the Journal of Commerce from which he rose from a cub reporter to become the world’s leading maritime journalist, and founder and chair of the largest container shipping conference in the world. Tirschwell, who most recently served as vice president of the Journal of Commerce, announced his plans to leave the business and continue work as an independent shipping journalist. He leaves behind a senior leadership team dedicated to providing the shipping industry with the essential news and analysis that it has for 199 years, while bringing industry stakeholders together at JOC’s three conferences: TPM in Long Beach, Inland Distribution in Chicago, and Breakbulk &amp; Project Cargo in New Orleans. "Peter’s departure from the Journal of Commerce caps a remarkable journey that began as a general assignment reporter in New York and took him to increasingly senior roles as West Coast bureau chief, managing editor, editor-in-chief, and ultimately to leader of the business,” said Chris Brooks, executive director of the Journal of Commerce and Tirschwell’s longtime colleague. “His contributions, including a recent two-year stint in Singapore to promote the Journal of Commerce’s global growth strategy, have been immeasurable.” Tirschwell, a New York City native with figurative saltwater in his veins, helped make the Journal of Commerce the premier global shipping publication and grow TPM from some 150 people in its first year to a global event attracting more than 4,000 people annually. That, along with his regular analysis and reporting and frequent speeches at industry events, helped make him one of the most respected and unbiased voices and experts in the shipping industry. The Journal of Commerce thanks Peter Tirschwell for his leadership, vision, mentorship, and camaraderie as it moves into a new chapter on the eve of its 200th birthday, dedicated to providing the news, information and events the shipping industry depends upon. Contact Mark Szakonyi at <a href="mailto:mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>. </div>

Peter Tirschwell this week ended a 34-year tenure at the Journal of Commerce from which he rose from a cub reporter to become the world’s leading maritime journalist, and founder and chair of the largest container shipping conference in the world. Tirschwell, who most recently served as vice president of the Journal of Commerce, announced his plans to leave the business and continue work as an independent shipping journalist. He leaves behind a senior leadership team dedicated to providing the shipping industry with the essential news and analysis that it has for 199 years, while bringing industry stakeholders together at JOC’s three conferences: TPM in Long Beach, Inland Distribution in Chicago, and Breakbulk & Project Cargo in New Orleans. "Peter’s departure from the Journal of Commerce caps a remarkable journey that began as a general assignment reporter in New York and took him to increasingly senior roles as West Coast bureau chief, managing editor, editor-in-chief, and ultimately to leader of the business,” said Chris Brooks, executive director of the Journal of Commerce and Tirschwell’s longtime colleague. “His contributions, including a recent two-year stint in Singapore to promote the Journal of Commerce’s global growth strategy, have been immeasurable.” Tirschwell, a New York City native with figurative saltwater in his veins, helped make the Journal of Commerce the premier global shipping publication and grow TPM from some 150 people in its first year to a global event attracting more than 4,000 people annually. That, along with his regular analysis and reporting and frequent speeches at industry events, helped make him one of the most respected and unbiased voices and experts in the shipping industry. The Journal of Commerce thanks Peter Tirschwell for his leadership, vision, mentorship, and camaraderie as it moves into a new chapter on the eve of its 200th birthday, dedicated to providing the news, information and events the shipping industry depends upon. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Container Shipping News

Supply chain

Peter Tirschwell leaves enduring legacy on Journal of Commerce

<div class="phx-topic abstract-wrapper">James McNamara, who joined the union as it faced tumult from containerization, persisted at his job over four decades to help shape the modern International Longshoremen’s Association.</div>

James McNamara, who joined the union as it faced tumult from containerization, persisted at his job over four decades to help shape the modern International Longshoremen’s Association.

<div class="phx-topic">The Port of New York and New Jersey’s maritime industry honored James McNamara, chief of staff for the International Longshoremen’s Association (ILA), for his 45 years in the business, rising in the union’s ranks along with current leadership to shape the ILA into a modern organization. On Wednesday, McNamara was inducted into the Maritime Association of the Port of New York &amp; New Jersey’s Hall of Fame, along with John Murray, chief executive officer of the Canaveral Port Authority; Bob Burke, chief executive officer of Ridgebury Tankers; and Ted Tregurtha, president of tug operator Moran Towing. McNamara, then a 26-year-old local reporter who lived far from the port in Queens, joined the ILA in August of 1981, after sending an unsolicited, typed cover letter and resume in search of a public relations job. ILA President Harold Daggett was a business agent for longshore mechanics when he first met McNamara. At the event, Daggett highlighted McNamara’s ILA charity work alongside the United States Maritime Alliance (USMX), with the two raising $20 million for St. Jude Children’s Hospital. “I couldn’t be more happy to have that guy on board,” Daggett said. “He’s like me having 10 wives, honest to God. I made him chief of staff. I had to. He was doing my job.” McNamara also came up the ranks with current Secretary-Treasurer Stephen Knott and John Baker, a general organizer and previous head of the ILA’s Great Lakes District Council. <h3>‘Deeply compassionate and very intelligent’ </h3>McNamara told the Journal of Commerce his only knowledge of the ILA came from a couple of assignments briefly interviewing Thomas “Teddy” Gleason, who had been the union’s president since 1963. After working for a newspaper, McNamara said going to a longshore union was a bit of culture shock. Gleason himself had been held as a material witness in a 1947 shooting of a New York stevedore. He was also called in 1981 to testify before a Senate committee about alleged associations the union had with New York organized crime. “The way they came across was very scary,” McNamara said. “They were tough guys. They came from the docks. That wasn’t ballet school. It was a tough environment.” Despite that initial impression, “I quickly learned that [longshore workers] were deeply compassionate and friendly and very intelligent,” McNamara said, adding that the latter especially came into play during contract negotiations. “Longshoremen would have the most intricate questions that went to the heart of the contract, perhaps more so than the officers and general counsel,” McNamara said. “Longshoremen, and especially their spouses, were the best analysts and professors of contracts.” They had to be, McNamara said, because the New York-New Jersey shipping industry was changing dramatically. At the time, New York City still had few finger piers that handled breakbulk cargo. But the New York-based ILA had to confront the industry’s move to containerization and the ceding of longshore jobs to New Jersey’s port. Gleason, who had led three wildcat strikes as a union organizer, sought to stabilize longshore work through establishing three-year contracts, improved benefits for his members, and the guaranteed annual income for union members most impacted by containerization. He also established benefit funds for ILA members and opened the union to more Black longshore workers. Even so, the ILA could not stem the tide of job loss. McNamara said the New York-New Jersey port had about 27,000 longshore workers when he joined the union, compared with the roughly 5,000 today that work “when we’re lucky.” Yet, the ILA sought to work with employers to ensure those members had the best possible working environment. Even though container terminals became busier and more congested with equipment than ever, only one ILA longshore equipment operator had a job-related fatality. The ILA also saw <a href="https://www.joc.com/article/ny-nj-looks-to-boost-longshore-workforce-with-covid-19-vaccines-5250297">at least 22 members perish while the union worked during COVID-19</a>. “Those 5,000 ILA members work in a clean environment on modern, safe equipment, keeping up the same productivity as the 27,000 that had been there before,” McNamara said. McNamara said one of his greatest accomplishments was taking part in negotiations with the USMX over the ILA’s current contract, in which the union <a href="https://www.joc.com/article/ila-ratifies-new-six-year-deal-with-higher-entry-pay-automation-protection-5951338">secured its largest pay raise ever and additional protections against port automation</a>. “Let me do a little bragging tonight,” McNamara said during his speech. “Of the four honorees, I am the only one here introduced by the greatest labor leader of all time, my friend of 45 years, Harold Daggett.” Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

The Port of New York and New Jersey’s maritime industry honored James McNamara, chief of staff for the International Longshoremen’s Association (ILA), for his 45 years in the business, rising in the union’s ranks along with current leadership to shape the ILA into a modern organization. On Wednesday, McNamara was inducted into the Maritime Association of the Port of New York & New Jersey’s Hall of Fame, along with John Murray, chief executive officer of the Canaveral Port Authority; Bob Burke, chief executive officer of Ridgebury Tankers; and Ted Tregurtha, president of tug operator Moran Towing. McNamara, then a 26-year-old local reporter who lived far from the port in Queens, joined the ILA in August of 1981, after sending an unsolicited, typed cover letter and resume in search of a public relations job. ILA President Harold Daggett was a business agent for longshore mechanics when he first met McNamara. At the event, Daggett highlighted McNamara’s ILA charity work alongside the United States Maritime Alliance (USMX), with the two raising $20 million for St. Jude Children’s Hospital. “I couldn’t be more happy to have that guy on board,” Daggett said. “He’s like me having 10 wives, honest to God. I made him chief of staff. I had to. He was doing my job.” McNamara also came up the ranks with current Secretary-Treasurer Stephen Knott and John Baker, a general organizer and previous head of the ILA’s Great Lakes District Council. ‘Deeply compassionate and very intelligent’ McNamara told the Journal of Commerce his only knowledge of the ILA came from a couple of assignments briefly interviewing Thomas “Teddy” Gleason, who had been the union’s president since 1963. After working for a newspaper, McNamara said going to a longshore union was a bit of culture shock. Gleason himself had been held as a material witness in a 1947 shooting of a New York stevedore. He was also called in 1981 to testify before a Senate committee about alleged associations the union had with New York organized crime. “The way they came across was very scary,” McNamara said. “They were tough guys. They came from the docks. That wasn’t ballet school. It was a tough environment.” Despite that initial impression, “I quickly learned that [longshore workers] were deeply compassionate and friendly and very intelligent,” McNamara said, adding that the latter especially came into play during contract negotiations. “Longshoremen would have the most intricate questions that went to the heart of the contract, perhaps more so than the officers and general counsel,” McNamara said. “Longshoremen, and especially their spouses, were the best analysts and professors of contracts.” They had to be, McNamara said, because the New York-New Jersey shipping industry was changing dramatically. At the time, New York City still had few finger piers that handled breakbulk cargo. But the New York-based ILA had to confront the industry’s move to containerization and the ceding of longshore jobs to New Jersey’s port. Gleason, who had led three wildcat strikes as a union organizer, sought to stabilize longshore work through establishing three-year contracts, improved benefits for his members, and the guaranteed annual income for union members most impacted by containerization. He also established benefit funds for ILA members and opened the union to more Black longshore workers. Even so, the ILA could not stem the tide of job loss. McNamara said the New York-New Jersey port had about 27,000 longshore workers when he joined the union, compared with the roughly 5,000 today that work “when we’re lucky.” Yet, the ILA sought to work with employers to ensure those members had the best possible working environment. Even though container terminals became busier and more congested with equipment than ever, only one ILA longshore equipment operator had a job-related fatality. The ILA also saw at least 22 members perish while the union worked during COVID-19 . “Those 5,000 ILA members work in a clean environment on modern, safe equipment, keeping up the same productivity as the 27,000 that had been there before,” McNamara said. McNamara said one of his greatest accomplishments was taking part in negotiations with the USMX over the ILA’s current contract, in which the union secured its largest pay raise ever and additional protections against port automation . “Let me do a little bragging tonight,” McNamara said during his speech. “Of the four honorees, I am the only one here introduced by the greatest labor leader of all time, my friend of 45 years, Harold Daggett.” Contact Michael Angell at michael.angell@spglobal.com .

Port News

North American ports

NY-NJ maritime industry honors ILA’s McNamara

<div class="phx-topic abstract-wrapper">The speech by Bobby Olvera sends a warning shot to employers and cargo owners ahead of the expiration of its longshore contract in 2028.</div>

The speech by Bobby Olvera sends a warning shot to employers and cargo owners ahead of the expiration of its longshore contract in 2028.

<div class="phx-topic">The president of the International Longshore and Warehouse Union (ILWU) on Wednesday slammed US West Coast employers as being dominated by foreign shipping companies, accusing them of caring more about the profits they send back to their headquarters than the port communities in which they operate. The message, delivered by Bobby Olvera at the annual meeting of the Agriculture Transportation Coalition (AgTC) in Tacoma, Washington, sends a warning shot to employers — and cargo owners — ahead of the expiration of the union’s coastwide contract in 2028. The previous contract, in which the ILWU scored a <a href="https://www.joc.com/article/ilwu-scores-32-wage-increase-70-million-bonus-in-tentative-new-contract-5223607">32% increase in wages for its members</a>, was finalized in 2022 after <a href="https://www.joc.com/article/west-coast-ports-hit-with-new-round-of-cargo-handling-disruptions-5226851">work stoppages and slowdowns</a> that resulted in a significant diversion of cargo to East and Gulf Coast ports. “The foreign shipping lines, they should not be operating our terminals here in the United States. That should be American stevedoring companies,” Olvera told the AgTC event. “They don’t care about our ports. It’s all [about] profit generating. It’s control generating.” Olvera said the ILWU is using this period to advocate for strong West Coast ports and their customers, which include agricultural importers and exporters, before the appropriate state and federal agencies regarding legislation and regulations that impact the flow of cargo. “But things have changed. What they’ve done, in my opinion, is turned the PMA into a one-trick pony. All they advocate [and] lobby for are tax incentives, tax breaks, dollars for tax breaks and tax funds for the terminals,” Olvera said. The Pacific Maritime Association (PMA), which represents ocean carrier and terminal operator employers in negotiations with the ILWU, said that is not the case at all. “PMA is focused each day on promoting strong and efficient West Coast ports that support the nation’s supply chain and sustain thousands of jobs at port terminals and millions of jobs throughout the US economy,” the association said in a statement Thursday. <h3>The role of private equity </h3>Former shipping company executive and Journal of Commerce contributor Ted Prince noted that the phenomenon of ocean carriers dominating terminal operators in a vertically-integrated operation developed decades ago, but that model has been changing due to investments by private equity and infrastructure funds in ports and marine terminals. “How do you deal with this silent force of private equity that in my mind is going to increasingly call the shots?” Prince asked Olvera during the event. “It starts and stops with the ports, with our public port authorities,” Olvera said. “I think we fail to recognize that they’re owned by the citizens. They’re owned by the communities. The port authority has an obligation when they execute 30- and 40-year leases on the terminals to ask the right questions.” Those “right questions” involve how to make their facilities more responsive to port users and their needs for sufficient gate hours and efficient operations, he added. A California-based agriculture exporter told Olvera that the lack of trust between the PMA and the ILWU has hurt the supply chain by imposing higher costs on shippers, which has resulted in a diversion of cargo to East and Gulf Coast ports. She suggested that some forms of technology that are now common at marine terminals are designed to reduce costs and improve efficiency, not to eliminate longshore jobs. “That’s where the technology comes in — to move more cargo,” she said. Olvera responded that he was not going to talk about automation at the ports. The West Coast longshore labor contract allows for automation, but anticipated union resistance has resulted in a new dynamic in which port authorities are working with terminal operators and the ILWU to ensure that <a href="https://www.joc.com/article/hesitation-from-port-authorities-slows-automation-in-southern-california-6199922">future projects move forward with the cooperation of both parties</a>. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. </div>

The president of the International Longshore and Warehouse Union (ILWU) on Wednesday slammed US West Coast employers as being dominated by foreign shipping companies, accusing them of caring more about the profits they send back to their headquarters than the port communities in which they operate. The message, delivered by Bobby Olvera at the annual meeting of the Agriculture Transportation Coalition (AgTC) in Tacoma, Washington, sends a warning shot to employers — and cargo owners — ahead of the expiration of the union’s coastwide contract in 2028. The previous contract, in which the ILWU scored a 32% increase in wages for its members , was finalized in 2022 after work stoppages and slowdowns that resulted in a significant diversion of cargo to East and Gulf Coast ports. “The foreign shipping lines, they should not be operating our terminals here in the United States. That should be American stevedoring companies,” Olvera told the AgTC event. “They don’t care about our ports. It’s all [about] profit generating. It’s control generating.” Olvera said the ILWU is using this period to advocate for strong West Coast ports and their customers, which include agricultural importers and exporters, before the appropriate state and federal agencies regarding legislation and regulations that impact the flow of cargo. “But things have changed. What they’ve done, in my opinion, is turned the PMA into a one-trick pony. All they advocate [and] lobby for are tax incentives, tax breaks, dollars for tax breaks and tax funds for the terminals,” Olvera said. The Pacific Maritime Association (PMA), which represents ocean carrier and terminal operator employers in negotiations with the ILWU, said that is not the case at all. “PMA is focused each day on promoting strong and efficient West Coast ports that support the nation’s supply chain and sustain thousands of jobs at port terminals and millions of jobs throughout the US economy,” the association said in a statement Thursday. The role of private equity Former shipping company executive and Journal of Commerce contributor Ted Prince noted that the phenomenon of ocean carriers dominating terminal operators in a vertically-integrated operation developed decades ago, but that model has been changing due to investments by private equity and infrastructure funds in ports and marine terminals. “How do you deal with this silent force of private equity that in my mind is going to increasingly call the shots?” Prince asked Olvera during the event. “It starts and stops with the ports, with our public port authorities,” Olvera said. “I think we fail to recognize that they’re owned by the citizens. They’re owned by the communities. The port authority has an obligation when they execute 30- and 40-year leases on the terminals to ask the right questions.” Those “right questions” involve how to make their facilities more responsive to port users and their needs for sufficient gate hours and efficient operations, he added. A California-based agriculture exporter told Olvera that the lack of trust between the PMA and the ILWU has hurt the supply chain by imposing higher costs on shippers, which has resulted in a diversion of cargo to East and Gulf Coast ports. She suggested that some forms of technology that are now common at marine terminals are designed to reduce costs and improve efficiency, not to eliminate longshore jobs. “That’s where the technology comes in — to move more cargo,” she said. Olvera responded that he was not going to talk about automation at the ports. The West Coast longshore labor contract allows for automation, but anticipated union resistance has resulted in a new dynamic in which port authorities are working with terminal operators and the ILWU to ensure that future projects move forward with the cooperation of both parties . Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Marine terminals

ILWU chief slams ‘foreign shipping companies’ ahead of contract expiration

<div class="phx-topic abstract-wrapper">The alignment between demand and the supply of capacity has individual dynamics across each trade lane and different consequences for the newbuild, second-hand and charter markets, writes Jeremy Masters. </div>

The alignment between demand and the supply of capacity has individual dynamics across each trade lane and different consequences for the newbuild, second-hand and charter markets, writes Jeremy Masters.

<div class="phx-topic">When a linkage is made between trade conditions and capacity evolution, there is a tendency to focus exclusively on the big ship trades. The reality is that the alignment between demand and supply of space has individual dynamics across each trade lane and different consequences for the newbuild, second-hand and charter markets. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6225328_0.1.jpg"></img></div>The big ship trades are predominantly inhabited by carrier-owned tonnage or long-term charters that often go back-to-back with non-operating owners (NOOs) making newbuild orders. Suffice it to say there is not a heavily-traded short-term charter market. Alphaliner’s May monthly monitor reported that there was a staggering 91.4% increase of the existing fleet in newbuild orders for 18,000-TEU to 24,000-TEU ships. It’s very tough to see that amount of capacity being successfully absorbed by an expansion of trades using big ships, slow-steaming and retaining southern Africa routings if the Red Sea fully opens. Scrapping is not relevant in this tier or indeed in the next two or three size tiers down due to the youth of the fleet. There are, of course, trades where existing loops can be upgraded — Far East to Europe being the most obvious — but if a trade already has a fragile balance, there will be a limit to absorption levels and cascading will potentially export oversupply contagion. <h3>Smaller trades, different dynamics </h3>If we switch to short-sea, regional, and smaller deep-sea trades, we enter a different set of dynamics. To illustrate the stark differences, we can look at the versatile 2,000-TEU to 5,099-TEU capacity category. It’s not just a case where these size ships fit the weekly volumes being generated, but also the capability of the ports served to take the ship sizes and turn them around quickly. In looking at why this ship size has been in such high demand and charter rates so robust, we can look at natural trade strength in a number of the feeder/regional trades they inhabit, such as intra-Asia, but structural issues are also at play: <ul><li>Carriers chartering and buying a tremendous amount of tonnage from NOOs to run their own regional/feeder systems </li><li>New deployments created to overcome disruption to normal ship systems, such as the Red Sea and Strait of Hormuz. </li><li>Congestion consistently reducing networking capacity. </li></ul>Gemini Cooperation’s hub-and-spoke system, for instance, increased demand for smaller tonnage but did not necessarily maximize usage of those assets. Unlike a nimble third-party feeder specialist who would swap sizes, adapt schedules and get enough carrier clients on board to fill ships on an ongoing basis, Gemini is, by design, running a fixed set of connections forcing it to sail its spoke ships on time at whatever utilization is possible with Gemini-only cargo. That’s not to question the business logic of vertical integration for the carriers. The combined effect of new ship systems being created and not maximizing the use of assets is, however, greater demand at a time the reduction of NOO tonnage has created inelasticity and high prices in both the charter and second-hand market. <h3>Newbuild fracture </h3>What seems counterintuitive in the smaller trades where demand is high, second-hand ships are hard to come by, and charter rates are extremely robust, is that the newbuild order book is considerably lower than in the big-ship categories. Alphaliner’s May monthly monitor reported the following percentages of the existing fleet on newbuild orders: 2,000 to 2,999 TEUs (12.8%), 3,000 to 3,999 TEUs (35.7%), and 4,000 to 5,099 TEUs (16.9%). These percentages have been moving up in recent months but are a quantum leap below the 89.4% in the 18,000-TEU to 24,000-TEU range. According to Sea-web, a sister product of the Journal of Commerce within S&amp;P Global, some 2.43 million TEUs were on order in 2025 for ships of 15,001 TEUs and up. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="fdc6bd37-a5e0-4c29-abde-4be9dbd2ba3e"></dynamic-object></div>Have carriers and NOO’s overcooked their orders in the big ships and undercooked them at the lower end? The answer on the big ships looks to be “yes,” and there is a built-in carrier driver for this: There is not a well-populated second-hand or short-term charter market for newer, bigger ships, so if you need energy-efficient, low-slot cost vessels to be competitive in particular trades going forward, there is a pressure to order even if you have overcapacity concerns. There is a simpler and more pervasive explanation: The move from three major east-west networks ( 2M, Ocean, THEA ) to four ( MSC, Ocean, Gemini, Premier) catalyzed an arms race that continues today and will only be resolved by further carrier and/or consortium consolidation. Jeremy Masters is managing director of Shipping Masters. Contact him at <a href="mailto:jeremy@shippingmastershk.com">jeremy@shippingmastershk.com</a>. </div>

When a linkage is made between trade conditions and capacity evolution, there is a tendency to focus exclusively on the big ship trades. The reality is that the alignment between demand and supply of space has individual dynamics across each trade lane and different consequences for the newbuild, second-hand and charter markets. The big ship trades are predominantly inhabited by carrier-owned tonnage or long-term charters that often go back-to-back with non-operating owners (NOOs) making newbuild orders. Suffice it to say there is not a heavily-traded short-term charter market. Alphaliner’s May monthly monitor reported that there was a staggering 91.4% increase of the existing fleet in newbuild orders for 18,000-TEU to 24,000-TEU ships. It’s very tough to see that amount of capacity being successfully absorbed by an expansion of trades using big ships, slow-steaming and retaining southern Africa routings if the Red Sea fully opens. Scrapping is not relevant in this tier or indeed in the next two or three size tiers down due to the youth of the fleet. There are, of course, trades where existing loops can be upgraded — Far East to Europe being the most obvious — but if a trade already has a fragile balance, there will be a limit to absorption levels and cascading will potentially export oversupply contagion. Smaller trades, different dynamics If we switch to short-sea, regional, and smaller deep-sea trades, we enter a different set of dynamics. To illustrate the stark differences, we can look at the versatile 2,000-TEU to 5,099-TEU capacity category. It’s not just a case where these size ships fit the weekly volumes being generated, but also the capability of the ports served to take the ship sizes and turn them around quickly. In looking at why this ship size has been in such high demand and charter rates so robust, we can look at natural trade strength in a number of the feeder/regional trades they inhabit, such as intra-Asia, but structural issues are also at play: Carriers chartering and buying a tremendous amount of tonnage from NOOs to run their own regional/feeder systems New deployments created to overcome disruption to normal ship systems, such as the Red Sea and Strait of Hormuz. Congestion consistently reducing networking capacity. Gemini Cooperation’s hub-and-spoke system, for instance, increased demand for smaller tonnage but did not necessarily maximize usage of those assets. Unlike a nimble third-party feeder specialist who would swap sizes, adapt schedules and get enough carrier clients on board to fill ships on an ongoing basis, Gemini is, by design, running a fixed set of connections forcing it to sail its spoke ships on time at whatever utilization is possible with Gemini-only cargo. That’s not to question the business logic of vertical integration for the carriers. The combined effect of new ship systems being created and not maximizing the use of assets is, however, greater demand at a time the reduction of NOO tonnage has created inelasticity and high prices in both the charter and second-hand market. Newbuild fracture What seems counterintuitive in the smaller trades where demand is high, second-hand ships are hard to come by, and charter rates are extremely robust, is that the newbuild order book is considerably lower than in the big-ship categories. Alphaliner’s May monthly monitor reported the following percentages of the existing fleet on newbuild orders: 2,000 to 2,999 TEUs (12.8%), 3,000 to 3,999 TEUs (35.7%), and 4,000 to 5,099 TEUs (16.9%). These percentages have been moving up in recent months but are a quantum leap below the 89.4% in the 18,000-TEU to 24,000-TEU range. According to Sea-web, a sister product of the Journal of Commerce within S&P Global, some 2.43 million TEUs were on order in 2025 for ships of 15,001 TEUs and up. Have carriers and NOO’s overcooked their orders in the big ships and undercooked them at the lower end? The answer on the big ships looks to be “yes,” and there is a built-in carrier driver for this: There is not a well-populated second-hand or short-term charter market for newer, bigger ships, so if you need energy-efficient, low-slot cost vessels to be competitive in particular trades going forward, there is a pressure to order even if you have overcapacity concerns. There is a simpler and more pervasive explanation: The move from three major east-west networks ( 2M, Ocean, THEA ) to four ( MSC, Ocean, Gemini, Premier) catalyzed an arms race that continues today and will only be resolved by further carrier and/or consortium consolidation. Jeremy Masters is managing director of Shipping Masters. Contact him at jeremy@shippingmastershk.com .

Container lines

Asia-Europe

Evolution of ocean capacity linked to varied dynamics of trade needs

<div class="phx-topic abstract-wrapper">Project shippers in the US are being encouraged to test the robustness of bridge strength and state permitting feasibility up to a year in advance of major cargo moves.</div>

Project shippers in the US are being encouraged to test the robustness of bridge strength and state permitting feasibility up to a year in advance of major cargo moves.

<div class="phx-topic">Project cargo shippers in the US are being urged to submit “dummy permits” to periodically test bridge and state permitting feasibility to avoid last-minute surprises on the volatile final leg of a cargo move. As project cargo lands at ports or prepares to exit fabrication facilities, the margin for error shrinks to zero. Yet, this is where permitting roadblocks can see multi-million-dollar projects grind to a halt. James Weston, senior project logistics manager at engineering, procurement and construction (EPC) company Linde Engineering, believes a proactive, structural shift in how shippers approach route planning would avoid last-minute surprises. Weston suggested shippers should implement an internal permit feasibility assessment process that routinely submits dummy permits up to a year in advance for major projects. “Let’s apply for a permit a year in advance ... route studies will give you the feasibility for infrastructure challenges and things of that nature, but it doesn’t tell you if you’re going to be able to get under that bridge,” he said. “It doesn’t tell you if the states can even allow you to go down that route.” Weston added that spending a fraction of the budget upfront acts as cheap insurance against liquid damages. “I can mitigate a challenge a year in advance a lot easier than I can 20 days out,” he said. Deep fragmentation within permitting infrastructure in the US means that project cargo carriers frequently face situations where a route approved by one state becomes a compliance headache at the neighboring border. Craig McGraw, vice president of sales and marketing at freight service provider Trans American Trucking &amp; Warehouse, said that local infrastructure updates can instantly derail execution. “We’ve had cases where we go to a facility, we have our truck ready, and then, because of construction delays, the permit we previously applied for is invalid,” McGraw said. To solve this, McGraw and other members of the international trade association Specialized Carriers and Rigging Association (SCRA) routinely lobby in Washington, DC, pushing for “permit harmonization in different regions of the US, to move things along quicker,” he said. Ragan Watson, who handles project sales at lifting specialist Barnhart, echoed the need to bridge the disconnect between carriers and state regulators. Barnhart utilizes annual SCRA events to present upcoming project portfolios directly to officials from roughly 45 permit offices. “We [say], ‘These are the projects that we’re encountering in your area ... What are the issues you’re envisioning that already could be something that we can gird against?’” Watson said. <h3>Equipment challenge must be overcome </h3>Even the most meticulous permit planning cannot overcome a lack of physical equipment. The executives highlighted a pressing need for strategic, long-term asset acquisition rather than reactive buying during market spikes. Watson warned against rushing out to “buy more picks and shovels when there’s a gold rush,” urging project owners to abandon traditional short-term tendering. Instead, he suggested that shippers provide a project list “for the next three to five years” so asset-owning suppliers can justify capital expenditures to their executives. This long-term visibility is particularly vital given the explosive growth of data centers across the US, which is fundamentally reshaping market capacity. McGraw pointed out that the massive scale of data center components is forcing specialized carriers to procure highly specific trailers. “From what we’re understanding that’s going to be going on for the next 10 years ... companies are going out and buying trailers specific to this,” he said. Yet, without guaranteed contracts, acquiring those expensive assets is a gamble that “can kind of come back to bite you in the end,” he added. The executives agreed that overcoming last-mile friction requires an aggressive educational outreach campaign directed at cargo owners, procurement teams, and engineers who may suffer from a “curse of knowledge” or a complete lack of operational awareness. “I think that education of the freight owners is vital,” Weston said, advising logistics professionals to hold training sessions across corporate silos so that engineering and procurement teams understand the physical limitations of transport. Joye Runfola, director of supply chain and logistics for the Americas at industrial gas manufacturer Chart Industries, summarized the reality facing today’s supply chains. “If it’s going to go wrong, it’s going to go wrong at the end,” she said. Contact Carly Fields at <a href="mailto:carly.fields@spglobal.com">carly.fields@spglobal.com</a>. </div>

Project cargo shippers in the US are being urged to submit “dummy permits” to periodically test bridge and state permitting feasibility to avoid last-minute surprises on the volatile final leg of a cargo move. As project cargo lands at ports or prepares to exit fabrication facilities, the margin for error shrinks to zero. Yet, this is where permitting roadblocks can see multi-million-dollar projects grind to a halt. James Weston, senior project logistics manager at engineering, procurement and construction (EPC) company Linde Engineering, believes a proactive, structural shift in how shippers approach route planning would avoid last-minute surprises. Weston suggested shippers should implement an internal permit feasibility assessment process that routinely submits dummy permits up to a year in advance for major projects. “Let’s apply for a permit a year in advance ... route studies will give you the feasibility for infrastructure challenges and things of that nature, but it doesn’t tell you if you’re going to be able to get under that bridge,” he said. “It doesn’t tell you if the states can even allow you to go down that route.” Weston added that spending a fraction of the budget upfront acts as cheap insurance against liquid damages. “I can mitigate a challenge a year in advance a lot easier than I can 20 days out,” he said. Deep fragmentation within permitting infrastructure in the US means that project cargo carriers frequently face situations where a route approved by one state becomes a compliance headache at the neighboring border. Craig McGraw, vice president of sales and marketing at freight service provider Trans American Trucking & Warehouse, said that local infrastructure updates can instantly derail execution. “We’ve had cases where we go to a facility, we have our truck ready, and then, because of construction delays, the permit we previously applied for is invalid,” McGraw said. To solve this, McGraw and other members of the international trade association Specialized Carriers and Rigging Association (SCRA) routinely lobby in Washington, DC, pushing for “permit harmonization in different regions of the US, to move things along quicker,” he said. Ragan Watson, who handles project sales at lifting specialist Barnhart, echoed the need to bridge the disconnect between carriers and state regulators. Barnhart utilizes annual SCRA events to present upcoming project portfolios directly to officials from roughly 45 permit offices. “We [say], ‘These are the projects that we’re encountering in your area ... What are the issues you’re envisioning that already could be something that we can gird against?’” Watson said. Equipment challenge must be overcome Even the most meticulous permit planning cannot overcome a lack of physical equipment. The executives highlighted a pressing need for strategic, long-term asset acquisition rather than reactive buying during market spikes. Watson warned against rushing out to “buy more picks and shovels when there’s a gold rush,” urging project owners to abandon traditional short-term tendering. Instead, he suggested that shippers provide a project list “for the next three to five years” so asset-owning suppliers can justify capital expenditures to their executives. This long-term visibility is particularly vital given the explosive growth of data centers across the US, which is fundamentally reshaping market capacity. McGraw pointed out that the massive scale of data center components is forcing specialized carriers to procure highly specific trailers. “From what we’re understanding that’s going to be going on for the next 10 years ... companies are going out and buying trailers specific to this,” he said. Yet, without guaranteed contracts, acquiring those expensive assets is a gamble that “can kind of come back to bite you in the end,” he added. The executives agreed that overcoming last-mile friction requires an aggressive educational outreach campaign directed at cargo owners, procurement teams, and engineers who may suffer from a “curse of knowledge” or a complete lack of operational awareness. “I think that education of the freight owners is vital,” Weston said, advising logistics professionals to hold training sessions across corporate silos so that engineering and procurement teams understand the physical limitations of transport. Joye Runfola, director of supply chain and logistics for the Americas at industrial gas manufacturer Chart Industries, summarized the reality facing today’s supply chains. “If it’s going to go wrong, it’s going to go wrong at the end,” she said. Contact Carly Fields at carly.fields@spglobal.com .

Heavy-haul transport

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‘Dummy permits’ could overcome last-mile snafus for project cargoes

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