<div class="phx-topic abstract-wrapper">In the latest course correction in the US’ busiest trade lane, carriers are set to deploy less tonnage in August as spot rates fall and retail import forecasts weaken. </div>

In the latest course correction in the US’ busiest trade lane, carriers are set to deploy less tonnage in August as spot rates fall and retail import forecasts weaken.

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<div class="phx-topic">Container lines are pulling back on the deployment of tonnage from Asia to the US in August in the latest course correction linked to stop-and-start import demand amid tariff uncertainty. Container lines are set to deploy 6.2% less tonnage from Asia to the US West Coast in August than in July, equating to 90,000 TEUs of capacity, according to maritime intelligence provider eeSea. Comparatively, ocean capacity from Asia to US East and Gulf coasts will be trimmed by just 1.7%. Mediterranean Shipping Co. this week suspended its Pearl service to Long Beach, with the last sailing out of Xiamen on July 13, according to Kuehne + Nagel’s SeaExplorer tool. Container lines can also blank sailings — removing ships from services or skipping ports — to further calibrate capacity to weakening demand.<div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="0d272fa5-b752-4ec3-a342-964ef1a2b1f3"></dynamic-object></div>The rate of blanking compared with deployed capacity in May reached 26%, equating to 262,000 TEUs, as carriers adjusted networks, according to eeSea. In June, the rate was 9.5%. <h3>Tariff whiplash </h3>Carriers began pushing capacity back into the trade in May in anticipation of a surge of imports from China, driven by an early peak season caused in large part by the 90-day reprieve on higher US tariffs. Just a month earlier, US importers canceled China bookings after President Donald Trump on April 9 imposed 145% tariffs. In response, ocean carriers blanked sailings and suspended services, although Trump soon reversed course. Now carriers face an expanding capacity overhang amid downbeat retail import forecasts and the surge in US imports linked to the initial tariff reprieve in its last gasp. The tentative agreement with China to bring US tariffs to 55% hasn’t had much impact on importers’ peak season ordering, thanks to more than eight months of frontloading shipments and a narrow window for getting goods in before the year-end shopping season. While US retailers <a href="https://www.joc.com/article/pause-on-tariffs-prompts-us-retailers-to-upgrade-summer-import-forecast-6022230">upgraded their import forecast</a> slightly in early June, their volume expectations still lag the same period in 2024. US imports are expected to reach 2.13 million TEUs this month, down from 2.32 million TEUs a year ago, according to the Global Port Tracker. Retailers plan to bring in 14.7% less volume, equating to 331,000 TEUs of capacity, next month compared with August 2024. US laden imports from Asia have been falling since September, with the exception of a short-lived recovery in April, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. In September, inbound volumes hit 1.79 million TEUs, falling to 1.4 million TEUs by May. Container spot rates from Asia to the US, a barometer of how capacity is matching up to demand, have been falling for a month, according to various indexes. For example, container spot rates from Shanghai to the US West Coast last week were less than half the price a month ago, at $2,089 per FEU, according to the Shanghai Containerized Freight Index. Contact Mark Szakonyi at <a href="mark.szakonyi@spglobal.com ">mark.szakonyi@spglobal.com</a>. </div>

Container lines are pulling back on the deployment of tonnage from Asia to the US in August in the latest course correction linked to stop-and-start import demand amid tariff uncertainty. Container lines are set to deploy 6.2% less tonnage from Asia to the US West Coast in August than in July, equating to 90,000 TEUs of capacity, according to maritime intelligence provider eeSea. Comparatively, ocean capacity from Asia to US East and Gulf coasts will be trimmed by just 1.7%. Mediterranean Shipping Co. this week suspended its Pearl service to Long Beach, with the last sailing out of Xiamen on July 13, according to Kuehne + Nagel’s SeaExplorer tool. Container lines can also blank sailings — removing ships from services or skipping ports — to further calibrate capacity to weakening demand. The rate of blanking compared with deployed capacity in May reached 26%, equating to 262,000 TEUs, as carriers adjusted networks, according to eeSea. In June, the rate was 9.5%. Tariff whiplash Carriers began pushing capacity back into the trade in May in anticipation of a surge of imports from China, driven by an early peak season caused in large part by the 90-day reprieve on higher US tariffs. Just a month earlier, US importers canceled China bookings after President Donald Trump on April 9 imposed 145% tariffs. In response, ocean carriers blanked sailings and suspended services, although Trump soon reversed course. Now carriers face an expanding capacity overhang amid downbeat retail import forecasts and the surge in US imports linked to the initial tariff reprieve in its last gasp. The tentative agreement with China to bring US tariffs to 55% hasn’t had much impact on importers’ peak season ordering, thanks to more than eight months of frontloading shipments and a narrow window for getting goods in before the year-end shopping season. While US retailers upgraded their import forecast slightly in early June, their volume expectations still lag the same period in 2024. US imports are expected to reach 2.13 million TEUs this month, down from 2.32 million TEUs a year ago, according to the Global Port Tracker. Retailers plan to bring in 14.7% less volume, equating to 331,000 TEUs of capacity, next month compared with August 2024. US laden imports from Asia have been falling since September, with the exception of a short-lived recovery in April, according to PIERS, a sister product of the Journal of Commerce within S&P Global. In September, inbound volumes hit 1.79 million TEUs, falling to 1.4 million TEUs by May. Container spot rates from Asia to the US, a barometer of how capacity is matching up to demand, have been falling for a month, according to various indexes. For example, container spot rates from Shanghai to the US West Coast last week were less than half the price a month ago, at $2,089 per FEU, according to the Shanghai Containerized Freight Index. Contact Mark Szakonyi at mark.szakonyi@spglobal.com .

Container lines

Trans-Pacific

Container Shipping News

Container lines cutting trans-Pacific capacity overhang

<div class="phx-topic abstract-wrapper">The routing impasse between the railroads threatens supply chain disruptions for ocean carrier CMA CGM, which has cargo booked on the service that is due to begin later this week.</div>

The routing impasse between the railroads threatens supply chain disruptions for ocean carrier CMA CGM, which has cargo booked on the service that is due to begin later this week.

<div class="phx-topic">BNSF Railway has filed an <a href="https://dcms-external.s3.amazonaws.com/DCMS_External_PROD/1751927358207/309737.pdf">emergency petition</a> with the US Surface Transportation Board (STB) to intervene in a dispute with Union Pacific Railroad (UP) in which BNSF alleges UP is blocking the launch of a new freight service between the Port of Oakland and Salt Lake City. The impasse threatens supply chain disruptions for ocean carrier CMA CGM, which has cargo booked on the service that is due to begin later this week. The disagreement involves how BNSF will route trains between Oakland and Salt Lake City. BNSF wants to run a double-stack intermodal service along the so-called Northern Route, which passes through Northern California and Nevada. UP said BNSF must instead use the Southern Route over Donner Pass near Lake Tahoe, where UP invested in costly tunnel upgrades more than a decade ago. The route selected has financial implications for both Class I railroads, including how many train crews are needed and whether BNSF would owe Union Pacific millions of dollars for using the upgraded Southern Route. BNSF has the right to use UP-owned tracks between Oakland and Salt Lake City. However, UP controls dispatching and provides train crews, and without its cooperation, BNSF cannot move containers across the corridor. The dispute, meanwhile, threatens the launch of an international intermodal service scheduled for later this week. CMA CGM called the matter “deeply concerning” and costly for cargo owners. “Without immediate resolution, our supply chain will be disrupted, impacting our customers across the region, including potentially a loss of business,” Bob Basila, senior vice president of CMA CGM, wrote in <a href="https://dcms-external.s3.amazonaws.com/DCMS_External_PROD/1751927391221/309738.pdf">a filing to the STB Monday</a>. “We have made substantial operational and commercial commitments based on the availability of this service, and the current impasse threatens to undermine those investments.” BNSF said emergency relief is necessary given freight has already arrived in Oakland. “The first empty train arrived in Salt Lake City [July 6] and the first container arrived [July 7],” BNSF wrote Monday in its petition to the STB. “Once loaded, the first westbound train is expected to leave Salt Lake City this week. BNSF anticipates the first eastbound movement of BNSF double-stack intermodal trains over the Northern Route will begin as early as later this week.” There is potential for business growth in Salt Lake City for ocean carriers. In 2020, ocean carriers handled nearly 52,000 TEUs between Oakland and Salt Lake City, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. The total, however, has fallen each subsequent year, ending last year at 16,600 TEUs. If ocean carriers were able to return to the 2020 total, it would be enough volume to support multiple trains per week in both directions, although it’s unlikely there would be daily trains. <h3>Allegations fly in both directions </h3>BNSF told the STB it would prefer to use the Northern Route and claimed UP is employing delay tactics in retaliation for BNSF signing multi-year agreements with two former UP ocean carrier partners, including CMA CGM. UP alleges that BNSF did not provide sufficient prior notice to hire crews and plan resources to handle up to five trains per week in both directions between Oakland and Salt Lake City and requires more time to prepare. Carl Garrison, UP’s vice president of network planning and operations, said BNSF only notified UP senior staff of its needs on June 20. BNSF countered that it contacted UP on May 2, including written correspondence and follow-up phone calls. “If BNSF cannot fulfill its promises to begin running new intermodal service this week, it has only itself to blame,” UP wrote in <a href="https://dcms-external.s3.amazonaws.com/DCMS_External_PROD/1751971741044/309739.pdf">its response Monday</a> to the STB. UP also said trains on the Northern Route primarily run westbound, so running a bi-directional service would require significant operational adjustments and could degrade the performance of existing trains. It added that the Southern Route is best equipped to handle bi-directional traffic. The Southern Route was upgraded in 2009 to accommodate double-stack intermodal trains. If BNSF uses it, the company could be required to reimburse UP for up to half the cost of those improvements. BNSF argues doing so would cost tens of millions of dollars, making the new service financially unsustainable. BNSF would only need to pay for crew services, dispatching and track access on the Northern Route, a much lower figure. UP also said the matter should go through the normal STB dispute process, not an emergency filing. The normal dispute resolution process outlined in a 2002 agreement includes meetings, executive escalation, and potential arbitration or mediation, which can take far longer to resolve. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

BNSF Railway has filed an emergency petition with the US Surface Transportation Board (STB) to intervene in a dispute with Union Pacific Railroad (UP) in which BNSF alleges UP is blocking the launch of a new freight service between the Port of Oakland and Salt Lake City. The impasse threatens supply chain disruptions for ocean carrier CMA CGM, which has cargo booked on the service that is due to begin later this week. The disagreement involves how BNSF will route trains between Oakland and Salt Lake City. BNSF wants to run a double-stack intermodal service along the so-called Northern Route, which passes through Northern California and Nevada. UP said BNSF must instead use the Southern Route over Donner Pass near Lake Tahoe, where UP invested in costly tunnel upgrades more than a decade ago. The route selected has financial implications for both Class I railroads, including how many train crews are needed and whether BNSF would owe Union Pacific millions of dollars for using the upgraded Southern Route. BNSF has the right to use UP-owned tracks between Oakland and Salt Lake City. However, UP controls dispatching and provides train crews, and without its cooperation, BNSF cannot move containers across the corridor. The dispute, meanwhile, threatens the launch of an international intermodal service scheduled for later this week. CMA CGM called the matter “deeply concerning” and costly for cargo owners. “Without immediate resolution, our supply chain will be disrupted, impacting our customers across the region, including potentially a loss of business,” Bob Basila, senior vice president of CMA CGM, wrote in a filing to the STB Monday . “We have made substantial operational and commercial commitments based on the availability of this service, and the current impasse threatens to undermine those investments.” BNSF said emergency relief is necessary given freight has already arrived in Oakland. “The first empty train arrived in Salt Lake City [July 6] and the first container arrived [July 7],” BNSF wrote Monday in its petition to the STB. “Once loaded, the first westbound train is expected to leave Salt Lake City this week. BNSF anticipates the first eastbound movement of BNSF double-stack intermodal trains over the Northern Route will begin as early as later this week.” There is potential for business growth in Salt Lake City for ocean carriers. In 2020, ocean carriers handled nearly 52,000 TEUs between Oakland and Salt Lake City, according to PIERS, a sister product of the Journal of Commerce within S&P Global. The total, however, has fallen each subsequent year, ending last year at 16,600 TEUs. If ocean carriers were able to return to the 2020 total, it would be enough volume to support multiple trains per week in both directions, although it’s unlikely there would be daily trains. Allegations fly in both directions BNSF told the STB it would prefer to use the Northern Route and claimed UP is employing delay tactics in retaliation for BNSF signing multi-year agreements with two former UP ocean carrier partners, including CMA CGM. UP alleges that BNSF did not provide sufficient prior notice to hire crews and plan resources to handle up to five trains per week in both directions between Oakland and Salt Lake City and requires more time to prepare. Carl Garrison, UP’s vice president of network planning and operations, said BNSF only notified UP senior staff of its needs on June 20. BNSF countered that it contacted UP on May 2, including written correspondence and follow-up phone calls. “If BNSF cannot fulfill its promises to begin running new intermodal service this week, it has only itself to blame,” UP wrote in its response Monday to the STB. UP also said trains on the Northern Route primarily run westbound, so running a bi-directional service would require significant operational adjustments and could degrade the performance of existing trains. It added that the Southern Route is best equipped to handle bi-directional traffic. The Southern Route was upgraded in 2009 to accommodate double-stack intermodal trains. If BNSF uses it, the company could be required to reimburse UP for up to half the cost of those improvements. BNSF argues doing so would cost tens of millions of dollars, making the new service financially unsustainable. BNSF would only need to pay for crew services, dispatching and track access on the Northern Route, a much lower figure. UP also said the matter should go through the normal STB dispute process, not an emergency filing. The normal dispute resolution process outlined in a 2002 agreement includes meetings, executive escalation, and potential arbitration or mediation, which can take far longer to resolve. Contact Ari Ashe at ari.ashe@spglobal.com .

Surface

Rail News

North American ports

North-American rail

Intermodal providers

BNSF-UP dispute threatens Oakland-SLC service, triggers STB petition

<div class="phx-topic abstract-wrapper">Beginning in September, the joint service will make added stops at Aarhus in Denmark, Gothenburg in Sweden and Rotterdam in the Netherlands as the last three European calls. </div>

Beginning in September, the joint service will make added stops at Aarhus in Denmark, Gothenburg in Sweden and Rotterdam in the Netherlands as the last three European calls.

<div class="phx-topic">The Gemini Cooperation is adding three new calls on a joint Asia-Europe container service as port congestion in Northern Europe challenges the hub-and-spoke model championed by the shipping alliance. Gemini partners Maersk and Hapag-Lloyd will change port rotations for their respective AE5 and NE4 services from Asia to “address fluctuating port congestion in Europe and ensure more consistent delivery,” Hapag-Lloyd said in an advisory Tuesday. The original European rotation of the AE5/NE4 only included London Gateway and Germany’s Bremerhaven and Hamburg ports. Along with those existing calls, the services from September will make added stops at Aarhus in Denmark, Gothenburg in Sweden and Rotterdam in the Netherlands as their last three European calls. Aarhus and Gothenburg had been previously served by Gemini using a shuttle service for transshipping from Bremerhaven. The changes announced Tuesday include the AE5/NE4 services calling Hamburg before Bremerhaven. While the Gemini partners have insisted their hub-and-spoke network could maintain reliable schedules and avoid blank sailings, Maersk said in a separate advisory Tuesday it was just as easy to unwind the network “to address challenges, predicted or not.” It added that the shuttle vessels serving Aarhus will be redeployed to “locations with an increased disruption risk to our customers’ business.” Since April, Europe has experienced bouts of port congestion because of strong import demand, changes in container alliance structures and poor schedule reliability due to the ongoing longer transits around southern Africa. Other ocean carriers have <a href="https://www.joc.com/article/ocean-carriers-adjust-calls-as-congestion-chokes-european-hubs-6037668">had to switch their European port rotations</a> to mitigate delays. <h3>Busy spring at Hamburg </h3>Hamburg, one of the harder-hit ports, saw an uptick in ship calls and vessel sizes through spring, according to data from Sea-web, a sister product of the Journal of Commerce within S&amp;P Global. During April, 416 container ships called the port, Sea-web data shows, with total vessel capacity reaching 1.83 million TEUs, the highest in 12 months. In May, 421 container ships called Hamburg, totaling 1.8 million TEUs in capacity. Germany’s HHLA, which operates three of Hamburg’s container terminals, is seeing ships wait between one and four days for an open berth as the “line-up is congested with late-arriving vessels,” ocean carrier HMM said in a customer advisory update. The terminals are operating at 75% to 80% capacity. Ongoing capital projects at Hamburg terminals may also be impacting handling efficiency. HHLA had to reduce the size of one berth at a Hamburg terminal due to construction of new ship-to-shore cranes. Another HHLA terminal is constructing two additional container yards this summer, which won’t be completed until next year. The terminal is also testing automated guide vehicles for moving containers. The tests are starting out on smaller ships, with a full rollout to all the berths in late 2025. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

The Gemini Cooperation is adding three new calls on a joint Asia-Europe container service as port congestion in Northern Europe challenges the hub-and-spoke model championed by the shipping alliance. Gemini partners Maersk and Hapag-Lloyd will change port rotations for their respective AE5 and NE4 services from Asia to “address fluctuating port congestion in Europe and ensure more consistent delivery,” Hapag-Lloyd said in an advisory Tuesday. The original European rotation of the AE5/NE4 only included London Gateway and Germany’s Bremerhaven and Hamburg ports. Along with those existing calls, the services from September will make added stops at Aarhus in Denmark, Gothenburg in Sweden and Rotterdam in the Netherlands as their last three European calls. Aarhus and Gothenburg had been previously served by Gemini using a shuttle service for transshipping from Bremerhaven. The changes announced Tuesday include the AE5/NE4 services calling Hamburg before Bremerhaven. While the Gemini partners have insisted their hub-and-spoke network could maintain reliable schedules and avoid blank sailings, Maersk said in a separate advisory Tuesday it was just as easy to unwind the network “to address challenges, predicted or not.” It added that the shuttle vessels serving Aarhus will be redeployed to “locations with an increased disruption risk to our customers’ business.” Since April, Europe has experienced bouts of port congestion because of strong import demand, changes in container alliance structures and poor schedule reliability due to the ongoing longer transits around southern Africa. Other ocean carriers have had to switch their European port rotations to mitigate delays. Busy spring at Hamburg Hamburg, one of the harder-hit ports, saw an uptick in ship calls and vessel sizes through spring, according to data from Sea-web, a sister product of the Journal of Commerce within S&P Global. During April, 416 container ships called the port, Sea-web data shows, with total vessel capacity reaching 1.83 million TEUs, the highest in 12 months. In May, 421 container ships called Hamburg, totaling 1.8 million TEUs in capacity. Germany’s HHLA, which operates three of Hamburg’s container terminals, is seeing ships wait between one and four days for an open berth as the “line-up is congested with late-arriving vessels,” ocean carrier HMM said in a customer advisory update. The terminals are operating at 75% to 80% capacity. Ongoing capital projects at Hamburg terminals may also be impacting handling efficiency. HHLA had to reduce the size of one berth at a Hamburg terminal due to construction of new ship-to-shore cranes. Another HHLA terminal is constructing two additional container yards this summer, which won’t be completed until next year. The terminal is also testing automated guide vehicles for moving containers. The tests are starting out on smaller ships, with a full rollout to all the berths in late 2025. Contact Michael Angell at michael.angell@spglobal.com .

Maritime

Port News

Asia-Europe

International ports

Europe’s port congestion forcing Gemini to switch up Asia service

<div class="phx-topic abstract-wrapper">The recent death of FedEx founder Fred Smith presents an opportunity to compare his contributions to global supply chains with another visionary, Malcom McLean, the father of containerization. </div>

The recent death of FedEx founder Fred Smith presents an opportunity to compare his contributions to global supply chains with another visionary, Malcom McLean, the father of containerization.

<div class="phx-topic">It is hard to imagine two individuals who did more to disrupt freight transportation than Fred Smith and Malcom McLean. But that is where the similarities end between the pioneers of express delivery and container shipping. Their respective revolutions redefined transportation but resulted in a wholly divergent set of winners and losers. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6040127_0.1.jpg"></img></div>McLean, who died in 2001, was a trucker frustrated by having to wait at the port while cargo was manually loaded. His genius, and why he sits in the pantheon of 20th century business visionaries, was not because he “invented” the shipping container. The container had been identified years before his first ship sailed in 1956 as a method capable of driving out cost, enabling end-to-end transit and reducing theft. Rather, his legacy emerged through the grit and determination required to break through walls of operational complexity and customer skepticism. Smith, <a href="https://www.joc.com/article/fred-smith-fedex-founder-and-visionary-dead-at-80-6029098">who died June 21 at the age of 80</a>, also broke little ground technologically — planes, trucks and warehouses all existed long before FedEx began operations in 1973. Rather, it was physically combining the assets and synching them operationally that created the breakthrough represented by overnight express delivery. What Smith saw, as did McLean, was an untapped market. While McLean saw customers hungry to drive down costs and willing to sacrifice delivery speed to achieve it, Smith spotted a market at the opposite end of the spectrum — one that wanted speed and, at the right price, would be willing to pay for it. The results of their divergent trajectories up and down the value chain could not have been more different. Smith created value — shipping blood samples, legal documents and urgently needed spare parts — and was compensated for doing so. Smith’s model, envisioned in a 1965 paper written at Yale, was validated; FedEx today has half a million employees, a market cap of $55 billion and has expanded into adjacent spaces such as freight forwarding and trucking. Express delivery, moreover, has been proven to be a profitable business for FedEx and others that followed, including UPS and DHL. FedEx is a case study in business benefit. Customers benefit through availability of a needed service and the provider is duly compensated, so everyone wins. Not so in container shipping. <h3>‘Lopsided’ value proposition </h3>The revolution sparked by McLean’s debut of the first container service, operating between Newark and Houston, led instead to a lopsided value proposition. While McLean himself made a fortune when he sold his shipping company, Sea-Land Service Inc. in 1969, the long-term winners in containerization of ocean-going cargo, was not among the shipping companies that followed McLean into containers, but rather their customers, and developing nations such as China. Containers enhanced the opportunity presented by low-cost labor in China with low-cost and efficient shipping, greasing the wheels for mass-relocation of manufacturing beginning in the 1990s. But the shipping companies themselves, moving containers on ever-larger ships, struggled over a span of decades to avoid waves of overcapacity and low freight rates — to the benefit of customers who were more than happy with low costs and largely reliable schedules. The industry earned more profit from 2020 to 2022 during the extreme COVID-19 supply chain disruptions than it did during the entire period between 1956 and 2020, according to data from Sea-Intelligence Maritime Analysis. And even then, the lopsided value proposition of containers only flipped from one winner to another; ocean carriers’ profits during COVID-19 came at the expense of their customers who suddenly had to endure higher costs, longer delays and inconsistent service. The reliable supply chains on which their international expansion had been based were in tatters. And since COVID-19, the situation for retailers, manufacturers and other users of containerized shipping has only continued. Successive waves of disruption, including the diversion of ships around southern Africa to avoid attacks in the Red Sea, drought in the Panama Canal and upheaval due to the imposition and then retraction of 145% tariffs on China led to even more profits for carriers and yet more problems for supply chains. Anger at ocean carriers led in 2022 to the passage of the first US ocean shipping legislation in nearly 25 years. None of this takes away from McLean’s accomplishment; his refusal to patent his innovation led to the 40-foot container becoming a global standard. But as a lesson in value creation, McLean and Smith offer two very different models. Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>. </div>

It is hard to imagine two individuals who did more to disrupt freight transportation than Fred Smith and Malcom McLean. But that is where the similarities end between the pioneers of express delivery and container shipping. Their respective revolutions redefined transportation but resulted in a wholly divergent set of winners and losers. McLean, who died in 2001, was a trucker frustrated by having to wait at the port while cargo was manually loaded. His genius, and why he sits in the pantheon of 20th century business visionaries, was not because he “invented” the shipping container. The container had been identified years before his first ship sailed in 1956 as a method capable of driving out cost, enabling end-to-end transit and reducing theft. Rather, his legacy emerged through the grit and determination required to break through walls of operational complexity and customer skepticism. Smith, who died June 21 at the age of 80 , also broke little ground technologically — planes, trucks and warehouses all existed long before FedEx began operations in 1973. Rather, it was physically combining the assets and synching them operationally that created the breakthrough represented by overnight express delivery. What Smith saw, as did McLean, was an untapped market. While McLean saw customers hungry to drive down costs and willing to sacrifice delivery speed to achieve it, Smith spotted a market at the opposite end of the spectrum — one that wanted speed and, at the right price, would be willing to pay for it. The results of their divergent trajectories up and down the value chain could not have been more different. Smith created value — shipping blood samples, legal documents and urgently needed spare parts — and was compensated for doing so. Smith’s model, envisioned in a 1965 paper written at Yale, was validated; FedEx today has half a million employees, a market cap of $55 billion and has expanded into adjacent spaces such as freight forwarding and trucking. Express delivery, moreover, has been proven to be a profitable business for FedEx and others that followed, including UPS and DHL. FedEx is a case study in business benefit. Customers benefit through availability of a needed service and the provider is duly compensated, so everyone wins. Not so in container shipping. ‘Lopsided’ value proposition The revolution sparked by McLean’s debut of the first container service, operating between Newark and Houston, led instead to a lopsided value proposition. While McLean himself made a fortune when he sold his shipping company, Sea-Land Service Inc. in 1969, the long-term winners in containerization of ocean-going cargo, was not among the shipping companies that followed McLean into containers, but rather their customers, and developing nations such as China. Containers enhanced the opportunity presented by low-cost labor in China with low-cost and efficient shipping, greasing the wheels for mass-relocation of manufacturing beginning in the 1990s. But the shipping companies themselves, moving containers on ever-larger ships, struggled over a span of decades to avoid waves of overcapacity and low freight rates — to the benefit of customers who were more than happy with low costs and largely reliable schedules. The industry earned more profit from 2020 to 2022 during the extreme COVID-19 supply chain disruptions than it did during the entire period between 1956 and 2020, according to data from Sea-Intelligence Maritime Analysis. And even then, the lopsided value proposition of containers only flipped from one winner to another; ocean carriers’ profits during COVID-19 came at the expense of their customers who suddenly had to endure higher costs, longer delays and inconsistent service. The reliable supply chains on which their international expansion had been based were in tatters. And since COVID-19, the situation for retailers, manufacturers and other users of containerized shipping has only continued. Successive waves of disruption, including the diversion of ships around southern Africa to avoid attacks in the Red Sea, drought in the Panama Canal and upheaval due to the imposition and then retraction of 145% tariffs on China led to even more profits for carriers and yet more problems for supply chains. Anger at ocean carriers led in 2022 to the passage of the first US ocean shipping legislation in nearly 25 years. None of this takes away from McLean’s accomplishment; his refusal to patent his innovation led to the 40-foot container becoming a global standard. But as a lesson in value creation, McLean and Smith offer two very different models. Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

Supply chain

Two legends took divergent paths to supply chain success

<div class="phx-topic abstract-wrapper">Rhenus Logistics will manage the end-to-end supply chain via a 4PL control tower tailored to the circular textile logistics business.</div>

Rhenus Logistics will manage the end-to-end supply chain via a 4PL control tower tailored to the circular textile logistics business.

<div class="phx-topic">Global clothing retailer H&amp;M Group and German recycling firm Remondis have formed a joint venture company that will tackle the logistics of reusing and recycling up to 150 million garments a year. Looper Textile Co. will collect, sort and enable the processing of used textiles, with German-based forwarder Rhenus Logistics coordinating the transport flows, end-to-end supply chain visibility and creation of a digital 4PL control tower tailored to the circular textile logistics business. “Used textiles are one of the largest material flows in the world,” Simon Bodmer, head of logistics at Remondis Recycling, said in a statement Tuesday announcing the joint venture. He added that digital solutions were crucial for the coordination and movement of the 150 million pieces of clothing to be collected per year. Rhenus will have the overarching responsibility for managing logistics partners and processes within the reuse and recycling system that supports the circular economy and requires full transparency, visibility and data-driven supply chain operations. “Our 4PL control tower provides a central platform for the coordinated and integrated management of all logistics activities and increases visibility along the entire value chain,” said Chris Gerfertz, managing global director at Rhenus 4PL Solutions. The impact of the textile industry on the environment is enormous. Textiles contain many different fibers that make recycling difficult and often impossible when the material consists of blended fibers. The United Nations Environment Program (UNEP) estimates 92 million metric tons of textile waste is produced globally each year. “Unsustainable fashion is aggravating the triple planetary crisis of climate change, nature, land and biodiversity loss, and pollution and waste,” Inger Andersen, executive director of UNEP, said in a speech earlier this year. “We need to focus on a circular economy approach that values sustainable production, reuse and repair.” EU rules requiring separate collection of textile waste came into force on Jan. 1, while proposals before the European Parliament include a requirement that producers of textiles products on the European single market should cover the costs of separate collection, sorting and recycling. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Global clothing retailer H&M Group and German recycling firm Remondis have formed a joint venture company that will tackle the logistics of reusing and recycling up to 150 million garments a year. Looper Textile Co. will collect, sort and enable the processing of used textiles, with German-based forwarder Rhenus Logistics coordinating the transport flows, end-to-end supply chain visibility and creation of a digital 4PL control tower tailored to the circular textile logistics business. “Used textiles are one of the largest material flows in the world,” Simon Bodmer, head of logistics at Remondis Recycling, said in a statement Tuesday announcing the joint venture. He added that digital solutions were crucial for the coordination and movement of the 150 million pieces of clothing to be collected per year. Rhenus will have the overarching responsibility for managing logistics partners and processes within the reuse and recycling system that supports the circular economy and requires full transparency, visibility and data-driven supply chain operations. “Our 4PL control tower provides a central platform for the coordinated and integrated management of all logistics activities and increases visibility along the entire value chain,” said Chris Gerfertz, managing global director at Rhenus 4PL Solutions. The impact of the textile industry on the environment is enormous. Textiles contain many different fibers that make recycling difficult and often impossible when the material consists of blended fibers. The United Nations Environment Program (UNEP) estimates 92 million metric tons of textile waste is produced globally each year. “Unsustainable fashion is aggravating the triple planetary crisis of climate change, nature, land and biodiversity loss, and pollution and waste,” Inger Andersen, executive director of UNEP, said in a speech earlier this year. “We need to focus on a circular economy approach that values sustainable production, reuse and repair.” EU rules requiring separate collection of textile waste came into force on Jan. 1, while proposals before the European Parliament include a requirement that producers of textiles products on the European single market should cover the costs of separate collection, sorting and recycling. Contact Greg Knowler at greg.knowler@spglobal.com .

Fast fashion retailer forms recycling logistics venture to tackle textile waste

<div class="phx-topic abstract-wrapper">The just-concluded legislative session also puts aside emergency funding for the Port of Portland that is generated via lottery sales.</div>

The just-concluded legislative session also puts aside emergency funding for the Port of Portland that is generated via lottery sales.

<div class="phx-topic">Oregon’s lawmakers voted to help finance dredging for the development of a new container terminal at the Port of Coos Bay — but only if more federal backing is secured. Legislators also set aside emergency funding that the Port of Portland sought to stave off its closure.The Oregon Legislature’s 2025 session, which ended in late June, included passage of a two-year spending bill that will allow the state to issue up to $100 million in bonds to fund channel deepening and widening for <a href="https://www.joc.com/article/proposed-oregon-container-terminal-among-projects-winning-dot-grants-5764924">the proposed Pacific Coast Intermodal Port (PCIP)</a> container terminal at Coos Bay. The spending bill now awaits Governor Tina Kotek’s signature. The terminal, a joint project of the port and logistics infrastructure developer NorthPoint Development, is designed to handle over 1 million TEUs per year, chiefly serving inland rail markets. The project calls for dredging eight miles of the Coos Bay navigation channel to 45 feet from its current depth of 37 feet, along with widening it from 300 feet to 450 feet. That will allow the PCIP to handle post-Panamax ships up to 13,000 TEUs. The Port of Coos Bay has targeted a 2030 opening for the project. The channel modifications are expected to cost a total of $560 million, according to the Port of Coos Bay. The state can only issue the bonds once the PCIP has received final permitting approval, and the project’s backers have secured $1 billion in railroad improvement financing from the Department of Transportation. The PCIP will require raising tunnel clearances and other improvements on about 120 miles of track that will connect the port to Union Pacific’s rail network. Coos Bay has secured $30 million in various grants toward improving the rail tracks. In addition, <a href="https://www.joc.com/article/proposed-oregon-container-terminal-among-projects-winning-dot-grants-5764924">Coos Bay also received a $25 million grant</a> in 2024 toward the design of the PCIP, which is expected to cost over $2 billion. <h3>Lottery to help fund Portland </h3>A separate bill passed at the end of the 2025 session includes a “Container Port Improvement Fund” that will include $20 million funded through lottery ticket sales. Gov. Kotek had sought <a href="https://www.joc.com/article/oregon-governor-proposes-40-million-to-keep-portland-container-service-alive-5225215">$40 million for the Port of Portland</a> last year after it revealed larger-than-expected financial losses, prompting the port to consider closing its container terminal. The port struck a deal in December for its current stevedore to fully takeover the terminal, a requirement for receiving the grant funding. The bill also sets aside $15 million in state funds for navigation improvements on the Columbia River. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

Oregon’s lawmakers voted to help finance dredging for the development of a new container terminal at the Port of Coos Bay — but only if more federal backing is secured. Legislators also set aside emergency funding that the Port of Portland sought to stave off its closure. The Oregon Legislature’s 2025 session, which ended in late June, included passage of a two-year spending bill that will allow the state to issue up to $100 million in bonds to fund channel deepening and widening for the proposed Pacific Coast Intermodal Port (PCIP) container terminal at Coos Bay. The spending bill now awaits Governor Tina Kotek’s signature. The terminal, a joint project of the port and logistics infrastructure developer NorthPoint Development, is designed to handle over 1 million TEUs per year, chiefly serving inland rail markets. The project calls for dredging eight miles of the Coos Bay navigation channel to 45 feet from its current depth of 37 feet, along with widening it from 300 feet to 450 feet. That will allow the PCIP to handle post-Panamax ships up to 13,000 TEUs. The Port of Coos Bay has targeted a 2030 opening for the project. The channel modifications are expected to cost a total of $560 million, according to the Port of Coos Bay. The state can only issue the bonds once the PCIP has received final permitting approval, and the project’s backers have secured $1 billion in railroad improvement financing from the Department of Transportation. The PCIP will require raising tunnel clearances and other improvements on about 120 miles of track that will connect the port to Union Pacific’s rail network. Coos Bay has secured $30 million in various grants toward improving the rail tracks. In addition, Coos Bay also received a $25 million grant in 2024 toward the design of the PCIP, which is expected to cost over $2 billion. Lottery to help fund Portland A separate bill passed at the end of the 2025 session includes a “Container Port Improvement Fund” that will include $20 million funded through lottery ticket sales. Gov. Kotek had sought $40 million for the Port of Portland last year after it revealed larger-than-expected financial losses, prompting the port to consider closing its container terminal. The port struck a deal in December for its current stevedore to fully takeover the terminal, a requirement for receiving the grant funding. The bill also sets aside $15 million in state funds for navigation improvements on the Columbia River. Contact Michael Angell at michael.angell@spglobal.com .

Marine terminals

Oregon earmarks funds for proposed Coos Bay terminal

<div class="phx-topic abstract-wrapper">The shipping industry needs a fundamentally new, collaborative approach to build true resilience. </div>

The shipping industry needs a fundamentally new, collaborative approach to build true resilience.

<div class="phx-topic">The early 2020s have reshaped the context for international supply chains. The COVID-19 pandemic, geopolitical tensions, and ongoing adverse events have exposed the sector’s complexities, underscoring the need for greater supply chain resilience. Visibility is a prerequisite for effective supply chain and carbon footprint management. In a world where blocs are driving apart and uncertainty is sky high, incremental improvements and isolated digital tools are no longer sufficient. The industry needs a fundamentally new, collaborative approach to build true resilience. Several high-profile digital supply chain initiatives have failed to deliver a lasting impact. The most prominent example, TradeLens, was discontinued despite strong backing and considerable investment. Its centralized model struggled to achieve broad industry support, ultimately faltering because it could not build the trust required to make such industry-wide solutions economically viable. Other platforms, such as Project44 and FourKites, have made significant strides in transport visibility. Yet, their traction remains limited. A common thread running through shortcomings is a lack of trust, insufficient perceived value, and governance models that do not serve the actors or the sector. Technology can only solve the challenges facing supply chains and logistics when it is <a href="https://unctad.org/news/transport-newsletter-article-no-96-fourth-quarter-2022">underpinned by collaboration</a> and trust. <h3>A different way forward </h3>The <a href="https://encoded-592c9deb-987b-4562-aa3c-9fa3d37d83e9.uri/http%3a%2f%2fwww.virtualwatchtower.org)">Virtual Watch Tower</a> (VWT) was conceived as a direct response to these challenges. It is not just another platform, but a neutral, industry-driven public good. Designed by and for the supply chain community, VWT’s mission is to create a digital infrastructure that links existing tools and platforms, enabling secure, selective, and trustworthy sharing of primary data to close gaps. What sets VWT apart is its governance and inclusivity. Rather than being controlled by a single actor or a small group, it is stewarded by neutral stakeholders and, in the future, a trustee-led foundation, ensuring neutrality and legitimacy. At VWT, shippers and logistics providers co-create solutions, ensuring that the digital infrastructure addresses real-world needs. At the heart of VWT’s approach is VWTnet, powered by <a href="http://www.twin.org">TWIN</a> — the Trade Worldwide Information Network. TWIN is a public-good digital data architecture and federated backbone that enables actors to share primary data on their own terms securely. New data gathering mechanisms will help the VWT members to fill current data gaps. This architecture has already demonstrated its value in the real world. The organic growth of VWT, expanding shipment by shipment and actor by actor, is a testament to the power of network effects when trust and interoperability are embedded in the system’s fabric. The VWT vision is that disruptions can be managed collaboratively. When a disruption occurs, whether it is a port strike or a climate-induced delay, all relevant parties involved in the shipments are informed in real time. Recovery plans can be coordinated rather than improvised, and operational flows can bemanaged with far greater agility. Equally transformative is VWT’s approach to emissions tracking. By leveraging primary operational data, VWT will enable shipment-specific emissions calculations, turning sustainability from a retrospective report into an actionable planning and management tool. Shippers can optimize routes for both speed and carbon impact, and authorities can align incentives with verified, real-time data. Emission performance becomes a differentiator, not a compliance afterthought. VWT’s work on these use cases has begun, and the first minimum viable product is scheduled to be launched in 2026. <h3>Building from ground up </h3>Perhaps the most significant differentiator of the community-driven VWT is not technical, but institutional. Drawing on lessons from failed efforts, VWT will be built from the ground up with a two-tier governance model: strategic oversight by a trustee-led foundation, and technical co-evolution by a global network of providers. This structure ensures legitimacy, trust, and adaptability, qualities that have attracted both private and public sector interest. Open forums, transparent decision-making, and participatory rule-setting have fostered a sense of belonging and ownership across the community. As a result, VWT is a movement — one that is evolving through continuous dialogue and shared stewardship among ecosystem actors. By early 2025, VWT surpassed 50 member organizations, with hundreds of shipments monitored, ready for an emerging ecosystem of services operating on top of VWTnet. The journey from concept to infrastructure has been propelled by relentless awareness-building, turning VWT from an idea and research project into a reference point for digital trade transformation. The next challenge is to institutionalize these gains, embedding VWT’s principles and protocols into the fabric of trade. This means maintaining open standards, transparent governance, and economic viability, especially for smaller actors. The ambition is to scale trust, sustain value, and drive adoption in a traditionally conservative industry. Wolfgang Lehmacher, who formerly served as a director at the World Economic Forum, holds many roles, including as a CEO emeritus of GeoPost Intercontinental and as an advisory board member of The Logistics and Supply Chain. He can be reached at <a href="mailto:w.lehmacher@gmail.com">w.lehmacher@gmail.com</a>. Mikael Lind is an adjunct professor of maritime informatics at Chalmers and Research Institutes of Sweden (RISE). He is co-editor of the first two books on maritime informatics and is co-editor of the book <a href="http://www.maritime-decarbonization.org/">Maritime Decarbonization</a>. He can be reached at <a href="mailto:Mikael.Lind@ri.se">Mikael.Lind@ri.se</a>. </div>

The early 2020s have reshaped the context for international supply chains. The COVID-19 pandemic, geopolitical tensions, and ongoing adverse events have exposed the sector’s complexities, underscoring the need for greater supply chain resilience. Visibility is a prerequisite for effective supply chain and carbon footprint management. In a world where blocs are driving apart and uncertainty is sky high, incremental improvements and isolated digital tools are no longer sufficient. The industry needs a fundamentally new, collaborative approach to build true resilience. Several high-profile digital supply chain initiatives have failed to deliver a lasting impact. The most prominent example, TradeLens, was discontinued despite strong backing and considerable investment. Its centralized model struggled to achieve broad industry support, ultimately faltering because it could not build the trust required to make such industry-wide solutions economically viable. Other platforms, such as Project44 and FourKites, have made significant strides in transport visibility. Yet, their traction remains limited. A common thread running through shortcomings is a lack of trust, insufficient perceived value, and governance models that do not serve the actors or the sector. Technology can only solve the challenges facing supply chains and logistics when it is underpinned by collaboration and trust. A different way forward The Virtual Watch Tower (VWT) was conceived as a direct response to these challenges. It is not just another platform, but a neutral, industry-driven public good. Designed by and for the supply chain community, VWT’s mission is to create a digital infrastructure that links existing tools and platforms, enabling secure, selective, and trustworthy sharing of primary data to close gaps. What sets VWT apart is its governance and inclusivity. Rather than being controlled by a single actor or a small group, it is stewarded by neutral stakeholders and, in the future, a trustee-led foundation, ensuring neutrality and legitimacy. At VWT, shippers and logistics providers co-create solutions, ensuring that the digital infrastructure addresses real-world needs. At the heart of VWT’s approach is VWTnet, powered by TWIN — the Trade Worldwide Information Network. TWIN is a public-good digital data architecture and federated backbone that enables actors to share primary data on their own terms securely. New data gathering mechanisms will help the VWT members to fill current data gaps. This architecture has already demonstrated its value in the real world. The organic growth of VWT, expanding shipment by shipment and actor by actor, is a testament to the power of network effects when trust and interoperability are embedded in the system’s fabric. The VWT vision is that disruptions can be managed collaboratively. When a disruption occurs, whether it is a port strike or a climate-induced delay, all relevant parties involved in the shipments are informed in real time. Recovery plans can be coordinated rather than improvised, and operational flows can bemanaged with far greater agility. Equally transformative is VWT’s approach to emissions tracking. By leveraging primary operational data, VWT will enable shipment-specific emissions calculations, turning sustainability from a retrospective report into an actionable planning and management tool. Shippers can optimize routes for both speed and carbon impact, and authorities can align incentives with verified, real-time data. Emission performance becomes a differentiator, not a compliance afterthought. VWT’s work on these use cases has begun, and the first minimum viable product is scheduled to be launched in 2026. Building from ground up Perhaps the most significant differentiator of the community-driven VWT is not technical, but institutional. Drawing on lessons from failed efforts, VWT will be built from the ground up with a two-tier governance model: strategic oversight by a trustee-led foundation, and technical co-evolution by a global network of providers. This structure ensures legitimacy, trust, and adaptability, qualities that have attracted both private and public sector interest. Open forums, transparent decision-making, and participatory rule-setting have fostered a sense of belonging and ownership across the community. As a result, VWT is a movement — one that is evolving through continuous dialogue and shared stewardship among ecosystem actors. By early 2025, VWT surpassed 50 member organizations, with hundreds of shipments monitored, ready for an emerging ecosystem of services operating on top of VWTnet. The journey from concept to infrastructure has been propelled by relentless awareness-building, turning VWT from an idea and research project into a reference point for digital trade transformation. The next challenge is to institutionalize these gains, embedding VWT’s principles and protocols into the fabric of trade. This means maintaining open standards, transparent governance, and economic viability, especially for smaller actors. The ambition is to scale trust, sustain value, and drive adoption in a traditionally conservative industry. Wolfgang Lehmacher, who formerly served as a director at the World Economic Forum, holds many roles, including as a CEO emeritus of GeoPost Intercontinental and as an advisory board member of The Logistics and Supply Chain. He can be reached at w.lehmacher@gmail.com . Mikael Lind is an adjunct professor of maritime informatics at Chalmers and Research Institutes of Sweden (RISE). He is co-editor of the first two books on maritime informatics and is co-editor of the book Maritime Decarbonization . He can be reached at Mikael.Lind@ri.se .

Logistics Technology News

Creating a digital platform for all

<div class="phx-topic abstract-wrapper">New research into digital crane systems raises concerns of an information gap at the intersection of technology and operational risk for project cargo shippers.</div>

New research into digital crane systems raises concerns of an information gap at the intersection of technology and operational risk for project cargo shippers.

<div class="phx-topic">During a major power project discharge in northern South America earlier this year, a digitally-controlled vessel crane failed due to a sensor fault. The issue, although small in technical scope, locked the crane’s operations entirely. With no technician available locally and the onboard crew unable to isolate the fault, the vessel sat idle for several days until a specialist arrived. While ground equipment and rigging crews waited, auxiliary engines ran continuously, consuming fuel and generating emissions — all without a single piece of cargo moving. Incidents such as this — while not yet widespread — raise important questions about the project cargo sector’s growing reliance on digital lifting systems, especially as the global fleet shifts toward automation and sensor-driven control systems.  This scenario is part of the research I am conducting as part of a doctoral study at the University of Houston. The study examines how digital crane systems affect operational resilience, what dependencies they create, and whether shippers, forwarders, and engineering, procurement and construction companies (EPCs) have adequate visibility into those risks when selecting a vessel.  <h3>Opportunity meets operational dependency  </h3>While the industry continues to embrace AI, digital workflows and automation in logistics planning and optimization, it is often onboard — at the level of the crane — where these technologies have the most immediate and practical impact. Multipurpose vessels (MPVs) equipped with modern cranes — especially fully electric or highly automated models — introduce new performance advantages but also new dependencies. Systems now rely heavily on embedded sensors, electronic controllers, and diagnostic software. When these systems work, they enable precision lifting and better control. But when they fail, even a minor component issue can result in a full operational standstill if appropriate support is not available. This challenge is especially relevant for MPVs that have recently undergone crane retrofits. In these cases, advanced equipment may be paired with crews trained in crane operation but having limited hands-on experience with digital diagnostics or system-level troubleshooting — particularly when the technology is new to the fleet or differs significantly from prior configurations. Carrier vetting tools such as RightShip are widely used to assess safety, flag status and emissions history. Yet most charterers still lack structured visibility into the type, age and support model of onboard cranes, which are critical to the execution of any heavy-lift project.  Many vessel operators maintain service agreements with crane manufacturers such as Liebherr, MacGregor or NMF. However, the nature of these agreements — whether they include 24/7 response, local technician access or remote diagnostics — is rarely visible to the chartering party. As a result, it is difficult for project cargo stakeholders to assess how a vessel will respond in the event of a system fault during port operations. This represents an information gap at the intersection of technology and operational risk — particularly for shippers working under tight schedules or emissions compliance requirements. <h3>Downtime, delay and emissions impact </h3>Prolonged crane downtime can have wide-ranging effects, including financial due to extended laytime, self-propelled modular transporter standby, loss of berth for the ship, pilotage costs, and potential liquidated damages. Schedule-related effects are possible, including disruption to tightly sequenced infrastructure or power installation windows. And there are environmental impacts through continued fuel use during idle periods, often counted toward “Scope 3” emissions. My research does not argue against digitalization — on the contrary, it acknowledges the efficiency and safety gains that automated systems bring. Rather, it seeks to explore whether gaps in support infrastructure and crew readiness are creating new vulnerabilities that shippers and forwarders are not currently equipped to evaluate. The research framework builds on the Unified Theory of Acceptance and Use of Technology (UTAUT), adapting it for maritime operations. A pilot survey conducted among vessel operators and project logistics managers suggests the following: <ul><li>Shippers rarely receive details on the specific type or age of crane systems at the time of the fixture. </li><li>Crew diagnostic capability varies widely depending on vessel and crane configuration. </li><li>Service agreements with original equipment manufacturers are common, but charterers often lack insight into their scope or responsiveness. </li></ul>These data points help explore how perceived performance, crew effort expectancy and facilitating conditions affect confidence in using digitalized vessels for heavy-lift operations. The study also examines whether digital dependency contributes to environmental, social and governance (ESG) exposure via avoidable fuel use during unplanned idle periods. New dimensions of the surveys for this research, developed based on operational feedback, include distinguishing between electric, electro-hydraulic and traditional crane systems; assessing crew familiarity with crane diagnostic tools and reset protocols; and capturing whether retrofitted vessels present unique support challenges. Digitalization in maritime crane systems is a long-term trend that promises continued efficiency and safety. But with that evolution comes increased dependency on systems that require specialized support. For project cargo stakeholders, the ability to assess not just lifting capacity but also system resilience and support infrastructure will become critical to ensuring safe, timely and sustainable operations. Marco Poisler, also a DBA candidate at the University of Houston Bauer College of Business, can be reached at <a href="mailto:corporate@utcoverseas.com">corporate@utcoverseas.com</a>. </div>

During a major power project discharge in northern South America earlier this year, a digitally-controlled vessel crane failed due to a sensor fault. The issue, although small in technical scope, locked the crane’s operations entirely. With no technician available locally and the onboard crew unable to isolate the fault, the vessel sat idle for several days until a specialist arrived. While ground equipment and rigging crews waited, auxiliary engines ran continuously, consuming fuel and generating emissions — all without a single piece of cargo moving. Incidents such as this — while not yet widespread — raise important questions about the project cargo sector’s growing reliance on digital lifting systems, especially as the global fleet shifts toward automation and sensor-driven control systems.  This scenario is part of the research I am conducting as part of a doctoral study at the University of Houston. The study examines how digital crane systems affect operational resilience, what dependencies they create, and whether shippers, forwarders, and engineering, procurement and construction companies (EPCs) have adequate visibility into those risks when selecting a vessel.  Opportunity meets operational dependency  While the industry continues to embrace AI, digital workflows and automation in logistics planning and optimization, it is often onboard — at the level of the crane — where these technologies have the most immediate and practical impact. Multipurpose vessels (MPVs) equipped with modern cranes — especially fully electric or highly automated models — introduce new performance advantages but also new dependencies. Systems now rely heavily on embedded sensors, electronic controllers, and diagnostic software. When these systems work, they enable precision lifting and better control. But when they fail, even a minor component issue can result in a full operational standstill if appropriate support is not available. This challenge is especially relevant for MPVs that have recently undergone crane retrofits. In these cases, advanced equipment may be paired with crews trained in crane operation but having limited hands-on experience with digital diagnostics or system-level troubleshooting — particularly when the technology is new to the fleet or differs significantly from prior configurations. Carrier vetting tools such as RightShip are widely used to assess safety, flag status and emissions history. Yet most charterers still lack structured visibility into the type, age and support model of onboard cranes, which are critical to the execution of any heavy-lift project.  Many vessel operators maintain service agreements with crane manufacturers such as Liebherr, MacGregor or NMF. However, the nature of these agreements — whether they include 24/7 response, local technician access or remote diagnostics — is rarely visible to the chartering party. As a result, it is difficult for project cargo stakeholders to assess how a vessel will respond in the event of a system fault during port operations. This represents an information gap at the intersection of technology and operational risk — particularly for shippers working under tight schedules or emissions compliance requirements. Downtime, delay and emissions impact Prolonged crane downtime can have wide-ranging effects, including financial due to extended laytime, self-propelled modular transporter standby, loss of berth for the ship, pilotage costs, and potential liquidated damages. Schedule-related effects are possible, including disruption to tightly sequenced infrastructure or power installation windows. And there are environmental impacts through continued fuel use during idle periods, often counted toward “Scope 3” emissions. My research does not argue against digitalization — on the contrary, it acknowledges the efficiency and safety gains that automated systems bring. Rather, it seeks to explore whether gaps in support infrastructure and crew readiness are creating new vulnerabilities that shippers and forwarders are not currently equipped to evaluate. The research framework builds on the Unified Theory of Acceptance and Use of Technology (UTAUT), adapting it for maritime operations. A pilot survey conducted among vessel operators and project logistics managers suggests the following: Shippers rarely receive details on the specific type or age of crane systems at the time of the fixture. Crew diagnostic capability varies widely depending on vessel and crane configuration. Service agreements with original equipment manufacturers are common, but charterers often lack insight into their scope or responsiveness. These data points help explore how perceived performance, crew effort expectancy and facilitating conditions affect confidence in using digitalized vessels for heavy-lift operations. The study also examines whether digital dependency contributes to environmental, social and governance (ESG) exposure via avoidable fuel use during unplanned idle periods. New dimensions of the surveys for this research, developed based on operational feedback, include distinguishing between electric, electro-hydraulic and traditional crane systems; assessing crew familiarity with crane diagnostic tools and reset protocols; and capturing whether retrofitted vessels present unique support challenges. Digitalization in maritime crane systems is a long-term trend that promises continued efficiency and safety. But with that evolution comes increased dependency on systems that require specialized support. For project cargo stakeholders, the ability to assess not just lifting capacity but also system resilience and support infrastructure will become critical to ensuring safe, timely and sustainable operations. Marco Poisler, also a DBA candidate at the University of Houston Bauer College of Business, can be reached at corporate@utcoverseas.com .

Breakbulk News

Port infrastructure

Project cargo

Crane digital dependency creates risk gap for project cargo handling

Notes: Average rail performance represents years 2017 to 2019 and 2023.

Average rail performance

Average rail performance: {valueY.formatNumber('#.##')}

Pandemic-era congestion (2020-2022)

Pandemic congestion: {valueY.formatNumber('#.##')}

Current Year

Current year: {valueY.formatNumber('#.##')}

Intermodal train cars holding refers to how many trains with containers or trailers are stopped outside of a designated terminal or crew change point due to a disruption to normal operations. The total in the chart is the rolling four-week average total of the US-based Class I railroads: BNSF Railway, CSX Transportation, Norfolk Southern and Union Pacific Railroad. Average rail performance is defined as the weekly performance prior to and after the pandemic-related freight surge. Pandemic-era congestion is the worst result for each week from 2020 through 2022. [STB](https://www.stb.gov/reports-data/rail-service-data/)

US intermodal trains held (STB)

US intermodal train holdings Gateway

<div class="phx-topic abstract-wrapper">Easing freight rates and demand suggest a “wait-and-see” approach by US importers as the July 9 end of the temporary reprieve on so-called “reciprocal” tariffs nears.</div>

Easing freight rates and demand suggest a “wait-and-see” approach by US importers as the July 9 end of the temporary reprieve on so-called “reciprocal” tariffs nears.

<div class="phx-topic">Ocean carriers are keeping trans-Atlantic capacity at high levels ahead of next week’s expiration of President Donald Trump’s 90-day pause on so-called “reciprocal” tariffs. Easing freight rates and demand, meanwhile, suggest a “wait-and-see” approach by US importers. The pause ends on July 9 as trade negotiations continue between the US and the European Union. Market expectations are for the 10% across-the-board tariffs on all US trading partners to be applied to the EU and be accompanied by some level of tariffs on automobiles, steel and aluminum. Trump has also suggested he could extend the pause on reciprocal tariffs while talks continue. With no certainty over the outcome of the trade talks, carriers are keeping capacity available to handle any increase in shipments once there is greater clarity around tariff levels. Data from ocean visibility provider eeSea shows that carriers will deploy 344,811 TEUs of capacity in July on the westbound trans-Atlantic, the highest in the past 12 months, then easing slightly to 327,226 TEUs in August. Just 24,840 TEUs will be blanked in July, while no blank sailings have yet been announced for August. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="739d3923-220d-4e28-bddd-a3113b21dddf"></dynamic-object></div>Meanwhile, Peter Sand, chief analyst at rate benchmarking platform Xeneta, said the decline in short-term rates slowed in May and June after they fell 21.6% in the first quarter. The North Europe-North America rate is now down 37% compared with the beginning of the year, at $1,206 per FEU, according to Xeneta. “It comes on the back of falling demand in January to April, down from last year by 0.5%, with deployed capacity on this trade growing from 75,000 TEUs per week in mid-February to 89,000 TEUs per week now,” Sand told the Journal of Commerce. “Looking into the early days of July, we anticipate a slide in rates to the extent of $40 to $50 per FEU,” he added. “At the same time, carriers have announced that capacity could increase to as much as 95,000 to 97,000 TEUs/week in July and August.” The spot market assessed by Platts, a sister company of the Journal of Commerce within S&amp;P Global, show that rates from North Europe to the East Coast of North America have remained at $1,700 per FEU since May 16. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="588a0a38-fc1c-473a-a9b5-5d71ec3b54dc"></dynamic-object></div>Casper Ellerbaek, global head of ocean freight at DHL Global Forwarding, said “some degree” of frontloading could be seen on westbound trans-Atlantic routes in some sectors, but noted that with the uncertainty surrounding the trade lane, it was hardly conclusive. “This does not warrant drawing any conclusions or making assessments about the general development of demand,” Ellerbaek told the Journal of Commerce. Imports from North Europe to the US came in at 196,580 TEUs in May, down from the peak so far this year of 212,730 TEUs in March, according to PIERS, also part of S&amp;P Global. US imports from the Mediterranean hit a 2025 high in April of 170,360 TEUs, but PIERS data for May shows a 19% drop in volume to 137,710 TEUs. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Ocean carriers are keeping trans-Atlantic capacity at high levels ahead of next week’s expiration of President Donald Trump’s 90-day pause on so-called “reciprocal” tariffs. Easing freight rates and demand, meanwhile, suggest a “wait-and-see” approach by US importers. The pause ends on July 9 as trade negotiations continue between the US and the European Union. Market expectations are for the 10% across-the-board tariffs on all US trading partners to be applied to the EU and be accompanied by some level of tariffs on automobiles, steel and aluminum. Trump has also suggested he could extend the pause on reciprocal tariffs while talks continue. With no certainty over the outcome of the trade talks, carriers are keeping capacity available to handle any increase in shipments once there is greater clarity around tariff levels. Data from ocean visibility provider eeSea shows that carriers will deploy 344,811 TEUs of capacity in July on the westbound trans-Atlantic, the highest in the past 12 months, then easing slightly to 327,226 TEUs in August. Just 24,840 TEUs will be blanked in July, while no blank sailings have yet been announced for August. Meanwhile, Peter Sand, chief analyst at rate benchmarking platform Xeneta, said the decline in short-term rates slowed in May and June after they fell 21.6% in the first quarter. The North Europe-North America rate is now down 37% compared with the beginning of the year, at $1,206 per FEU, according to Xeneta. “It comes on the back of falling demand in January to April, down from last year by 0.5%, with deployed capacity on this trade growing from 75,000 TEUs per week in mid-February to 89,000 TEUs per week now,” Sand told the Journal of Commerce. “Looking into the early days of July, we anticipate a slide in rates to the extent of $40 to $50 per FEU,” he added. “At the same time, carriers have announced that capacity could increase to as much as 95,000 to 97,000 TEUs/week in July and August.” The spot market assessed by Platts, a sister company of the Journal of Commerce within S&P Global, show that rates from North Europe to the East Coast of North America have remained at $1,700 per FEU since May 16. Casper Ellerbaek, global head of ocean freight at DHL Global Forwarding, said “some degree” of frontloading could be seen on westbound trans-Atlantic routes in some sectors, but noted that with the uncertainty surrounding the trade lane, it was hardly conclusive. “This does not warrant drawing any conclusions or making assessments about the general development of demand,” Ellerbaek told the Journal of Commerce. Imports from North Europe to the US came in at 196,580 TEUs in May, down from the peak so far this year of 212,730 TEUs in March, according to PIERS, also part of S&P Global. US imports from the Mediterranean hit a 2025 high in April of 170,360 TEUs, but PIERS data for May shows a 19% drop in volume to 137,710 TEUs. Contact Greg Knowler at greg.knowler@spglobal.com .

Trans-Atlantic

Trans-Atlantic ocean trade readies for end to 90-day pause on US tariffs

<div class="phx-topic abstract-wrapper">The procedural reauthorization bill would provide funding for the agency for the next three fiscal years and add more outside expertise on ports and ocean carriers.</div>

The procedural reauthorization bill would provide funding for the agency for the next three fiscal years and add more outside expertise on ports and ocean carriers.

<div class="phx-topic">A bill reauthorizing the US Federal Maritime Commission (FMC) for another three years has been introduced in the House of Representatives, with the proposed legislation also adding more outside expertise to the agency for help on ocean carriers and ports and allowing for a complaint process covering freight indices. Representatives John Garamendi (D-Calif.), along with Dusty Johnson (R-SD), Mike Ezell (R-Miss.) and Salud Carbajal (D-Calif.), introduced the bill last week to reauthorize the FMC through 2029, Garamendi’s office said in a statement Monday. The bill, which includes funding for the agency, aims to build on Garamendi and Johnson’s work on the Ocean Shipping Reform Act of 2022 (OSRA-22), the statement said. “Ocean shipping is a critical aspect of America’s national, food and economic security,” Johnson said in the statement. That’s why our Federal Maritime Commission must be equipped with the proper tools to keep the industry operating above bar.” The reauthorization bill, which is a standard procedure for many federal agencies, outlines funding for the FMC through the next three fiscal years. The FMC’s budget will increase from $49.2 million in 2026 to $57 million in 2029, representing an average 5% annual increase over that time. Along with the funding, the bill includes <a href="https://www.joc.com/article/us-house-bills-keep-shipping-reform-effort-alive-even-after-freight-rate-plunge-5241752">tweaks to OSRA-22 that Garamendi and Johnson had been pushing for</a>. The reauthorization bill proposes the creation of a 13-member national port advisory committee. The committee would be comprised of five members from marine terminal operators, five from port authorities and three members of the longshore workforce. It also includes a new ocean carrier advisory committee with six members from ocean carriers and three from ocean forwarders or non-vessel-operating common carriers (NVOs). The bill also includes new regulations for freight index providers such as the Shanghai Shipping Exchange. OSRA-22 required that within three years of its passage, shipping exchanges be registered with the FMC and that their underlying rules and regulations for any service contracts using their indices be published. The new bill would also allow the FMC to investigate any complaints about “alleged incidents of market manipulation or other anticompetitive practices” by shipping exchanges. The legislation also extends the deadline for shipping exchanges to register with the FMC until two years after the reauthorization’s passage. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

A bill reauthorizing the US Federal Maritime Commission (FMC) for another three years has been introduced in the House of Representatives, with the proposed legislation also adding more outside expertise to the agency for help on ocean carriers and ports and allowing for a complaint process covering freight indices. Representatives John Garamendi (D-Calif.), along with Dusty Johnson (R-SD), Mike Ezell (R-Miss.) and Salud Carbajal (D-Calif.), introduced the bill last week to reauthorize the FMC through 2029, Garamendi’s office said in a statement Monday. The bill, which includes funding for the agency, aims to build on Garamendi and Johnson’s work on the Ocean Shipping Reform Act of 2022 (OSRA-22), the statement said. “Ocean shipping is a critical aspect of America’s national, food and economic security,” Johnson said in the statement. That’s why our Federal Maritime Commission must be equipped with the proper tools to keep the industry operating above bar.” The reauthorization bill, which is a standard procedure for many federal agencies, outlines funding for the FMC through the next three fiscal years. The FMC’s budget will increase from $49.2 million in 2026 to $57 million in 2029, representing an average 5% annual increase over that time. Along with the funding, the bill includes tweaks to OSRA-22 that Garamendi and Johnson had been pushing for . The reauthorization bill proposes the creation of a 13-member national port advisory committee. The committee would be comprised of five members from marine terminal operators, five from port authorities and three members of the longshore workforce. It also includes a new ocean carrier advisory committee with six members from ocean carriers and three from ocean forwarders or non-vessel-operating common carriers (NVOs). The bill also includes new regulations for freight index providers such as the Shanghai Shipping Exchange. OSRA-22 required that within three years of its passage, shipping exchanges be registered with the FMC and that their underlying rules and regulations for any service contracts using their indices be published. The new bill would also allow the FMC to investigate any complaints about “alleged incidents of market manipulation or other anticompetitive practices” by shipping exchanges. The legislation also extends the deadline for shipping exchanges to register with the FMC until two years after the reauthorization’s passage. Contact Michael Angell at michael.angell@spglobal.com .

Transport, Trade and Regulation News

Congress seeks reauthorization of FMC through 2029

<div class="phx-topic abstract-wrapper">The groups want the US customs agency to rule that tariffs should be assessed according to a good’s origin port, not a secondary port through which it might have been transshipped. </div>

The groups want the US customs agency to rule that tariffs should be assessed according to a good’s origin port, not a secondary port through which it might have been transshipped.

<div class="phx-topic">A wide-ranging coalition of shipper and logistics service provider groups is urging US Customs and Border Protection (CBP) and the Department of Homeland Security (DHS) to clarify whether goods transshipped before the Trump administration imposed tariffs on most nations on April 5 will be subject to those additional costs. At issue is whether goods that departed from their origin ports prior to the April 5 deadline, but were then transshipped at another port en route to their US destination ports, are subject to the tariffs, issued under the president’s authority through the International Emergency Economic Powers Act (IEEPA). In a letter dated June 27, 94 shipper, customs broker and forwarder organizations, including the National Retail Federation, Retail Industry Leaders Association, National Industrial Transportation League and National Customs Brokers and Forwarders Association of America, said communication between CBP and the trade community has offered “differing and sometimes contradictory responses.” The groups assert that previous CBP rulings dictate that relay legs or diversions of cargo shouldn’t impact the duty levels of goods, citing, in particular, the “sale for exportation standard” that underpins transactions between buyers and sellers of goods. “Numerous CBP rulings clarify that CBP relies on documentary evidence, such as invoices, purchase orders and/or bills of lading, when confirming that the ultimate destination for goods always was the United States and there was never a contingency of diversion,” the letter said. “The sale for exportation standard is consistent with and supports the finding that relay vessels originating in the initial country of export should meet the in-transit exception and eligibility should be based on the initial country of loading and export.” The transshipment issue has been a thorn in the side of importers trying to navigate the IEEPA tariffs, as CBP’s original guidance on April 4 wasn’t clear, according to a range of trade compliance experts. Subsequent guidance issued by CBP on May 15, which included a set of frequently asked questions, <a href="https://www.joc.com/article/scheduling-linked-to-10-tariffs-causing-confusion-angst-for-us-importers-6009281">included details on how transshipment would impact tariff exemptions</a>. <h3>Seeking better communication </h3>Import groups argue that transshipment is often out of the hands of the cargo owners responsible for paying tariffs. In the letter, the groups asked for guidance around the IEEPA tariffs to be conveyed via a consistent channel to avoid confusion among the trade community. “With the proliferation of communication channels, it is vital for the trade community to have one consistent and reliable repository of information regarding updates and changes to trade practices, policies and procedures,” the letter said. The groups also asked CBP and DHS to avoid cutting agency resources to execute and enforce changing tariffs. The IEEPA tariffs are currently caught up in a legal dispute, with the US Court of International Trade (CIT) <a href="https://www.joc.com/article/federal-court-ruling-blocking-tariffs-resets-shipping-outlook-6013402">ruling in late May</a> that President Donald Trump had overstepped his authority in using the act to justify his tariffs. But a US Court of Appeals for the Federal Circuit temporarily stayed the CIT’s order, preserving the tariffs until a hearing on the case is held. The US Supreme Court on June 20 declined to fast track a case brought by two toy importers challenging the tariffs. Trade attorneys speaking at the American Association of Exporters and Importers in Washington, DC, on Friday said they expect the dual challenges to IEEPA tariffs — the CIT challenge and the toy importers’ case — to take a minimum of six months to be resolved, and likely longer. The Trump administration, meanwhile, said last week it will likely extend the reprieve on the reciprocal tariffs that are due to expire July 9 on all countries except China, Mexico and Canada. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

A wide-ranging coalition of shipper and logistics service provider groups is urging US Customs and Border Protection (CBP) and the Department of Homeland Security (DHS) to clarify whether goods transshipped before the Trump administration imposed tariffs on most nations on April 5 will be subject to those additional costs. At issue is whether goods that departed from their origin ports prior to the April 5 deadline, but were then transshipped at another port en route to their US destination ports, are subject to the tariffs, issued under the president’s authority through the International Emergency Economic Powers Act (IEEPA). In a letter dated June 27, 94 shipper, customs broker and forwarder organizations, including the National Retail Federation, Retail Industry Leaders Association, National Industrial Transportation League and National Customs Brokers and Forwarders Association of America, said communication between CBP and the trade community has offered “differing and sometimes contradictory responses.” The groups assert that previous CBP rulings dictate that relay legs or diversions of cargo shouldn’t impact the duty levels of goods, citing, in particular, the “sale for exportation standard” that underpins transactions between buyers and sellers of goods. “Numerous CBP rulings clarify that CBP relies on documentary evidence, such as invoices, purchase orders and/or bills of lading, when confirming that the ultimate destination for goods always was the United States and there was never a contingency of diversion,” the letter said. “The sale for exportation standard is consistent with and supports the finding that relay vessels originating in the initial country of export should meet the in-transit exception and eligibility should be based on the initial country of loading and export.” The transshipment issue has been a thorn in the side of importers trying to navigate the IEEPA tariffs, as CBP’s original guidance on April 4 wasn’t clear, according to a range of trade compliance experts. Subsequent guidance issued by CBP on May 15, which included a set of frequently asked questions, included details on how transshipment would impact tariff exemptions . Seeking better communication Import groups argue that transshipment is often out of the hands of the cargo owners responsible for paying tariffs. In the letter, the groups asked for guidance around the IEEPA tariffs to be conveyed via a consistent channel to avoid confusion among the trade community. “With the proliferation of communication channels, it is vital for the trade community to have one consistent and reliable repository of information regarding updates and changes to trade practices, policies and procedures,” the letter said. The groups also asked CBP and DHS to avoid cutting agency resources to execute and enforce changing tariffs. The IEEPA tariffs are currently caught up in a legal dispute, with the US Court of International Trade (CIT) ruling in late May that President Donald Trump had overstepped his authority in using the act to justify his tariffs. But a US Court of Appeals for the Federal Circuit temporarily stayed the CIT’s order, preserving the tariffs until a hearing on the case is held. The US Supreme Court on June 20 declined to fast track a case brought by two toy importers challenging the tariffs. Trade attorneys speaking at the American Association of Exporters and Importers in Washington, DC, on Friday said they expect the dual challenges to IEEPA tariffs — the CIT challenge and the toy importers’ case — to take a minimum of six months to be resolved, and likely longer. The Trump administration, meanwhile, said last week it will likely extend the reprieve on the reciprocal tariffs that are due to expire July 9 on all countries except China, Mexico and Canada. Contact Eric Johnson at eric.johnson@spglobal.com .

Shipper groups urge CBP to clarify tariff transshipment confusion

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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

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<div class="phx-topic abstract-wrapper">Loup Logistics provides direct access to nearly 80,000 rail-owned containers across North America, significantly expanding UP’s transloading options.</div>

Loup Logistics provides direct access to nearly 80,000 rail-owned containers across North America, significantly expanding UP’s transloading options.

<div class="phx-topic">A subsidiary of Union Pacific Railroad has launched a new transloading service that will transfer imports into rail-owned 53-foot containers for inland hauls, presenting new competition to rival BNSF Railway. Loup Logistics said Tuesday the “port-to-door” service will be available at any US port. Union Pacific currently relies on partners such as Hub Group, Schneider National and STG Logistics, among others, for transloaded freight. But Loup provides direct access to nearly 80,000 rail-owned containers across North America, significantly expanding UP’s transloading options. Formed in 2017, Loup works with non-asset intermodal marketing companies (IMCs) to provide a door-to-door domestic intermodal product. Loup’s service removes the burden of securing drayage and chassis, making it an appealing option for IMCs seeking turnkey solutions for their shippers. Loup will partner with the non-asset IMCs to offer the port-to-door product to its existing domestic shippers. Logistics powerhouse J.B. Hunt Transport Services, a partner of BNSF, has aggressively expanded its <a href="https://www.joc.com/article/tpm23-intermodal-providers-banking-on-transloading-surge-5217461">transloading operations</a> in Los Angeles and the Seattle-Tacoma area in recent years. J.B. Hunt will also be a key partner in transloading through <a href="https://www.joc.com/article/tpm25-bnsf-believes-barstow-hub-can-improve-service-to-smaller-markets-5955620">BNSF’s Barstow International Gateway</a>, which is due to open in 2027. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

A subsidiary of Union Pacific Railroad has launched a new transloading service that will transfer imports into rail-owned 53-foot containers for inland hauls, presenting new competition to rival BNSF Railway. Loup Logistics said Tuesday the “port-to-door” service will be available at any US port. Union Pacific currently relies on partners such as Hub Group, Schneider National and STG Logistics, among others, for transloaded freight. But Loup provides direct access to nearly 80,000 rail-owned containers across North America, significantly expanding UP’s transloading options. Formed in 2017, Loup works with non-asset intermodal marketing companies (IMCs) to provide a door-to-door domestic intermodal product. Loup’s service removes the burden of securing drayage and chassis, making it an appealing option for IMCs seeking turnkey solutions for their shippers. Loup will partner with the non-asset IMCs to offer the port-to-door product to its existing domestic shippers. Logistics powerhouse J.B. Hunt Transport Services, a partner of BNSF, has aggressively expanded its transloading operations in Los Angeles and the Seattle-Tacoma area in recent years. J.B. Hunt will also be a key partner in transloading through BNSF’s Barstow International Gateway , which is due to open in 2027. Contact Ari Ashe at ari.ashe@spglobal.com .

Union Pacific subsidiary jumps into transloading with ‘port-to-door' service

<div class="phx-topic abstract-wrapper">The fresh capacity carriers rushed into the US’ busiest trade lane in April and May is no longer needed, sending rates on a downward spiral and forcing carriers to shelve proposed price hikes.</div>

The fresh capacity carriers rushed into the US’ busiest trade lane in April and May is no longer needed, sending rates on a downward spiral and forcing carriers to shelve proposed price hikes.

<div class="phx-topic">Ocean carriers have failed to implement a planned general rate increase (GRI) in the eastbound trans-Pacific this week, with vessel capacity on the route exceeding forward demand that has been in steady decline for weeks. And in yet another sign that the peak shipping season will be muted, carriers have also dropped plans to impose a peak season surcharge (PSS) on fixed-rate contracts to the US West Coast. That comes as spot rates paid by importers and freight-all-kinds (FAK) rates charged to forwarders continue to sink. “They went up quickly. It looks like they’re going down just as quickly,” Kurt McElroy, executive vice president at the forwarder Kerry Apex, said. “There’s not enough demand.” Carriers have announced PSSs of $1,000 per FEU to the US East Coast from July 1–14, according to carrier rate announcements shared with the Journal of Commerce, who spoke to eight forwarders and two carriers for this story. At least one container line is rolling PSSs into quarterly rates, but at approximately half the amount, two shippers said on the condition of anonymity. Rate activity in the largest US trade lane <a href="https://www.joc.com/article/importers-try-to-push-cargo-to-contract-rates-as-trans-pac-spot-market-surges-5244311">contrasts sharply with last year</a>, when spot rates surged as high as $10,000 per FEU to the East Coast and $8,000 to the West Coast in early July, while carriers were also able to impose a series of PSSs throughout the summer and fall. This year, uncertainty about the Trump administration’s trade policy resulted in massive frontloading of fall and holiday merchandise as US retailers rushed to bring in goods during a 90-day reprieve from so-called reciprocal tariffs. The pause on tariffs from most countries expires July 9, while a similar reprieve on China-sourced goods ends Aug. 14. That frontloading likely means weaker imports during the traditional August through October peak shipping season, said Christian Sur, executive vice president for ocean freight contract logistics at the forwarder Unique Logistics International. Last year, July to October volume was strong, but with all of the frontloading, especially from China, no one expects the volume to be as strong this year,” Sur said. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e8c13a3e-9f5a-412f-8741-adbf5e1a7779"></dynamic-object></div>As a result, spot rates have been sinking rapidly over the past month. Platts, a sister company of the Journal of Commerce within S&amp;P Global, pegged spot rates from North Asia to the West Coast at $2,200 per FEU as of July 1, down 15% on the week. Rates to the East Coast were $4,300 per FEU, 12% lower. Rate benchmarking platform Xeneta had the West Coast spot rate at $2,800 per FEU as of June 26, with the East Coast at $5,473 per FEU. Spot rates listed on some rate indexes can lag the rates importers and forwarders are actually paying by a week or longer. This week, most imports from Asia are moving at $4,400 to $4,500 per FEU to the East Coast and $2,400 to $2,500 per FEU to the West Coast, McElroy said. Retailers and forwarders who shop around can secure even lower prices from some carriers, said Jon Monroe, who serves as an adviser to forwarders. Some carriers are quoting sub-$4,000-per-FEU spot/FAK rates to the East Coast and sub-$2,000 per FEU to the West Coast, Monroe said. <h3>Tariffs a fading concern? </h3>Carriers ending PSSs on fixed-rate accounts for both importers and forwarders to the West Coast and limiting their PSSs to the East Coast to two weeks from July 1–14 indicate that going forward, no one is making bookings based on tariff deadlines, Sur said. “Tariffs are quickly becoming a non-issue,” he said. Ample vessel capacity for the coming months has also made shipper concerns about securing space this summer less of an issue than it was in past years. Data from maritime visibility provider eeSea shows that the recent addition of vessel capacity by trans-Pacific carriers has brought total capacity to 1.57 million TEUs in July, the highest for any month since 2021. Some 8.6% of that capacity is poised to be blanked. In August, the total capacity is scheduled to slip to 1.48 million TEUs, with 7.7% of the capacity scheduled to be blanked. Even with the blank sailings, the total capacity offered in the eastbound trans-Pacific will be almost 20% higher in July than July 2024 and 10.6% higher in August year over year, according to eeSea. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="c3135e8b-9bef-4f08-a278-5c853b855a74"></dynamic-object></div>Carriers rushed fresh capacity into the eastbound trans-Pacific in April and May when the Trump administration announced the pauses on higher tariffs. But once that surge in bookings was over, overcapacity took hold, sending rates on a downward spiral. A carrier source said the eastbound trans-Pac may witness additional blank sailings in the coming months. “Volumes are starting to go down and rates are falling because a lot of capacity was brought on,” the source said. “If management starts seeing the rates decline very quickly, they might remove the capacity.” <h3>August–October volumes difficult to forecast </h3>Projecting import volumes for the traditional August through October peak shipping season remains a hazy task, forwarders and carriers say. “This is a time when it is hard to predict where we are headed,” said Robert Khachatryan, CEO of the forwarder Freight Right Global Logistics. Still, Khachatryan said he does not detect huge demand building among importers. “The market is still soft and is likely to remain so at least through July,” a second carrier executive said. “But we can’t say beyond that. We’re in a wait-and-see mode.” A logistics manager for a large retailer told the Journal of Commerce she is still waiting on the company’s second-half forecast, but July and August look softer than last year. The source said July will be the retailer’s peak season. The retailer is still paying a $500 PSS into the West Coast, but that is down from $2,000 per FEU originally. Despite the frontloading by most retailers, there is still fall and holiday merchandise scheduled to be shipped. While import volumes will be down from last fall’s double-digit year-over-year increases, they won’t fall off the cliff. Ben Coleman, president of the forwarder Teampower Logistics, said there are clients with seasonal merchandise still scheduled to ship and others who will seek to rebuild their inventories. Another forwarder said the several months of frontloading did not rob the eastbound trans-Pacific of all its cargo this fall. “There are still retail goods that have to be moved,” the source said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.Contact Laura Robb at <a href="mailto:laura.robb@spglobal.com">laura.robb@spglobal.com</a>.</div>

Ocean carriers have failed to implement a planned general rate increase (GRI) in the eastbound trans-Pacific this week, with vessel capacity on the route exceeding forward demand that has been in steady decline for weeks. And in yet another sign that the peak shipping season will be muted, carriers have also dropped plans to impose a peak season surcharge (PSS) on fixed-rate contracts to the US West Coast. That comes as spot rates paid by importers and freight-all-kinds (FAK) rates charged to forwarders continue to sink. “They went up quickly. It looks like they’re going down just as quickly,” Kurt McElroy, executive vice president at the forwarder Kerry Apex, said. “There’s not enough demand.” Carriers have announced PSSs of $1,000 per FEU to the US East Coast from July 1–14, according to carrier rate announcements shared with the Journal of Commerce, who spoke to eight forwarders and two carriers for this story. At least one container line is rolling PSSs into quarterly rates, but at approximately half the amount, two shippers said on the condition of anonymity. Rate activity in the largest US trade lane contrasts sharply with last year , when spot rates surged as high as $10,000 per FEU to the East Coast and $8,000 to the West Coast in early July, while carriers were also able to impose a series of PSSs throughout the summer and fall. This year, uncertainty about the Trump administration’s trade policy resulted in massive frontloading of fall and holiday merchandise as US retailers rushed to bring in goods during a 90-day reprieve from so-called reciprocal tariffs. The pause on tariffs from most countries expires July 9, while a similar reprieve on China-sourced goods ends Aug. 14. That frontloading likely means weaker imports during the traditional August through October peak shipping season, said Christian Sur, executive vice president for ocean freight contract logistics at the forwarder Unique Logistics International. Last year, July to October volume was strong, but with all of the frontloading, especially from China, no one expects the volume to be as strong this year,” Sur said. As a result, spot rates have been sinking rapidly over the past month. Platts, a sister company of the Journal of Commerce within S&P Global, pegged spot rates from North Asia to the West Coast at $2,200 per FEU as of July 1, down 15% on the week. Rates to the East Coast were $4,300 per FEU, 12% lower. Rate benchmarking platform Xeneta had the West Coast spot rate at $2,800 per FEU as of June 26, with the East Coast at $5,473 per FEU. Spot rates listed on some rate indexes can lag the rates importers and forwarders are actually paying by a week or longer. This week, most imports from Asia are moving at $4,400 to $4,500 per FEU to the East Coast and $2,400 to $2,500 per FEU to the West Coast, McElroy said. Retailers and forwarders who shop around can secure even lower prices from some carriers, said Jon Monroe, who serves as an adviser to forwarders. Some carriers are quoting sub-$4,000-per-FEU spot/FAK rates to the East Coast and sub-$2,000 per FEU to the West Coast, Monroe said. Tariffs a fading concern? Carriers ending PSSs on fixed-rate accounts for both importers and forwarders to the West Coast and limiting their PSSs to the East Coast to two weeks from July 1–14 indicate that going forward, no one is making bookings based on tariff deadlines, Sur said. “Tariffs are quickly becoming a non-issue,” he said. Ample vessel capacity for the coming months has also made shipper concerns about securing space this summer less of an issue than it was in past years. Data from maritime visibility provider eeSea shows that the recent addition of vessel capacity by trans-Pacific carriers has brought total capacity to 1.57 million TEUs in July, the highest for any month since 2021. Some 8.6% of that capacity is poised to be blanked. In August, the total capacity is scheduled to slip to 1.48 million TEUs, with 7.7% of the capacity scheduled to be blanked. Even with the blank sailings, the total capacity offered in the eastbound trans-Pacific will be almost 20% higher in July than July 2024 and 10.6% higher in August year over year, according to eeSea. Carriers rushed fresh capacity into the eastbound trans-Pacific in April and May when the Trump administration announced the pauses on higher tariffs. But once that surge in bookings was over, overcapacity took hold, sending rates on a downward spiral. A carrier source said the eastbound trans-Pac may witness additional blank sailings in the coming months. “Volumes are starting to go down and rates are falling because a lot of capacity was brought on,” the source said. “If management starts seeing the rates decline very quickly, they might remove the capacity.” August–October volumes difficult to forecast Projecting import volumes for the traditional August through October peak shipping season remains a hazy task, forwarders and carriers say. “This is a time when it is hard to predict where we are headed,” said Robert Khachatryan, CEO of the forwarder Freight Right Global Logistics. Still, Khachatryan said he does not detect huge demand building among importers. “The market is still soft and is likely to remain so at least through July,” a second carrier executive said. “But we can’t say beyond that. We’re in a wait-and-see mode.” A logistics manager for a large retailer told the Journal of Commerce she is still waiting on the company’s second-half forecast, but July and August look softer than last year. The source said July will be the retailer’s peak season. The retailer is still paying a $500 PSS into the West Coast, but that is down from $2,000 per FEU originally. Despite the frontloading by most retailers, there is still fall and holiday merchandise scheduled to be shipped. While import volumes will be down from last fall’s double-digit year-over-year increases, they won’t fall off the cliff. Ben Coleman, president of the forwarder Teampower Logistics, said there are clients with seasonal merchandise still scheduled to ship and others who will seek to rebuild their inventories. Another forwarder said the several months of frontloading did not rob the eastbound trans-Pacific of all its cargo this fall. “There are still retail goods that have to be moved,” the source said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .Contact Laura Robb at laura.robb@spglobal.com .

Forwarding

Excess capacity sinks planned July 1 rate increase in eastbound trans-Pacific

<div class="phx-topic abstract-wrapper">The deployment of 24,000-TEU ships on its Africa Express service allows the carrier to better leverage billions of dollars invested in West Africa in recent years, reducing exposure to congested North European ports. </div>

The deployment of 24,000-TEU ships on its Africa Express service allows the carrier to better leverage billions of dollars invested in West Africa in recent years, reducing exposure to congested North European ports.

<div class="phx-topic">Mediterranean Shipping Co.’s recent deployment of the largest vessels in its fleet to West African ports shows how the container line is capitalizing on the regional market and reducing its reliance on European hubs for transshipping. The deployment in April of 24,000-TEU ships on its Africa Express service allows MSC to better leverage billions of dollars invested in West Africa in recent years, reducing exposure to congested North European ports and tapping growing regional demand. West Africa’s GDP is forecast to expand 4.3% in 2025–26, according to the African Development Bank. The service connecting West Africa with north and southeast Asia calls Tema, Ghana and its longstanding hub in Lomé, Togo. Container volumes at Lomé last year rose 5% year over year to 2 million TEUs, according to an <a href="https://www.togofirst.com/en/logistics/2404-16204-lome-port-records-modest-growth-in-2024-fueled-by-strong-transshipment?utm_source=chatgpt.com">Invest in Togo</a> report. MSC’s European hub-and-spoke network relies on Antwerp, Gioia Tauro, Rotterdam and Valencia, yet its $6.1 billion acquisition of Bolloré Africa Logistics (renamed Africa Global Logistics [AGL]) in 2022 opened new possibilities for the carrier. At MSC’s emerging hub in Abidjan, Côte d’Ivoire, where a second terminal operated by AGL opened in 2022, volumes rocketed 29% last year to 1.6 million TEUs, the <a href="https://www.ecofinagency.com/finance/2702-46447-port-of-abidjan-handles-1-6-million-teus-in-2024-almost-double-2022?utm_source=chatgpt.com">Ecofin Agency</a> said. The new facility expanded Abidjan’s container capacity to 2.5 million TEUs. MSC was not available for comment. <h3>Creating new hubs ‘makes sense’ </h3>The growth in West Africa’s transshipment volumes is more than just a result of major carriers routing ships around the Cape of Good Hope to avoid Houthi rebel attacks in the Red Sea, analysts tell the Journal of Commerce. Transshipping through Lomé and Abidjan allows MSC to reduce exposure when port congestion hits Antwerp and Rotterdam, as has been the case since the start of 2025. Setting up hubs closer to Europe — but not in Europe — could allow carriers to reduce payments under the EU Emissions Trading Scheme, which launched in 2024, said Jan Hoffmann, the World Bank’s global lead for maritime transport and ports. “The region used to be connected to the rest of the world via transshipment services in Antwerp or Rotterdam [but] now counts on numerous direct connections, with the largest vessels,” said Hoffmann. “Deploying ultra large container ships [ULCSs] on that route and establishing hubs in [the West Africa] region makes sense for a number of reasons.” In addition to reducing payments under the EU Emissions Trading Scheme, those reasons include improvements to roads connecting West African ports. As the largest operator of container ship tonnage and free of a shipping alliance partner, MSC is well positioned to make bolder moves within its network, said Jeremy Masters, managing director of Shipping Masters and a Journal of Commerce contributor. Other container lines serve West Africa but have yet to significantly drive transshipment volumes, Masters said. For example, CMA CGM deploys 16,000-TEU ships on its West Africa loop connecting Pointe-Noire in the Republic of Congo to Qingdao, China. Ocean Network Express’ services to the region are more focused on loops serving West Africa than feeding a node connecting deep-sea services to short-sea services. West Africa ports are growing and modernizing. DP World is spending $1.2 billion to construct a greenfield facility at Ndayane in Senegal. When phase one is completed in 2027, <a href="https://www.dpworld.com/news/releases/dp-world-kicks-off-maritime-construction-at-new-12-billion-port-in-senegal/">the port’s 1.2 million TEU container capacity</a> will reduce pressure on the country’s other major port, Dakar. The ULCSs will likely be repatriated to the Suez Canal routing when maritime safety is restored to the Red Sea, Masters said. “But if Lomé has by that time proven [itself] through its local and regional feed of volume, and then if MSC looks at other deep-sea routes that connect through, then I think [the port] would have established itself in its own right,” he said. Still, such is the combined impact of the size of the global container ship order book and the amount of vessels likely to be freed up by the would-be shorter Suez routings that it can be argued that West Africa’s increasing attractiveness could be just the way to put all the extra tonnage to good use. Contact Peter Shaw-Smith at <a href="mailto:petershawsmith@gmail.com">petershawsmith@gmail.com</a>. </div>

Mediterranean Shipping Co.’s recent deployment of the largest vessels in its fleet to West African ports shows how the container line is capitalizing on the regional market and reducing its reliance on European hubs for transshipping. The deployment in April of 24,000-TEU ships on its Africa Express service allows MSC to better leverage billions of dollars invested in West Africa in recent years, reducing exposure to congested North European ports and tapping growing regional demand. West Africa’s GDP is forecast to expand 4.3% in 2025–26, according to the African Development Bank. The service connecting West Africa with north and southeast Asia calls Tema, Ghana and its longstanding hub in Lomé, Togo. Container volumes at Lomé last year rose 5% year over year to 2 million TEUs, according to an Invest in Togo report. MSC’s European hub-and-spoke network relies on Antwerp, Gioia Tauro, Rotterdam and Valencia, yet its $6.1 billion acquisition of Bolloré Africa Logistics (renamed Africa Global Logistics [AGL]) in 2022 opened new possibilities for the carrier. At MSC’s emerging hub in Abidjan, Côte d’Ivoire, where a second terminal operated by AGL opened in 2022, volumes rocketed 29% last year to 1.6 million TEUs, the Ecofin Agency said. The new facility expanded Abidjan’s container capacity to 2.5 million TEUs. MSC was not available for comment. Creating new hubs ‘makes sense’ The growth in West Africa’s transshipment volumes is more than just a result of major carriers routing ships around the Cape of Good Hope to avoid Houthi rebel attacks in the Red Sea, analysts tell the Journal of Commerce. Transshipping through Lomé and Abidjan allows MSC to reduce exposure when port congestion hits Antwerp and Rotterdam, as has been the case since the start of 2025. Setting up hubs closer to Europe — but not in Europe — could allow carriers to reduce payments under the EU Emissions Trading Scheme, which launched in 2024, said Jan Hoffmann, the World Bank’s global lead for maritime transport and ports. “The region used to be connected to the rest of the world via transshipment services in Antwerp or Rotterdam [but] now counts on numerous direct connections, with the largest vessels,” said Hoffmann. “Deploying ultra large container ships [ULCSs] on that route and establishing hubs in [the West Africa] region makes sense for a number of reasons.” In addition to reducing payments under the EU Emissions Trading Scheme, those reasons include improvements to roads connecting West African ports. As the largest operator of container ship tonnage and free of a shipping alliance partner, MSC is well positioned to make bolder moves within its network, said Jeremy Masters, managing director of Shipping Masters and a Journal of Commerce contributor. Other container lines serve West Africa but have yet to significantly drive transshipment volumes, Masters said. For example, CMA CGM deploys 16,000-TEU ships on its West Africa loop connecting Pointe-Noire in the Republic of Congo to Qingdao, China. Ocean Network Express’ services to the region are more focused on loops serving West Africa than feeding a node connecting deep-sea services to short-sea services. West Africa ports are growing and modernizing. DP World is spending $1.2 billion to construct a greenfield facility at Ndayane in Senegal. When phase one is completed in 2027, the port’s 1.2 million TEU container capacity will reduce pressure on the country’s other major port, Dakar. The ULCSs will likely be repatriated to the Suez Canal routing when maritime safety is restored to the Red Sea, Masters said. “But if Lomé has by that time proven [itself] through its local and regional feed of volume, and then if MSC looks at other deep-sea routes that connect through, then I think [the port] would have established itself in its own right,” he said. Still, such is the combined impact of the size of the global container ship order book and the amount of vessels likely to be freed up by the would-be shorter Suez routings that it can be argued that West Africa’s increasing attractiveness could be just the way to put all the extra tonnage to good use. Contact Peter Shaw-Smith at petershawsmith@gmail.com .

Growth in West African ports opens new transshipment options for MSC

<div class="phx-topic abstract-wrapper">Longer transits around southern Africa, restructured alliance networks and bottlenecks in Asia continue to cause ships to arrive outside their scheduled European arrival windows.</div>

Longer transits around southern Africa, restructured alliance networks and bottlenecks in Asia continue to cause ships to arrive outside their scheduled European arrival windows.

<div class="phx-topic">Container lines are making another round of changes to services to mitigate persistent congestion at European ports, avoiding maxed out terminals and overwhelmed inland rail and waterway networks. Longer transits around southern Africa, restructured alliance networks and bottlenecks in Asia are causing ships to arrive outside their scheduled European arrival windows. Strong peak season demand is piling on the pressure with the wave of incoming volume adding to congestion and forcing carriers to divert some services away from the congested import gateways. Mediterranean Shipping Co. has adjusted its Asia-Europe services to mitigate the delays, omitting some ports and adding others, while congestion at London Gateway is seeing CMA CGM’s Safran service from Europe to the East Coast of South America calling at Southampton instead. Maersk was scheduled to return its north-south NeoSamba service to London Gateway after moving it to Southampton in early June because of congestion but has decided to maintain the Southampton call. “The current diversion from London Gateway to Southampton will be extended by an additional four weeks, to maintain high service reliability during peak demand periods and to avoid port congestion,” Maersk told customers in its July market update this week. HMM is reporting yard density of 80% and above at several terminals in Rotterdam, Hamburg and Antwerp with full berths and vessels arriving late. Data this week from port visibility provider Portcast shows 11 vessels waiting to berth at Antwerp-Bruges, nine at Hamburg and seven at Rotterdam. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="5eb289f4-4310-4545-b840-86a556bf3fac"></dynamic-object></div>Kuehne + Nagel’s visibility tool SeaExplorer noted that port congestion in North European ports of Antwerp, Hamburg and Bremerhaven was extending transit times, with delays in berthing, operational disruptions and high yard utilization over 92% identified as key factors. Disruption is also extending into inland transport networks. Ocean Network Express is warning of long wait times for trucks and barges in North European hubs, with some terminals suspending the redelivery of empties, while Maersk warned customers of rail disruption in Hamburg from July 2 until July 9. “During this period, no rail transport to or from the Port of Hamburg will be operationally feasible, and customers are kindly asked to change their ocean bookings from Hamburg to Bremerhaven where possible,” the carrier noted. <h3>Low water limits barge loading </h3>Intermodal transport operator Contargo said average waiting times for the handling of its barges this week were 78 hours in Antwerp and 64 hours in Rotterdam. Contargo also warned that low water levels on the Rhine were limiting barge loading and generating low water surcharges. In the north of Italy, major infrastructure works are scheduled on the national railway line serving ports of Genoa, La Spezia and Vado Ligure. At the Port of Genoa, no rail services will be available between Aug. 2 and 31, with Maersk not accepting rail cargo from July 21. In the first four months of 2025, total Asia-Europe volume was up 9% year over year at 6.13 million TEUs, with the Asia-North Europe segment rising 6.6% to 3.72 million TEUs and Asia-Mediterranean surging 12.14% to 2.4 million TEUs, according to the latest volume data from Container Trades Statistics. While Asia-Europe volume data for June is not yet available, carriers and forwarders are reporting robust cargo bookings through the summer months. At the same time, carriers have deployed a record amount of capacity on the North Europe corridor in July while also increasing blank sailings on the trade lane. Freight-all-kinds (FAK) rate increases for Asia-North Europe were imposed from July 1 by MSC ($4,300 per FEU) and CMA CGM ($4,100/FEU), pushing rates on the trade lane up almost $500 to $3,350/FEU, according to rate benchmarking platform Xeneta. Data from visibility provider eeSea shows carriers on Asia-North Europe will deploy a record 1.15 million TEUs in capacity in July and blank 85,727 TEUs. In August, the deployed capacity will drop to just over 1 million TEUs while 104,790 TEUs will be cut from the trade. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="6a5146cf-79d1-41fa-85fb-c1916fc625ac"></dynamic-object></div>Carriers are taking the opposite approach on Asia-Mediterranean, where a record 882,845 TEUs of capacity will be deployed in August, up 50,000 TEUs compared with July, eeSea data shows. Blank sailings will decline from almost 80,000 TEUs in July to 20,000 TEUs in August. “Strong demand from Asia to North Europe and the Mediterranean is forecast for the rest of July in line with seasonality ... we encourage customers to book as early as possible in order to secure space,” advised Maersk in its July update. Forwarders are giving their customers the same advice. “To avoid delays caused by congestion, blank sailings, and container shortages, it is recommended to book space at least one to two weeks in advance for Asia and EU ports,” Taiwan-based forwarder Dimerco Express Group noted in a July market report. Dimerco said some China origins were beginning to apply overweight surcharges to Asia-Europe containers as carriers prioritized light cargo and high-cube containers to improve ship utilization. “Early booking is strongly recommended for heavy cargo in small containers,” the forwarder warned. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Container lines are making another round of changes to services to mitigate persistent congestion at European ports, avoiding maxed out terminals and overwhelmed inland rail and waterway networks. Longer transits around southern Africa, restructured alliance networks and bottlenecks in Asia are causing ships to arrive outside their scheduled European arrival windows. Strong peak season demand is piling on the pressure with the wave of incoming volume adding to congestion and forcing carriers to divert some services away from the congested import gateways. Mediterranean Shipping Co. has adjusted its Asia-Europe services to mitigate the delays, omitting some ports and adding others, while congestion at London Gateway is seeing CMA CGM’s Safran service from Europe to the East Coast of South America calling at Southampton instead. Maersk was scheduled to return its north-south NeoSamba service to London Gateway after moving it to Southampton in early June because of congestion but has decided to maintain the Southampton call. “The current diversion from London Gateway to Southampton will be extended by an additional four weeks, to maintain high service reliability during peak demand periods and to avoid port congestion,” Maersk told customers in its July market update this week. HMM is reporting yard density of 80% and above at several terminals in Rotterdam, Hamburg and Antwerp with full berths and vessels arriving late. Data this week from port visibility provider Portcast shows 11 vessels waiting to berth at Antwerp-Bruges, nine at Hamburg and seven at Rotterdam. Kuehne + Nagel’s visibility tool SeaExplorer noted that port congestion in North European ports of Antwerp, Hamburg and Bremerhaven was extending transit times, with delays in berthing, operational disruptions and high yard utilization over 92% identified as key factors. Disruption is also extending into inland transport networks. Ocean Network Express is warning of long wait times for trucks and barges in North European hubs, with some terminals suspending the redelivery of empties, while Maersk warned customers of rail disruption in Hamburg from July 2 until July 9. “During this period, no rail transport to or from the Port of Hamburg will be operationally feasible, and customers are kindly asked to change their ocean bookings from Hamburg to Bremerhaven where possible,” the carrier noted. Low water limits barge loading Intermodal transport operator Contargo said average waiting times for the handling of its barges this week were 78 hours in Antwerp and 64 hours in Rotterdam. Contargo also warned that low water levels on the Rhine were limiting barge loading and generating low water surcharges. In the north of Italy, major infrastructure works are scheduled on the national railway line serving ports of Genoa, La Spezia and Vado Ligure. At the Port of Genoa, no rail services will be available between Aug. 2 and 31, with Maersk not accepting rail cargo from July 21. In the first four months of 2025, total Asia-Europe volume was up 9% year over year at 6.13 million TEUs, with the Asia-North Europe segment rising 6.6% to 3.72 million TEUs and Asia-Mediterranean surging 12.14% to 2.4 million TEUs, according to the latest volume data from Container Trades Statistics. While Asia-Europe volume data for June is not yet available, carriers and forwarders are reporting robust cargo bookings through the summer months. At the same time, carriers have deployed a record amount of capacity on the North Europe corridor in July while also increasing blank sailings on the trade lane. Freight-all-kinds (FAK) rate increases for Asia-North Europe were imposed from July 1 by MSC ($4,300 per FEU) and CMA CGM ($4,100/FEU), pushing rates on the trade lane up almost $500 to $3,350/FEU, according to rate benchmarking platform Xeneta. Data from visibility provider eeSea shows carriers on Asia-North Europe will deploy a record 1.15 million TEUs in capacity in July and blank 85,727 TEUs. In August, the deployed capacity will drop to just over 1 million TEUs while 104,790 TEUs will be cut from the trade. Carriers are taking the opposite approach on Asia-Mediterranean, where a record 882,845 TEUs of capacity will be deployed in August, up 50,000 TEUs compared with July, eeSea data shows. Blank sailings will decline from almost 80,000 TEUs in July to 20,000 TEUs in August. “Strong demand from Asia to North Europe and the Mediterranean is forecast for the rest of July in line with seasonality ... we encourage customers to book as early as possible in order to secure space,” advised Maersk in its July update. Forwarders are giving their customers the same advice. “To avoid delays caused by congestion, blank sailings, and container shortages, it is recommended to book space at least one to two weeks in advance for Asia and EU ports,” Taiwan-based forwarder Dimerco Express Group noted in a July market report. Dimerco said some China origins were beginning to apply overweight surcharges to Asia-Europe containers as carriers prioritized light cargo and high-cube containers to improve ship utilization. “Early booking is strongly recommended for heavy cargo in small containers,” the forwarder warned. Contact Greg Knowler at greg.knowler@spglobal.com .

Ocean carriers adjust calls as congestion chokes European hubs

<div class="phx-topic abstract-wrapper">The long-term effects of US tariffs and the removal of the de minimis exemption have disrupted established air cargo flows and is clouding the industry outlook for the year.</div>

The long-term effects of US tariffs and the removal of the de minimis exemption have disrupted established air cargo flows and is clouding the industry outlook for the year.

<div class="phx-topic">The air cargo industry is flying into a bumpy second half, with persistent uncertainty over US tariff levels and the bleeding of freight due to new US “de minimis” curbs on low-value Chinese goods. It is impacting every aspect of the industry, from disrupting cargo flows to capacity deployment to demand, and clouding the outlook for the year. “We just simply cannot predict how that is going to play out,” Brie Carere, FedEx’s chief customer officer, told investors on the company’s fourth-quarter earnings call on June 24. After volumes from the US to China “deteriorated sharply,” in May, FedEx said it couldn’t provide a full-year forecast due to the “uncertain global demand,” environment. Global air cargo spot rates declined for a second consecutive month in June, down 4% year over year as the supply of capacity overtook demand for the first time in 19 months, according to rate benchmarking platform Xeneta. “We are starting to see the longer-term effects of all this uncertainty because a lot of damage has been done,” Niall van de Wouw, chief air freight officer at Xeneta, said in a market update Friday. “This might be the new reality for the foreseeable future as the industry is facing a much more challenging second half of the year. The air cargo market is losing altitude amid so much uncertainty,” he added. After eliminating the duty-free exemption for low-value shipments from China valued at under $800 on May 2, the US on May 14 reduced the de minimis tariff on the low-value imports from 120% to 54%. Items sent via post from China to the US will be charged a flat fee of $100, regardless of value. In 2024, e-commerce shipments accounted for about 50% of China-to-US air freight volume, filling dozens of freighters every day. Data from air cargo analyst Rotate showed that in the days following May 2, 40 freighters per day were pulled out of the trans-Pacific. The International Air Transport Association (IATA) noted in an industry outlook this week that tariffs and the removal of the de minimis exemption have disrupted established air cargo flows, forcing carriers to adjust or redeploy capacity on certain routes. “Uncertainty remains high, which impedes planning and optimization along the supply chain, and further loss of momentum in the coming months cannot be ruled out,” IATA warned. <h3>Refocusing e-commerce efforts </h3>Tim van Leeuwen, head of consulting at Rotate, said China-US air cargo demand in May fell 28% year over year, driven by declines in both general air cargo and e-commerce, with early June figures showing the trend has continued. “Direct China-US freighter capacity in June was down 11% compared to March, wiping out capacity growth we have seen over the past year and returning to similar capacity as June 2024,” he told the Journal of Commerce. “The e-commerce platforms seem to be refocusing their efforts, with significant growth of exports to the European Union and Asia-Pacific replacing lost demand to the US,” he noted. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="0bd62abc-58b3-4d7e-bfd7-9616da3c9b9c"></dynamic-object></div>Faced with such an uncertain and volatile trade lane, Van de Wouw said forwarders were taking a cautious approach to the market. “Around 46% of their procured volumes remain in the spot market, reflecting a belief that rates may yet fall further,” he said. “Their wait-and-see approach favours flexibility over long-term commitments — for now.” China-North America spot rates of $4.86/kg last week fell below $5/kg for the first time in almost two months, dropping 5% compared with the previous week, according to the Baltic Air Index (BAI). Spot rates from China to North Europe were at $4.23 per kilogram in the last week of June, down slightly compared with the previous week but remaining above the $4 mark since March. Dimerco Express Group put the total China-US cargo volumes decline at 60% in May and June, with e-commerce bookings down about 50%. The Taiwan-based forwarder noted in a July market outlook that there was no sign of recovery in e-commerce volume and scheduled freighter flights continue to be cancelled. <h3>Positive growth areas </h3>However, there are bright spots in the gloomy outlook. Demand out of Southeast Asia — particularly from Thailand and Vietnam — is rising ahead of the upcoming tariff deadline next week. President Donald Trump’s 90-day pause on so-called “reciprocal” tariffs ends at midnight on July 8. “Intra-Asia traffic is holding strong, especially on routes linking China with Taiwan, Vietnam, Thailand, Malaysia and Singapore,” said Kathy Liu, vice president of global sales and marketing at Dimerco Express Group. “Capacity on these lanes is tight, and we’re seeing higher rates compared to the same period last year,” she added. The summer season will also bring increased demand for perishable exports on the trans-Pacific, both out of Asia and on the backhaul routes, good news for airlines facing such dramatic cuts in e-commerce volume. “Air imports from Asia are expected to rebound and grow during the summer months, driven by the early peak shipping season. Shippers are ramping up volumes, particularly toward Asia, with a growing shift from ocean to air,” the forwarder said. Air freight space on the westbound routes will likely remain tight, with possible booking delays or rollovers, and Dimerco advised pre-booking at least five to seven days in advance for high-volume or time-sensitive cargo. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

The air cargo industry is flying into a bumpy second half, with persistent uncertainty over US tariff levels and the bleeding of freight due to new US “de minimis” curbs on low-value Chinese goods. It is impacting every aspect of the industry, from disrupting cargo flows to capacity deployment to demand, and clouding the outlook for the year. “We just simply cannot predict how that is going to play out,” Brie Carere, FedEx’s chief customer officer, told investors on the company’s fourth-quarter earnings call on June 24. After volumes from the US to China “deteriorated sharply,” in May, FedEx said it couldn’t provide a full-year forecast due to the “uncertain global demand,” environment. Global air cargo spot rates declined for a second consecutive month in June, down 4% year over year as the supply of capacity overtook demand for the first time in 19 months, according to rate benchmarking platform Xeneta. “We are starting to see the longer-term effects of all this uncertainty because a lot of damage has been done,” Niall van de Wouw, chief air freight officer at Xeneta, said in a market update Friday. “This might be the new reality for the foreseeable future as the industry is facing a much more challenging second half of the year. The air cargo market is losing altitude amid so much uncertainty,” he added. After eliminating the duty-free exemption for low-value shipments from China valued at under $800 on May 2, the US on May 14 reduced the de minimis tariff on the low-value imports from 120% to 54%. Items sent via post from China to the US will be charged a flat fee of $100, regardless of value. In 2024, e-commerce shipments accounted for about 50% of China-to-US air freight volume, filling dozens of freighters every day. Data from air cargo analyst Rotate showed that in the days following May 2, 40 freighters per day were pulled out of the trans-Pacific. The International Air Transport Association (IATA) noted in an industry outlook this week that tariffs and the removal of the de minimis exemption have disrupted established air cargo flows, forcing carriers to adjust or redeploy capacity on certain routes. “Uncertainty remains high, which impedes planning and optimization along the supply chain, and further loss of momentum in the coming months cannot be ruled out,” IATA warned. Refocusing e-commerce efforts Tim van Leeuwen, head of consulting at Rotate, said China-US air cargo demand in May fell 28% year over year, driven by declines in both general air cargo and e-commerce, with early June figures showing the trend has continued. “Direct China-US freighter capacity in June was down 11% compared to March, wiping out capacity growth we have seen over the past year and returning to similar capacity as June 2024,” he told the Journal of Commerce. “The e-commerce platforms seem to be refocusing their efforts, with significant growth of exports to the European Union and Asia-Pacific replacing lost demand to the US,” he noted. Faced with such an uncertain and volatile trade lane, Van de Wouw said forwarders were taking a cautious approach to the market. “Around 46% of their procured volumes remain in the spot market, reflecting a belief that rates may yet fall further,” he said. “Their wait-and-see approach favours flexibility over long-term commitments — for now.” China-North America spot rates of $4.86/kg last week fell below $5/kg for the first time in almost two months, dropping 5% compared with the previous week, according to the Baltic Air Index (BAI). Spot rates from China to North Europe were at $4.23 per kilogram in the last week of June, down slightly compared with the previous week but remaining above the $4 mark since March. Dimerco Express Group put the total China-US cargo volumes decline at 60% in May and June, with e-commerce bookings down about 50%. The Taiwan-based forwarder noted in a July market outlook that there was no sign of recovery in e-commerce volume and scheduled freighter flights continue to be cancelled. Positive growth areas However, there are bright spots in the gloomy outlook. Demand out of Southeast Asia — particularly from Thailand and Vietnam — is rising ahead of the upcoming tariff deadline next week. President Donald Trump’s 90-day pause on so-called “reciprocal” tariffs ends at midnight on July 8. “Intra-Asia traffic is holding strong, especially on routes linking China with Taiwan, Vietnam, Thailand, Malaysia and Singapore,” said Kathy Liu, vice president of global sales and marketing at Dimerco Express Group. “Capacity on these lanes is tight, and we’re seeing higher rates compared to the same period last year,” she added. The summer season will also bring increased demand for perishable exports on the trans-Pacific, both out of Asia and on the backhaul routes, good news for airlines facing such dramatic cuts in e-commerce volume. “Air imports from Asia are expected to rebound and grow during the summer months, driven by the early peak shipping season. Shippers are ramping up volumes, particularly toward Asia, with a growing shift from ocean to air,” the forwarder said. Air freight space on the westbound routes will likely remain tight, with possible booking delays or rollovers, and Dimerco advised pre-booking at least five to seven days in advance for high-volume or time-sensitive cargo. Contact Greg Knowler at greg.knowler@spglobal.com .

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