<div class="phx-topic abstract-wrapper">OTR Capital argues DAT, the largest load board for truckload freight in North America, violated a non-compete clause when it acquired factoring company Outgo in May. </div>

OTR Capital argues DAT, the largest load board for truckload freight in North America, violated a non-compete clause when it acquired factoring company Outgo in May.

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<div class="phx-topic">A court in Georgia has ordered DAT Freight &amp; Solutions to stop providing factoring service until a hearing can be held on whether DAT is violating a non-compete agreement with OTR Capital. DAT, the largest load board for truckload freight in North America, stressed that the June 10 order from the Superior Court of Cobb County is temporary. DAT is being sued by OTR. “We believe the suit is without merit and will defend ourselves vigorously,” DAT said in a statement Friday. “We are concerned that OTR’s actions directly impact the cash flow of our carrier customers,” it added. “Cash flow is the lifeblood of these small businesses, and any disruption to it can severely impede their operations.” Freight factoring is a financial service in which carriers sell their unpaid invoices to a third party that advances them the cash they are owed, generally in exchange for a single-digit percentage of the invoice amount. DAT has offered factoring services to its carrier customers since 2007 via external partnerships, most recently with OTR Solutions. DAT’s <a href="https://www.joc.com/article/dat-acquires-trucker-tools-in-move-to-reduce-load-board-driver-churn-5907848">acquisition of Outgo</a> last month led to the complaint from OTR. OTR Capital, a part of OTR Solutions, claimed the Outgo deal violated a non-compete clause in its agreement with DAT. In the June 10 ruling, Senior Judge Adele Grubbs ordered DAT not to compete with OTR through Outgo or any other factoring service. Grubbs also ordered DAT to cease providing any factoring services through Outgo. The order, issued in response to a request for emergency relief from OTR, lasts until a full hearing is held on the case. OTR, in a June 12 filing, claimed DAT has violated that order. “DAT has refused to expressly confirm that it has stopped providing all factoring services to its existing clients,” OTR said in the filing. The acquisition of Outgo is part of DAT’s efforts to expand its platform, grounded in truckload spot market load-matching. The acquisition was DAT’s second in six months, after it <a href="https://www.joc.com/article/dat-acquires-trucker-tools-in-move-to-reduce-load-board-driver-churn-5907848">acquired Trucker Tools</a>, a load visibility tool for brokers, in December. “As this is pending litigation, we have no further comment on the case itself at this time,” DAT said in its statement. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

A court in Georgia has ordered DAT Freight & Solutions to stop providing factoring service until a hearing can be held on whether DAT is violating a non-compete agreement with OTR Capital. DAT, the largest load board for truckload freight in North America, stressed that the June 10 order from the Superior Court of Cobb County is temporary. DAT is being sued by OTR. “We believe the suit is without merit and will defend ourselves vigorously,” DAT said in a statement Friday. “We are concerned that OTR’s actions directly impact the cash flow of our carrier customers,” it added. “Cash flow is the lifeblood of these small businesses, and any disruption to it can severely impede their operations.” Freight factoring is a financial service in which carriers sell their unpaid invoices to a third party that advances them the cash they are owed, generally in exchange for a single-digit percentage of the invoice amount. DAT has offered factoring services to its carrier customers since 2007 via external partnerships, most recently with OTR Solutions. DAT’s acquisition of Outgo last month led to the complaint from OTR. OTR Capital, a part of OTR Solutions, claimed the Outgo deal violated a non-compete clause in its agreement with DAT. In the June 10 ruling, Senior Judge Adele Grubbs ordered DAT not to compete with OTR through Outgo or any other factoring service. Grubbs also ordered DAT to cease providing any factoring services through Outgo. The order, issued in response to a request for emergency relief from OTR, lasts until a full hearing is held on the case. OTR, in a June 12 filing, claimed DAT has violated that order. “DAT has refused to expressly confirm that it has stopped providing all factoring services to its existing clients,” OTR said in the filing. The acquisition of Outgo is part of DAT’s efforts to expand its platform, grounded in truckload spot market load-matching. The acquisition was DAT’s second in six months, after it acquired Trucker Tools , a load visibility tool for brokers, in December. “As this is pending litigation, we have no further comment on the case itself at this time,” DAT said in its statement. Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Logistics Technology News

Truckload

Surface

Court orders DAT to temporarily halt trucking factoring service

<div class="phx-topic abstract-wrapper">UP’s new protection program for high-value freight comes amid heightened concerns over cargo theft in the US and will cost users $100 per container.</div>

UP’s new protection program for high-value freight comes amid heightened concerns over cargo theft in the US and will cost users $100 per container.

<div class="phx-topic">Union Pacific Railroad (UP) will launch a new insurance program on July 1 offering shippers up to $250,000 in liability coverage against cargo theft, more than double the company’s existing protection. That additional protection, however, comes with tighter security requirements, more logistical planning, and added costs. UP’s so-called “High-Value Product” program comes amid heightened concerns over cargo theft in the US, a growing problem in the rail industry. Criminal networks have become <a href="https://www.joc.com/article/tpm25-bnsf-ceo-says-fighting-cargo-theft-requires-collective-effort-5956508">increasingly sophisticated</a>, sabotaging trains and signal systems, deploying counter-surveillance teams to detect law enforcement and drones, and obtaining insider details about the contents of individual containers, according to the Los Angeles Times. UP’s standard liability coverage is $100,000 per container. The new tier of coverage would bring the railroad in line with its chief rival, BNSF Railway, which already provides up to $250,000 in coverage for high-value goods. The enhanced coverage with UP will come at a cost — a surcharge of $100 per container. UP announced the new insurance program via a policy change posted on <a href="https://www.up.com/customers/announcements/premium/policyandprograms/PR2025-41.html">its website</a>; the railroad did not respond to a request for comment about the program from the Journal of Commerce. High-value cargo carried by railroads is often loaded in the bottom well of a double-stack train, where the container doors are positioned flush against the steel frame of the railcar and topped with another container. It is unclear, however, whether all of UP’s “High-Value Product” freight will be placed in the bottom well. <h3>Extra work for shippers </h3>To qualify for the $250,000 in coverage, shippers must use a special commodity code for high-value cargo that charges a higher per-container fee. They are also expressly prohibited from using plastic seals on their freight, and instead must use specialized high-security locks and theft-deterrent barrier seals that go around the container door. Customers must also include the pin number for the seal in the paperwork filed with UP and take digital, date-stamped photographs showing the container number, seal application and lock with its unique identification number visible. BNSF Railway does not require specialized locks and theft-deterrent seals as part of its $250,000 liability program. It charges $80 per container for the higher-cost policy. In general, while shippers and intermodal marketing companies support enhanced efforts to combat cargo theft, some have raised concerns about the logistics of reusing high-security locks and barrier seals. For instance, if a shipper sends a container from Los Angeles to Chicago using a specialized locking device, it is unclear how that hardware would be returned to Southern California for reuse, or who would bear the costs involved. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Union Pacific Railroad (UP) will launch a new insurance program on July 1 offering shippers up to $250,000 in liability coverage against cargo theft, more than double the company’s existing protection. That additional protection, however, comes with tighter security requirements, more logistical planning, and added costs. UP’s so-called “High-Value Product” program comes amid heightened concerns over cargo theft in the US, a growing problem in the rail industry. Criminal networks have become increasingly sophisticated , sabotaging trains and signal systems, deploying counter-surveillance teams to detect law enforcement and drones, and obtaining insider details about the contents of individual containers, according to the Los Angeles Times. UP’s standard liability coverage is $100,000 per container. The new tier of coverage would bring the railroad in line with its chief rival, BNSF Railway, which already provides up to $250,000 in coverage for high-value goods. The enhanced coverage with UP will come at a cost — a surcharge of $100 per container. UP announced the new insurance program via a policy change posted on its website ; the railroad did not respond to a request for comment about the program from the Journal of Commerce. High-value cargo carried by railroads is often loaded in the bottom well of a double-stack train, where the container doors are positioned flush against the steel frame of the railcar and topped with another container. It is unclear, however, whether all of UP’s “High-Value Product” freight will be placed in the bottom well. Extra work for shippers To qualify for the $250,000 in coverage, shippers must use a special commodity code for high-value cargo that charges a higher per-container fee. They are also expressly prohibited from using plastic seals on their freight, and instead must use specialized high-security locks and theft-deterrent barrier seals that go around the container door. Customers must also include the pin number for the seal in the paperwork filed with UP and take digital, date-stamped photographs showing the container number, seal application and lock with its unique identification number visible. BNSF Railway does not require specialized locks and theft-deterrent seals as part of its $250,000 liability program. It charges $80 per container for the higher-cost policy. In general, while shippers and intermodal marketing companies support enhanced efforts to combat cargo theft, some have raised concerns about the logistics of reusing high-security locks and barrier seals. For instance, if a shipper sends a container from Los Angeles to Chicago using a specialized locking device, it is unclear how that hardware would be returned to Southern California for reuse, or who would bear the costs involved. Contact Ari Ashe at ari.ashe@spglobal.com .

North-American rail

Union Pacific will offer shippers enhanced liability coverage for cargo theft

<div class="phx-topic abstract-wrapper">Economies of scale are prompting shippers to superscale project cargoes, putting pressure on carriers and forwarders. </div>

Economies of scale are prompting shippers to superscale project cargoes, putting pressure on carriers and forwarders.

<div class="phx-topic">The supersizing of conventional power cargoes is increasing project complexity and pushing the limits of available transportation, market experts say. Conventional power project cargo is changing, with both weight and size increasing, Satish Singh, CEO of Mumbai-based freight forwarder Total Movements, told the Journal of Commerce. The trend is being driven by an industry push for cost competitiveness, leading to larger power plants and “a lot of heavy, heavy stuff — heavy turbines, heavy generators, heavy boilers,” Singh said. Project cargo shippers are opting for larger packages to streamline on-site assembly, aiming to “move in 30 days compared to six months,” he added. While conventional power projects are expanding in scale, the green mandate in Europe is now a significant factor influencing demand within the continent. “Within Europe, the focus is more on renewable energy,” Tristan Boorsma of Netherlands-based project cargo forwarder NMT Projects said. “Slowly, we see that at least in Europe, the demand for conventional power cargoes is reducing.” However, Boorsma said there would be a continued need for conventional power generation in regions “where the infrastructure is not really there for renewables.” The European energy transition also requires significant upgrades to existing infrastructure, a further boon for project cargo demand. To meet this there are more transformers being moved, which are also getting heavier, Boorsma said. That surge in demand for transformers has been so profound that Iris Mullejans, managing director of Germany-based project forwarder Riedl, said transformer manufacturers cannot keep up with demand. “They are full for transformer orders through to 2030,” she told the Journal of Commerce. <h3>Road limitations restrict mode options </h3>The movement of these increasingly large project cargo components presents transportation challenges, especially in Europe. “There, we are quite limited in terms of road transportation, so we have to look at alternatives,” Boorsma said. “We have to do a lot by inland barging.” Permitting is another pain point. “The permit application within Europe is very difficult with long lead times,” he said. “Every country has different rules and regulations.” Mullejans added that European infrastructure is generally “really run down,” although she acknowledged investments in Germany and the presence of heavy lift corridors in Finland, Sweden and Iceland that “really help.” The challenge of navigating infrastructure extends beyond Europe. Juan Turner, director/owner of Argentina-based forwarder Rowners, noted that while permits in the country can be obtained online in as little as a week to 10 days, there are instances where “you have to invent and find a solution, and then it’s a completely different story.” A recurring capacity theme is the shortage of essential resources. Turner highlighted the lack of “sufficient asset capacity to meet demand in remote locations,” citing Paraguay as an example where equipment often needs to be sourced from neighboring countries. Even more critical, he stressed, is ”manpower — the drivers and all the logistics team.” Mullejans added that a lack of good engineering and engineers led her firm to employ that expertise in-house. Singh said India faces its own unique challenge. “We have a lot of coastlines, but the government hasn’t developed any seaports for industrial zones,” he said. Frequently, Total Movements has to build temporary jetties to roll up and transport project cargoes. The alternative is relying on major Indian ports that are “way too far from the project,” NMT’s Boorsma said. Contact Carly Fields at <a href="mailto:carly.fields@spglobal.com">carly.fields@spglobal.com</a>. </div>

The supersizing of conventional power cargoes is increasing project complexity and pushing the limits of available transportation, market experts say. Conventional power project cargo is changing, with both weight and size increasing, Satish Singh, CEO of Mumbai-based freight forwarder Total Movements, told the Journal of Commerce. The trend is being driven by an industry push for cost competitiveness, leading to larger power plants and “a lot of heavy, heavy stuff — heavy turbines, heavy generators, heavy boilers,” Singh said. Project cargo shippers are opting for larger packages to streamline on-site assembly, aiming to “move in 30 days compared to six months,” he added. While conventional power projects are expanding in scale, the green mandate in Europe is now a significant factor influencing demand within the continent. “Within Europe, the focus is more on renewable energy,” Tristan Boorsma of Netherlands-based project cargo forwarder NMT Projects said. “Slowly, we see that at least in Europe, the demand for conventional power cargoes is reducing.” However, Boorsma said there would be a continued need for conventional power generation in regions “where the infrastructure is not really there for renewables.” The European energy transition also requires significant upgrades to existing infrastructure, a further boon for project cargo demand. To meet this there are more transformers being moved, which are also getting heavier, Boorsma said. That surge in demand for transformers has been so profound that Iris Mullejans, managing director of Germany-based project forwarder Riedl, said transformer manufacturers cannot keep up with demand. “They are full for transformer orders through to 2030,” she told the Journal of Commerce. Road limitations restrict mode options The movement of these increasingly large project cargo components presents transportation challenges, especially in Europe. “There, we are quite limited in terms of road transportation, so we have to look at alternatives,” Boorsma said. “We have to do a lot by inland barging.” Permitting is another pain point. “The permit application within Europe is very difficult with long lead times,” he said. “Every country has different rules and regulations.” Mullejans added that European infrastructure is generally “really run down,” although she acknowledged investments in Germany and the presence of heavy lift corridors in Finland, Sweden and Iceland that “really help.” The challenge of navigating infrastructure extends beyond Europe. Juan Turner, director/owner of Argentina-based forwarder Rowners, noted that while permits in the country can be obtained online in as little as a week to 10 days, there are instances where “you have to invent and find a solution, and then it’s a completely different story.” A recurring capacity theme is the shortage of essential resources. Turner highlighted the lack of “sufficient asset capacity to meet demand in remote locations,” citing Paraguay as an example where equipment often needs to be sourced from neighboring countries. Even more critical, he stressed, is ”manpower — the drivers and all the logistics team.” Mullejans added that a lack of good engineering and engineers led her firm to employ that expertise in-house. Singh said India faces its own unique challenge. “We have a lot of coastlines, but the government hasn’t developed any seaports for industrial zones,” he said. Frequently, Total Movements has to build temporary jetties to roll up and transport project cargoes. The alternative is relying on major Indian ports that are “way too far from the project,” NMT’s Boorsma said. Contact Carly Fields at carly.fields@spglobal.com .

Maritime

Breakbulk News

Heavy-haul transport

Project cargo

Energy projects

Heavier power cargoes challenge transport, infrastructure limitations

<div class="phx-topic abstract-wrapper">Forwarders moving cargo on monthly contracts have pegged average week-to-week gains at $200 to $300 per FEU for bookings from West India to Felixstowe/London Gateway or Rotterdam. </div>

Forwarders moving cargo on monthly contracts have pegged average week-to-week gains at $200 to $300 per FEU for bookings from West India to Felixstowe/London Gateway or Rotterdam.

<div class="phx-topic">After seeing a sharp downward correction in early May with the end of Indian seasonal grape volumes, ocean rates on the India-Europe trade have ticked up in the last two weeks, according to new data obtained by the Journal of Commerce from local freight forwarders. Forwarder executives said that while westbound volumes remain somewhat flat, carriers have been able to push rates higher due mainly to issues linked to vessel capacity and equipment availability. The sources believe some mainliners have swapped larger vessels with smaller ships for Indian coverage in a strategic repositioning of capacity into the now-heated trans-Pacific trade. Forwarders moving cargo on monthly contracts have pegged average week-to-week gains at $200 to $300 per FEU for bookings from West India (Nhava Sheva/Mundra) to Felixstowe/London Gateway or Rotterdam. “Rates have been steady to slightly rising over the last two to three weeks,” said an executive at a Mumbai-based forwarding house. That uptick comes as carriers have lined up a new round of rate hikes for India-Europe loads beginning June 15, and July 1 in some cases. Expecting these attempts to work, at least partially, major carriers on the trade lane have also revised spot rates upward for late-June/early-July sailings, sources said. “Our ocean tariff rates from the Indian subcontinent to North Europe and the Mediterranean Sea will increase,” Hapag-Lloyd told customers, announcing a $1,000-per-box hike for West India. Sources have also reported sporadic difficulty securing enough empty boxes at hinterland locations in recent weeks, especially out of the southern India region. “It’s not an acute shortage situation, but empties are fewer, varying from carrier to carrier for the type of equipment under pressure,” a second forwarder told the Journal of Commerce. Additionally, CMA CGM’s premier “Epic” service on the India-Europe trade lane has declared two void calls for West India in June due to what it said were “operational constraints.” Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

After seeing a sharp downward correction in early May with the end of Indian seasonal grape volumes, ocean rates on the India-Europe trade have ticked up in the last two weeks, according to new data obtained by the Journal of Commerce from local freight forwarders. Forwarder executives said that while westbound volumes remain somewhat flat, carriers have been able to push rates higher due mainly to issues linked to vessel capacity and equipment availability. The sources believe some mainliners have swapped larger vessels with smaller ships for Indian coverage in a strategic repositioning of capacity into the now-heated trans-Pacific trade. Forwarders moving cargo on monthly contracts have pegged average week-to-week gains at $200 to $300 per FEU for bookings from West India (Nhava Sheva/Mundra) to Felixstowe/London Gateway or Rotterdam. “Rates have been steady to slightly rising over the last two to three weeks,” said an executive at a Mumbai-based forwarding house. That uptick comes as carriers have lined up a new round of rate hikes for India-Europe loads beginning June 15, and July 1 in some cases. Expecting these attempts to work, at least partially, major carriers on the trade lane have also revised spot rates upward for late-June/early-July sailings, sources said. “Our ocean tariff rates from the Indian subcontinent to North Europe and the Mediterranean Sea will increase,” Hapag-Lloyd told customers, announcing a $1,000-per-box hike for West India. Sources have also reported sporadic difficulty securing enough empty boxes at hinterland locations in recent weeks, especially out of the southern India region. “It’s not an acute shortage situation, but empties are fewer, varying from carrier to carrier for the type of equipment under pressure,” a second forwarder told the Journal of Commerce. Additionally, CMA CGM’s premier “Epic” service on the India-Europe trade lane has declared two void calls for West India in June due to what it said were “operational constraints.” Contact Bency Mathew at bencyvmathew@gmail.com .

Container Shipping News

Asia-Europe

India-Europe ocean rates rebound on space, equipment pressures

<div class="phx-topic abstract-wrapper">Sea-Intelligence said elevated freight rates are drawing small carriers to the eastbound trade lane, but the additional capacity should dwindle by mid-August. </div>

Sea-Intelligence said elevated freight rates are drawing small carriers to the eastbound trade lane, but the additional capacity should dwindle by mid-August.

<div class="phx-topic">Niche container lines are ramping up weekly capacity in the trans-Pacific at a rate similar to the surge of 2021 and 2022, drawn by the lure of strong ocean freight rates. But that capacity is expected to quickly ebb as rates ease throughout the summer, according to consultancy Sea-Intelligence Maritime Analysis. Sea-Intelligence said Thursday it expects niche ocean carriers to provide 4.6% of the weekly capacity in the trans-Pacific by the end of June. That would top the 4.5% those carriers deployed at the start of September 2021. The draw for the niche carriers is the strength in spot freight rates, Sea-Intelligence said, although those rates have <a href="https://www.joc.com/article/asia-uswc-spot-rates-weakening-as-vessel-overcapacity-takes-hold-6022847">already started to soften amid the broader injection of fresh capacity</a>. The North Asia-to-US West Coast trade lane saw spot ocean freight rates at $5,633 per FEU as of June 11, down 7% on the week, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. Spot freight rates had risen threefold since bottoming out at $1,600 in late March. “During the height of the pandemic, the [Asia-North America West Coast (NAWC)] trade lane saw a slew of new entrants — carriers which had no previous footprint on Asia-NAWC and were only there to seize an opportunity that had presented itself in the form of unnaturally high freight rates,” Sea-Intelligence Chief Executive Alan Murphy said. Murphy added that capacity “is back at the level” seen during the height of the pandemic. “This means that the current market conditions are such that these new entrants feel that there is an opportunity reminiscent of the global pandemic,” he said. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e8c13a3e-9f5a-412f-8741-adbf5e1a7779"></dynamic-object></div>Some niche carriers have remained in the trans-Pacific since 2022, seeking to offer regularly scheduled liner service instead of ad hoc calls. SeaLead Shipping and T.S. Lines launched <a href="https://www.joc.com/article/two-niche-ocean-carriers-team-up-in-trans-pacific-as-rates-remain-high-5703158">a jointly-operated trans-Pacific service</a> into the Port of Long Beach almost one year ago when freight rates hovered near $6,000 per FEU. Hede Shipping has also regularly offered <a href="https://www.joc.com/article/chinese-niche-carrier-to-launch-shanghai-los-angeles-expedited-service-next-week-5222119">a premium express service</a> to Los Angeles since March 2024. However, Sea-Intelligence sees the current surge in niche carrier capacity ending faster than it did during 2021–22. Sea-Intelligence data shows that weekly niche carriers will account for 3.8% of capacity by the end of July, with that amount dropping to 2.6% by mid-August. The drawdown coincides with expectations that <a href="https://www.joc.com/article/pause-in-tariff-hikes-drives-big-gains-in-trans-pacific-spot-rates-6017111">imports from Asia will peak around late summer</a> as the Trump administration’s 90-day reprieve on Chinese tariffs expires. “If history is anything to go by, we will see these carriers remove capacity as quickly as it was introduced once the market conditions start to normalize,” Murphy said. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Niche container lines are ramping up weekly capacity in the trans-Pacific at a rate similar to the surge of 2021 and 2022, drawn by the lure of strong ocean freight rates. But that capacity is expected to quickly ebb as rates ease throughout the summer, according to consultancy Sea-Intelligence Maritime Analysis. Sea-Intelligence said Thursday it expects niche ocean carriers to provide 4.6% of the weekly capacity in the trans-Pacific by the end of June. That would top the 4.5% those carriers deployed at the start of September 2021. The draw for the niche carriers is the strength in spot freight rates, Sea-Intelligence said, although those rates have already started to soften amid the broader injection of fresh capacity . The North Asia-to-US West Coast trade lane saw spot ocean freight rates at $5,633 per FEU as of June 11, down 7% on the week, according to Platts, a sister company of the Journal of Commerce within S&P Global. Spot freight rates had risen threefold since bottoming out at $1,600 in late March. “During the height of the pandemic, the [Asia-North America West Coast (NAWC)] trade lane saw a slew of new entrants — carriers which had no previous footprint on Asia-NAWC and were only there to seize an opportunity that had presented itself in the form of unnaturally high freight rates,” Sea-Intelligence Chief Executive Alan Murphy said. Murphy added that capacity “is back at the level” seen during the height of the pandemic. “This means that the current market conditions are such that these new entrants feel that there is an opportunity reminiscent of the global pandemic,” he said. Some niche carriers have remained in the trans-Pacific since 2022, seeking to offer regularly scheduled liner service instead of ad hoc calls. SeaLead Shipping and T.S. Lines launched a jointly-operated trans-Pacific service into the Port of Long Beach almost one year ago when freight rates hovered near $6,000 per FEU. Hede Shipping has also regularly offered a premium express service to Los Angeles since March 2024. However, Sea-Intelligence sees the current surge in niche carrier capacity ending faster than it did during 2021–22. Sea-Intelligence data shows that weekly niche carriers will account for 3.8% of capacity by the end of July, with that amount dropping to 2.6% by mid-August. The drawdown coincides with expectations that imports from Asia will peak around late summer as the Trump administration’s 90-day reprieve on Chinese tariffs expires. “If history is anything to go by, we will see these carriers remove capacity as quickly as it was introduced once the market conditions start to normalize,” Murphy said. Contact Michael Angell at michael.angell@spglobal.com .

Trans-Pacific

June expected to be peak for niche carriers in the trans-Pacific: analyst

<div class="phx-topic abstract-wrapper">Instead of rising in May as would typically be expected, US freight volumes dropped, and that is having an impact on pricing, freight indicators reveal. </div>

Instead of rising in May as would typically be expected, US freight volumes dropped, and that is having an impact on pricing, freight indicators reveal.

<div class="phx-topic">Trucking executives may say they are <a href="https://www.joc.com/article/schneider-jb-hunt-see-us-truck-capacity-shrinking-in-h2-6023884">increasingly, if still cautiously, optimistic</a> about a recovery in their market, but the latest data on US freight demand isn’t encouraging. The monthly Cass Freight Index and the US producer price index report released Thursday show freight demand and pricing either declining or stalled on a month-to-month basis. Truck and intermodal rail shipments fell 0.4% from April to May and dropped 4% year over year, according to the shipment component of the Cass Freight Index. The 4% decline followed a 3.6% year-over-year decrease in shipments in April. The May shipment decline bucks normal seasonal trends, Cass said. Consumer spending in the first quarter, before the Trump administration introduced higher US tariffs, is still propping up freight demand, but that support is beginning to weaken. “Pre-tariff inventory stocking has started to turn to destocking, and those stocks will start to thin in the coming months,” Cass Information Systems said in its May report. A further drop in domestic freight volume is likely this month. Normal seasonality would have shipments decline by 2% year over year in June, according to Cass. On a year-over-year basis, the Cass Freight Shipments Index has been falling since February 2023. Month to month, the index rose 0.4% in April before dropping in May. Truckload rates are still rising year over year, but they have been decreasing on a consecutive monthly basis, according to the Cass Truckload Linehaul Index. In May, the truckload pricing index was up 0.6% from a year ago but down 0.8% from April. The Truckload Linehaul index, which includes spot and contract rates, dropped 1.5% from February through May. The truckload index trendline is similar, although not identical, to other indicators. The long-distance US truckload producer price index (PPI) was flat in May from April at a reading of 177.3 and up 3% from a year earlier. The PPI, released by the US Bureau of Labor Statistics Thursday, measures the total cost of a truckload shipment paid by shippers and is weighted toward contract rates. The weighted Journal of Commerce Shipper-Paid Truckload Rate rose 4 cents per mile on average in May to $2.18 per mile, although that was down from $2.21 a year earlier. The measure of all-inclusive shipper-paid dry-van pricing is down 8% from January. The US long-distance less-than-truckload (LTL) PPI shows more stability but also the impact of lower LTL volumes. The LTL PPI dropped about 1 percentage point to 258.1 in May after staying flat at about 259 for three months. However, those three months represented the highest reading for the LTL PPI in its history, with pricing up about 5% year over year. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. </div>

Trucking executives may say they are increasingly, if still cautiously, optimistic about a recovery in their market, but the latest data on US freight demand isn’t encouraging. The monthly Cass Freight Index and the US producer price index report released Thursday show freight demand and pricing either declining or stalled on a month-to-month basis. Truck and intermodal rail shipments fell 0.4% from April to May and dropped 4% year over year, according to the shipment component of the Cass Freight Index. The 4% decline followed a 3.6% year-over-year decrease in shipments in April. The May shipment decline bucks normal seasonal trends, Cass said. Consumer spending in the first quarter, before the Trump administration introduced higher US tariffs, is still propping up freight demand, but that support is beginning to weaken. “Pre-tariff inventory stocking has started to turn to destocking, and those stocks will start to thin in the coming months,” Cass Information Systems said in its May report. A further drop in domestic freight volume is likely this month. Normal seasonality would have shipments decline by 2% year over year in June, according to Cass. On a year-over-year basis, the Cass Freight Shipments Index has been falling since February 2023. Month to month, the index rose 0.4% in April before dropping in May. Truckload rates are still rising year over year, but they have been decreasing on a consecutive monthly basis, according to the Cass Truckload Linehaul Index. In May, the truckload pricing index was up 0.6% from a year ago but down 0.8% from April. The Truckload Linehaul index, which includes spot and contract rates, dropped 1.5% from February through May. The truckload index trendline is similar, although not identical, to other indicators. The long-distance US truckload producer price index (PPI) was flat in May from April at a reading of 177.3 and up 3% from a year earlier. The PPI, released by the US Bureau of Labor Statistics Thursday, measures the total cost of a truckload shipment paid by shippers and is weighted toward contract rates. The weighted Journal of Commerce Shipper-Paid Truckload Rate rose 4 cents per mile on average in May to $2.18 per mile, although that was down from $2.21 a year earlier. The measure of all-inclusive shipper-paid dry-van pricing is down 8% from January. The US long-distance less-than-truckload (LTL) PPI shows more stability but also the impact of lower LTL volumes. The LTL PPI dropped about 1 percentage point to 258.1 in May after staying flat at about 259 for three months. However, those three months represented the highest reading for the LTL PPI in its history, with pricing up about 5% year over year. Contact William B. Cassidy at bill.cassidy@spglobal.com .

US trucking rate momentum stalls amid volume decline: Cass, PPIs

<div class="phx-topic abstract-wrapper">As agricultural exports enter their traditional peak season, it is prudent to be proactive now — while there is still an empty container supply extant in North America. </div>

As agricultural exports enter their traditional peak season, it is prudent to be proactive now — while there is still an empty container supply extant in North America.

<div class="phx-topic">“Where Have All the Flowers Gone?” is a folk song written by American singer-songwriter Pete Seeger. Legend has it that he wrote it while on an airplane to play at Oberlin College, one of the few locations willing to defy the McCarthy hiring blacklist imposed on him. Subsequently, the song became a mainstay of the anti-war movement during the Vietnam War and has been covered by many artists and in many languages. The song utilizes the image of flowers and the cycle of life to depict the cyclical and destructive nature of war. And while I recognize that applying this metaphor to our industry’s cyclicality may be a step too far, I believe that the plaintive refrain, “Oh when will you/we ever learn; Oh, when will you/we ever learn?” certainly applies. In today’s transportation industry, there are very few of us that can remember the days of regulation when we struggled in an economy beset by stagflation. President Jimmy Carter then liberated our sector with deregulation. Because regulation — by design — was intended to ensure excess capacity, two decades of halcyon growth followed as this capacity was redeployed to productive applications. Along with globalization and outsourcing, logistics and supply chain management became industries in their own right, and intermodal was a key driver. However, about 25 years ago, the “free” capacity unleashed by deregulation had been consumed and growth needed to be supported by investment. Coincidentally, these changes took place against the aftermath of the 9/11 terrorist attack. A bipartisan blue-ribbon commission was established, and three years later, they released their report. The findings were extensive. The government was not prepared and did not know how to respond. Problems with intelligence collection, analysis, sharing across agencies, and a lack of coordination among federal agencies exacerbated the challenges. In fact, the whole structure represented a maze of siloed and disaggregated responsibilities. When I read the report, I was struck by the potential for a future commission assembled to write many of the same findings about the transportation network in our country. I actually wrote a white paper in 2004 claiming that it would be unnecessary to convene an investigation of the inevitable supply chain meltdown because it was already written. All that was necessary was to take the 9/11 report and replace “national security” with “supply chain.” <h3>COVID-19 drove changes </h3>Of course, our industry did nothing to address these structural shortcomings and muddled on until COVID-19 struck. At that time, it seemed that our entire industry adopted the “4C” excuse — everything was the fault of COVID, China, Congestion and Chassis. Everyone was surprised that such a terrible fate could befall our industry. Even worse, our industry seemed to be represented by our least qualified spokespeople and most of the media had no idea of basic facts. Somehow, we all survived that mess. Many of the problems impacted the entire network. The maelstrom of detention and demurrage bills gave rise to the Ocean Shipping Reform Act of 2022 (OSRA-22). It increased the authority of the Federal Maritime Commission (FMC) to promote the growth and development of US exports through an ocean transportation system that is competitive, efficient and economical. Beyond its mandate addressing complaints about detention and demurrage charges, OSRA-22 prohibits common ocean carriers, marine terminal operators or ocean transportation intermediaries from unreasonably refusing cargo space when available or resorting to other unfair or unjustly discriminatory methods. These protections were welcomed by the export community. However, we have to recognize that a complaint process after the fact may be insufficient to provide adequate protection if there is no effective remedy available. At times of high demand (and rates) for imports from Asia to North America, ocean carriers frequently evacuate all containers as soon as their import cargo is devanned. This moots the question of available space because there may be vessel space — but no empty containers.  As agricultural exports enter their traditional peak season, we believe that it is prudent to be proactive now, while there is still an empty container supply extant in North America. The Agriculture Transportation Coalition convenes June 16 for its annual meeting. I am sure Executive Director Peter Friedmann will have this high on the agenda; we do not want to be wondering where all the containers have gone. Contact Ted Prince at <a href="mailto:ted@tricitiesintermodal.com">ted@tricitiesintermodal.com</a>.</div>

“Where Have All the Flowers Gone?” is a folk song written by American singer-songwriter Pete Seeger. Legend has it that he wrote it while on an airplane to play at Oberlin College, one of the few locations willing to defy the McCarthy hiring blacklist imposed on him. Subsequently, the song became a mainstay of the anti-war movement during the Vietnam War and has been covered by many artists and in many languages. The song utilizes the image of flowers and the cycle of life to depict the cyclical and destructive nature of war. And while I recognize that applying this metaphor to our industry’s cyclicality may be a step too far, I believe that the plaintive refrain, “Oh when will you/we ever learn; Oh, when will you/we ever learn?” certainly applies. In today’s transportation industry, there are very few of us that can remember the days of regulation when we struggled in an economy beset by stagflation. President Jimmy Carter then liberated our sector with deregulation. Because regulation — by design — was intended to ensure excess capacity, two decades of halcyon growth followed as this capacity was redeployed to productive applications. Along with globalization and outsourcing, logistics and supply chain management became industries in their own right, and intermodal was a key driver. However, about 25 years ago, the “free” capacity unleashed by deregulation had been consumed and growth needed to be supported by investment. Coincidentally, these changes took place against the aftermath of the 9/11 terrorist attack. A bipartisan blue-ribbon commission was established, and three years later, they released their report. The findings were extensive. The government was not prepared and did not know how to respond. Problems with intelligence collection, analysis, sharing across agencies, and a lack of coordination among federal agencies exacerbated the challenges. In fact, the whole structure represented a maze of siloed and disaggregated responsibilities. When I read the report, I was struck by the potential for a future commission assembled to write many of the same findings about the transportation network in our country. I actually wrote a white paper in 2004 claiming that it would be unnecessary to convene an investigation of the inevitable supply chain meltdown because it was already written. All that was necessary was to take the 9/11 report and replace “national security” with “supply chain.” COVID-19 drove changes Of course, our industry did nothing to address these structural shortcomings and muddled on until COVID-19 struck. At that time, it seemed that our entire industry adopted the “4C” excuse — everything was the fault of COVID, China, Congestion and Chassis. Everyone was surprised that such a terrible fate could befall our industry. Even worse, our industry seemed to be represented by our least qualified spokespeople and most of the media had no idea of basic facts. Somehow, we all survived that mess. Many of the problems impacted the entire network. The maelstrom of detention and demurrage bills gave rise to the Ocean Shipping Reform Act of 2022 (OSRA-22). It increased the authority of the Federal Maritime Commission (FMC) to promote the growth and development of US exports through an ocean transportation system that is competitive, efficient and economical. Beyond its mandate addressing complaints about detention and demurrage charges, OSRA-22 prohibits common ocean carriers, marine terminal operators or ocean transportation intermediaries from unreasonably refusing cargo space when available or resorting to other unfair or unjustly discriminatory methods. These protections were welcomed by the export community. However, we have to recognize that a complaint process after the fact may be insufficient to provide adequate protection if there is no effective remedy available. At times of high demand (and rates) for imports from Asia to North America, ocean carriers frequently evacuate all containers as soon as their import cargo is devanned. This moots the question of available space because there may be vessel space — but no empty containers.  As agricultural exports enter their traditional peak season, we believe that it is prudent to be proactive now, while there is still an empty container supply extant in North America. The Agriculture Transportation Coalition convenes June 16 for its annual meeting. I am sure Executive Director Peter Friedmann will have this high on the agenda; we do not want to be wondering where all the containers have gone. Contact Ted Prince at ted@tricitiesintermodal.com .

Supply chain

Act now before we wonder where all the containers have gone

<div class="phx-topic abstract-wrapper">The Trump administration’s tariff policy is yet another milestone that has shaken the US economy over the past 60 years, writes Ted Prince. </div>

The Trump administration’s tariff policy is yet another milestone that has shaken the US economy over the past 60 years, writes Ted Prince.

<div class="phx-topic">Since the announcement of reciprocal tariffs on so-called “Liberation Day” last month, we have been bombarded by conflicting predictions of the possible benefits and disasters that may befall our country, our economy and our industry. What I find interesting is that the history of the past 60 years seems to have been forgotten. While there are many important dates, I will focus on four. <h3>Yanqui go home! </h3>I would start in April 1965, when President Lyndon Johnson deployed the Marines and 82nd Airborne to the Dominican Republic to quell a civil war that broke out after a military junta. While the intervention was intended to protect US nationals, mission creep led to the deployment of over 22,000 American troops. While the invasion successfully reinstalled a conservative government, it increased distrust of the US. At the same time, companies such as Hewlett Packard were rolling out a continuous pipeline of electronic innovations. Their intention was to near-shore manufacturing in Latin America; however, the prevalence of “Yanqui Go Home!” made them look elsewhere. Japan and then the “Four Tigers” (Singapore, Hong Kong, Taiwan and South Korea) became the factory sites instead. The Vietnam War had become the first containerized war, and plentiful equipment was available to load back to the US. While electronics required factories, much of the manufacturing was cottage industries. For example, importers of blue jeans were buying from hundreds of small vendors. Ocean carrier consolidators would send pickup trucks into the New Territories to pick up loose articles of clothing (some which no doubt had been made in China) for consolidation at their facilities adjacent to the Kwai Tsing container terminals. <h3>Voluntary restraint </h3>In May 1981, with the American auto industry mired in recession, Japanese car makers agreed to “voluntary export restraint,” which limited exports of passenger cars to the US. However, at the same time, they implemented a strategy of “transplants,” whereby cars were assembled in the US. Some might consider this an example of “reshoring;” however, it is not that simple. Initially, the plants were built in Japan, then disassembled, shipped to the US, and reassembled. Most of the parts (CKD: cars knocked down) came from Japan, so actual US content — other than labor — was minimal. Over time, suppliers proliferated along Interstates 65 and 75 to support these plants. However, many of these were also Japanese transplants. Some were joint ventures with US partners, but many were just US subsidiaries of Japanese manufacturers. Barry Bluestone and Bennett Harrison described this phenomenon in their 1982 work, “The Deindustrialization of America: Plant Closings, Community Abandonment, and the Dismantling of Basic Industry.” They pointed out the irony that the Japanese were successfully investing in US industrial sectors that scarcely a decade ago were said to be declining, uncompetitive, and suffering from deindustrialization. <h3>The Plaza Accord </h3>The Plaza Accord in September 1985 effectively devalued the dollar against other major currencies. Initially, the US trade deficit worsened, as imports rose in price with a devalued dollar. However, the devaluation made US exports cheaper for its trading partners to purchase, which grew the market in goods and services — which are unaccounted for in the current administration’s calculation. <h3>China and the WTO </h3>Finally, in 2001, China joined the World Trade Organization (WTO). What followed was a massive dislocation in trade as China built world-class factories and world-class ports to ship goods throughout the world. Some of those factories have since relocated to nations with cheaper labor. However, a whole ecosystem of suppliers has grown up that supports the manufacturing and assembly of sophisticated products. China’s development took over 30 years. It was no shortcut. It was also the result of extensive industrial policy similar to what Japan and the Four Tigers had done previously. Most importantly, these policies did not deviate for decades and supported a long-term strategy whereby investment could be made with confidence. Our current politics are such that it is impossible to invest in today’s doctrine because it may no longer be applicable by the time the factory opens in three to eight years. In the past 30 years, trade has increased dramatically as a share of gross domestic product (GDP). However, while most economists believe that this has been good for the economy, the general public’s outlook is less sanguine. In large part, this is because trade’s impacts can vary widely: localized changes in jobs (both gains and losses) and reduced prices of goods and services. Freight is inextricably linked to trade. It has transformed our industry. We will no doubt have a ringside seat to the policy that is evolving. Contact Ted Prince at <a href="mailto:ted@tricitiesintermodal.com">ted@tricitiesintermodal.com</a>. </div>

Since the announcement of reciprocal tariffs on so-called “Liberation Day” last month, we have been bombarded by conflicting predictions of the possible benefits and disasters that may befall our country, our economy and our industry. What I find interesting is that the history of the past 60 years seems to have been forgotten. While there are many important dates, I will focus on four. Yanqui go home! I would start in April 1965, when President Lyndon Johnson deployed the Marines and 82nd Airborne to the Dominican Republic to quell a civil war that broke out after a military junta. While the intervention was intended to protect US nationals, mission creep led to the deployment of over 22,000 American troops. While the invasion successfully reinstalled a conservative government, it increased distrust of the US. At the same time, companies such as Hewlett Packard were rolling out a continuous pipeline of electronic innovations. Their intention was to near-shore manufacturing in Latin America; however, the prevalence of “Yanqui Go Home!” made them look elsewhere. Japan and then the “Four Tigers” (Singapore, Hong Kong, Taiwan and South Korea) became the factory sites instead. The Vietnam War had become the first containerized war, and plentiful equipment was available to load back to the US. While electronics required factories, much of the manufacturing was cottage industries. For example, importers of blue jeans were buying from hundreds of small vendors. Ocean carrier consolidators would send pickup trucks into the New Territories to pick up loose articles of clothing (some which no doubt had been made in China) for consolidation at their facilities adjacent to the Kwai Tsing container terminals. Voluntary restraint In May 1981, with the American auto industry mired in recession, Japanese car makers agreed to “voluntary export restraint,” which limited exports of passenger cars to the US. However, at the same time, they implemented a strategy of “transplants,” whereby cars were assembled in the US. Some might consider this an example of “reshoring;” however, it is not that simple. Initially, the plants were built in Japan, then disassembled, shipped to the US, and reassembled. Most of the parts (CKD: cars knocked down) came from Japan, so actual US content — other than labor — was minimal. Over time, suppliers proliferated along Interstates 65 and 75 to support these plants. However, many of these were also Japanese transplants. Some were joint ventures with US partners, but many were just US subsidiaries of Japanese manufacturers. Barry Bluestone and Bennett Harrison described this phenomenon in their 1982 work, “The Deindustrialization of America: Plant Closings, Community Abandonment, and the Dismantling of Basic Industry.” They pointed out the irony that the Japanese were successfully investing in US industrial sectors that scarcely a decade ago were said to be declining, uncompetitive, and suffering from deindustrialization. The Plaza Accord The Plaza Accord in September 1985 effectively devalued the dollar against other major currencies. Initially, the US trade deficit worsened, as imports rose in price with a devalued dollar. However, the devaluation made US exports cheaper for its trading partners to purchase, which grew the market in goods and services — which are unaccounted for in the current administration’s calculation. China and the WTO Finally, in 2001, China joined the World Trade Organization (WTO). What followed was a massive dislocation in trade as China built world-class factories and world-class ports to ship goods throughout the world. Some of those factories have since relocated to nations with cheaper labor. However, a whole ecosystem of suppliers has grown up that supports the manufacturing and assembly of sophisticated products. China’s development took over 30 years. It was no shortcut. It was also the result of extensive industrial policy similar to what Japan and the Four Tigers had done previously. Most importantly, these policies did not deviate for decades and supported a long-term strategy whereby investment could be made with confidence. Our current politics are such that it is impossible to invest in today’s doctrine because it may no longer be applicable by the time the factory opens in three to eight years. In the past 30 years, trade has increased dramatically as a share of gross domestic product (GDP). However, while most economists believe that this has been good for the economy, the general public’s outlook is less sanguine. In large part, this is because trade’s impacts can vary widely: localized changes in jobs (both gains and losses) and reduced prices of goods and services. Freight is inextricably linked to trade. It has transformed our industry. We will no doubt have a ringside seat to the policy that is evolving. Contact Ted Prince at ted@tricitiesintermodal.com .

Transport, Trade and Regulation News

A history lesson while we watch current US trade policy unfold

S&P Global Platts editors engaging with market participants to assess the current value of freight-all-kinds (FAK) rates on major container trades produce container spot rates. The rates include bunker adjustment factors, general rate increases and emergency rare restoration. They also include low-sulfur fuel, equipment imbalance and repositioning surcharges. The rates exclude terminal handling, port security, overweight container, delivery, and detention and demurrage charges. [Platts](https://www.spglobal.com/commodityinsights)

North Asia to US West and East Coast container spot rates (Platts)

Platts North Asia to US East and West Coasts Weekly Gateway

<div class="phx-topic abstract-wrapper">Cargo landing at the country’s ports in July will be 20% higher than the forecast made just last month by the National Retail Federation and Hackett Associates. </div>

Cargo landing at the country’s ports in July will be 20% higher than the forecast made just last month by the National Retail Federation and Hackett Associates.

<div class="phx-topic">US retailers on Monday significantly upgraded import projections through August amid the temporary pauses in effect on the so-called reciprocal tariffs implemented by the Trump administration. Cargo landing at the country’s ports in July will be 20% higher than the <a href="https://www.joc.com/article/us-retailers-project-first-year-over-year-import-cut-in-19-months-as-tariffs-bite-6001817">forecast made in May</a> by the National Retail Federation (NRF) and Hackett Associates. Their June Global Port Tracker (GPT) shows the first upgrade to US import projections since February, before the first round of tariffs were announced in April. “Tariff reductions will lead to a surge in imports in June through August as importers take advantage of the various 90-day pauses,” Hackett Associates Founder Ben Hackett said. A pause on higher tariffs on most of the US’ trading partners is in effect until July 9, while the pause on the 145% tariff on imports from China is due to expire Aug. 14. The GPT’s updated forecast calls for July US imports of 2.13 million TEUs — up 20.3% from last month’s GPT but still well below the 2.32 million TEUs brought in during July 2024. Retailers expect August imports to reach 1.98 million TEUs, up 8.8% from May’s forecast. “[Shippers] are now looking to get those orders and cargo moving in order <a href="https://www.joc.com/article/ocean-carriers-bring-in-more-trans-pacific-container-services-amid-rate-surge-6012725">to bring as much merchandise</a> into the country as they can before the reciprocal tariff and additional China tariff pauses end in July and August,” said Jonathan Gold, NRF’s vice president for Supply Chain and Customs Policy. June import projections were also upgraded from the May GPT, with retailers expecting 17.5% higher volumes at 2.01 million TEUs. Preliminary May volumes of 1.91 million TEUs are expected to be 5.5% higher than forecast last month. <h3>A soft Q4 </h3>But the summer surge is expected to end given the uncertainty over what will happen once the temporary tariff reprieves expire. Retailers slightly downgraded import expectations for September to 1.78 million TEUs, which would also be a 21.6% drop compared with the year-ago month. And in its initial forecast for October, the GPT projects imports of 1.8 million TEUs, almost 20% lower than October 2024. “The peak for the winter holidays will come early this year, making it simultaneous with the peak for the back-to-school season,” Hackett said. “If higher tariffs are not delayed again, we can expect the final four months of the year to see declining volumes of imports.” The updated forecast brings the first-half projection for US imports to 12.54 million TEUs, up 3.4% from expectations made in May and 3.7% higher than actual first-half 2024 volumes. The GPT is published monthly using import data collected from 13 ports on the US East, West and Gulf coasts. Contact Laura Robb at <a href="mailto:Laura.Robb@spglobal.com">laura.robb@spglobal.com</a>.  </div>

US retailers on Monday significantly upgraded import projections through August amid the temporary pauses in effect on the so-called reciprocal tariffs implemented by the Trump administration. Cargo landing at the country’s ports in July will be 20% higher than the forecast made in May by the National Retail Federation (NRF) and Hackett Associates. Their June Global Port Tracker (GPT) shows the first upgrade to US import projections since February, before the first round of tariffs were announced in April. “Tariff reductions will lead to a surge in imports in June through August as importers take advantage of the various 90-day pauses,” Hackett Associates Founder Ben Hackett said. A pause on higher tariffs on most of the US’ trading partners is in effect until July 9, while the pause on the 145% tariff on imports from China is due to expire Aug. 14. The GPT’s updated forecast calls for July US imports of 2.13 million TEUs — up 20.3% from last month’s GPT but still well below the 2.32 million TEUs brought in during July 2024. Retailers expect August imports to reach 1.98 million TEUs, up 8.8% from May’s forecast. “[Shippers] are now looking to get those orders and cargo moving in order to bring as much merchandise into the country as they can before the reciprocal tariff and additional China tariff pauses end in July and August,” said Jonathan Gold, NRF’s vice president for Supply Chain and Customs Policy. June import projections were also upgraded from the May GPT, with retailers expecting 17.5% higher volumes at 2.01 million TEUs. Preliminary May volumes of 1.91 million TEUs are expected to be 5.5% higher than forecast last month. A soft Q4 But the summer surge is expected to end given the uncertainty over what will happen once the temporary tariff reprieves expire. Retailers slightly downgraded import expectations for September to 1.78 million TEUs, which would also be a 21.6% drop compared with the year-ago month. And in its initial forecast for October, the GPT projects imports of 1.8 million TEUs, almost 20% lower than October 2024. “The peak for the winter holidays will come early this year, making it simultaneous with the peak for the back-to-school season,” Hackett said. “If higher tariffs are not delayed again, we can expect the final four months of the year to see declining volumes of imports.” The updated forecast brings the first-half projection for US imports to 12.54 million TEUs, up 3.4% from expectations made in May and 3.7% higher than actual first-half 2024 volumes. The GPT is published monthly using import data collected from 13 ports on the US East, West and Gulf coasts. Contact Laura Robb at laura.robb@spglobal.com . 

Pause on tariffs prompts US retailers to upgrade summer import forecast

<div class="phx-topic abstract-wrapper">TRAC Intermodal, DCLI and FlexiVan Leasing began unstacking chassis shortly after the Trump administration last month announced a 90-day pause on the 145% tariffs on Chinese imports.</div>

TRAC Intermodal, DCLI and FlexiVan Leasing began unstacking chassis shortly after the Trump administration last month announced a 90-day pause on the 145% tariffs on Chinese imports.

<div class="phx-topic">As an expected wave of imports from China begins arriving at US ports in the coming weeks, the country’s three largest marine chassis providers say they are pulling idle equipment from storage, inspecting and repairing units, and repositioning chassis to key inland hubs to avoid a repeat of the shortages seen during the pandemic. TRAC Intermodal, DCLI and FlexiVan Leasing, the US’ top three lessors by fleet size, respectively, began unstacking chassis shortly after the Trump administration last month announced a 90-day pause on the 145% tariffs on Chinese imports. TRAC owns more than 200,000 marine chassis, while DCLI has about 140,000 units and FlexiVan about 120,000. None of the companies disclosed the number of chassis they’ve taken out of long-term storage, but each said the total is in the “tens of thousands.” “Our current utilization, our working fleet, is rather soft,” said Val Noel, chief operating officer of TRAC. “But we think this could be a little bit like a tsunami, and we want to have extra capacity to make sure we don’t have any service disruptions.” TRAC will focus on repairing and positioning chassis in Chicago, Dallas and Memphis. Noel said chassis placed into Memphis can be redeployed to Kansas City, St. Louis and Omaha, if necessary, while chassis in Chicago can be redirected to the Ohio Valley. DCLI began unstacking equipment in Southern California days after the tariff pause announcement and has since expanded the process to inland locations including Chicago, Dallas and Memphis. “We have safety stocks in place in key markets and are working with our vendors to ensure we have the repair capacity necessary to respond to this demand,” said Mike O’Malley, DCLI’s senior vice president of government and public relations. FlexiVan, which is exiting Southern California’s Pool of Pools, has focused on ensuring chassis availability for its core partner, Ocean Network Express (ONE). “[We are] working continuously to get pool chassis into a ready to use condition and fleeted into our private pool for ONE and other customers,” Flexi said in a statement to the Journal of Commerce. FlexiVan in late April opened its new private chassis pool serving the ports of Los Angeles and Long Beach, with FlexiVan Pool “designed to enhance our service capabilities for carriers and customers.” <h3>Getting repairs done now </h3>The chassis providers emphasized that pulling equipment out of long-term storage is not a one-day process. Units stacked for months, sometimes years, must undergo full inspections and safety checks, and in many cases, minor repairs before they are roadworthy. It can take several weeks to check lighting systems, brake lines, tires and structural components that can rust, corrode or suffer other weather-related fatigue. Technicians must also be available in sufficient numbers, and often work overtime, to meet repair deadlines. DCLI said it’s better prepared than during the pandemic because it did not significantly scale back repair operations with repair vendors when the market softened. DCLI said it learned how important it is to keep mechanics working even as volumes soften because widespread layoffs require rehiring and training later, which makes it difficult to complete repairs before a cargo surge. As a result, DCLI believes it can quickly inspect, repair and certify idle chassis without having to rebuild labor capacity from scratch. <h3>Communication is key </h3>Knowing when and where to deploy repaired units is crucial to prevent equipment shortages. Chassis providers rely on cargo forecasts from ocean carriers, railroads and shippers and data from the US Department of Transportation’s Freight Logistics Optimization Works (FLOW) initiative to position chassis ahead of surges. Under normal conditions, imports going to secondary cities such as Cincinnati, Columbus or St. Louis can be part of a block within a larger train to Chicago or Kansas City. During a surge, however, those cities may receive dedicated trains with double or triple the usual number of containers, flooding local terminals and straining chassis availability. “That’s one of the things that has beaten us in the past,” Noel acknowledged. “Normally a city might get a 3,000-foot block of containers, and during a surge it’s a 10,000-foot train. Both of our western roads (BNSF Railway and Union Pacific Railroad) have been super in partnering with us, letting us know what’s coming so we can be prepared.” The landscape has also changed in recent years in ways that may increase supply chain resiliency. More trucking companies and cargo owners now operate private chassis fleets, reducing their reliance on shared pool equipment. Railroads have also adjusted terminal operations, placing more import containers into grounded stacks, allowing cargo owners to retrieve loads using their own equipment and easing pressure on the public pools managed by DCLI, TRAC, and FlexiVan. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

As an expected wave of imports from China begins arriving at US ports in the coming weeks, the country’s three largest marine chassis providers say they are pulling idle equipment from storage, inspecting and repairing units, and repositioning chassis to key inland hubs to avoid a repeat of the shortages seen during the pandemic. TRAC Intermodal, DCLI and FlexiVan Leasing, the US’ top three lessors by fleet size, respectively, began unstacking chassis shortly after the Trump administration last month announced a 90-day pause on the 145% tariffs on Chinese imports. TRAC owns more than 200,000 marine chassis, while DCLI has about 140,000 units and FlexiVan about 120,000. None of the companies disclosed the number of chassis they’ve taken out of long-term storage, but each said the total is in the “tens of thousands.” “Our current utilization, our working fleet, is rather soft,” said Val Noel, chief operating officer of TRAC. “But we think this could be a little bit like a tsunami, and we want to have extra capacity to make sure we don’t have any service disruptions.” TRAC will focus on repairing and positioning chassis in Chicago, Dallas and Memphis. Noel said chassis placed into Memphis can be redeployed to Kansas City, St. Louis and Omaha, if necessary, while chassis in Chicago can be redirected to the Ohio Valley. DCLI began unstacking equipment in Southern California days after the tariff pause announcement and has since expanded the process to inland locations including Chicago, Dallas and Memphis. “We have safety stocks in place in key markets and are working with our vendors to ensure we have the repair capacity necessary to respond to this demand,” said Mike O’Malley, DCLI’s senior vice president of government and public relations. FlexiVan, which is exiting Southern California’s Pool of Pools, has focused on ensuring chassis availability for its core partner, Ocean Network Express (ONE). “[We are] working continuously to get pool chassis into a ready to use condition and fleeted into our private pool for ONE and other customers,” Flexi said in a statement to the Journal of Commerce. FlexiVan in late April opened its new private chassis pool serving the ports of Los Angeles and Long Beach, with FlexiVan Pool “designed to enhance our service capabilities for carriers and customers.” Getting repairs done now The chassis providers emphasized that pulling equipment out of long-term storage is not a one-day process. Units stacked for months, sometimes years, must undergo full inspections and safety checks, and in many cases, minor repairs before they are roadworthy. It can take several weeks to check lighting systems, brake lines, tires and structural components that can rust, corrode or suffer other weather-related fatigue. Technicians must also be available in sufficient numbers, and often work overtime, to meet repair deadlines. DCLI said it’s better prepared than during the pandemic because it did not significantly scale back repair operations with repair vendors when the market softened. DCLI said it learned how important it is to keep mechanics working even as volumes soften because widespread layoffs require rehiring and training later, which makes it difficult to complete repairs before a cargo surge. As a result, DCLI believes it can quickly inspect, repair and certify idle chassis without having to rebuild labor capacity from scratch. Communication is key Knowing when and where to deploy repaired units is crucial to prevent equipment shortages. Chassis providers rely on cargo forecasts from ocean carriers, railroads and shippers and data from the US Department of Transportation’s Freight Logistics Optimization Works (FLOW) initiative to position chassis ahead of surges. Under normal conditions, imports going to secondary cities such as Cincinnati, Columbus or St. Louis can be part of a block within a larger train to Chicago or Kansas City. During a surge, however, those cities may receive dedicated trains with double or triple the usual number of containers, flooding local terminals and straining chassis availability. “That’s one of the things that has beaten us in the past,” Noel acknowledged. “Normally a city might get a 3,000-foot block of containers, and during a surge it’s a 10,000-foot train. Both of our western roads (BNSF Railway and Union Pacific Railroad) have been super in partnering with us, letting us know what’s coming so we can be prepared.” The landscape has also changed in recent years in ways that may increase supply chain resiliency. More trucking companies and cargo owners now operate private chassis fleets, reducing their reliance on shared pool equipment. Railroads have also adjusted terminal operations, placing more import containers into grounded stacks, allowing cargo owners to retrieve loads using their own equipment and easing pressure on the public pools managed by DCLI, TRAC, and FlexiVan. Contact Ari Ashe at ari.ashe@spglobal.com .

North American ports

Drayage

US chassis providers getting equipment ready for US import surge

<div class="phx-topic abstract-wrapper">But a rise in demand for general cargo will not be enough to offset the sharp decline in e-commerce shipments that followed the US clampdown in May on low-value imports from China. </div>

But a rise in demand for general cargo will not be enough to offset the sharp decline in e-commerce shipments that followed the US clampdown in May on low-value imports from China.

<div class="phx-topic">MUNICH — Trans-Pacific air cargo demand is showing signs of recovery amid restocking efforts in the US, with airlines bringing back some of the freighter capacity that had been shifted out of the trade lane to serve strengthening general cargo markets. But the volume generated by seasonal tech product launches, semiconductors, perishables and pharma — and boosted by shippers being forced into the air <a href="https://www.joc.com/article/pause-in-tariff-hikes-drives-big-gains-in-trans-pacific-spot-rates-6017111">as China-US ocean space tightens</a> — will not replace the massive demand for e-commerce that filled dozens of freighters per day, according to Airbus. “E-commerce has been driving freight demand over the past years, and the big question out there is what’s going to happen to it,” Oliver von Tronchin, head of freighter marketing at the French aircraft manufacturer, told an Air Cargo Europe panel at the Transport Logistic exhibition this week. “What we are looking at is the change to the de minimis rule and the European equivalent, and if a $2.75 item is left with $100 flat fee from the US, people will not buy that item,” 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. The European Union is proposing a €2 handling fee for small parcels under €150 from China that would be paid by online retailers, such as Shein and Temu, but Brussels has not set an implementation date. In 2024, e-commerce shipments accounted for about 50% of China-to-US air freight volume, according to rate benchmarking platform Xeneta. Since the duty-free status of low-value Chinese imports was revoked in May, the volume has declined. The drop in trans-Pacific air freight is a leading factor in the International Air Transport Association’s (IATA’s) forecast of little to no growth in global air cargo volume for 2025, a huge climb down from the 12% jump in year over year demand in 2024. <h3>Challenge to match supply and demand </h3>Airlines are trying to match supply with demand, but those on the trans-Pacific are not being helped by the policy changes emanating from the White House. China-US tonnage in mid-May was down 25% year over year, with freighter capacity down 40%, according to Cargo Facts Consulting. As volume began to recover over the last two weeks, it encouraged carriers to bring back freighters, but with e-commerce demand muted, most of the returning lift was serving general cargo. C.H. Robinson noted in a market update this week that airlines were being cautious in adding capacity as demand recovers, with that balancing act expected to tighten available space and push rates higher throughout June, especially for non-priority shipments. The forwarder warned that end-of-quarter demand and tariff deadlines will likely create bottlenecks for last-minute bookings on China-US routes and advised shippers to explore alternate routes through Southeast Asia and book space two to three weeks in advance. The rising demand on the trans-Pacific can be seen in data from air cargo analyst Rotate, which shows an 11% increase in air cargo capacity on the Asia-North America route last week compared with the average capacity deployed over the previous four weeks. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="d1642275-60f0-447f-84f8-8fd17fcb6d8f"></dynamic-object></div>China to US spot rates are rising in tandem with the increasing demand; as of June 1, they were up 14% from the first week of May at $4.31 per kilogram, according to Xeneta. Nadeem Sultan, senior vice president of cargo planning and freighters at Emirates SkyCargo, said general air freight volume was growing on Asia-North America but airlines remained in a holding pattern regarding the tariffs. “We are seeing that demand rise, but right now, everybody is waiting until mid-August when the 90-day pause in [China] tariffs ends to see what the permanent rule is going to be,” he said. “Depending on what the politicians say over the coming weeks, corporate companies are going to decide how high the risk is and whether they should be frontloading or not,” Sultan added. “But it is too early for them to make that decision now and I would say by the middle of July we will have more clarity.” <h3>E-commerce is ‘a way of life’ </h3>While e-commerce volume is currently under pressure, airlines and aircraft manufacturers at Air Cargo Europe were bullish on future air cargo demand. “Overall, e-commerce is still robust and will still be a sizable driver within air freight in the years ahead,” von Tronchin said. “It has become a way of life, and we’re used to that way of life, and I don’t think any of us are necessarily going to change it.” Jannie Davel, CEO of MSC Air Cargo, agreed, noting that e-commerce would remain a core component of air freight, and that the market would rebalance, although not to the high demand of the past. Davel added that shippers of general cargo were also adapting to changing trade flows as the tariffs forced Asian manufacturers to adjust production strategies. “We are seeing a lot of high-tech manufacturing shifting out of China to South Asia, so even if the tariffs are maintained, the trade will still be there,” he said. “It will maybe take some time to adjust, but then it will balance out.” The bullish view on air cargo demand was shared by Boeing and Airbus. Even with the US-China trade war roiling international markets and changing demand patterns, the plane makers have left their 20-year market forecasts unchanged. John Purdoch, director of product marketing of freighters at Boeing, said all the fundamentals in the market remained in place to support long-term growth. “Over the next 20 years, almost 3,000 new freighters will enter the market in all segments, and over 800 of those in the large, wide-body space,” Purdoch said. “We believe we are on a long-term growth path of 4% growth year over year for the next 20 years.” Von Tronchin said Airbus was “in the long-term game,” adding that the current disruptions to the market were temporary. “Our global market forecast is for 20 years, and as we saw in COVID-19 and after the financial crisis, air cargo has always come back to a trend of 3% to 4% growth per year,” he said. “Air cargo will remain a growth industry, independent of the short-term effects we are seeing.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

MUNICH — Trans-Pacific air cargo demand is showing signs of recovery amid restocking efforts in the US, with airlines bringing back some of the freighter capacity that had been shifted out of the trade lane to serve strengthening general cargo markets. But the volume generated by seasonal tech product launches, semiconductors, perishables and pharma — and boosted by shippers being forced into the air as China-US ocean space tightens — will not replace the massive demand for e-commerce that filled dozens of freighters per day, according to Airbus. “E-commerce has been driving freight demand over the past years, and the big question out there is what’s going to happen to it,” Oliver von Tronchin, head of freighter marketing at the French aircraft manufacturer, told an Air Cargo Europe panel at the Transport Logistic exhibition this week. “What we are looking at is the change to the de minimis rule and the European equivalent, and if a $2.75 item is left with $100 flat fee from the US, people will not buy that item,” 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. The European Union is proposing a €2 handling fee for small parcels under €150 from China that would be paid by online retailers, such as Shein and Temu, but Brussels has not set an implementation date. In 2024, e-commerce shipments accounted for about 50% of China-to-US air freight volume, according to rate benchmarking platform Xeneta. Since the duty-free status of low-value Chinese imports was revoked in May, the volume has declined. The drop in trans-Pacific air freight is a leading factor in the International Air Transport Association’s (IATA’s) forecast of little to no growth in global air cargo volume for 2025, a huge climb down from the 12% jump in year over year demand in 2024. Challenge to match supply and demand Airlines are trying to match supply with demand, but those on the trans-Pacific are not being helped by the policy changes emanating from the White House. China-US tonnage in mid-May was down 25% year over year, with freighter capacity down 40%, according to Cargo Facts Consulting. As volume began to recover over the last two weeks, it encouraged carriers to bring back freighters, but with e-commerce demand muted, most of the returning lift was serving general cargo. C.H. Robinson noted in a market update this week that airlines were being cautious in adding capacity as demand recovers, with that balancing act expected to tighten available space and push rates higher throughout June, especially for non-priority shipments. The forwarder warned that end-of-quarter demand and tariff deadlines will likely create bottlenecks for last-minute bookings on China-US routes and advised shippers to explore alternate routes through Southeast Asia and book space two to three weeks in advance. The rising demand on the trans-Pacific can be seen in data from air cargo analyst Rotate, which shows an 11% increase in air cargo capacity on the Asia-North America route last week compared with the average capacity deployed over the previous four weeks. China to US spot rates are rising in tandem with the increasing demand; as of June 1, they were up 14% from the first week of May at $4.31 per kilogram, according to Xeneta. Nadeem Sultan, senior vice president of cargo planning and freighters at Emirates SkyCargo, said general air freight volume was growing on Asia-North America but airlines remained in a holding pattern regarding the tariffs. “We are seeing that demand rise, but right now, everybody is waiting until mid-August when the 90-day pause in [China] tariffs ends to see what the permanent rule is going to be,” he said. “Depending on what the politicians say over the coming weeks, corporate companies are going to decide how high the risk is and whether they should be frontloading or not,” Sultan added. “But it is too early for them to make that decision now and I would say by the middle of July we will have more clarity.” E-commerce is ‘a way of life’ While e-commerce volume is currently under pressure, airlines and aircraft manufacturers at Air Cargo Europe were bullish on future air cargo demand. “Overall, e-commerce is still robust and will still be a sizable driver within air freight in the years ahead,” von Tronchin said. “It has become a way of life, and we’re used to that way of life, and I don’t think any of us are necessarily going to change it.” Jannie Davel, CEO of MSC Air Cargo, agreed, noting that e-commerce would remain a core component of air freight, and that the market would rebalance, although not to the high demand of the past. Davel added that shippers of general cargo were also adapting to changing trade flows as the tariffs forced Asian manufacturers to adjust production strategies. “We are seeing a lot of high-tech manufacturing shifting out of China to South Asia, so even if the tariffs are maintained, the trade will still be there,” he said. “It will maybe take some time to adjust, but then it will balance out.” The bullish view on air cargo demand was shared by Boeing and Airbus. Even with the US-China trade war roiling international markets and changing demand patterns, the plane makers have left their 20-year market forecasts unchanged. John Purdoch, director of product marketing of freighters at Boeing, said all the fundamentals in the market remained in place to support long-term growth. “Over the next 20 years, almost 3,000 new freighters will enter the market in all segments, and over 800 of those in the large, wide-body space,” Purdoch said. “We believe we are on a long-term growth path of 4% growth year over year for the next 20 years.” Von Tronchin said Airbus was “in the long-term game,” adding that the current disruptions to the market were temporary. “Our global market forecast is for 20 years, and as we saw in COVID-19 and after the financial crisis, air cargo has always come back to a trend of 3% to 4% growth per year,” he said. “Air cargo will remain a growth industry, independent of the short-term effects we are seeing.” Contact Greg Knowler at greg.knowler@spglobal.com .

Air Cargo

Signs of air cargo recovery on the trans-Pacific as freighter aircraft return

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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">The intermodal yard and attached warehouse park would be developed about 50 miles outside the city and are part of a $170 million investment plan unveiled by the railroad. </div>

The intermodal yard and attached warehouse park would be developed about 50 miles outside the city and are part of a $170 million investment plan unveiled by the railroad.

<div class="phx-topic">Canadian National (CN) said Wednesday it plans to invest $170 million in its Illinois rail operations, including the development of a long-planned logistics park outside of Chicago. CN said that along with track maintenance and other infrastructure projects in the state, the investment will go toward the construction of the “Chicago Logistics Hub,” a 900-acre development site about 50 miles outside Chicago. The site, located in the village of Channahon, will include an intermodal yard and a business park for warehouses, CN said in a statement. The railroad acquired the site when it bought the Elgin, Joliet and Eastern Railway in 2009. CN has previously said that acquiring rail trackage outside of the metropolitan Chicago region provides an advantage in transit times of up to 48 hours relative to other Class I railroads. “Our continued infrastructure investment in Illinois will help strengthen the resiliency and efficiency of our network across the state,” CN Chief Executive Tracy Robinson said in the statement. Earlier this year, CN completed a project to extend siding track for four miles in the Chicago area to improve fluidity and railcar capacity in the region. The $54 million siding project was part of CN’s 2024 capital budget in the state, including $15 million for containers and yard equipment and $10 million for its other intermodal hubs. CN is expected to break ground on the new hub this year, according to the village of Channahon, with the project scheduled to be completed in late 2027 or early 2028. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Canadian National (CN) said Wednesday it plans to invest $170 million in its Illinois rail operations, including the development of a long-planned logistics park outside of Chicago. CN said that along with track maintenance and other infrastructure projects in the state, the investment will go toward the construction of the “Chicago Logistics Hub,” a 900-acre development site about 50 miles outside Chicago. The site, located in the village of Channahon, will include an intermodal yard and a business park for warehouses, CN said in a statement. The railroad acquired the site when it bought the Elgin, Joliet and Eastern Railway in 2009. CN has previously said that acquiring rail trackage outside of the metropolitan Chicago region provides an advantage in transit times of up to 48 hours relative to other Class I railroads. “Our continued infrastructure investment in Illinois will help strengthen the resiliency and efficiency of our network across the state,” CN Chief Executive Tracy Robinson said in the statement. Earlier this year, CN completed a project to extend siding track for four miles in the Chicago area to improve fluidity and railcar capacity in the region. The $54 million siding project was part of CN’s 2024 capital budget in the state, including $15 million for containers and yard equipment and $10 million for its other intermodal hubs. CN is expected to break ground on the new hub this year, according to the village of Channahon, with the project scheduled to be completed in late 2027 or early 2028. Contact Michael Angell at michael.angell@spglobal.com .

Intermodal providers

Rail News

Canadian National to move forward on new Chicago-area logistics hub

<div class="phx-topic abstract-wrapper">The railroad said the higher fees, which are temporary, are meant to keep terminals fluid amid the higher volume of imports expected to land in the US over the coming weeks.</div>

The railroad said the higher fees, which are temporary, are meant to keep terminals fluid amid the higher volume of imports expected to land in the US over the coming weeks.

<div class="phx-topic">Norfolk Southern Railway (NS) will temporarily increase storage fees on cargo owners who do not retrieve their containers promptly, a measure the railroad says is intended to preserve terminal fluidity amid an expected surge in freight volume. The higher storage fees, a form of demurrage, will apply to ocean containers available for pickup beginning July 7. NS said the storage fees will be rolled back to current levels once port activity slows down. Domestic intermodal loads are not affected. Under the fee structure, ocean containers left more than two days beyond the free-time window will incur daily penalties of $200 per day, double the standard $100 rate. The fee rises to $300 after six days, up from the usual $200. An importer that leaves a container at an NS terminal for seven days beyond the free-time allowance would pay $1,500 per box, compared with $900 under the standard storage scale. The free-time window won’t change. In major terminals, the shipper has the day of notification plus an additional 24 hours to get the container out without penalties. If NS notifies the shipper after 5 p.m. local time, the next calendar day is treated as the start of the free-time period. <h3>‘Well-positioned’ to handle volume surge </h3>Meanwhile, NS’ intermodal network has been steady so far this year. The railroad’s intermodal traffic, both international and domestic containers, was up 3.5% through the end of May compared with the first five months of last year, according to data from the Association of American Railroads. “If we have any kind of surge that folks have been talking about, we’re well-positioned to handle it,” Jason Zampi, NS’ CFO, said Tuesday at a Wells Fargo investors conference. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="46372146-c5b4-4ec6-b12b-784cbc5611a9"></dynamic-object></div>NS’ Intermodal Service Z-score, as measured by the Journal of Commerce, has hovered near zero, indicating service levels remain close to long-term norms dating back to 2017. The metric compares intermodal train speeds, intermodal trains holding, and loaded intermodal railcars idling for more than 48 hours each week with the railroad’s own historical averages, as reported to the US Surface Transportation Board. Intermodal train speeds have been faster than the long-term average in 12 of the first 22 weeks, while the number of loaded intermodal railcars sitting idle for more than 48 hours was evenly split — 11 weeks above average, 11 below. NS in January introduced a <a href="https://www.joc.com/article/norfolk-southern-launches-appointment-system-at-landers-terminal-5934009">mandatory appointment system</a> at its Landers terminal in Chicago for retrieving ocean containers from terminal stacks. The new system may face its most significant test yet in the coming weeks. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Norfolk Southern Railway (NS) will temporarily increase storage fees on cargo owners who do not retrieve their containers promptly, a measure the railroad says is intended to preserve terminal fluidity amid an expected surge in freight volume. The higher storage fees, a form of demurrage, will apply to ocean containers available for pickup beginning July 7. NS said the storage fees will be rolled back to current levels once port activity slows down. Domestic intermodal loads are not affected. Under the fee structure, ocean containers left more than two days beyond the free-time window will incur daily penalties of $200 per day, double the standard $100 rate. The fee rises to $300 after six days, up from the usual $200. An importer that leaves a container at an NS terminal for seven days beyond the free-time allowance would pay $1,500 per box, compared with $900 under the standard storage scale. The free-time window won’t change. In major terminals, the shipper has the day of notification plus an additional 24 hours to get the container out without penalties. If NS notifies the shipper after 5 p.m. local time, the next calendar day is treated as the start of the free-time period. ‘Well-positioned’ to handle volume surge Meanwhile, NS’ intermodal network has been steady so far this year. The railroad’s intermodal traffic, both international and domestic containers, was up 3.5% through the end of May compared with the first five months of last year, according to data from the Association of American Railroads. “If we have any kind of surge that folks have been talking about, we’re well-positioned to handle it,” Jason Zampi, NS’ CFO, said Tuesday at a Wells Fargo investors conference. NS’ Intermodal Service Z-score, as measured by the Journal of Commerce, has hovered near zero, indicating service levels remain close to long-term norms dating back to 2017. The metric compares intermodal train speeds, intermodal trains holding, and loaded intermodal railcars idling for more than 48 hours each week with the railroad’s own historical averages, as reported to the US Surface Transportation Board. Intermodal train speeds have been faster than the long-term average in 12 of the first 22 weeks, while the number of loaded intermodal railcars sitting idle for more than 48 hours was evenly split — 11 weeks above average, 11 below. NS in January introduced a mandatory appointment system at its Landers terminal in Chicago for retrieving ocean containers from terminal stacks. The new system may face its most significant test yet in the coming weeks. Contact Ari Ashe at ari.ashe@spglobal.com .

Norfolk Southern will raise container storage fees ahead of expected surge

<div class="phx-topic abstract-wrapper">A widening spread between the West and East coasts comes as carriers have added fresh capacity, especially to Southern California, to take advantage of what had been a sharp jump in demand and rates following the US pause on higher tariffs against China.</div>

A widening spread between the West and East coasts comes as carriers have added fresh capacity, especially to Southern California, to take advantage of what had been a sharp jump in demand and rates following the US pause on higher tariffs against China.

<div class="phx-topic">Spot ocean rates on the eastbound trans-Pacific are diverging sharply this week, with prices to the US West Coast softening amid a fresh capacity injection and the East Coast market still showing strength. Rates to the West Coast were $5,700 per FEU as of June 9, down 6% on the week, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. East Coast rates, meanwhile, were up 4% at $7,400 per FEU. The $1,700 spread between the coasts is the widest variance since late January and comes as ocean carriers have moved capacity to Asia-West Coast routes to take advantage of what had been <a href="https://www.joc.com/article/pause-on-tariffs-prompts-us-retailers-to-upgrade-summer-import-forecast-6022230">a sharp jump in demand and rates following the 90-day pause</a> announced May 12 by the Trump administration on higher tariffs against China. “The rates for cargo coming into the Pacific Southwest are going down, but pricing to the US East Coast is actually going up,” Stephen A. Nothdurft, vice president of sales for North America at the forwarder MOL Consolidation Services, told the Journal of Commerce. “It’s due to all of these extra-loaders and services returning into rotation [to Los Angeles-Long Beach].” The spot rate variance between the two coasts is capacity-driven, Nothdurft said. “It’s a bit of an indication that the so-called ‘normal’ differential of $1,000 is all really based on supply and demand,” he said. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e8c13a3e-9f5a-412f-8741-adbf5e1a7779"></dynamic-object></div>A carrier executive told the Journal of Commerce that carriers have been “way too aggressive” in <a href="https://www.joc.com/article/ocean-carriers-bring-in-more-trans-pacific-container-services-amid-rate-surge-6012725">adding capacity to the West Coast</a>, especially Southern California. Vessels leaving Asia for Los Angeles-Long Beach have been “half-full,” driving spot rates lower, the executive said. He added that despite what the indexes say, the spot rates that are actually moving cargo today to the Southern California gateway are $4,000 to $5,000 per FEU. <h3>East Coast volumes to build, then taper quickly </h3>A second carrier executive expects volumes will build to the East Coast in the coming weeks because retailers there must ship their holiday merchandise soon in order to have goods on the store shelves for the Black Friday sales on the day after Thanksgiving. “The volumes are going to be there,” the source said, adding carriers in the coming weeks are likely to add capacity to key East Coast gateways such as New York-New Jersey and Savannah. Despite the uncertainty over tariffs that is likely to continue into July for most Asian countries and into August for China, retailers importing through East Coast ports have to finalize their year-end holiday orders with factories in Asia and ship the merchandise soon, said Kevin Parkerson, an industry consultant and former logistics manager at national retailers. “For the East Coast, the deadline is early August,” Parkerson said. Forwarders say that with the extensive frontloading of product that has already taken place, it is likely the increased imports through the East Coast will taper off by late July. “Time will tell, but I’m not 100% confident in the East Coast extending its imports for very long,” said Jason Cook, CEO of Ardent Global Logistics. Contact Laura Robb at <a href="mailto:laura.robb@spglobal.com">laura.robb@spglobal.com</a>.Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Spot ocean rates on the eastbound trans-Pacific are diverging sharply this week, with prices to the US West Coast softening amid a fresh capacity injection and the East Coast market still showing strength. Rates to the West Coast were $5,700 per FEU as of June 9, down 6% on the week, according to Platts, a sister company of the Journal of Commerce within S&P Global. East Coast rates, meanwhile, were up 4% at $7,400 per FEU. The $1,700 spread between the coasts is the widest variance since late January and comes as ocean carriers have moved capacity to Asia-West Coast routes to take advantage of what had been a sharp jump in demand and rates following the 90-day pause announced May 12 by the Trump administration on higher tariffs against China. “The rates for cargo coming into the Pacific Southwest are going down, but pricing to the US East Coast is actually going up,” Stephen A. Nothdurft, vice president of sales for North America at the forwarder MOL Consolidation Services, told the Journal of Commerce. “It’s due to all of these extra-loaders and services returning into rotation [to Los Angeles-Long Beach].” The spot rate variance between the two coasts is capacity-driven, Nothdurft said. “It’s a bit of an indication that the so-called ‘normal’ differential of $1,000 is all really based on supply and demand,” he said. A carrier executive told the Journal of Commerce that carriers have been “way too aggressive” in adding capacity to the West Coast , especially Southern California. Vessels leaving Asia for Los Angeles-Long Beach have been “half-full,” driving spot rates lower, the executive said. He added that despite what the indexes say, the spot rates that are actually moving cargo today to the Southern California gateway are $4,000 to $5,000 per FEU. East Coast volumes to build, then taper quickly A second carrier executive expects volumes will build to the East Coast in the coming weeks because retailers there must ship their holiday merchandise soon in order to have goods on the store shelves for the Black Friday sales on the day after Thanksgiving. “The volumes are going to be there,” the source said, adding carriers in the coming weeks are likely to add capacity to key East Coast gateways such as New York-New Jersey and Savannah. Despite the uncertainty over tariffs that is likely to continue into July for most Asian countries and into August for China, retailers importing through East Coast ports have to finalize their year-end holiday orders with factories in Asia and ship the merchandise soon, said Kevin Parkerson, an industry consultant and former logistics manager at national retailers. “For the East Coast, the deadline is early August,” Parkerson said. Forwarders say that with the extensive frontloading of product that has already taken place, it is likely the increased imports through the East Coast will taper off by late July. “Time will tell, but I’m not 100% confident in the East Coast extending its imports for very long,” said Jason Cook, CEO of Ardent Global Logistics. Contact Laura Robb at laura.robb@spglobal.com .Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Port News

Container lines

Asia-USWC spot rates weakening as vessel overcapacity takes hold

<div class="phx-topic abstract-wrapper">Demand from Cargado’s freight broker customers to add US-Canada carriers to its vetted network led the company to move to the northern border. </div>

Demand from Cargado’s freight broker customers to add US-Canada carriers to its vetted network led the company to move to the northern border.

<div class="phx-topic">Cross-border load board provider Cargado on Monday said it has expanded into Canada to complement its existing marketplace for US-Mexico truckload freight. The expansion, driven by demand from its freight broker customers, gives brokers access to Cargado’s network of vetted cross-border carriers that operate between the US and Mexico. Cargado’s customers include eight of the top 10 US freight brokers and more than half of the top 100. “Canadian expansion was a highly requested feature among our customers,” Cargado CEO Matt Silver said in a statement. The company also released a new rate benchmarking feature Monday, Cargado Market Rates, that allows brokers to see current and historical lane-level pricing data to inform their quoting activity to shippers. The benchmarking tool is based on more than 35,000 historical bids and freight matches between brokers and carriers, Cargado Chief Technology Officer Rylan Hawkins said in the statement. Cargado is connected to more than 200 brokers and 900 carriers. Founded in April 2024 as a cross-border load board specialist, Cargado in April <a href="https://www.joc.com/article/mexico-potential-leads-investors-to-back-cross-border-load-board-5978223">landed a $12 million funding round</a> from investors to build out its invite-only product addressing the fast-growing US-Mexico freight market. The company has raised a total of $22 million from investors including LGVP, Conversion Capital, Assembly Ventures and RyderVentures. Silver previously <a href="https://www.joc.com/article/arrive-logistics-moves-into-cross-border-freight-with-forager-acquisition-5225326">sold the cross-border broker he founded</a>, Forager, to Arrive Logistics in 2022. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

Cross-border load board provider Cargado on Monday said it has expanded into Canada to complement its existing marketplace for US-Mexico truckload freight. The expansion, driven by demand from its freight broker customers, gives brokers access to Cargado’s network of vetted cross-border carriers that operate between the US and Mexico. Cargado’s customers include eight of the top 10 US freight brokers and more than half of the top 100. “Canadian expansion was a highly requested feature among our customers,” Cargado CEO Matt Silver said in a statement. The company also released a new rate benchmarking feature Monday, Cargado Market Rates, that allows brokers to see current and historical lane-level pricing data to inform their quoting activity to shippers. The benchmarking tool is based on more than 35,000 historical bids and freight matches between brokers and carriers, Cargado Chief Technology Officer Rylan Hawkins said in the statement. Cargado is connected to more than 200 brokers and 900 carriers. Founded in April 2024 as a cross-border load board specialist, Cargado in April landed a $12 million funding round from investors to build out its invite-only product addressing the fast-growing US-Mexico freight market. The company has raised a total of $22 million from investors including LGVP, Conversion Capital, Assembly Ventures and RyderVentures. Silver previously sold the cross-border broker he founded , Forager, to Arrive Logistics in 2022. Contact Eric Johnson at eric.johnson@spglobal.com .

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