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<div class="phx-topic abstract-wrapper">The LNG market is cementing its position as the alternative fuel of choice for the container shipping industry with significant expansion in ship orders and global bunkering infrastructure, a SEA-LNG report has found.</div>

The LNG market is cementing its position as the alternative fuel of choice for the container shipping industry with significant expansion in ship orders and global bunkering infrastructure, a SEA-LNG report has found.

Feature image

<div class="phx-topic">Ocean carriers operating and ordering liquefied natural gas-capable vessels are effectively “inoculating” themselves against ongoing regulatory uncertainty, according to industry coalition SEA-LNG. The shift to LNG as an interim alternative fuel reduces emissions to comply with European Union rules and has a lower cost of compliance with EU and potential future decarbonization regulations from the International Maritime Organization (IMO) compared with alternative fuels, SEA-LNG noted in its “View from the Bridge” report released this week. “It is clear LNG is on a runway to the future,” Peter Keller, chairman of SEA-LNG, told the Journal of Commerce in London following publication of the report. "Most of the alternative fuel ships in the container shipping order book are LNG-capable and our direction could not be clearer.” Despite uncertainties caused by the IMO’s decision to delay the adoption of its net zero framework, the container shipping industry has continued to invest heavily in dual-fuel vessels and bunkering infrastructure. The swelling order book growth in 2025 was dominated by the container sector, which accounted for 88% of LNG dual-fuel orders, with 61% of those orders for vessels with a capacity of 14,500 to 24,000 TEUs. Data from Sea-web, a sister company of the Journal of Commerce within S&amp;P Global, shows that just over 4 million TEUs of capacity for LNG dual-fuel ships was on order in 2025, compared to 2 million TEUs of methanol-capable vessels. The SEA-LNG report estimated that investment in LNG dual-fuel vessels and associated fuel supply chains over the past 10 years has amounted to more than $150 billion. A large portion of that is going into the supply side, with fuel availability at scale crucial for the global shipping industry. <h3>Surge in European demand </h3>The report said bunkering of liquefied biomethane has surged in Europe over the past year, driven by increasingly stringent EU regulations and voluntary, customer-related commitments. “Demand for LNG as a marine fuel has grown significantly over the past year, driven not only by regulatory developments like FuelEU Maritime but also by the growth of the LNG dual-fuel fleet,” Michael Schaap, commercial director of Titan Clean Fuels, said in the report. In 2024, the LNG market size was about 406 million metric tons, or approximately 100 times the current consumption of LNG as a marine fuel, the report noted. There is over 1 billion mt per annum of LNG import terminal capacity with terminals in, or near, all major bunkering ports. As demand from shipping grows for green methane, biomethane and e-methane, their production facilities can plug into the existing infrastructure. LNG bunkering is currently available in 222 ports worldwide, with plans underway to add a further 622. By the end of 2025, there were 62 LNG bunker vessels operating in hubs such as Rotterdam, Zeebrugge, Barcelona, Singapore, Shanghai, and the US East Coast, and 38 LNG bunker vessels on order. Shell is forecasting an LNG bunker market size of more than 15 million mt per annum by 2030, driven by the rapid growth in the LNG dual-fuel fleet and projected declines in LNG prices. Future LNG prices are forecast to drop with approximately 170 million mt per annum of new liquefaction capacity coming on stream by 2030, representing about a 42% increase in LNG supply. Regulatory uncertainty reached a head in October last year when the IMO decided to <a href="https://www.joc.com/article/imo-punts-on-pivotal-net-zero-shipping-regulation-6099141">postpone the adoption of its global net-zero framework</a> for a year following robust US-led opposition to the proposed pricing and fuel intensity measures. The IMO will focus on building consensus around its net-zero framework this year before a reconvened Marine Environment Protection Committee meets in October to finalize the legally binding measures. While many member states and non-governmental groups were frustrated, the SEA-LNG report said the delay offered an opportunity for the IMO to find the right way forward. “We need certainty because without that we risk other components getting in the way,” SEA-LNG's Keller told the Journal of Commerce. “Regulations can bring unintended consequences, especially when you are dealing with 176 countries that all have their own ideas of what should be in the regulations.” <h3>Avoiding double compliance costs </h3>The SEA-LNG report called on the IMO to ensure a single global decarbonization framework for maritime, with any local or regional regulations converging with IMO regulations to avoid double compliance costs. The industry coalition wants the net-zero framework to be based on regulations that were goal-based and technology-neutral, protecting first movers and incentivizing solutions that were practical, scalable and investable. “If the IMO makes any fuel prescriptive it could hurt the early movers and we don’t want that,” Keller said. The SEA-LNG report also addressed “methane slip” from ships under power from LNG and “fugitive emissions” in the LNG supply chain, with climate activists pointing out that methane from fossil LNG is a far more potent greenhouse gas than CO2 emissions. SEA-LNG said methane slip had to be resolved if LNG was going to become a long-term and viable solution towards net-zero, and the coalition and other industry groups were making progress in addressing the issue. The report stated that across the global LNG fueled fleet, methane slip in the latest low-pressure engine technologies had fallen by 60% and would be resolved by 2030. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Ocean carriers operating and ordering liquefied natural gas-capable vessels are effectively “inoculating” themselves against ongoing regulatory uncertainty, according to industry coalition SEA-LNG. The shift to LNG as an interim alternative fuel reduces emissions to comply with European Union rules and has a lower cost of compliance with EU and potential future decarbonization regulations from the International Maritime Organization (IMO) compared with alternative fuels, SEA-LNG noted in its “View from the Bridge” report released this week. “It is clear LNG is on a runway to the future,” Peter Keller, chairman of SEA-LNG, told the Journal of Commerce in London following publication of the report. "Most of the alternative fuel ships in the container shipping order book are LNG-capable and our direction could not be clearer.” Despite uncertainties caused by the IMO’s decision to delay the adoption of its net zero framework, the container shipping industry has continued to invest heavily in dual-fuel vessels and bunkering infrastructure. The swelling order book growth in 2025 was dominated by the container sector, which accounted for 88% of LNG dual-fuel orders, with 61% of those orders for vessels with a capacity of 14,500 to 24,000 TEUs. Data from Sea-web, a sister company of the Journal of Commerce within S&P Global, shows that just over 4 million TEUs of capacity for LNG dual-fuel ships was on order in 2025, compared to 2 million TEUs of methanol-capable vessels. The SEA-LNG report estimated that investment in LNG dual-fuel vessels and associated fuel supply chains over the past 10 years has amounted to more than $150 billion. A large portion of that is going into the supply side, with fuel availability at scale crucial for the global shipping industry. Surge in European demand The report said bunkering of liquefied biomethane has surged in Europe over the past year, driven by increasingly stringent EU regulations and voluntary, customer-related commitments. “Demand for LNG as a marine fuel has grown significantly over the past year, driven not only by regulatory developments like FuelEU Maritime but also by the growth of the LNG dual-fuel fleet,” Michael Schaap, commercial director of Titan Clean Fuels, said in the report. In 2024, the LNG market size was about 406 million metric tons, or approximately 100 times the current consumption of LNG as a marine fuel, the report noted. There is over 1 billion mt per annum of LNG import terminal capacity with terminals in, or near, all major bunkering ports. As demand from shipping grows for green methane, biomethane and e-methane, their production facilities can plug into the existing infrastructure. LNG bunkering is currently available in 222 ports worldwide, with plans underway to add a further 622. By the end of 2025, there were 62 LNG bunker vessels operating in hubs such as Rotterdam, Zeebrugge, Barcelona, Singapore, Shanghai, and the US East Coast, and 38 LNG bunker vessels on order. Shell is forecasting an LNG bunker market size of more than 15 million mt per annum by 2030, driven by the rapid growth in the LNG dual-fuel fleet and projected declines in LNG prices. Future LNG prices are forecast to drop with approximately 170 million mt per annum of new liquefaction capacity coming on stream by 2030, representing about a 42% increase in LNG supply. Regulatory uncertainty reached a head in October last year when the IMO decided to postpone the adoption of its global net-zero framework for a year following robust US-led opposition to the proposed pricing and fuel intensity measures. The IMO will focus on building consensus around its net-zero framework this year before a reconvened Marine Environment Protection Committee meets in October to finalize the legally binding measures. While many member states and non-governmental groups were frustrated, the SEA-LNG report said the delay offered an opportunity for the IMO to find the right way forward. “We need certainty because without that we risk other components getting in the way,” SEA-LNG's Keller told the Journal of Commerce. “Regulations can bring unintended consequences, especially when you are dealing with 176 countries that all have their own ideas of what should be in the regulations.” Avoiding double compliance costs The SEA-LNG report called on the IMO to ensure a single global decarbonization framework for maritime, with any local or regional regulations converging with IMO regulations to avoid double compliance costs. The industry coalition wants the net-zero framework to be based on regulations that were goal-based and technology-neutral, protecting first movers and incentivizing solutions that were practical, scalable and investable. “If the IMO makes any fuel prescriptive it could hurt the early movers and we don’t want that,” Keller said. The SEA-LNG report also addressed “methane slip” from ships under power from LNG and “fugitive emissions” in the LNG supply chain, with climate activists pointing out that methane from fossil LNG is a far more potent greenhouse gas than CO2 emissions. SEA-LNG said methane slip had to be resolved if LNG was going to become a long-term and viable solution towards net-zero, and the coalition and other industry groups were making progress in addressing the issue. The report stated that across the global LNG fueled fleet, methane slip in the latest low-pressure engine technologies had fallen by 60% and would be resolved by 2030. Contact Greg Knowler at greg.knowler@spglobal.com .

Container lines

Container Shipping News

Clear direction set for LNG amid ongoing regulatory uncertainty: industry group 

<div class="phx-topic abstract-wrapper">The feeling that an arms race for bigger ships and a rush for alternative fuels has overtaken purely rational decision making is strong, writes Jeremy Masters.</div>

The feeling that an arms race for bigger ships and a rush for alternative fuels has overtaken purely rational decision making is strong, writes Jeremy Masters.

<div class="phx-topic">If you look at Alphaliner’s data on the cellular newbuilding order book, there are some striking numbers at both ends of the spectrum. The most obvious place to start is the 18,000 to 24,000-TEU range because that is where the biggest impacts are made in overall capacity injection, and there are multiple knock-on effects through cascading. According to Alphaliner in December, the total TEUs on order in the 18,000 to 24,000-TEU range as a percentage of the existing fleet size was a staggering 81%. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6156554_0.1.jpg"></img></div>If we look at where 18,000 to 24,000-TEU ships are deployed today, based on the capability to handle the vessels, the biggest concentration by far is in the Far East to North Europe and Mediterranean lanes. Given that the trade is already tending to an oversupply position, even just upgrading existing loops is going to severely test the limits of absorption. A return to Suez routing – and thus less ships required for the same weekly services – would seem to guarantee a severe overhang of capacity. Given this reality, some of the carriers’ options are: 1.	Tying up whole strings of expensive high-spec ships versus tinkering with blank sailings. This is a tough call, but the economics stack up if the supply/demand position moves enough in favor of the carriers and rates can be significantly increased. 2.	Retaining some loops around the Cape of Good Hope is a justifiable reaction to an unpredictable Middle East situation and would indeed be welcomed by a portion of clients not wishing to be caught with all their fish in the wrong basket. 3.	Super slow-steaming is an option, but of course this will extend transit times and has the potential to create competitive problems if it is not universally applied. Ironically, a reopening of the Suez routing would allow carriers to test the limits on slow-steaming without extending clients’ transit times. 4.	Scrapping is sometimes touted by carrier executives as one of the key cures for overcapacity. But the reality is that the oldest ships are in the smaller sizes, thus even if they are scrapped, the impact will not be great unless it’s on a very big scale, and those size ships are currently in great demand. Almost 1.3 million TEUs in capacity for ultra-large container ships was on order in 2025, according to Sea-web, a sister product of the Journal of Commerce within S&amp;P Global. <h3>‘Arms race’ for bigger ships? </h3>Of the options above, pulling full strings of large ships is clearly the most radical and impactful, but may be sidelined because it’s difficult to explain internally, and externally could provoke a barrage of complaint and regulatory investigation. As it is likely that the other measures plus some blank sailings simply will not be enough to steer supply down to demand, the next area of attention will be expanding the number of trades where we see 18,000-plus TEU ships. Mediterranean Shipping Co.’s (MSC) West Africa Express is instructive because it serves two new areas MSC has opened for big ships — West Africa and India. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="83f8b939-db16-47a4-b70a-8715aaf729ec"></dynamic-object></div>West Africa has four ports on that service, but India has only one, Vizhinjam. But there is connectivity at Vizhinjam to both local feeders and other deep-sea services (hub-and-spoke) where the spokes can be short and long. Given that there are several geographies like India where there are only a small number of ports able to take the very biggest ships, it could well be that the surplus of big ships creates more hub-and-spoke systems as carriers push these ships into more trades and the limited number of ports that can handle them. These may not initially be the 24,000-TEU ships which would be natural to use to upgrade European services (even if it means having fewer services), but there will be a cascading of capacity and thus a desire to deploy bigger ships in more places. If you are a port or port operator in a region where there are size constraints, there has never been a better time to positively differentiate yourself by upgrading or finding green field sites that can accommodate the biggest ships. The feeling that an arms race in the bigger sizes and a rush for alternative fuels has overtaken purely rational decision making is strong. That is reinforced by looking at the smaller-size ships which have been in very heavy demand, so one might expect strong newbuild ordering. Alphaliner reported in December that the order book as a percentage of existing capacity for 4,000 to 5,099-TEU ships was 10.4%, and for 5,100 to 7,499-TEU ships was 7.3%. This has gone up quite a bit in recent months, but is still relatively sane. If there is a disconnect today with freight markets, it’s not as widely advertised in the charter market, but in the newbuild market. Jeremy Masters is managing director of Shipping Masters. Contact him at <a href="mailto:jeremy@shippingmastershk.com">jeremy@shippingmastershk.com.</a></div>

If you look at Alphaliner’s data on the cellular newbuilding order book, there are some striking numbers at both ends of the spectrum. The most obvious place to start is the 18,000 to 24,000-TEU range because that is where the biggest impacts are made in overall capacity injection, and there are multiple knock-on effects through cascading. According to Alphaliner in December, the total TEUs on order in the 18,000 to 24,000-TEU range as a percentage of the existing fleet size was a staggering 81%. If we look at where 18,000 to 24,000-TEU ships are deployed today, based on the capability to handle the vessels, the biggest concentration by far is in the Far East to North Europe and Mediterranean lanes. Given that the trade is already tending to an oversupply position, even just upgrading existing loops is going to severely test the limits of absorption. A return to Suez routing – and thus less ships required for the same weekly services – would seem to guarantee a severe overhang of capacity. Given this reality, some of the carriers’ options are: 1. Tying up whole strings of expensive high-spec ships versus tinkering with blank sailings. This is a tough call, but the economics stack up if the supply/demand position moves enough in favor of the carriers and rates can be significantly increased. 2. Retaining some loops around the Cape of Good Hope is a justifiable reaction to an unpredictable Middle East situation and would indeed be welcomed by a portion of clients not wishing to be caught with all their fish in the wrong basket. 3. Super slow-steaming is an option, but of course this will extend transit times and has the potential to create competitive problems if it is not universally applied. Ironically, a reopening of the Suez routing would allow carriers to test the limits on slow-steaming without extending clients’ transit times. 4. Scrapping is sometimes touted by carrier executives as one of the key cures for overcapacity. But the reality is that the oldest ships are in the smaller sizes, thus even if they are scrapped, the impact will not be great unless it’s on a very big scale, and those size ships are currently in great demand. Almost 1.3 million TEUs in capacity for ultra-large container ships was on order in 2025, according to Sea-web, a sister product of the Journal of Commerce within S&P Global. ‘Arms race’ for bigger ships? Of the options above, pulling full strings of large ships is clearly the most radical and impactful, but may be sidelined because it’s difficult to explain internally, and externally could provoke a barrage of complaint and regulatory investigation. As it is likely that the other measures plus some blank sailings simply will not be enough to steer supply down to demand, the next area of attention will be expanding the number of trades where we see 18,000-plus TEU ships. Mediterranean Shipping Co.’s (MSC) West Africa Express is instructive because it serves two new areas MSC has opened for big ships — West Africa and India. West Africa has four ports on that service, but India has only one, Vizhinjam. But there is connectivity at Vizhinjam to both local feeders and other deep-sea services (hub-and-spoke) where the spokes can be short and long. Given that there are several geographies like India where there are only a small number of ports able to take the very biggest ships, it could well be that the surplus of big ships creates more hub-and-spoke systems as carriers push these ships into more trades and the limited number of ports that can handle them. These may not initially be the 24,000-TEU ships which would be natural to use to upgrade European services (even if it means having fewer services), but there will be a cascading of capacity and thus a desire to deploy bigger ships in more places. If you are a port or port operator in a region where there are size constraints, there has never been a better time to positively differentiate yourself by upgrading or finding green field sites that can accommodate the biggest ships. The feeling that an arms race in the bigger sizes and a rush for alternative fuels has overtaken purely rational decision making is strong. That is reinforced by looking at the smaller-size ships which have been in very heavy demand, so one might expect strong newbuild ordering. Alphaliner reported in December that the order book as a percentage of existing capacity for 4,000 to 5,099-TEU ships was 10.4%, and for 5,100 to 7,499-TEU ships was 7.3%. This has gone up quite a bit in recent months, but is still relatively sane. If there is a disconnect today with freight markets, it’s not as widely advertised in the charter market, but in the newbuild market. Jeremy Masters is managing director of Shipping Masters. Contact him at jeremy@shippingmastershk.com.

Could the ocean carrier order book be a matter of ‘irrational exuberance’?

<div class="phx-topic abstract-wrapper">The carrier consortium released details of its new network showing a slight uptick in port calls primarily from Southeast Asia and small rotation changes on the US East Coast.</div>

The carrier consortium released details of its new network showing a slight uptick in port calls primarily from Southeast Asia and small rotation changes on the US East Coast.

<div class="phx-topic">Carriers in the Ocean Alliance will be offering North American shippers more connections from Southeast Asia and the Indian subcontinent as part of their 2026 network. Ocean Alliance carriers will also make their first return to the Port of Jacksonville in seven years with a new call on their Gulf Coast service. CMA CGM, Cosco Shipping and Evergreen Marine each announced this week the launch of the Ocean Alliance’s “Day 10” product covering 14 services to the North American West Coast and eight to the East Coast. The new network will go into effect as of April. While the number of services to North America did not change compared with the alliance’s 2025 network, the 2026 network to and from the US and Canada does feature new port rotations that highlight the ongoing shift of US importers away from China. The Port of Haiphong will see the biggest increase in North American connectivity. Calls to the Vietnamese port, where <a href="https://www.joc.com/article/cma-cgm-signs-deal-to-develop-600-million-haiphong-terminal-complex-6012131">CMA CGM plans to build a $600 million terminal</a>, will be added to four trans-Pacific services to North America, according to Cosco’s Day 10 schedule. On the West Coast, those services include the Pacific Southwest 9 (PSW9) service to Long Beach and the Pacific Northwest 2 (PNW2) to the ports of Vancouver and Seattle. Haiphong remains a call for Ocean Alliance’s PSW1 service into Long Beach. However, another Long Beach service, PSW10, that previously called Haiphong as part of the 2025 network, appears to have been dropped in favor of the Port of Laem Chabang in Thailand. Ocean Alliance’s 2025 network previously had no regular service between Southeast Asia and the Pacific Northwest. On the East Coast, Haiphong will be added as a call to the USEC3 and 5 services. Haiphong was previously a call only on the Ocean Alliance’s USEC8 service into Norfolk as of 2025, but that call has been replaced with Vietnam’s Cai Mep as of the 2026 network. Laem Chabang will also be on the new rotation for the PSW7 service into Los Angeles. The Laem Chabang call appears to have replaced a call to Malaysia’s Port Klang featured on the 2025 network. The transshipment port of Colombo in Sri Lanka will also be added to the USEC5 service that makes first call at Savannah, adding a second Ocean Alliance service from the Indian subcontinent along with the current USEC3 service rotation. In addition, Ocean Alliance added Taiwan’s Kaohsiung as a backhaul on three West Coast trans-Pacific services, along with a westbound call to South Korea’s Busan. Chinese port rotations will also see small changes in the 2026 network. The southern China port of Yangpu, across the Beibu Gulf from Haiphong, will be added to the front-haul for the PSW9 and PNW2 services to the West Coast. Tianjin will also be added to the PSW5 service, while Hong Kong will be added to the PNW2 service.China’s Xiamen port will get a second service with a new call on the USEC4 service, adding to an existing call on the USEC2 service. But a previous Xiamen call on the USEC5 appears to have been dropped in favor of the new Haiphong call. Amid the ongoing sourcing shift away from China, container volumes from Southeast Asia to the US saw year-over-year gains in every month last year, with 10 of those months seeing double-digit gains, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global.<div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="021af9b6-860f-45a6-99eb-549dc05cabfe"></dynamic-object></div><h3>Jacksonville gets Far East service</h3>Jacksonville this year will be on the rotation for Ocean Alliance’s USEC6 service that covers the US Gulf Coast. The USEC6 previously featured a call to New Orleans, but it’s not included in the 2026 network. While Jacksonville already has Asia services through the Premier Alliance, Mediterranean Shipping Co. and Zim Integrated Shipping, the <a href="https://www.joc.com/article/jaxport-optimistic-on-growth-despite-service-loss-5236112">Ocean Alliance has not been a regular caller to the port since 2019</a> when it dropped Jacksonville on the same service. Other US rotation changes include dropping Charleston from the USEC4 service, while keeping the port on rotation for three other Ocean Alliance services. The USEC4 will replace the Charleston call with a call to Baltimore, but that port will be dropped from the USEC5 service. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

Carriers in the Ocean Alliance will be offering North American shippers more connections from Southeast Asia and the Indian subcontinent as part of their 2026 network. Ocean Alliance carriers will also make their first return to the Port of Jacksonville in seven years with a new call on their Gulf Coast service. CMA CGM, Cosco Shipping and Evergreen Marine each announced this week the launch of the Ocean Alliance’s “Day 10” product covering 14 services to the North American West Coast and eight to the East Coast. The new network will go into effect as of April. While the number of services to North America did not change compared with the alliance’s 2025 network, the 2026 network to and from the US and Canada does feature new port rotations that highlight the ongoing shift of US importers away from China. The Port of Haiphong will see the biggest increase in North American connectivity. Calls to the Vietnamese port, where CMA CGM plans to build a $600 million terminal , will be added to four trans-Pacific services to North America, according to Cosco’s Day 10 schedule. On the West Coast, those services include the Pacific Southwest 9 (PSW9) service to Long Beach and the Pacific Northwest 2 (PNW2) to the ports of Vancouver and Seattle. Haiphong remains a call for Ocean Alliance’s PSW1 service into Long Beach. However, another Long Beach service, PSW10, that previously called Haiphong as part of the 2025 network, appears to have been dropped in favor of the Port of Laem Chabang in Thailand. Ocean Alliance’s 2025 network previously had no regular service between Southeast Asia and the Pacific Northwest. On the East Coast, Haiphong will be added as a call to the USEC3 and 5 services. Haiphong was previously a call only on the Ocean Alliance’s USEC8 service into Norfolk as of 2025, but that call has been replaced with Vietnam’s Cai Mep as of the 2026 network. Laem Chabang will also be on the new rotation for the PSW7 service into Los Angeles. The Laem Chabang call appears to have replaced a call to Malaysia’s Port Klang featured on the 2025 network. The transshipment port of Colombo in Sri Lanka will also be added to the USEC5 service that makes first call at Savannah, adding a second Ocean Alliance service from the Indian subcontinent along with the current USEC3 service rotation. In addition, Ocean Alliance added Taiwan’s Kaohsiung as a backhaul on three West Coast trans-Pacific services, along with a westbound call to South Korea’s Busan. Chinese port rotations will also see small changes in the 2026 network. The southern China port of Yangpu, across the Beibu Gulf from Haiphong, will be added to the front-haul for the PSW9 and PNW2 services to the West Coast. Tianjin will also be added to the PSW5 service, while Hong Kong will be added to the PNW2 service. China’s Xiamen port will get a second service with a new call on the USEC4 service, adding to an existing call on the USEC2 service. But a previous Xiamen call on the USEC5 appears to have been dropped in favor of the new Haiphong call. Amid the ongoing sourcing shift away from China, container volumes from Southeast Asia to the US saw year-over-year gains in every month last year, with 10 of those months seeing double-digit gains, according to PIERS, a sister product of the Journal of Commerce within S&P Global. Jacksonville gets Far East service Jacksonville this year will be on the rotation for Ocean Alliance’s USEC6 service that covers the US Gulf Coast. The USEC6 previously featured a call to New Orleans, but it’s not included in the 2026 network. While Jacksonville already has Asia services through the Premier Alliance, Mediterranean Shipping Co. and Zim Integrated Shipping, the Ocean Alliance has not been a regular caller to the port since 2019 when it dropped Jacksonville on the same service. Other US rotation changes include dropping Charleston from the USEC4 service, while keeping the port on rotation for three other Ocean Alliance services. The USEC4 will replace the Charleston call with a call to Baltimore, but that port will be dropped from the USEC5 service. Contact Michael Angell at michael.angell@spglobal.com .

Ocean Alliance adding Vietnam calls to North America for 2026

<div class="phx-topic abstract-wrapper">Container flows at the railroad’s primary Appliance Park terminal slowed considerably in December and into January after it implemented a new appointment system for truck drivers to pick up import boxes.</div>

Container flows at the railroad’s primary Appliance Park terminal slowed considerably in December and into January after it implemented a new appointment system for truck drivers to pick up import boxes.

<div class="phx-topic">Norfolk Southern Railway (NS) is reopening an idled terminal in Louisville, giving the railroad a second facility to support what is now a congested market. The Buechel Intermodal Facility will reopen on Jan. 26 as NS battles long truck turn times and congestion at Appliance Park, its primary terminal in Louisville. Appliance largely replaced the older Buechel facility that was built nearly 50 years ago. Buechel briefly reopened in 2021 during the pandemic-related freight surge but was idled again as volumes cooled off. But container flows in Appliance Park slowed considerably in December and into January after Norfolk Southern implemented a new appointment system for truck drivers to pick up import boxes, which also coincided with the holidays and some construction on the property. Conditions at Appliance <a href="https://www.joc.com/article/drivers-battling-delays-at-norfolk-southern-terminal-in-louisville-6150589">deteriorated into early January,</a> with some drivers complaining of waits up to six hours. “Right now, we target approximately 20 to 25 appointments per hour at Appliance Park and with the Buechel facility up and running, we’ll basically double the number of appointments available to drivers,” a NS spokesperson told the Journal of Commerce. <h2>NS says dwells improving </h2>The railroad said drive dwell times have dropped to about 30 minutes on average in the last 10 days, which coincides with NS opening a temporary satellite lot at a Louisville depot owned by drayage provider ContainerPort Group. Once Buechel is re-opened, Norfolk Southern will restructure how international containers are handled in Louisville. All import loads will be taken to Buechel and put into container stacks, while all exports will be dropped off at Appliance Park. The move will allow ground crews to concentrate on a single direction for container flow at each terminal. NS will conduct a soft launch this weekend before officially segmenting inbound and outbound ocean containers on Monday. The Appliance Park and Buechel terminals are approximately three miles from one another, which Norfolk Southern said should make it relatively easy for truck drivers to perform a dual mission – dropping off an export container and then picking up an import box during the same trip. Contact Ari Ashe at <a href="ari.ashe@spglobal.com ">ari.ashe@spglobal.com</a>.</div>

Norfolk Southern Railway (NS) is reopening an idled terminal in Louisville, giving the railroad a second facility to support what is now a congested market. The Buechel Intermodal Facility will reopen on Jan. 26 as NS battles long truck turn times and congestion at Appliance Park, its primary terminal in Louisville. Appliance largely replaced the older Buechel facility that was built nearly 50 years ago. Buechel briefly reopened in 2021 during the pandemic-related freight surge but was idled again as volumes cooled off. But container flows in Appliance Park slowed considerably in December and into January after Norfolk Southern implemented a new appointment system for truck drivers to pick up import boxes, which also coincided with the holidays and some construction on the property. Conditions at Appliance deteriorated into early January, with some drivers complaining of waits up to six hours. “Right now, we target approximately 20 to 25 appointments per hour at Appliance Park and with the Buechel facility up and running, we’ll basically double the number of appointments available to drivers,” a NS spokesperson told the Journal of Commerce. NS says dwells improving The railroad said drive dwell times have dropped to about 30 minutes on average in the last 10 days, which coincides with NS opening a temporary satellite lot at a Louisville depot owned by drayage provider ContainerPort Group. Once Buechel is re-opened, Norfolk Southern will restructure how international containers are handled in Louisville. All import loads will be taken to Buechel and put into container stacks, while all exports will be dropped off at Appliance Park. The move will allow ground crews to concentrate on a single direction for container flow at each terminal. NS will conduct a soft launch this weekend before officially segmenting inbound and outbound ocean containers on Monday. The Appliance Park and Buechel terminals are approximately three miles from one another, which Norfolk Southern said should make it relatively easy for truck drivers to perform a dual mission – dropping off an export container and then picking up an import box during the same trip. Contact Ari Ashe at ari.ashe@spglobal.com .

Norfolk Southern reopening second terminal in congested Louisville

<div class="phx-topic abstract-wrapper">The deal will create a company with more than $5 billion in revenue across truckload brokerage, managed transportation services, and port-related offerings.</div>

The deal will create a company with more than $5 billion in revenue across truckload brokerage, managed transportation services, and port-related offerings.

<div class="phx-topic">Freight broker Echo Global Logistics has acquired third-party logistics provider and drayage specialist ITS Logistics, the companies announced Wednesday. The deal, terms of which were not disclosed, gives privately held Echo, the fifth-largest brokerage in the US, a major network of drayage, intermodal and drop trailer assets. The combined entity would create a company with $5.4 billion in revenue, Echo said in a statement. The deal is expected to close in the first half of this year. “This acquisition represents a meaningful strategic opportunity for Echo and our customers,” Echo CEO Doug Waggoner said, calling ITS’ products “highly differentiated.” “By applying Echo’s proprietary technology, advanced analytics, and growing AI capabilities to the ITS solution set, we will strengthen our value proposition for a broader range of customers,” Waggoner added. Founded in 1999, ITS has grown to be a top 10 provider of drayage services. “Echo's truckload brokerage scale, managed transportation platform, strong cross-border capabilities, and broad multimodal offering — combined with its technology platform and AI-driven innovation — will enable us to elevate our service offerings and provide enhanced value to our customers,” ITS CEO Scott Pruneau said in the statement. Echo, which was taken private in 2021, said ITS will continue operating with its existing leadership team and customer-facing structure, but will hook into Echo’s technology platform, carrier network, and enterprise commercial capabilities. ITS also has a robust truckload brokerage and dedicated truckload model that would integrate with Echo’s truckload and intermodal brokerage businesses. The acquisition represents Chicago-based Echo’s biggest acquisition since its $420 million purchase of fellow broker Command Transportation in 2015. Its most recent acquisition came in August, when it bought California-based 3PL FreightSaver for an undisclosed amount. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>.</div>

Freight broker Echo Global Logistics has acquired third-party logistics provider and drayage specialist ITS Logistics, the companies announced Wednesday. The deal, terms of which were not disclosed, gives privately held Echo, the fifth-largest brokerage in the US, a major network of drayage, intermodal and drop trailer assets. The combined entity would create a company with $5.4 billion in revenue, Echo said in a statement. The deal is expected to close in the first half of this year. “This acquisition represents a meaningful strategic opportunity for Echo and our customers,” Echo CEO Doug Waggoner said, calling ITS’ products “highly differentiated.” “By applying Echo’s proprietary technology, advanced analytics, and growing AI capabilities to the ITS solution set, we will strengthen our value proposition for a broader range of customers,” Waggoner added. Founded in 1999, ITS has grown to be a top 10 provider of drayage services. “Echo's truckload brokerage scale, managed transportation platform, strong cross-border capabilities, and broad multimodal offering — combined with its technology platform and AI-driven innovation — will enable us to elevate our service offerings and provide enhanced value to our customers,” ITS CEO Scott Pruneau said in the statement. Echo, which was taken private in 2021, said ITS will continue operating with its existing leadership team and customer-facing structure, but will hook into Echo’s technology platform, carrier network, and enterprise commercial capabilities. ITS also has a robust truckload brokerage and dedicated truckload model that would integrate with Echo’s truckload and intermodal brokerage businesses. The acquisition represents Chicago-based Echo’s biggest acquisition since its $420 million purchase of fellow broker Command Transportation in 2015. Its most recent acquisition came in August, when it bought California-based 3PL FreightSaver for an undisclosed amount. Contact Eric Johnson at eric.johnson@spglobal.com .

Surface

Drayage

Truck brokers

Broker Echo buys ITS Logistics to build drayage, intermodal presence

<div class="phx-topic abstract-wrapper">Shippers should heed signs that ocean carriers have managed to keep the decline in Asia imports from sinking the market, reflecting a modicum of control and price restraint.</div>

Shippers should heed signs that ocean carriers have managed to keep the decline in Asia imports from sinking the market, reflecting a modicum of control and price restraint.

<div class="phx-topic">It is a buyer’s market during this annual trans-Pacific service contract cycle, and importers of Asia-sourced goods — particularly smaller shippers — are under some of the strongest C-Suite pressure in years to reduce costs. But shippers should also heed signs that ocean carriers have managed to keep the decline in Asia imports from sinking the market, reflecting a modicum of control and price restraint. A few container line executives privately acknowledge what preliminary contract benchmark readings reflect: The starting point for contract rate levels is lower than during last year’s negotiation cycle. Demand is weaker than a year ago, and capacity is more plentiful as evidenced by the swelling order book. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6155716_0.1.jpg"></img></div>In the first two rounds of bids in this annual service contract cycle, tendered rates for Asia to the US West Coast were down approximately 25% from levels in January 2025, according to a Xeneta analysis. However, the tendered rates in this cycle have been rising since the beginning of the year, said Emily Stausbøll, senior analyst at Xeneta. “We certainly expect that as more US shippers start tendering, they should be saving money compared to last year, but how much depends on shippers’ individual negotiations and whatever happens in the market over the next few months before many of those contracts are finalized,” Stausbøll said. <h3>C-Suite calling </h3>The pressure on logistics managers to cut costs has risen dramatically in less than a year, making it infeasible to simply pass on the additional costs to suppliers and/or suffer weaker margins. The US tariff rate on imports from China more than doubled to 47.5% between January and November 2025, according to the latest available analysis from the Peterson Institute for International Economics. No wonder then that a recent Goldman Sachs survey found that between April and August of last year, surveyed businesses passed 37% of higher tariff costs to consumers and 9% onto suppliers. The companies absorbed the remaining 51%, according to the study released in October. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="a08410a8-0b00-4c48-9ef6-78b6354f0678"></dynamic-object></div>Small and medium-sized importers are ordering only what they know they can sell and taking an even harder look at their own transport costs, said Serkan Kavas, executive vice president for imports at the forwarder MTS Logistics. For example, shippers who booked before a general rate increase (GRI) was imposed but didn’t ship until after it was implemented have become more sensitive to the higher transport cost they’ve accrued, and often with one day or less of notice, he said. A cost difference of $50 per TEU matters more now. “It’s all about cost,” Kavas said. “The service reliability has not been too bad. There is an abundance of space. On the carrier side, there is not too much difference to the level of service.” In a down market, in which analysts expect US imports to barely register any growth in 2026 compared with 2025, some ocean carriers are targeting smaller shippers that they would have normally left to forwarders. One of Kavas’ customers, he said, was approached by a major carrier for annual volumes of no more than 1,000 TEUs. <h3>Holding the line so far </h3>While volumes are plunging, pricing isn’t. US imports from China in December dropped 22.3% year over year while total volumes from Asia fell 6.1% in the same period, according to PIERS, a sister company of the Journal of Commerce within S&amp;P Global. Yet container spot rates, as measured by Drewry, Platts and the Shanghai Shipping Exchange, have shown resilience, rising about 40% since early December. Implementing blank sailings and moderately-sized GRIs while holding the price line on freight-all-kind rates appears to have worked for carriers. “Ocean carriers need another catalyst to keep the rates at certain levels, or they will continue to perform blank sailings which they have mastered,” Kavas said. “They are doing this in a very disciplined manner, and considering the number of carriers in the market at the moment, ocean freight rate fluctuations will continue to be present, but I don’t see rates are diving.” <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="a2606c91-b30c-4219-b617-9491b44b6af1"></dynamic-object></div>Ocean carriers are adjusting further to expectations of reduced demand. Carriers will reduce the available capacity from Asia to North America to 2.5 million TEUs in the first quarter from 2.6 million TEUs in the fourth quarter, according to Xeneta forecasts and an analysis of blanked sailings, including those not announced by carriers. The semblance of carrier control on the trans-Pacific despite weakening volumes should give importers pause amid negotiations on annual contracts, which generally run from May 1 through April. The market may be down, but capacity discipline so far isn’t, and shippers who push too hard on contract rates or are too exposed to spot rates could end up paying if the market turns. Contact Mark Szakonyi at <a href="https://www.joc.com/article/mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>.</div>

It is a buyer’s market during this annual trans-Pacific service contract cycle, and importers of Asia-sourced goods — particularly smaller shippers — are under some of the strongest C-Suite pressure in years to reduce costs. But shippers should also heed signs that ocean carriers have managed to keep the decline in Asia imports from sinking the market, reflecting a modicum of control and price restraint. A few container line executives privately acknowledge what preliminary contract benchmark readings reflect: The starting point for contract rate levels is lower than during last year’s negotiation cycle. Demand is weaker than a year ago, and capacity is more plentiful as evidenced by the swelling order book. In the first two rounds of bids in this annual service contract cycle, tendered rates for Asia to the US West Coast were down approximately 25% from levels in January 2025, according to a Xeneta analysis. However, the tendered rates in this cycle have been rising since the beginning of the year, said Emily Stausbøll, senior analyst at Xeneta. “We certainly expect that as more US shippers start tendering, they should be saving money compared to last year, but how much depends on shippers’ individual negotiations and whatever happens in the market over the next few months before many of those contracts are finalized,” Stausbøll said. C-Suite calling The pressure on logistics managers to cut costs has risen dramatically in less than a year, making it infeasible to simply pass on the additional costs to suppliers and/or suffer weaker margins. The US tariff rate on imports from China more than doubled to 47.5% between January and November 2025, according to the latest available analysis from the Peterson Institute for International Economics. No wonder then that a recent Goldman Sachs survey found that between April and August of last year, surveyed businesses passed 37% of higher tariff costs to consumers and 9% onto suppliers. The companies absorbed the remaining 51%, according to the study released in October. Small and medium-sized importers are ordering only what they know they can sell and taking an even harder look at their own transport costs, said Serkan Kavas, executive vice president for imports at the forwarder MTS Logistics. For example, shippers who booked before a general rate increase (GRI) was imposed but didn’t ship until after it was implemented have become more sensitive to the higher transport cost they’ve accrued, and often with one day or less of notice, he said. A cost difference of $50 per TEU matters more now. “It’s all about cost,” Kavas said. “The service reliability has not been too bad. There is an abundance of space. On the carrier side, there is not too much difference to the level of service.” In a down market, in which analysts expect US imports to barely register any growth in 2026 compared with 2025, some ocean carriers are targeting smaller shippers that they would have normally left to forwarders. One of Kavas’ customers, he said, was approached by a major carrier for annual volumes of no more than 1,000 TEUs. Holding the line so far While volumes are plunging, pricing isn’t. US imports from China in December dropped 22.3% year over year while total volumes from Asia fell 6.1% in the same period, according to PIERS, a sister company of the Journal of Commerce within S&P Global. Yet container spot rates, as measured by Drewry, Platts and the Shanghai Shipping Exchange, have shown resilience, rising about 40% since early December. Implementing blank sailings and moderately-sized GRIs while holding the price line on freight-all-kind rates appears to have worked for carriers. “Ocean carriers need another catalyst to keep the rates at certain levels, or they will continue to perform blank sailings which they have mastered,” Kavas said. “They are doing this in a very disciplined manner, and considering the number of carriers in the market at the moment, ocean freight rate fluctuations will continue to be present, but I don’t see rates are diving.” Ocean carriers are adjusting further to expectations of reduced demand. Carriers will reduce the available capacity from Asia to North America to 2.5 million TEUs in the first quarter from 2.6 million TEUs in the fourth quarter, according to Xeneta forecasts and an analysis of blanked sailings, including those not announced by carriers. The semblance of carrier control on the trans-Pacific despite weakening volumes should give importers pause amid negotiations on annual contracts, which generally run from May 1 through April. The market may be down, but capacity discipline so far isn’t, and shippers who push too hard on contract rates or are too exposed to spot rates could end up paying if the market turns. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Buyer’s market for US importers belies risks in contract talks

<div class="phx-topic abstract-wrapper">The current market situation is favorable for BCOs, and the temptation will be great to drive down base rates because of internal cost pressures, writes John McCauley.</div>

The current market situation is favorable for BCOs, and the temptation will be great to drive down base rates because of internal cost pressures, writes John McCauley.

<div class="phx-topic">At this time of year, many have reflected on 2025 and made resolutions for 2026. I have adjusted this to make no resolutions, but a few predictions that, in most cases, I hope will not materialize. In addition, I want to give some advice to beneficial cargo owners (BCOs), many of whom are in various stages of negotiations for 2026–27 service contracts. Starting with the predictions, let’s consider some supply, capacity, and demand issues. <h3>Capacity </h3>I expect Red Sea transits will resume, but very slowly and primarily for East Med cargo and for the India sub-continent to the East Coast of the US. Asia-Europe transits will only resume if insurance premiums disappear. The Houthis are still present and will be volatile and unreliable, so they remain the wild card for this prediction. At best, Asia-Europe, if Suez passage resumes, would take six months to stabilize. The US port fees for Chinese-built and -owned vessels will be a non-event. However, for carriers, the sword of Damocles is hanging over this one, so don’t expect any major service reshuffles. Sadly, service reliability levels will stay stable at a horrible 60%, notwithstanding the herculean efforts of Gemini to drag the industry up. Most carriers won’t care enough to do something about it. Expect significant trucking and drayage disruption in the US. Bankruptcies will rise as seasonality gets more unpredictable. Driver shortages will get worse. The consequences will be price volatility, both up and down, with significant backlogs adding to detention and demurrage bills. Berthing and landside restrictions will continue to hinder moving larger vessels to north-south trades as few terminals are deep-sea; they are river or bay, at best, and are often hemmed in by towns and cities and tidal-constrained. <h3>Demand </h3>Many BCOs are under high internal pressure to contribute to reductions in overall supply chain costs as margins become thinner through higher input costs (somewhat largely driven by tariffs), downstream price squeezing, and weaker demand. Container freight downward trends will be an obvious target. Keep an eye on US credit card debt and defaults, which will rise significantly by the third quarter at the latest, thus further softening demand. Macro level indicators will prey on demand. US inflation will remain stubbornly near at least 2.5% to 3% while unemployment will remain at about 4.5% as immigration net deficits offset layoffs. Job creation will stagnate. Depending on the GDP trend, expect a high likelihood of stagflation toward the end of the fourth quarter (subject to the reliability of US government data). China will continue manufacturing export expansion and increase its proportion of global trade. <h3>Recommendation </h3>What does this mean for upcoming service contract negotiations? With the expectation of vessel oversupply continuing through the year, BCOs will push to the limit to reduce base rates. They will face several dilemmas, including how to get rid of unmerited and unjustifiable surcharges and which carriers to choose from in alliances and vessel-sharing agreements. Overall, the market situation is favorable for BCOs. The temptation to drive down base rates will be great because of internal cost pressures and/or wanting to make up for some years of carrier supply strength. This should be tempered with a caveat that many BCOs have been burnt in the past for being too empathetic to carriers’ financial difficulties. If I were in the shoes of a medium-size BCO of 30,000 TEUs and above, I would select a mix that would aim for base rates around the Xeneta/NYSHEX forecast average index levels, even if offered lower rates than those levels. It is important to keep in with Mediterranean Shipping Co. even if you don’t use them today. I would use index-linked contracts today and continue to do so with a maximum of 50% to leave yourself some volume for fixed rates and some spot prices. Of that remaining volume, I would leave about 25% for spot as the downside risk is still relatively low. Finally, the market situation should allow for BCOs to get into their contracts the exclusion of any non-explainable (by the carrier) and justifiable (judged and accepted by the BCO) surcharges. John McCauley, formerly a vice president of transportation and logistics at Cargill, now consults for shippers. Contact him at <a href="mailto:john-mccauley1@outlook.com">john-mccauley1@outlook.com</a>.</div>

At this time of year, many have reflected on 2025 and made resolutions for 2026. I have adjusted this to make no resolutions, but a few predictions that, in most cases, I hope will not materialize. In addition, I want to give some advice to beneficial cargo owners (BCOs), many of whom are in various stages of negotiations for 2026–27 service contracts. Starting with the predictions, let’s consider some supply, capacity, and demand issues. Capacity I expect Red Sea transits will resume, but very slowly and primarily for East Med cargo and for the India sub-continent to the East Coast of the US. Asia-Europe transits will only resume if insurance premiums disappear. The Houthis are still present and will be volatile and unreliable, so they remain the wild card for this prediction. At best, Asia-Europe, if Suez passage resumes, would take six months to stabilize. The US port fees for Chinese-built and -owned vessels will be a non-event. However, for carriers, the sword of Damocles is hanging over this one, so don’t expect any major service reshuffles. Sadly, service reliability levels will stay stable at a horrible 60%, notwithstanding the herculean efforts of Gemini to drag the industry up. Most carriers won’t care enough to do something about it. Expect significant trucking and drayage disruption in the US. Bankruptcies will rise as seasonality gets more unpredictable. Driver shortages will get worse. The consequences will be price volatility, both up and down, with significant backlogs adding to detention and demurrage bills. Berthing and landside restrictions will continue to hinder moving larger vessels to north-south trades as few terminals are deep-sea; they are river or bay, at best, and are often hemmed in by towns and cities and tidal-constrained. Demand Many BCOs are under high internal pressure to contribute to reductions in overall supply chain costs as margins become thinner through higher input costs (somewhat largely driven by tariffs), downstream price squeezing, and weaker demand. Container freight downward trends will be an obvious target. Keep an eye on US credit card debt and defaults, which will rise significantly by the third quarter at the latest, thus further softening demand. Macro level indicators will prey on demand. US inflation will remain stubbornly near at least 2.5% to 3% while unemployment will remain at about 4.5% as immigration net deficits offset layoffs. Job creation will stagnate. Depending on the GDP trend, expect a high likelihood of stagflation toward the end of the fourth quarter (subject to the reliability of US government data). China will continue manufacturing export expansion and increase its proportion of global trade. Recommendation What does this mean for upcoming service contract negotiations? With the expectation of vessel oversupply continuing through the year, BCOs will push to the limit to reduce base rates. They will face several dilemmas, including how to get rid of unmerited and unjustifiable surcharges and which carriers to choose from in alliances and vessel-sharing agreements. Overall, the market situation is favorable for BCOs. The temptation to drive down base rates will be great because of internal cost pressures and/or wanting to make up for some years of carrier supply strength. This should be tempered with a caveat that many BCOs have been burnt in the past for being too empathetic to carriers’ financial difficulties. If I were in the shoes of a medium-size BCO of 30,000 TEUs and above, I would select a mix that would aim for base rates around the Xeneta/NYSHEX forecast average index levels, even if offered lower rates than those levels. It is important to keep in with Mediterranean Shipping Co. even if you don’t use them today. I would use index-linked contracts today and continue to do so with a maximum of 50% to leave yourself some volume for fixed rates and some spot prices. Of that remaining volume, I would leave about 25% for spot as the downside risk is still relatively low. Finally, the market situation should allow for BCOs to get into their contracts the exclusion of any non-explainable (by the carrier) and justifiable (judged and accepted by the BCO) surcharges. John McCauley, formerly a vice president of transportation and logistics at Cargill, now consults for shippers. Contact him at john-mccauley1@outlook.com .

A few market predictions and some advice for BCOs as contract season heats up

<div class="phx-topic abstract-wrapper">There are a lot of theories explaining the current freight recession, but there is no disputing that decreased demand, cutthroat competition, and plummeting rates have occurred simultaneously with inflationary cost components, writes Ted Prince.</div>

There are a lot of theories explaining the current freight recession, but there is no disputing that decreased demand, cutthroat competition, and plummeting rates have occurred simultaneously with inflationary cost components, writes Ted Prince.

<div class="phx-topic">In 1948, Gerald Hern, sports editor of the Boston Post, composed a brief poem describing the Boston Braves’ pitching en route to the 1948 National League pennant: First we’ll use Spahn then we’ll use Sain Then an off day, followed by rain Back will come Spahn, followed by Sain And followed, we hope, by two days of rain Warren Spahn and Johnny Sain were responsible for 39 of the Braves’ 91 victories that year. However, it was common to have a one-two punch at the top of a team’s pitching rotation. Intermodal has a similar duality: international and domestic — primarily dry 40- and 53-foot containers, respectively. While intermodal has a plethora of markets and equipment, the two segments have been carrying the industry for decades to constant new heights. They are also closely correlated in that a great deal of the domestic market is import cargo that was transloaded on the West Coast for movement inland. Hern’s work comes to mind when thinking about intermodal’s performance in 2025 and its prospects for 2026. Unlike the hoped-for two days of good rain, the industry has endured four years of painful rain since the halcyon volumes of 2021, the “good old days” of the COVID-19 pandemic. There are a lot of theories explaining the current freight “recession,” but there is no disputing that decreased demand, cutthroat competition, and plummeting rates have occurred simultaneously with inflationary cost components. As a result, intermodal has frequently found itself as a surface freight alternative that is slower and more expensive than trucking. And while there were some green shoots in 2024, the industry has been hoping for a second-half recovery — that has failed to materialize — in each of the past three years. The same seems true for 2026. <h3>Supply and demand drivers </h3>As we look forward, we need to consider supply and demand drivers. “Affordability” has taken the place of prominence in our political lexicon. As the costs of food and housing rise, discretionary income for other consumer products has shriveled and reduced demand. The same goes for increasing credit card, car, and student loan debt. Regardless of mortgage rates, there are long-term limitations on housing starts. This can further reduce consumer demand because so many purchases — e.g., furniture, home, electronics, etc. — are often associated with new homes. And although seven-year car loans have become more common, I don’t believe 50-year home mortgages will have the same penetration. With demand problematic, intermodal success will probably rely on supply changes. Many contend that the demand during the early days of COVID-19 created excess capacity that the truck market is still trying to absorb. However, it is unclear whether there was really an increase in overall capacity, or just realignment as many truckers decided to go out on their own. Regardless, there were a number of carriers that acquired capacity at historically high prices and must keep operating to just make their payments. The normal culling of unprofitable capacity was precluded by this inability to exit the market, ensuring a never-ending supply of zombie truckers. This capacity is getting older and more expensive to operate. Nevertheless, there is a feeling (or hope?) that 2026 will finally see marginal carriers leave the market and rate stability restored. <h3>Enhanced regulatory oversight </h3>The environmental green benefits of intermodal are not a priority for the current administration, so economic green will be paramount. Most likely that would come from increased regulatory oversight. Enhanced enforcement on non-domiciled commercial driver’s licenses is reducing driver supply. And there is still the unknown of hacked electronic logging devices allowing for illegal hours of service. What is unclear is whether these initiatives will impact truckload and drayage carriers equally, or whether one segment will suffer disproportionate opprobrium. If it is the former, intermodal will be advantaged; however, if it is the latter, maybe not. The former would be a rising tide that would raise all intermodal ships, whereas the latter could see the further ascendance of bimodal operations with integrated drayage overseen by robust safety regimens. In an attempt to increase demand, we can expect major players to assume prominent roles. Railroads and bimodals will seek to deploy equipment that has been stored for years. Ocean carriers will continue to consider their inland options. Finally, ports may become more involved as they explore inland options to attract more discretionary cargo. There are no historical comparisons for the last five years. It is unclear when the market will turn, but when it does, the recovery will follow Ernest Hemingway’s description: “Gradually, then suddenly.” We can then hope for the sun also to rise on intermodal. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at <a href="mailto:ted@tricitiesintermodal.com">ted@tricitiesintermodal.com</a>.</div>

In 1948, Gerald Hern, sports editor of the Boston Post, composed a brief poem describing the Boston Braves’ pitching en route to the 1948 National League pennant: First we’ll use Spahn then we’ll use Sain Then an off day, followed by rain Back will come Spahn, followed by Sain And followed, we hope, by two days of rain Warren Spahn and Johnny Sain were responsible for 39 of the Braves’ 91 victories that year. However, it was common to have a one-two punch at the top of a team’s pitching rotation. Intermodal has a similar duality: international and domestic — primarily dry 40- and 53-foot containers, respectively. While intermodal has a plethora of markets and equipment, the two segments have been carrying the industry for decades to constant new heights. They are also closely correlated in that a great deal of the domestic market is import cargo that was transloaded on the West Coast for movement inland. Hern’s work comes to mind when thinking about intermodal’s performance in 2025 and its prospects for 2026. Unlike the hoped-for two days of good rain, the industry has endured four years of painful rain since the halcyon volumes of 2021, the “good old days” of the COVID-19 pandemic. There are a lot of theories explaining the current freight “recession,” but there is no disputing that decreased demand, cutthroat competition, and plummeting rates have occurred simultaneously with inflationary cost components. As a result, intermodal has frequently found itself as a surface freight alternative that is slower and more expensive than trucking. And while there were some green shoots in 2024, the industry has been hoping for a second-half recovery — that has failed to materialize — in each of the past three years. The same seems true for 2026. Supply and demand drivers As we look forward, we need to consider supply and demand drivers. “Affordability” has taken the place of prominence in our political lexicon. As the costs of food and housing rise, discretionary income for other consumer products has shriveled and reduced demand. The same goes for increasing credit card, car, and student loan debt. Regardless of mortgage rates, there are long-term limitations on housing starts. This can further reduce consumer demand because so many purchases — e.g., furniture, home, electronics, etc. — are often associated with new homes. And although seven-year car loans have become more common, I don’t believe 50-year home mortgages will have the same penetration. With demand problematic, intermodal success will probably rely on supply changes. Many contend that the demand during the early days of COVID-19 created excess capacity that the truck market is still trying to absorb. However, it is unclear whether there was really an increase in overall capacity, or just realignment as many truckers decided to go out on their own. Regardless, there were a number of carriers that acquired capacity at historically high prices and must keep operating to just make their payments. The normal culling of unprofitable capacity was precluded by this inability to exit the market, ensuring a never-ending supply of zombie truckers. This capacity is getting older and more expensive to operate. Nevertheless, there is a feeling (or hope?) that 2026 will finally see marginal carriers leave the market and rate stability restored. Enhanced regulatory oversight The environmental green benefits of intermodal are not a priority for the current administration, so economic green will be paramount. Most likely that would come from increased regulatory oversight. Enhanced enforcement on non-domiciled commercial driver’s licenses is reducing driver supply. And there is still the unknown of hacked electronic logging devices allowing for illegal hours of service. What is unclear is whether these initiatives will impact truckload and drayage carriers equally, or whether one segment will suffer disproportionate opprobrium. If it is the former, intermodal will be advantaged; however, if it is the latter, maybe not. The former would be a rising tide that would raise all intermodal ships, whereas the latter could see the further ascendance of bimodal operations with integrated drayage overseen by robust safety regimens. In an attempt to increase demand, we can expect major players to assume prominent roles. Railroads and bimodals will seek to deploy equipment that has been stored for years. Ocean carriers will continue to consider their inland options. Finally, ports may become more involved as they explore inland options to attract more discretionary cargo. There are no historical comparisons for the last five years. It is unclear when the market will turn, but when it does, the recovery will follow Ernest Hemingway’s description: “Gradually, then suddenly.” We can then hope for the sun also to rise on intermodal. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at ted@tricitiesintermodal.com .

North-American rail

Intermodal providers

Pace of freight market recovery a matter of ‘gradually, then suddenly’

West

East

Gulf

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

Asia to US West, East and Gulf Coast YTD container volume market share (PIERS)

PIERS TEU market share US coastal imports from Asia (YTD) Gateway

<div class="phx-topic abstract-wrapper">Citing “the complex and uncertain international context,” the carrier said proforma voyages through the Suez that were confirmed last month would remain diverted via the Cape of Good Hope in southern Africa.</div>

Citing “the complex and uncertain international context,” the carrier said proforma voyages through the Suez that were confirmed last month would remain diverted via the Cape of Good Hope in southern Africa.

<div class="phx-topic">CMA CGM on Tuesday said it would scale back plans to reroute three Asia-Europe westbound services through the Red Sea and Suez that were announced just last month. The carrier’s about-face is a glaring example of the delicate balancing act facing liners as they chart a return to transits through the Red Sea while also acknowledging that the returns may be short-lived. The move comes as Maersk <a href="https://www.joc.com/article/maersk-set-to-resume-regular-suez-transits-on-india-usec-mecl-loop-sources-6152441">last week announced its scheduled MECL service</a> from India to the US East Coast would resume Suez sailings from Jan. 26. Citing “the complex and uncertain international context,” CMA CGM said in a statement that proforma voyages through the Suez that were confirmed last month on Asia-Europe would remain diverted via the Cape of Good Hope in southern Africa. “The CMA CGM Group has decided for the time being to reroute vessels deployed on our FAL 1, FAL 3 and MEX services via the Cape of Good Hope,” the carrier said in a statement, adding that the Suez situation would be regularly reviewed.   For carriers, the risks to crew and brand that come with a Suez/Red Sea return are high — despite Houthi rebels announcing in November that ship attacks would end — on top of the additional costs of diverting vessels should attacks resume.  There’s also the commercial concern of staying competitive with Suez transits offering up to 10-day shorter transits from Asia to Europe, and the larger risk of released capacity that would put immense downward pressure on rates. Carriers also must weigh the willingness of shippers and insurers to allow cargo to return to a potentially volatile route. “A hybrid routing is going to be the prevailing mode for this year, whereby carriers are going to start with more backhaul and lower-value cargo in Suez transits but keep on using the Cape of Good Hope for the higher-value head-haul voyages,” Simon Heaney, senior manager of container research at Drewry, told a webinar hosted by the maritime consultant Tuesday. “This is going to mean that more effective capacity will be drip fed back into the market over the course of the year and won’t happen all at once,” he added. “It will give carriers more time to assess the risk-reward position, prepare their future networks and prevent a total collapse in pricing.” Still, Heaney warned that overcapacity in the market would bring down rates, “regardless of how quickly Suez transits resume.” It was a position supported by transport analysts at HSBC, who said in a market update Tuesday that a swift return to Suez could cause a short-term increase in rates, but prices would decline through 2026. “Spot freight rates could fall significantly and also weigh on this year’s trans-Pacific [service contract talks] in April and May,” HSBC said. <h3>Some scheduled services take shorter route </h3>Ocean carriers have been increasing their transits via the Suez and Red Sea recently, encouraged by the absence of Houthi attacks that began in late 2023 and forced lengthy diversions around southern Africa.   The working approach so far, led by CMA CGM and with Maersk and other carriers starting to follow, has been to route India-US services through the Suez. CMA CGM is operating its service from India to the US via the Suez and Maersk will resume sailings for its MECL (India, Middle East-US East Coast) service via the Red Sea and Suez Canal from Jan. 26. The Ocean Alliance has scheduled all eastbound legs of its NEU4 Asia-Europe service from January and its MED2 Asia-Mediterranean service from February via the Suez. Getting shippers onboard will be a crucial part of the Suez-return puzzle. Some shippers tell the Journal of Commerce that directives from their C-suites prevent them from considering Suez voyages despite the better transit time. Other cargo owners, such as the supply chain director for a Europe-based shipper, have no problem using the Egyptian waterway.“Our global insurance policy isn’t significantly affected by shipping through the Red Sea, so if the services are there and the cost makes sense, then there wouldn’t be much stopping us from using them,” the source said. “But it all seems very tentative,” he added. “I think what we’re seeing is the tension between carriers wanting to attract cargo by offering a diverse mix of transit times, and a fear of crashing the market or a return to bunching at the ports in Asia and Europe.” Drewry noted that insurance costs were less of an impediment, with premiums expressed as a percentage of the vessel hull value currently about 0.2% or 0.3%, down from a high of 1% in the two years since the Red Sea attacks began. <h3>Two-route voyage schedule </h3>Drewry’s expectations of a two-route Suez-Africa voyage schedule this year reflected the cautious approach from carriers and alliances, as well as shippers that want to avoid valuable cargo being put at risk while factoring into contracts any resumption of the shorter route.“We know that depending on the direction of the voyage and the size of the ship, the multiple of the goods value versus the ship value can range from five to 10 times,” Heaney told the webinar.   Most of the Asia-Europe annual contracting has been completed for the year, with shippers and forwarders telling the Journal of Commerce that a return to the Suez has been factored in. “We have built some flex into our negotiations on these lanes this year that allows for a renegotiation in case there is a sudden rush back to the Red Sea route,” the head of logistics at a European retailer said. It was an approach supported by Philip Damas, managing director of Drewry Shipping Consultants, who said low rates were a given through 2026 while shippers were asking for two rates — one for current transits via the Cape and one for the Suez.  “That option makes it easier to later effectively apply the relevant rates,” Damas told the Drewry webinar. “Another option is to negotiate based on the Cape routing and have a specific review clause that when the Suez Canal transits resume fully, there will be a renegotiation. Having that clause up front is probably easier.”  Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>.   </div>

CMA CGM on Tuesday said it would scale back plans to reroute three Asia-Europe westbound services through the Red Sea and Suez that were announced just last month. The carrier’s about-face is a glaring example of the delicate balancing act facing liners as they chart a return to transits through the Red Sea while also acknowledging that the returns may be short-lived.  The move comes as Maersk last week announced its scheduled MECL service from India to the US East Coast would resume Suez sailings from Jan. 26.  Citing “the complex and uncertain international context,” CMA CGM said in a statement that proforma voyages through the Suez that were confirmed last month on Asia-Europe would remain diverted via the Cape of Good Hope in southern Africa.  “The CMA CGM Group has decided for the time being to reroute vessels deployed on our FAL 1, FAL 3 and MEX services via the Cape of Good Hope,” the carrier said in a statement, adding that the Suez situation would be regularly reviewed.    For carriers, the risks to crew and brand that come with a Suez/Red Sea return are high — despite Houthi rebels announcing in November that ship attacks would end — on top of the additional costs of diverting vessels should attacks resume.   There’s also the commercial concern of staying competitive with Suez transits offering up to 10-day shorter transits from Asia to Europe, and the larger risk of released capacity that would put immense downward pressure on rates. Carriers also must weigh the willingness of shippers and insurers to allow cargo to return to a potentially volatile route.  “A hybrid routing is going to be the prevailing mode for this year, whereby carriers are going to start with more backhaul and lower-value cargo in Suez transits but keep on using the Cape of Good Hope for the higher-value head-haul voyages,” Simon Heaney, senior manager of container research at Drewry, told a webinar hosted by the maritime consultant Tuesday.  “This is going to mean that more effective capacity will be drip fed back into the market over the course of the year and won’t happen all at once,” he added. “It will give carriers more time to assess the risk-reward position, prepare their future networks and prevent a total collapse in pricing.”  Still, Heaney warned that overcapacity in the market would bring down rates, “regardless of how quickly Suez transits resume.”  It was a position supported by transport analysts at HSBC, who said in a market update Tuesday that a swift return to Suez could cause a short-term increase in rates, but prices would decline through 2026.  “Spot freight rates could fall significantly and also weigh on this year’s trans-Pacific [service contract talks] in April and May,” HSBC said.  Some scheduled services take shorter route  Ocean carriers have been increasing their transits via the Suez and Red Sea recently, encouraged by the absence of Houthi attacks that began in late 2023 and forced lengthy diversions around southern Africa.   The working approach so far, led by CMA CGM and with Maersk and other carriers starting to follow, has been to route India-US services through the Suez. CMA CGM is operating its service from India to the US via the Suez and Maersk will resume sailings for its MECL (India, Middle East-US East Coast) service via the Red Sea and Suez Canal from Jan. 26.  The Ocean Alliance has scheduled all eastbound legs of its NEU4 Asia-Europe service from January and its MED2 Asia-Mediterranean service from February via the Suez.  Getting shippers onboard will be a crucial part of the Suez-return puzzle. Some shippers tell the Journal of Commerce that directives from their C-suites prevent them from considering Suez voyages despite the better transit time. Other cargo owners, such as the supply chain director for a Europe-based shipper, have no problem using the Egyptian waterway. “Our global insurance policy isn’t significantly affected by shipping through the Red Sea, so if the services are there and the cost makes sense, then there wouldn’t be much stopping us from using them,” the source said.  “But it all seems very tentative,” he added. “I think what we’re seeing is the tension between carriers wanting to attract cargo by offering a diverse mix of transit times, and a fear of crashing the market or a return to bunching at the ports in Asia and Europe.”  Drewry noted that insurance costs were less of an impediment, with premiums expressed as a percentage of the vessel hull value currently about 0.2% or 0.3%, down from a high of 1% in the two years since the Red Sea attacks began.  Two-route voyage schedule  Drewry’s expectations of a two-route Suez-Africa voyage schedule this year reflected the cautious approach from carriers and alliances, as well as shippers that want to avoid valuable cargo being put at risk while factoring into contracts any resumption of the shorter route. “We know that depending on the direction of the voyage and the size of the ship, the multiple of the goods value versus the ship value can range from five to 10 times,” Heaney told the webinar.    Most of the Asia-Europe annual contracting has been completed for the year, with shippers and forwarders telling the Journal of Commerce that a return to the Suez has been factored in.  “We have built some flex into our negotiations on these lanes this year that allows for a renegotiation in case there is a sudden rush back to the Red Sea route,” the head of logistics at a European retailer said.  It was an approach supported by Philip Damas, managing director of Drewry Shipping Consultants, who said low rates were a given through 2026 while shippers were asking for two rates — one for current transits via the Cape and one for the Suez.   “That option makes it easier to later effectively apply the relevant rates,” Damas told the Drewry webinar. “Another option is to negotiate based on the Cape routing and have a specific review clause that when the Suez Canal transits resume fully, there will be a renegotiation. Having that clause up front is probably easier.”   Contact Greg Knowler at  greg.knowler@spglobal.com .   

CMA CGM backs off plans to resume Suez transits for Asia-Europe services 

<div class="phx-topic abstract-wrapper">The regulator’s decision was unanimous, but Union Pacific and Norfolk Southern can fix what is deficient in the application and resubmit it at a later date.</div>

The regulator’s decision was unanimous, but Union Pacific and Norfolk Southern can fix what is deficient in the application and resubmit it at a later date.

<div class="phx-topic">The US Surface Transportation Board dealt a blow Friday to Union Pacific Railroad’s $85 billion deal to acquire Norfolk Southern Railway, ruling the merger application UP filed last month is “incomplete.” The regulator’s decision was unanimous, but Union Pacific and Norfolk Southern can fix what is deficient in the application and resubmit it at a later date. UP must inform the STB before Feb. 17 whether it plans to refile an amended application, and can refile any time prior to June 22. Once resubmitted, the STB will initiate a similar 30-day review of the application’s completeness, which likely means it will not issue a final decision on the merger itself until at least the second half of 2027. "Given the deficiencies...the board finds the application is incomplete and, under the terms of the statute, must be rejected,” STB wrote in its ruling. “The board’s decision to reject the application should not be read as an indication of how the board might ultimately assess any revised application or future informational needs, should applicants decide to submit a revised application." In Friday’s 15-page decision, the STB highlighted three major deficiencies in the application, which was submitted by UP on Dec. 19. First, the regulators ruled that the traffic analysis underpinning the application is deficient because it uses market share totals from 2023 and fails to provide future market share projections. Second, the STB took issue with UP failing to disclose what’s called a “Schedule 5.8.” The document defines what counts as a “materially burdensome regulatory condition,” a regulatory outcome that could give UP the contractual right to walk away from the deal. UP had argued that the document didn’t need to be disclosed to the STB because it contains attorney-related work products. BNSF Railway, Canadian Pacific Kansas City, and Canadian National all filed objections to UP’s application based on the first two issues that were flagged by STB. The STB also found that the related Terminal Railroad Association of St. Louis control application was misclassified as a “minor” transaction instead of a “significant” transaction. STB applies different procedural and evidentiary requirements to major, significant, and minor transactions. By deeming something significant instead of minor, it means the board wants to examine the issues involved more closely. The STB also noted several minor, technical issues that should be addressed in a revised application. While the board did not specify what those issues were, a Journal of Commerce analysis of the application found spelling errors and cities labeled with the incorrect state. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a></div>

The US Surface Transportation Board dealt a blow Friday to Union Pacific Railroad’s $85 billion deal to acquire Norfolk Southern Railway, ruling the merger application UP filed last month is “incomplete.” The regulator’s decision was unanimous, but Union Pacific and Norfolk Southern can fix what is deficient in the application and resubmit it at a later date. UP must inform the STB before Feb. 17 whether it plans to refile an amended application, and can refile any time prior to June 22. Once resubmitted, the STB will initiate a similar 30-day review of the application’s completeness, which likely means it will not issue a final decision on the merger itself until at least the second half of 2027. "Given the deficiencies...the board finds the application is incomplete and, under the terms of the statute, must be rejected,” STB wrote in its ruling. “The board’s decision to reject the application should not be read as an indication of how the board might ultimately assess any revised application or future informational needs, should applicants decide to submit a revised application." In Friday’s 15-page decision, the STB highlighted three major deficiencies in the application, which was submitted by UP on Dec. 19. First, the regulators ruled that the traffic analysis underpinning the application is deficient because it uses market share totals from 2023 and fails to provide future market share projections. Second, the STB took issue with UP failing to disclose what’s called a “Schedule 5.8.” The document defines what counts as a “materially burdensome regulatory condition,” a regulatory outcome that could give UP the contractual right to walk away from the deal. UP had argued that the document didn’t need to be disclosed to the STB because it contains attorney-related work products. BNSF Railway, Canadian Pacific Kansas City, and Canadian National all filed objections to UP’s application based on the first two issues that were flagged by STB. The STB also found that the related Terminal Railroad Association of St. Louis control application was misclassified as a “minor” transaction instead of a “significant” transaction. STB applies different procedural and evidentiary requirements to major, significant, and minor transactions. By deeming something significant instead of minor, it means the board wants to examine the issues involved more closely. The STB also noted several minor, technical issues that should be addressed in a revised application. While the board did not specify what those issues were, a Journal of Commerce analysis of the application found spelling errors and cities labeled with the incorrect state. Contact Ari Ashe at ari.ashe@spglobal.com

Rail News

STB rejects UP-NS merger application as ‘incomplete’

<div class="phx-topic abstract-wrapper">Noel Hacegaba made the announcement about the possible 1.8 million-TEU terminal during his first State of the Port presentation since taking over as CEO on Jan. 1 following the retirement of Mario Cordero.</div>

Noel Hacegaba made the announcement about the possible 1.8 million-TEU terminal during his first State of the Port presentation since taking over as CEO on Jan. 1 following the retirement of Mario Cordero.

<div class="phx-topic">The Port of Long Beach is exploring the possibility of developing what its new CEO said Thursday would be the “first conventional, zero-emissions container terminal in the world.” Noel Hacegaba made the announcement during his first State of the Port presentation since taking over as CEO on Jan. 1 following the retirement of Mario Cordero. Hacegaba said Long Beach has inked an exclusive agreement with Brookfield Infrastructure Group for the potential development of a 1.8 million-TEU terminal designed for express vessels of up to 9,000-TEU capacity. The facility, being called the Metro Express Terminal, would be built on Long Beach’s Pier S and use zero-emission, human-operated equipment, container peel-off operations, 24/7 gate access, free-flow cargo stacks and zero-emission trucks, he said. If it comes to fruition, Brookfield would partner with Nautilus International on the project, further details of which were not disclosed in Hacegaba’s presentation. That presentation made clear that the Port of Long Beach will leverage marine terminal expansion, massive investment in intermodal rail connectivity and the creation of a supply chain information highway to handle a projected doubling of container volume by 2050. That comes after the port handled a record 9.9 million laden and empty TEUs in 2025, according to data from the port. “According to our latest cargo forecast, 2050 is the year our container volumes will reach 20 million TEUs,” Hacegaba said. Long Beach forecasts it will handle about 9 million TEUs this year, which although down from 2025, will still rank among its top five years, he said. Long Beach faces an immediate challenge in adjusting to diminishing imports from China due to the Trump administration’s tariffs, and fewer exports to China because of that country’s counter tariffs. “Six years ago, about 70% of all our cargo — imports and exports — was tied to China,” Hacegaba said. “Today that’s down to 60%.” While the tariffs have fostered a shifting of US trade to Vietnam and other countries in Southeast Asia, it has also highlighted the importance of adding “speed, precision and reliability” to the Long Beach supply chain as it competes for cargo with other US ports, he said. <h3>Emphasis on on-dock rail connectivity </h3>Long Beach is investing $1.8 billion in its <a href="https://www.joc.com/article/inland-rail-connectivity-key-to-port-of-long-beach-growth-new-ceo-6133971">on-dock rail support facility at Pier B</a>, which is scheduled for completion in 2032. By assembling longer intermodal trains on dock rather than at near-dock sites that require a move by truck, the transfer of containers from vessel to train, which now takes slightly less than four days, will be reduced to 24 hours, Hacegaba said. “Our terminals are driving the movement of rail to inland points,” he said. “TTI (Total Terminals International) is already moving more than 50% of its containers by rail.” The <a href="https://www.joc.com/article/up-ns-deal-could-benefit-some-shippers-while-others-face-longer-transits-6143225">proposed merger of Union Pacific and Norfolk Southern</a>, which would create the nation’s first transcontinental railroad, holds the potential for faster, more efficient intermodal service to rail hubs in the eastern half of the country. Also, the announcement in November by BNSF Railway and CSX that they will <a href="https://www.joc.com/article/intermodal-cooperation-on-rails-has-declined-amid-cost-pressures-6152067">expand their intermodal partnership for service connecting Long Beach with rail terminals in the Ohio Valley and the Northeast</a> will cut transit times by as much as two days, Hacegaba said. Five of Long Beach’s six container terminals last year handled more than 1 million TEUs, with two of those facilities handling more than 2 million TEUs. International Transportation Service and Macquarie Asset Management in July broke ground on a project that will fill in a 19-acre slip at Pier G that will enhance operational efficiency and build a single, continuous wharf measuring 3,400 feet that will accommodate the berthing of two super-post Panamax ships at the same time, Hacegaba said. <h3>Data sharing within the supply chain </h3>Hacegaba also announced that development is beginning on Long Beach’s CargoNav digital platform that will navigate the supply chain one container at a time, from arrival on the dock to shipment to its final destination. Further information will be released in the coming months. Emphasizing the importance of data sharing among carriers, terminal operators, truckers, railroads and shippers, Long Beach several years ago unveiled its supply chain information highway through its community portal. “The goal was simple, end-to-end visibility via coast-to-coast connectivity,” Hacegaba said. Long Beach in the coming weeks will also launch a universal trucking appointment system that members of the Harbor Trucking Association asked for several years ago, he said. Projects that improve operational efficiency will be another priority, Hacegaba said, particularly those that continue to reduce harmful emissions from vessels, cargo-handling equipment, tugboats, trucks, and trains. “As we continue our quest to zero emissions, we remain laser-focused on our core mission — moving more cargo more quickly, safely, efficiently, and sustainably,” he said Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a></div>

The Port of Long Beach is exploring the possibility of developing what its new CEO said Thursday would be the “first conventional, zero-emissions container terminal in the world.” Noel Hacegaba made the announcement during his first State of the Port presentation since taking over as CEO on Jan. 1 following the retirement of Mario Cordero. Hacegaba said Long Beach has inked an exclusive agreement with Brookfield Infrastructure Group for the potential development of a 1.8 million-TEU terminal designed for express vessels of up to 9,000-TEU capacity. The facility, being called the Metro Express Terminal, would be built on Long Beach’s Pier S and use zero-emission, human-operated equipment, container peel-off operations, 24/7 gate access, free-flow cargo stacks and zero-emission trucks, he said. If it comes to fruition, Brookfield would partner with Nautilus International on the project, further details of which were not disclosed in Hacegaba’s presentation. That presentation made clear that the Port of Long Beach will leverage marine terminal expansion, massive investment in intermodal rail connectivity and the creation of a supply chain information highway to handle a projected doubling of container volume by 2050. That comes after the port handled a record 9.9 million laden and empty TEUs in 2025, according to data from the port. “According to our latest cargo forecast, 2050 is the year our container volumes will reach 20 million TEUs,” Hacegaba said. Long Beach forecasts it will handle about 9 million TEUs this year, which although down from 2025, will still rank among its top five years, he said. Long Beach faces an immediate challenge in adjusting to diminishing imports from China due to the Trump administration’s tariffs, and fewer exports to China because of that country’s counter tariffs. “Six years ago, about 70% of all our cargo — imports and exports — was tied to China,” Hacegaba said. “Today that’s down to 60%.” While the tariffs have fostered a shifting of US trade to Vietnam and other countries in Southeast Asia, it has also highlighted the importance of adding “speed, precision and reliability” to the Long Beach supply chain as it competes for cargo with other US ports, he said. Emphasis on on-dock rail connectivity Long Beach is investing $1.8 billion in its on-dock rail support facility at Pier B , which is scheduled for completion in 2032. By assembling longer intermodal trains on dock rather than at near-dock sites that require a move by truck, the transfer of containers from vessel to train, which now takes slightly less than four days, will be reduced to 24 hours, Hacegaba said. “Our terminals are driving the movement of rail to inland points,” he said. “TTI (Total Terminals International) is already moving more than 50% of its containers by rail.” The proposed merger of Union Pacific and Norfolk Southern , which would create the nation’s first transcontinental railroad, holds the potential for faster, more efficient intermodal service to rail hubs in the eastern half of the country. Also, the announcement in November by BNSF Railway and CSX that they will expand their intermodal partnership for service connecting Long Beach with rail terminals in the Ohio Valley and the Northeast will cut transit times by as much as two days, Hacegaba said. Five of Long Beach’s six container terminals last year handled more than 1 million TEUs, with two of those facilities handling more than 2 million TEUs. International Transportation Service and Macquarie Asset Management in July broke ground on a project that will fill in a 19-acre slip at Pier G that will enhance operational efficiency and build a single, continuous wharf measuring 3,400 feet that will accommodate the berthing of two super-post Panamax ships at the same time, Hacegaba said. Data sharing within the supply chain Hacegaba also announced that development is beginning on Long Beach’s CargoNav digital platform that will navigate the supply chain one container at a time, from arrival on the dock to shipment to its final destination. Further information will be released in the coming months. Emphasizing the importance of data sharing among carriers, terminal operators, truckers, railroads and shippers, Long Beach several years ago unveiled its supply chain information highway through its community portal. “The goal was simple, end-to-end visibility via coast-to-coast connectivity,” Hacegaba said. Long Beach in the coming weeks will also launch a universal trucking appointment system that members of the Harbor Trucking Association asked for several years ago, he said. Projects that improve operational efficiency will be another priority, Hacegaba said, particularly those that continue to reduce harmful emissions from vessels, cargo-handling equipment, tugboats, trucks, and trains. “As we continue our quest to zero emissions, we remain laser-focused on our core mission — moving more cargo more quickly, safely, efficiently, and sustainably,” he said Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com

Long Beach considering development of ‘conventional, zero-emissions' terminal: CEO

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<div class="phx-topic abstract-wrapper">Intermodal marketing companies have long been at a disadvantage because rail-owned containers lacked the real-time tracking and tracing capabilities that are standard among private fleets.</div>

Intermodal marketing companies have long been at a disadvantage because rail-owned containers lacked the real-time tracking and tracing capabilities that are standard among private fleets.

<div class="phx-topic">A multiyear effort to install GPS devices on approximately 75,000 rail-owned intermodal containers shared among several North American Class I railroads has been completed, according to Union Pacific Railroad (UP), closing a visibility gap that gave private container owners a strategic advantage in negotiations with shippers. UP owns and operates the container fleet, which also runs on the networks of Canadian National Railway, CSX Transportation, Norfolk Southern Railway and Mexico’s Ferromex. “This is another meaningful step as we deliver the best customer experience possible,” Kenny Rocker, UP’s executive vice president of sales, said in a statement on Monday. “By combining GPS-enabled containers with real-time data and smarter visibility tools, we’re providing the transparency and reliability our customers depend on.” The rail-owned containers are a critical resource for non-asset intermodal marketing companies (IMC), which compete directly for shipper freight with private container owners such as Hub Group, J.B. Hunt Transport Services and Schneider National. IMCs have long been at a disadvantage because rail-owned containers lacked the real-time tracking and tracing capabilities that are standard among private fleets. By contrast, real-time visibility is now common across the US truckload sector. Closing that gap has taken on added importance as UP’s projections for truckload-to-rail conversions are a pillar of its <a href="https://www.joc.com/article/up-in-merger-filing-vows-to-convert-millions-of-loads-to-intermodal-annually-6138380">case before the US Surface Transportation Board</a> as it seeks approval of its proposed acquisition of Norfolk Southern. Real-time location tracking of the rail-owned boxes will be available through the Blume Global platform and will support e-mail notifications, geofencing and application programming interface (API) connectivity. The move also introduces potential risk, however, as much of the freight moving in rail-owned containers already relies on Blume Global software; the logistics technology provider was the target of a cyberattack in 2022. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

A multiyear effort to install GPS devices on approximately 75,000 rail-owned intermodal containers shared among several North American Class I railroads has been completed, according to Union Pacific Railroad (UP), closing a visibility gap that gave private container owners a strategic advantage in negotiations with shippers. UP owns and operates the container fleet, which also runs on the networks of Canadian National Railway, CSX Transportation, Norfolk Southern Railway and Mexico’s Ferromex. “This is another meaningful step as we deliver the best customer experience possible,” Kenny Rocker, UP’s executive vice president of sales, said in a statement on Monday. “By combining GPS-enabled containers with real-time data and smarter visibility tools, we’re providing the transparency and reliability our customers depend on.” The rail-owned containers are a critical resource for non-asset intermodal marketing companies (IMC), which compete directly for shipper freight with private container owners such as Hub Group, J.B. Hunt Transport Services and Schneider National. IMCs have long been at a disadvantage because rail-owned containers lacked the real-time tracking and tracing capabilities that are standard among private fleets. By contrast, real-time visibility is now common across the US truckload sector. Closing that gap has taken on added importance as UP’s projections for truckload-to-rail conversions are a pillar of its case before the US Surface Transportation Board as it seeks approval of its proposed acquisition of Norfolk Southern. Real-time location tracking of the rail-owned boxes will be available through the Blume Global platform and will support e-mail notifications, geofencing and application programming interface (API) connectivity. The move also introduces potential risk, however, as much of the freight moving in rail-owned containers already relies on Blume Global software; the logistics technology provider was the target of a cyberattack in 2022. Contact Ari Ashe at ari.ashe@spglobal.com .

North American rail container fleet fully outfitted with GPS devices

<div class="phx-topic abstract-wrapper">As shippers realize that threats to service are not periodic but systemic, their focus on reliability will only intensify this year, writes Peter Tirschwell.</div>

As shippers realize that threats to service are not periodic but systemic, their focus on reliability will only intensify this year, writes Peter Tirschwell.

<div class="phx-topic">This year will not be marked by freight rates collapsing due to overcapacity and shippers weary from tariff costs reaping a windfall in ocean freight discounts. Despite the largest order book in history and volumes expected to slow globally, that is not the scenario coming into focus for the year ahead, even if widespread Red Sea transits resume. Rather, according to several sources in recent weeks, a different picture is emerging: Rates will likely moderate, perhaps by a few hundred dollars per container, and as shippers realize that threats to service are not periodic but systemic, their focus on reliability will only intensify this year. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6155383_0.1.jpg"></img></div>The year ahead, in other words, reflects long-term macro trends under way in containers: capacity tightening despite cyclicality due to infrastructure limitations and carrier actions to manage capacity, and shippers in response turning their focus away from rates and toward service to mitigate risk. “For 2026 as we move into this bid season, it won’t be all about the ocean rates,” Chantal McRoberts of Drewry Supply Chain Advisers told a recent Journal of Commerce webinar focused on Asia port congestion.  “We know that we’re in a more subdued demand environment. We know that the order book is large. We know that carriers are looking to secure volume, but the key to that is, what service are you providing? Shippers are definitely starting to factor that into their bid strategies,” she said. “The number one question that comes up from BCOs [beneficial cargo owners] is, putting the rates aside, I need a reliable provider or partner to work with. I still have to answer to the CFO. I still have to justify the cost, but I now also have to ensure that I'm procuring my ocean freight to deliver my product.” According to eeSea, ocean reliability from Asia to the US West Coast has ranged between 42% and 48% since September. <h3>China ‘lacking port capacity’ </h3>Port congestion in China is a case in point about shippers’ growing concerns about the integrity of supply chains.  Still the source of 36% of US imports in TEUs in 2025, (down from 40% in 2024), according to S&amp;P Global Market Intelligence, the country is encountering chronic congestion at Shanghai and Ningbo, its two largest ports, where ships typically are waiting two to three days outside the port. The fundamental reason, according to Asia sources over the past two years, was that while China ambitiously built port capacity ahead of demand in the years after entering the World Trade Organization in 2001, expansion has slowed at a time when its exports are experiencing a growth spurt.  “I know it’s a shocker, and it feels unnatural to hear it, but China is lacking port capacity. It’s as simple as that,” Nils Roche, founder of Solvens Advisory and recently deputy head of operations at Singapore-based carrier PIL, said on the Journal of Commerce webinar. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="615c1430-acb8-4c73-9884-61992f08d1d3"></dynamic-object></div>Limited port capacity in China is being called upon to handle surging volumes growing out of a macro-China economic strategy to diversify away from the US and overcome weakness in other sectors such as real estate.  China in November surpassed the $1 trillion trade surplus barrier for the first time. Its share of global exports grew from 33% to 37% between 2023 and 2025, Maersk told investors in November. Influenced by export growth, S&amp;P Global Market Intelligence in November raised Mainland China’s GDP growth forecast for 2025–27 by a quarter point, to 5.0%, 4.6% and 4.5%, respectively. “The upward adjustments primarily reflect a more positive assessment of export prospects,” S&amp;P Global said. The intractable nature of port capacity limitations is further reflected in growing ship sizes and more containers needed to be moved per port call at ports that have not kept pace. “The ships that you have today, they are not the ships that we had 10 years ago. If you think about it, I used to operate Panamaxes, and they were the rock stars,” Roche said, noting his skepticism that technology-driven productivity improvements can meaningfully expand capacity. “Now you have 18,000, 24,000-TEU ships coming into the ports. A Panamax calling a port is a port call, a 24,000-TEU ship calling a port, it's a major event.” The difficulty ports have in handling the volumes and ship sizes being thrown at them is confirmed by port performance data. The S&amp;P Global Port Performance data is based on vessel turnaround time and normalized by workload, with underlying data provided by carriers — in other words, how many hours a ship is spending in port to achieve a certain move count. The data shows ports on a global basis are operating well below pre-pandemic levels of performance. Due to port capacity limitations, Roche says the industry should temper its expectations for the impact of a return to the Red Sea, if that occurs this year (although there is no guarantee it will).  He said that if the Red Sea opens up, “we should not expect a massive influx of capacity, simply because the lack of capacity, or the bottleneck if you prefer, will be transferred from the ocean to the land.” “I disagree with the narrative carried by analysts that shipping obeys 100% of the laws of supply and demand, and that more ships mean more supply ... it’s being half-blind to an entire ecosystem,” Roche said. S&amp;P Global is the parent company of the Journal of Commerce.Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>.</div>

This year will not be marked by freight rates collapsing due to overcapacity and shippers weary from tariff costs reaping a windfall in ocean freight discounts. Despite the largest order book in history and volumes expected to slow globally, that is not the scenario coming into focus for the year ahead, even if widespread Red Sea transits resume.  Rather, according to several sources in recent weeks, a different picture is emerging: Rates will likely moderate, perhaps by a few hundred dollars per container, and as shippers realize that threats to service are not periodic but systemic, their focus on reliability will only intensify this year. The year ahead, in other words, reflects long-term macro trends under way in containers: capacity tightening despite cyclicality due to infrastructure limitations and carrier actions to manage capacity, and shippers in response turning their focus away from rates and toward service to mitigate risk.  “For 2026 as we move into this bid season, it won’t be all about the ocean rates,” Chantal McRoberts of Drewry Supply Chain Advisers told a recent Journal of Commerce webinar focused on Asia port congestion.   “We know that we’re in a more subdued demand environment. We know that the order book is large. We know that carriers are looking to secure volume, but the key to that is, what service are you providing? Shippers are definitely starting to factor that into their bid strategies,” she said. “The number one question that comes up from BCOs [beneficial cargo owners] is, putting the rates aside, I need a reliable provider or partner to work with. I still have to answer to the CFO. I still have to justify the cost, but I now also have to ensure that I'm procuring my ocean freight to deliver my product.”  According to eeSea, ocean reliability from Asia to the US West Coast has ranged between 42% and 48% since September.  China ‘lacking port capacity’  Port congestion in China is a case in point about shippers’ growing concerns about the integrity of supply chains.   Still the source of 36% of US imports in TEUs in 2025, (down from 40% in 2024), according to S&P Global Market Intelligence, the country is encountering chronic congestion at Shanghai and Ningbo, its two largest ports, where ships typically are waiting two to three days outside the port.  The fundamental reason, according to Asia sources over the past two years, was that while China ambitiously built port capacity ahead of demand in the years after entering the World Trade Organization in 2001, expansion has slowed at a time when its exports are experiencing a growth spurt.   “I know it’s a shocker, and it feels unnatural to hear it, but China is lacking port capacity. It’s as simple as that,” Nils Roche, founder of Solvens Advisory and recently deputy head of operations at Singapore-based carrier PIL, said on the Journal of Commerce webinar. Limited port capacity in China is being called upon to handle surging volumes growing out of a macro-China economic strategy to diversify away from the US and overcome weakness in other sectors such as real estate.   China in November surpassed the $1 trillion trade surplus barrier for the first time. Its share of global exports grew from 33% to 37% between 2023 and 2025, Maersk told investors in November. Influenced by export growth, S&P Global Market Intelligence in November raised Mainland China’s GDP growth forecast for 2025–27 by a quarter point, to 5.0%, 4.6% and 4.5%, respectively. “The upward adjustments primarily reflect a more positive assessment of export prospects,” S&P Global said.  The intractable nature of port capacity limitations is further reflected in growing ship sizes and more containers needed to be moved per port call at ports that have not kept pace.  “The ships that you have today, they are not the ships that we had 10 years ago. If you think about it, I used to operate Panamaxes, and they were the rock stars,” Roche said, noting his skepticism that technology-driven productivity improvements can meaningfully expand capacity. “Now you have 18,000, 24,000-TEU ships coming into the ports. A Panamax calling a port is a port call, a 24,000-TEU ship calling a port, it's a major event.” The difficulty ports have in handling the volumes and ship sizes being thrown at them is confirmed by port performance data. The S&P Global Port Performance data is based on vessel turnaround time and normalized by workload, with underlying data provided by carriers — in other words, how many hours a ship is spending in port to achieve a certain move count. The data shows ports on a global basis are operating well below pre-pandemic levels of performance. Due to port capacity limitations, Roche says the industry should temper its expectations for the impact of a return to the Red Sea, if that occurs this year (although there is no guarantee it will).   He said that if the Red Sea opens up, “we should not expect a massive influx of capacity, simply because the lack of capacity, or the bottleneck if you prefer, will be transferred from the ocean to the land.”  “I disagree with the narrative carried by analysts that shipping obeys 100% of the laws of supply and demand, and that more ships mean more supply ... it’s being half-blind to an entire ecosystem,” Roche said.  S&P Global is the parent company of the Journal of Commerce.Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

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