<div class="phx-topic abstract-wrapper">The decision nullifies Hong Kong-based Hutchison’s ability to operate the Balboa and Christobal ports that bookend the Panama Canal and clouds its attempt to sell its global terminals portfolio.</div>

The decision nullifies Hong Kong-based Hutchison’s ability to operate the Balboa and Christobal ports that bookend the Panama Canal and clouds its attempt to sell its global terminals portfolio.

Feature image

<div class="phx-topic">The Panama Supreme Court late Thursday ruled that the longstanding leases allowing CK Hutchison to operate two marine terminals that bookend the Panama Canal are unconstitutional, further clouding an attempt to sell its global terminals portfolio. The decision nullifies Hong Kong-based Hutchison’s ability to operate the Balboa and Christobal ports and represents a victory for US President Donald Trump, who has pressured Panama to end the leases over what he claims is China’s outsized influence on the canal’s operations via the terminals. Hutchison had already agreed to sell the two terminals to a consortium of BlackRock’s Global Infrastructure Partners and Mediterranean Shipping Co. (MSC) subsidiary Terminal Investments Limited (TiL) as part of a $22.8 billion sale of its 43 terminal operations worldwide. But the deal has run into opposition from Beijing over ties between Trump and BlackRock leadership. As a way around that opposition, Hutchison last summer confirmed it was in talks with a “major strategic investor from China.” China’s involvement as part of the buying consortium would likely draw Trump’s attention again. CK Hutchison can try to delay the Panama court decision by seeking a clarification on the ruling. But ultimately, the Panamanian government will seek an interim operator for the two terminals and then decide whether to put their operating the lease out for tender. Hutchison’s concession for the Panama ports began in 1997 and was renewed for another 25-year lease in 2021. Prime location Maersk in October <a href="https://www.joc.com/article/maersk-considering-investment-in-panamas-new-terminals-6100150">signaled its intent</a> to invest in two terminals the Panama Canal Authority (ACP) <a href="https://www.joc.com/article/panama-canal-mulls-developing-corozal-to-allay-neutrality-fears-over-hutchison-deal-6023330">hopes to build</a> in Corozal, on the Pacific side of the canal, and near Colon on the Atlantic side. In April, Maersk <a href="https://www.joc.com/article/panama-canal-mulls-developing-corozal-to-allay-neutrality-fears-over-hutchison-deal-6023330">bought the Panama Canal Railway</a>, the short-line railroad that links the ports of Balboa and Colon. Maersk, which is the railway’s largest customer, also operates a logistics park in the country. Louis Sola, then chairman of the Federal Maritime Commission, told US senators during a January 2025 hearing that  US terminal operators did not get a fair shake in Panama due to corruption in the government. US-based SSA Marine, Singapore-based PSA and Taiwan-based Evergreen Terminal also have terminals in Panama. Contact Mark Szakonyi at <a href="mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>. </div>

The Panama Supreme Court late Thursday ruled that the longstanding leases allowing CK Hutchison to operate two marine terminals that bookend the Panama Canal are unconstitutional, further clouding an attempt to sell its global terminals portfolio. The decision nullifies Hong Kong-based Hutchison’s ability to operate the Balboa and Christobal ports and represents a victory for US President Donald Trump, who has pressured Panama to end the leases over what he claims is China’s outsized influence on the canal’s operations via the terminals. Hutchison had already agreed to sell the two terminals to a consortium of BlackRock’s Global Infrastructure Partners and Mediterranean Shipping Co. (MSC) subsidiary Terminal Investments Limited (TiL) as part of a $22.8 billion sale of its 43 terminal operations worldwide. But the deal has run into opposition from Beijing over ties between Trump and BlackRock leadership. As a way around that opposition, Hutchison last summer confirmed it was in talks with a “major strategic investor from China.” China’s involvement as part of the buying consortium would likely draw Trump’s attention again. CK Hutchison can try to delay the Panama court decision by seeking a clarification on the ruling. But ultimately, the Panamanian government will seek an interim operator for the two terminals and then decide whether to put their operating the lease out for tender. Hutchison’s concession for the Panama ports began in 1997 and was renewed for another 25-year lease in 2021. Prime location Maersk in October signaled its intent to invest in two terminals the Panama Canal Authority (ACP) hopes to build in Corozal, on the Pacific side of the canal, and near Colon on the Atlantic side. In April, Maersk bought the Panama Canal Railway , the short-line railroad that links the ports of Balboa and Colon. Maersk, which is the railway’s largest customer, also operates a logistics park in the country. Louis Sola, then chairman of the Federal Maritime Commission, told US senators during a January 2025 hearing that  US terminal operators did not get a fair shake in Panama due to corruption in the government. US-based SSA Marine, Singapore-based PSA and Taiwan-based Evergreen Terminal also have terminals in Panama. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Panama court voids CK Hutchison canal terminal leases

<div class="phx-topic abstract-wrapper">DiBella, nominated to be a commissioner last September, said her focus for the agency will be to support Trump’s push to restore the American maritime industry. </div>

DiBella, nominated to be a commissioner last September, said her focus for the agency will be to support Trump’s push to restore the American maritime industry.

<div class="phx-topic">Laura DiBella has been tapped by President Donald Trump as the new chairman of the Federal Maritime Commission (FMC), the agency said Thursday. DiBella said her focus for the FMC will be to support Trump’s push to restore the American maritime industry. <a href="https://www.joc.com/article/trump-taps-two-floridians-to-serve-on-the-fmc-6075573">DiBella was nominated to be a member of the FMC in September</a> to fill the remaining term of previous chairman Louis Sola, <a href="https://www.joc.com/article/fmcs-sola-to-leave-agency-months-after-being-elevated-to-chairmans-slot-6031245">a two-term commissioner who left the agency in June</a>. DiBella was confirmed by the Senate in December and only sworn in three weeks ago to a term that expires in June 2028. DiBella’s experience includes serving as government affairs advisor for a Florida law firm and overseeing business development for Florida’s Department of Commerce. She was also the executive director for the Florida Harbor Pilots Association and the director of the Port of Fernandina. DiBella, in a statement from the FMC, said being tapped as the agency’s next chairman “is nothing short of a privilege” and that she intends to focus the commission on how it can implement Trump’s maritime agenda for the US. The five-member FMC still has one vacant seat, which is expected to be filled by Trump nominee Robert Harvey pending Senate confirmation. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Laura DiBella has been tapped by President Donald Trump as the new chairman of the Federal Maritime Commission (FMC), the agency said Thursday. DiBella said her focus for the FMC will be to support Trump’s push to restore the American maritime industry. DiBella was nominated to be a member of the FMC in September to fill the remaining term of previous chairman Louis Sola, a two-term commissioner who left the agency in June . DiBella was confirmed by the Senate in December and only sworn in three weeks ago to a term that expires in June 2028. DiBella’s experience includes serving as government affairs advisor for a Florida law firm and overseeing business development for Florida’s Department of Commerce. She was also the executive director for the Florida Harbor Pilots Association and the director of the Port of Fernandina. DiBella, in a statement from the FMC, said being tapped as the agency’s next chairman “is nothing short of a privilege” and that she intends to focus the commission on how it can implement Trump’s maritime agenda for the US. The five-member FMC still has one vacant seat, which is expected to be filled by Trump nominee Robert Harvey pending Senate confirmation. Contact Michael Angell at michael.angell@spglobal.com .

Container lines

Transport, Trade and Regulation News

Trump elevates Laura DiBella to be FMC chairman

<div class="phx-topic abstract-wrapper">The leading US truck brokerage said a rate spike due to winter weather does not signal a stronger trucking market, while international freight demand remains tepid.</div>

The leading US truck brokerage said a rate spike due to winter weather does not signal a stronger trucking market, while international freight demand remains tepid.

<div class="phx-topic">CH Robinson sees no near-term catalyst for US freight demand, with air and ocean rates likely remaining close to current levels and recent spikes in truck rates largely driven by winter weather. The truck brokerage and global forwarder, though, said its artificial intelligence (AI) initiatives continue to help it serve customers faster and gain market share. CH Robinson said Thursday its forwarding business saw an 8% year-over-year decline in ocean freight volumes for the fourth quarter of 2025, while its air freight tonnage declined 12.5%. Chief Executive David Bozeman said on an earnings conference call that <a href="https://www.joc.com/article/ch-robinson-cautious-on-second-half-outlook-amid-trade-volatility-6053833">frontloading by shippers throughout 2025</a> led to a “more pronounced decline in demand after the Q3 peak season.” “International freight continues to be impacted by global trade policies,” Bozeman said. “The macro conditions for global transportation companies were difficult in Q4, and we are not impervious to these volume and rate dynamics.” With air and ocean rates also declining, adjusted gross profit for CH Robinson’s forwarding business fell 12.7% in the fourth quarter to $178 million. The company did see a higher profit margin in the forwarding business, which Bozeman said was due to the segment’s revenue management and use of a “cohesive, centralized model with standardized and lean AI-enabled processes.” As for any immediate post-holiday bump, CFO Damon Lee said that declines in ocean freight rates that started in the third quarter “continued into Q4 and we expect that to continue into Q1.” “So, Q1, starting out a little challenging, but Q4 ended a little challenging,” Lee added. <h3>No change in demand </h3>Despite the decline in the forwarding business, CH Robinson’s truck brokerage saw fourth-quarter gross profit increase slightly, helping it beat analysts’ profit estimates. CH Robinson reported a fourth-quarter net profit of $1.23 per share, versus a $1.13 consensus estimate, according to Capital IQ, a sister company of the Journal of Commerce within S&amp;P Global. The company said that its overall truck volume rose 1% during the fourth quarter, versus a 7.6% drop in volume for the period as measured by the Cass Freight Shipment Index. Bozeman, meanwhile, said <a href="https://www.joc.com/article/truckload-brokers-eye-human-technology-balance-as-ai-takes-hold-5876340">AI is automating many broker tasks</a>, adding that AI allowed CH Robinson to manage a recent spike in truckload rates without affecting margins. “Spot market costs for truckload capacity spiked during the last five weeks of the quarter due to a seasonal decline in capacity, three winter storms and incremental pressure from the cumulative [federal] enforcement of various commercial driver regulations,” Bozeman said. While truck spot rates can spike during winter weather, those spikes will abate through the first quarter while more drivers will also return to the road, Michael Castagnetto, president of CH Robinson’s truck brokerage, said on the call. “When you think about an actual market inflection, which we’ve all been trying to predict as an industry for the better part of three and a half years now, there wasn’t a material demand change during the quarter,” Castagnetto said. Contact Michael Angell at <a href="mailto: michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

CH Robinson sees no near-term catalyst for US freight demand, with air and ocean rates likely remaining close to current levels and recent spikes in truck rates largely driven by winter weather. The truck brokerage and global forwarder, though, said its artificial intelligence (AI) initiatives continue to help it serve customers faster and gain market share. CH Robinson said Thursday its forwarding business saw an 8% year-over-year decline in ocean freight volumes for the fourth quarter of 2025, while its air freight tonnage declined 12.5%. Chief Executive David Bozeman said on an earnings conference call that frontloading by shippers throughout 2025 led to a “more pronounced decline in demand after the Q3 peak season.” “International freight continues to be impacted by global trade policies,” Bozeman said. “The macro conditions for global transportation companies were difficult in Q4, and we are not impervious to these volume and rate dynamics.” With air and ocean rates also declining, adjusted gross profit for CH Robinson’s forwarding business fell 12.7% in the fourth quarter to $178 million. The company did see a higher profit margin in the forwarding business, which Bozeman said was due to the segment’s revenue management and use of a “cohesive, centralized model with standardized and lean AI-enabled processes.” As for any immediate post-holiday bump, CFO Damon Lee said that declines in ocean freight rates that started in the third quarter “continued into Q4 and we expect that to continue into Q1.” “So, Q1, starting out a little challenging, but Q4 ended a little challenging,” Lee added. No change in demand Despite the decline in the forwarding business, CH Robinson’s truck brokerage saw fourth-quarter gross profit increase slightly, helping it beat analysts’ profit estimates. CH Robinson reported a fourth-quarter net profit of $1.23 per share, versus a $1.13 consensus estimate, according to Capital IQ, a sister company of the Journal of Commerce within S&P Global. The company said that its overall truck volume rose 1% during the fourth quarter, versus a 7.6% drop in volume for the period as measured by the Cass Freight Shipment Index. Bozeman, meanwhile, said AI is automating many broker tasks , adding that AI allowed CH Robinson to manage a recent spike in truckload rates without affecting margins. “Spot market costs for truckload capacity spiked during the last five weeks of the quarter due to a seasonal decline in capacity, three winter storms and incremental pressure from the cumulative [federal] enforcement of various commercial driver regulations,” Bozeman said. While truck spot rates can spike during winter weather, those spikes will abate through the first quarter while more drivers will also return to the road, Michael Castagnetto, president of CH Robinson’s truck brokerage, said on the call. “When you think about an actual market inflection, which we’ve all been trying to predict as an industry for the better part of three and a half years now, there wasn’t a material demand change during the quarter,” Castagnetto said. Contact Michael Angell at michael.angell@spglobal.com .

Forwarding

Truck brokers

CH Robinson seeing muted freight market to start 2026

<div class="phx-topic abstract-wrapper">Amid new threats from Houthi militants and the arrival of a US carrier strike group in the region, carriers — and their customers — are once again wondering when they will be able to safely transit the Red Sea/Suez route.</div>

Amid new threats from Houthi militants and the arrival of a US carrier strike group in the region, carriers — and their customers — are once again wondering when they will be able to safely transit the Red Sea/Suez route.

<div class="phx-topic">Shippers on the trades linking Asia to Europe and the US East Coast hoping for a resumption of Red Sea and Suez Canal transits remain at the mercy of factors out of their control as the regional security situation deteriorates anew. A US carrier strike group has arrived in the Gulf of Oman to back up another threat by President Donald Trump to take military action against Iran, this time over the lack of progress in a nuclear deal. Tehran has vowed to respond to any attacks, which may spill over into the southern Red Sea controlled by Iran-supported Houthi militants. And that leaves carriers, and their customers, once again wondering when they will be able to safely transit the Red Sea/Suez route, more than two years after the Houthis began their attacks on commercial shipping. “Shippers are faced with the greatest challenges out there right now,” said Destine Ozuygur, senior market analyst at rate benchmarking platform Xeneta. “They’re at the bottom of the operational decision funnel, which leaves them more vulnerable to shocks or setbacks than any other stakeholder in the equation.” Shippers, Ozuygur told the Journal of Commerce, are forced to create a procurement strategy that “rests on their ability to surmise the behavior of carriers, insurers, politicians [and] militias.” “Even with a complex framework of decision-making tools, operational insights and the best data visibility out there, we can’t confidently predict the next six weeks, let alone the next six days in a scenario like this,” she said. The complexity that confounds shipping analysis was illustrated in developments this month. After two years of diversions around southern Africa, expectations that head-haul Suez voyages would likely resume after the Lunar New Year gathered momentum when Maersk on Jan. 15 announced that <a href="https://www.joc.com/article/maersk-set-to-resume-regular-suez-transits-on-india-usec-mecl-loop-sources-6152441">a Middle East-US East Coast service would be routed through the Red Sea</a>. But the ink was barely dry on that announcement when CMA CGM, one of the main Red Sea users over the past two years, said it would <a href="https://www.joc.com/article/cma-cgm-backs-off-plans-to-resume-suez-transits-for-asia-europe-services-6155264">scale back plans to send three Asia-Europe westbound services through the Suez</a>, citing the “complex and uncertain international context.” A week later, the Iran-backed Houthi released two videos warning that <a href="https://www.joc.com/article/latest-houthi-threat-renews-questions-about-suez-route-as-us-iran-tensions-rise-6158709">ship attacks could resume “soon,”</a> just days before the US carrier strike group led by the USS Abraham Lincoln arrived with Trump’s new attack threat on Tehran. <h3>Frustrating turn of events </h3>It has been a frustrating turn of events for shippers eager to return to the shorter Suez route. The Asia-based supply chain director for a European retailer said his company was planning for the resumption of Suez transits after Lunar New Year, which begins Feb. 17, following talks with carriers that were confident head-haul services would gradually increase. That confidence was fueled by the absence of any Houthi attacks since November, following the Israel-Hamas ceasefire the month before. “But the situation has changed again, and we are now not ready to put cargo through the Suez,” the source told the Journal of Commerce, adding that their insurance broker said cargo on ships routed through the Red Sea would not be covered in the event of an attack. Another European importer said his cargo was covered for Red Sea transits, but the high cost of premiums was prohibitive, something that remains a significant hurdle for both carriers and shippers. Marine insurance provider Allianz Commercial told the Journal of Commerce this week that cost increases for ships transiting areas requiring war insurance depended on the assessment of the Joint War Committee in London, comprised of underwriting representatives from Lloyd’s and the International Underwriting Association. “The amount of the additional premiums can be very dynamic and is evaluated by individual underwriters, typically per vessel per voyage, and reflects current developments in individual shipping areas,” a spokesperson for Allianz said. But insurance issues extend beyond costs, according to Andy Gillespie, senior logistics advisor for supply chain management firm WOWL. Shippers sending cargo through the Red Sea would need to alert insurers and obtain specific rider coverage for shipments, but he said carrier alliance networks muddied the waters. “Think of this: The carrier I book and ship with is not transiting Suez but my container with them is on a partner’s vessel that is transiting Suez,” Gillespie said. “It shouldn’t be an issue to get the riders, but shippers better be alert to which shipments will be impacted. Carriers should be communicating the routings to customers.” <h3>Security concerns make visibility difficult </h3>But that kind of visibility from carriers would be difficult to provide under the fluid security situation, believes James Hookham, director of the Global Shippers Forum. “Whether shippers and forwarders will be able to pick a ship that transits the Suez will depend on the lines publishing a schedule of their intended routes, and that might be too much information in the public domain at this time,” he said. Ozuygur also had her doubts that shippers would have the visibility they need over voyages to establish their preferred strategies of shorter transit times/high risk compared with longer transits and lower risks. “Then they must reconcile that against whether they believe the carrier will follow through on that promise, and then finally have a plan B and a plan C in place if things go sideways,” she said. “That means having a close eye on service and voyage-level data across the entire network, access to expert analysis, and visibility into carriers’ track records of transparency, communication and reliability,” Ozuygur added. According to Drewry’s Red Sea Diversion Tracker, the number of container ships sailing via the Suez Canal jumped 69% to 61 in the two-week period ending Jan. 25, from a low base of 36 transits in the previous two-week period, as large carriers and smaller niche liners balanced the changing safety risk and the potential commercial benefit of the shorter route. Contact Greg Knowler at <a href="">greg.knowler@spglobal.com</a>. </div>

Shippers on the trades linking Asia to Europe and the US East Coast hoping for a resumption of Red Sea and Suez Canal transits remain at the mercy of factors out of their control as the regional security situation deteriorates anew. A US carrier strike group has arrived in the Gulf of Oman to back up another threat by President Donald Trump to take military action against Iran, this time over the lack of progress in a nuclear deal. Tehran has vowed to respond to any attacks, which may spill over into the southern Red Sea controlled by Iran-supported Houthi militants. And that leaves carriers, and their customers, once again wondering when they will be able to safely transit the Red Sea/Suez route, more than two years after the Houthis began their attacks on commercial shipping. “Shippers are faced with the greatest challenges out there right now,” said Destine Ozuygur, senior market analyst at rate benchmarking platform Xeneta. “They’re at the bottom of the operational decision funnel, which leaves them more vulnerable to shocks or setbacks than any other stakeholder in the equation.” Shippers, Ozuygur told the Journal of Commerce, are forced to create a procurement strategy that “rests on their ability to surmise the behavior of carriers, insurers, politicians [and] militias.” “Even with a complex framework of decision-making tools, operational insights and the best data visibility out there, we can’t confidently predict the next six weeks, let alone the next six days in a scenario like this,” she said. The complexity that confounds shipping analysis was illustrated in developments this month. After two years of diversions around southern Africa, expectations that head-haul Suez voyages would likely resume after the Lunar New Year gathered momentum when Maersk on Jan. 15 announced that a Middle East-US East Coast service would be routed through the Red Sea . But the ink was barely dry on that announcement when CMA CGM, one of the main Red Sea users over the past two years, said it would scale back plans to send three Asia-Europe westbound services through the Suez , citing the “complex and uncertain international context.” A week later, the Iran-backed Houthi released two videos warning that ship attacks could resume “soon,” just days before the US carrier strike group led by the USS Abraham Lincoln arrived with Trump’s new attack threat on Tehran. Frustrating turn of events It has been a frustrating turn of events for shippers eager to return to the shorter Suez route. The Asia-based supply chain director for a European retailer said his company was planning for the resumption of Suez transits after Lunar New Year, which begins Feb. 17, following talks with carriers that were confident head-haul services would gradually increase. That confidence was fueled by the absence of any Houthi attacks since November, following the Israel-Hamas ceasefire the month before. “But the situation has changed again, and we are now not ready to put cargo through the Suez,” the source told the Journal of Commerce, adding that their insurance broker said cargo on ships routed through the Red Sea would not be covered in the event of an attack. Another European importer said his cargo was covered for Red Sea transits, but the high cost of premiums was prohibitive, something that remains a significant hurdle for both carriers and shippers. Marine insurance provider Allianz Commercial told the Journal of Commerce this week that cost increases for ships transiting areas requiring war insurance depended on the assessment of the Joint War Committee in London, comprised of underwriting representatives from Lloyd’s and the International Underwriting Association. “The amount of the additional premiums can be very dynamic and is evaluated by individual underwriters, typically per vessel per voyage, and reflects current developments in individual shipping areas,” a spokesperson for Allianz said. But insurance issues extend beyond costs, according to Andy Gillespie, senior logistics advisor for supply chain management firm WOWL. Shippers sending cargo through the Red Sea would need to alert insurers and obtain specific rider coverage for shipments, but he said carrier alliance networks muddied the waters. “Think of this: The carrier I book and ship with is not transiting Suez but my container with them is on a partner’s vessel that is transiting Suez,” Gillespie said. “It shouldn’t be an issue to get the riders, but shippers better be alert to which shipments will be impacted. Carriers should be communicating the routings to customers.” Security concerns make visibility difficult But that kind of visibility from carriers would be difficult to provide under the fluid security situation, believes James Hookham, director of the Global Shippers Forum. “Whether shippers and forwarders will be able to pick a ship that transits the Suez will depend on the lines publishing a schedule of their intended routes, and that might be too much information in the public domain at this time,” he said. Ozuygur also had her doubts that shippers would have the visibility they need over voyages to establish their preferred strategies of shorter transit times/high risk compared with longer transits and lower risks. “Then they must reconcile that against whether they believe the carrier will follow through on that promise, and then finally have a plan B and a plan C in place if things go sideways,” she said. “That means having a close eye on service and voyage-level data across the entire network, access to expert analysis, and visibility into carriers’ track records of transparency, communication and reliability,” Ozuygur added. According to Drewry’s Red Sea Diversion Tracker, the number of container ships sailing via the Suez Canal jumped 69% to 61 in the two-week period ending Jan. 25, from a low base of 36 transits in the previous two-week period, as large carriers and smaller niche liners balanced the changing safety risk and the potential commercial benefit of the shorter route. Contact Greg Knowler at  greg.knowler@spglobal.com . 

Asia-Europe

Container Shipping News

Maritime

Shippers shoulder burden of Red Sea uncertainty as regional tensions rise again

<div class="phx-topic abstract-wrapper">Stonepeak will pay $2.4 billion to take a 25% stake in the United Ports JV while the French carrier will hold 75% and maintain operational control of the terminals involved. </div>

Stonepeak will pay $2.4 billion to take a 25% stake in the United Ports JV while the French carrier will hold 75% and maintain operational control of the terminals involved.

<div class="phx-topic">CMA CGM and private equity firm Stonepeak on Wednesday said they’ve formed a global marine terminals joint venture that involves 11 of the carrier’s major port assets in the US, South America, Europe, and Asia. Stonepeak will pay $2.4 billion to take a 25% stake in the JV, known as United Ports LLC. CMA CGM will hold 75% and maintain operational control of the terminals. The sale to Stonepeak puts the value of the terminals venture at $9.6 billion.“By joining forces with a partner with strong infrastructure expertise, we strengthen our ability to invest further in our port terminals, secure access to key gateways and enhance service quality for our customers,” CMA CGM Chief Executive Rodolphe Saadé said in a statement. Under the deal, Stonepeak has the option to contribute $3.6 billion in additional funding for future joint terminal projects, while CMA CGM said it will reinvest the initial $2.4 billion from the minority stake sale into its core business. The United Ports JV comes about 11 months after Saadé visited US President Donald Trump at the White House and <a href="https://www.joc.com/article/cma-cgm-to-invest-20-billion-in-us-shipping-ports-and-logistics-5957748">announced CMA CGM would spend $20 billion</a> over the next four years to significantly bolster its logistics presence in the US, including port assets. <h3>Los Angeles, New York terminals part of JV </h3>In the US, the terminals that will be part of the United Ports joint venture are the Fenix Marine Services (FMS) terminal in Los Angeles, and the Port Liberty Terminals in Bayonne, New Jersey. and Staten Island. United Ports will also include four container terminals in Spain: CSP Valencia, CSP Bilbao, Terminal Maritima de Guadalquivir, and TTI Algeciras. Other terminals in the joint venture include Brazil’s Santos terminal, CMA CGM’s Kaohsiung terminal in Taiwan, Nhava Sheva Freeport in India, and Vietnam’s Gemalink terminal in Cai Mep. Stonepeak is a major investor in container logistics and related infrastructure. It owns chassis provider TRAC Intermodal and has invested in cold-storage operator Lineage, container lessor Textainer and breakbulk terminal operator Logistec. “Container terminals play an essential role in global trade and are among the most difficult to substitute or replicate transportation infrastructure assets,” James Wyper, senior managing director and head of US private equity for Stonepeak, said in the statement. CMA CGM operates 41 terminals globally, according to its website, handling over 17 million TEUs annually. CMA CGM is also the majority owner of Terminal Link, a joint venture with China Merchants Port Holdings, that operates 21 terminals handling 29 million TEUs. Much of the CMA CGM terminals portfolio, as with the terminal assets of its competitors, has been assembled since liners pulled in record profits during the pandemic, providing ocean carriers a homeport in major markets. The pandemic highlighted <a href="https://www.joc.com/article/hutchison-deal-shows-thirst-of-big-carriers-to-control-global-terminal-assets-5960717">the need for ocean carriers to have operational control of terminals</a> instead of having ships wait in a queue at third-party terminals. In 2021, <a href="https://www.joc.com/article/cma-cgm-flexes-financial-might-with-fenix-marine-acquisition-5206339">it purchased the 90% share it did not already own in Fenix Marine</a>, which alone had a $2.3 billion enterprise value, according to CMA CGM. The following year, <a href="https://www.joc.com/article/cma-cgm-adds-terminal-assets-in-new-yorknew-jersey-5217593">it bought out Global Container Terminals’ leases for the Bayonne and Staten Island terminals</a>. CMA CGM terminals also formed a joint venture in 2022 with India’s JM Baxi Group for a 30-year concession on the Nhava Sheva terminal. Last year, CMA CGM began a public tender offer <a href="https://www.joc.com/article/cma-cgm-becomes-majority-shareholder-in-santos-brasil-terminal-operator-5991343">for the remaining stake it did not own in the Santos terminal</a>, a deal worth about $2.3 billion. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

CMA CGM and private equity firm Stonepeak on Wednesday said they’ve formed a global marine terminals joint venture that involves 11 of the carrier’s major port assets in the US, South America, Europe, and Asia. Stonepeak will pay $2.4 billion to take a 25% stake in the JV, known as United Ports LLC. CMA CGM will hold 75% and maintain operational control of the terminals. The sale to Stonepeak puts the value of the terminals venture at $9.6 billion. “By joining forces with a partner with strong infrastructure expertise, we strengthen our ability to invest further in our port terminals, secure access to key gateways and enhance service quality for our customers,” CMA CGM Chief Executive Rodolphe Saadé said in a statement. Under the deal, Stonepeak has the option to contribute $3.6 billion in additional funding for future joint terminal projects, while CMA CGM said it will reinvest the initial $2.4 billion from the minority stake sale into its core business. The United Ports JV comes about 11 months after Saadé visited US President Donald Trump at the White House and announced CMA CGM would spend $20 billion over the next four years to significantly bolster its logistics presence in the US, including port assets. Los Angeles, New York terminals part of JV In the US, the terminals that will be part of the United Ports joint venture are the Fenix Marine Services (FMS) terminal in Los Angeles, and the Port Liberty Terminals in Bayonne, New Jersey. and Staten Island. United Ports will also include four container terminals in Spain: CSP Valencia, CSP Bilbao, Terminal Maritima de Guadalquivir, and TTI Algeciras. Other terminals in the joint venture include Brazil’s Santos terminal, CMA CGM’s Kaohsiung terminal in Taiwan, Nhava Sheva Freeport in India, and Vietnam’s Gemalink terminal in Cai Mep. Stonepeak is a major investor in container logistics and related infrastructure. It owns chassis provider TRAC Intermodal and has invested in cold-storage operator Lineage, container lessor Textainer and breakbulk terminal operator Logistec. “Container terminals play an essential role in global trade and are among the most difficult to substitute or replicate transportation infrastructure assets,” James Wyper, senior managing director and head of US private equity for Stonepeak, said in the statement. CMA CGM operates 41 terminals globally, according to its website, handling over 17 million TEUs annually. CMA CGM is also the majority owner of Terminal Link, a joint venture with China Merchants Port Holdings, that operates 21 terminals handling 29 million TEUs. Much of the CMA CGM terminals portfolio, as with the terminal assets of its competitors, has been assembled since liners pulled in record profits during the pandemic, providing ocean carriers a homeport in major markets. The pandemic highlighted the need for ocean carriers to have operational control of terminals instead of having ships wait in a queue at third-party terminals. In 2021, it purchased the 90% share it did not already own in Fenix Marine , which alone had a $2.3 billion enterprise value, according to CMA CGM. The following year, it bought out Global Container Terminals’ leases for the Bayonne and Staten Island terminals . CMA CGM terminals also formed a joint venture in 2022 with India’s JM Baxi Group for a 30-year concession on the Nhava Sheva terminal. Last year, CMA CGM began a public tender offer for the remaining stake it did not own in the Santos terminal , a deal worth about $2.3 billion. Contact Michael Angell at michael.angell@spglobal.com .

Port News

North American ports

Marine terminals

International ports

CMA CGM forms global terminals venture with private equity firm

<div class="phx-topic abstract-wrapper">The parcel giant saw its forwarding and third-party logistics business drop in the fourth quarter due to higher tariffs, and says the weakness will carry over into the first quarter of 2026. </div>

The parcel giant saw its forwarding and third-party logistics business drop in the fourth quarter due to higher tariffs, and says the weakness will carry over into the first quarter of 2026.

<div class="phx-topic">United Parcel Service saw financial results in its supply chain division fall during the fourth quarter of 2025 amid the pullback in international freight. Although it expects results to improve through the year, UPS said the first quarter of 2026 is still being buffeted by last year’s big changes to US trade policy. UPS reported Monday that its supply chain business saw fourth-quarter revenue decline 12.7% to $2.7 billion, largely due to the impact of lower rates in its air and ocean forwarding business. The segment was also hit with lower volumes for delivering parcel shipments to the US Postal Service. Operating income for the segment rose 16% thanks to last year’s acquisition of healthcare logistics provider Andlauer, and strong growth in reverse supply chain solutions and in its same-day delivery app usage. The company’s parcel business saw a slight decline in the fourth quarter as higher revenue in its international business rose but could not offset the volume and revenue declines in its US parcel business. <h3>Expects ‘extreme weakness’ in international business </h3>During an earnings call Monday, UPS CFO Brian Dykes said the company’s results are still being impacted by higher US tariffs, the Trump administration’s threats to existing trade agreements with Canada and Mexico, and the end of tariff-free shipments on low-value, international goods that came into the US under the de minimis exemption. Dykes said the company is expecting “extreme weakness” in its international business during the first quarter due to changing North American trade flows and the higher tariffs the US put on Chinese goods. While UPS is pivoting to handle shipments from other Asian countries to the US, the margins on that business are not as high as its China-to-US business. “There was a lot of pressure both from Canada and Mexico, as well as continued decline in our China-to-US lanes, and really all of our US inbound lanes,” Dykes said. “That’s going to roll over into the first quarter as well.” “We are going to see extreme weakness in the first quarter that kind of gradually recovers,” he added. “We will lap the tariff impact in May and start to see positive growth from that. And then we’ll lap the de minimis impact in September.” Dykes said the UPS supply chain business should grow by high single-digits in 2026, thanks in part to the Andlauer acquisition. “[But] looking at the first quarter, we expect revenue to be approximately flat with a year-over-year decline in operating profit due to changes in trade lanes and tough comps from the front-running of tariffs and de minimis changes in 2025,” he said. UPS said it’s responding to the changing trade environment by investing outside of US trade lanes. UPS Vice President Kathleen Gutmann said on the call the company has a new air hub in Vietnam that’s operating at 80% capacity. She said the company is still seeing double-digit growth for shipments out of Asia, but “they’re going to Europe and India.” Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

United Parcel Service saw financial results in its supply chain division fall during the fourth quarter of 2025 amid the pullback in international freight. Although it expects results to improve through the year, UPS said the first quarter of 2026 is still being buffeted by last year’s big changes to US trade policy. UPS reported Monday that its supply chain business saw fourth-quarter revenue decline 12.7% to $2.7 billion, largely due to the impact of lower rates in its air and ocean forwarding business. The segment was also hit with lower volumes for delivering parcel shipments to the US Postal Service. Operating income for the segment rose 16% thanks to last year’s acquisition of healthcare logistics provider Andlauer, and strong growth in reverse supply chain solutions and in its same-day delivery app usage. The company’s parcel business saw a slight decline in the fourth quarter as higher revenue in its international business rose but could not offset the volume and revenue declines in its US parcel business. Expects ‘extreme weakness’ in international business During an earnings call Monday, UPS CFO Brian Dykes said the company’s results are still being impacted by higher US tariffs, the Trump administration’s threats to existing trade agreements with Canada and Mexico, and the end of tariff-free shipments on low-value, international goods that came into the US under the de minimis exemption. Dykes said the company is expecting “extreme weakness” in its international business during the first quarter due to changing North American trade flows and the higher tariffs the US put on Chinese goods. While UPS is pivoting to handle shipments from other Asian countries to the US, the margins on that business are not as high as its China-to-US business. “There was a lot of pressure both from Canada and Mexico, as well as continued decline in our China-to-US lanes, and really all of our US inbound lanes,” Dykes said. “That’s going to roll over into the first quarter as well.” “We are going to see extreme weakness in the first quarter that kind of gradually recovers,” he added. “We will lap the tariff impact in May and start to see positive growth from that. And then we’ll lap the de minimis impact in September.” Dykes said the UPS supply chain business should grow by high single-digits in 2026, thanks in part to the Andlauer acquisition. “[But] looking at the first quarter, we expect revenue to be approximately flat with a year-over-year decline in operating profit due to changes in trade lanes and tough comps from the front-running of tariffs and de minimis changes in 2025,” he said. UPS said it’s responding to the changing trade environment by investing outside of US trade lanes. UPS Vice President Kathleen Gutmann said on the call the company has a new air hub in Vietnam that’s operating at 80% capacity. She said the company is still seeing double-digit growth for shipments out of Asia, but “they’re going to Europe and India.” Contact Michael Angell at michael.angell@spglobal.com .

Air Cargo Carriers News

Air Cargo

Supply chain

Changes in US trade policy hitting UPS’ supply chain business

<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 .

Trans-Pacific

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 .

Surface

North-American rail

Intermodal providers

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

Notes: Data as of October 2025
Shaded areas indicate forecasts

MPV delivered

MPV demolished

HL capable delivered

HL capable demolished 

Net fleet loss/gain

The S&P Global multipurpose and heavy-lift fleet capacity database aggregates data for vessels that are in service, on order or have been demolished. The *Journal of Commerce* uses this database of current and historical data to forecast future newbuildings and demolitions.

Multipurpose and heavy-lift vessel deliveries and demolitions, with forecast  

MPV and HL Capable Fleet development Gateway

<div class="phx-topic abstract-wrapper">After announcing a pause on ship attacks in November, the Iran-backed militants posted a pair of threatening videos over the weekend that are sure to cause fresh concerns for ocean carriers planning a return to the Red Sea.</div>

After announcing a pause on ship attacks in November, the Iran-backed militants posted a pair of threatening videos over the weekend that are sure to cause fresh concerns for ocean carriers planning a return to the Red Sea.

<div class="phx-topic">Yemen’s Houthi militants have warned of new attacks on shipping in the Red Sea as tensions escalate between the US and Iran, raising questions over whether moves by some carriers to return services to the shorter Suez Canal route will actually happen. A Houthi video posted on YouTube over the weekend showed a ship on fire accompanied by the headline: “Soon.” It was followed by another video, this one from Houthi spokesman Brigadier Yahya Saree, pointing to “the escalation of possibilities” of the US launching a military strike against Iran, which he said would be met by retaliation against the US and Israel. The Iran-backed Houthi announced a pause on ship attacks in November following the Israel-Hamas ceasefire in Gaza that was agreed the previous month and have so far honored that pledge. But Iran’s clampdown on anti-government protests in late December sparked a threat earlier this month by US President Donald Trump to respond militarily, with a carrier strike group led by the USS Abraham Lincoln now heading for the region. Even before the new Houthi threat, CMA CGM, one of the main Red Sea users over the past two years, said it would <a href="https://www.joc.com/article/cma-cgm-backs-off-plans-to-resume-suez-transits-for-asia-europe-services-6155264">scale back plans to send three Asia-Europe westbound services</a> through the Suez, citing the “complex and uncertain international context.” <h3>Maersk India-US service due to begin shorter route </h3>Maersk’s <a href="https://www.joc.com/article/maersk-set-to-resume-regular-suez-transits-on-india-usec-mecl-loop-sources-6152441">MECL service from India to the US East Coast</a> is due to be rerouted through the Suez and Red Sea beginning Monday. While no change of plan has been announced, the volatility in the region prompted the carrier to include a caveat in its Jan. 15 advisory announcing a return to the shorter route. “Maersk has contingency plans in place should the security situation deteriorate, which may necessitate reverting individual MECL sailings or the wider structural change of the MECL service back to the Cape of Good Hope route,” the carrier said. While Maersk tests the waters and CMA CGM continues to send regional and back-haul services through the Red Sea, most of the other major carriers are content to maintain longer transits around southern Africa until the fluid geopolitical environment stabilizes. Carriers have used the longer route since the Houthis began attacks against commercial shipping in late 2023 in response to the Israel-Hamas war. Resuming services through the Suez represents more than just a routing change. Oversupplied carriers have benefited from the longer route absorbing about 8% of global capacity, preventing rates from falling. “A full-scale return of liner services to the Red Sea would initially be disruptive, with increased risks of port congestion, landside capacity constraints and short-term cost implications,” Bjoern Schoon, senior vice president of ocean freight at DHL Global Forwarding/Asia-Pacific, said in a market update last week. “However, once networks stabilize, it will benefit shippers through faster transit times, and the trade is likely to become more competitive on pricing,” Schoon added. Contact Greg Knowler at <a href="">greg.knowler@spglobal.com</a>.</div>

Yemen’s Houthi militants have warned of new attacks on shipping in the Red Sea as tensions escalate between the US and Iran, raising questions over whether moves by some carriers to return services to the shorter Suez Canal route will actually happen. A Houthi video posted on YouTube over the weekend showed a ship on fire accompanied by the headline: “Soon.” It was followed by another video, this one from Houthi spokesman Brigadier Yahya Saree, pointing to “the escalation of possibilities” of the US launching a military strike against Iran, which he said would be met by retaliation against the US and Israel. The Iran-backed Houthi announced a pause on ship attacks in November following the Israel-Hamas ceasefire in Gaza that was agreed the previous month and have so far honored that pledge. But Iran’s clampdown on anti-government protests in late December sparked a threat earlier this month by US President Donald Trump to respond militarily, with a carrier strike group led by the USS Abraham Lincoln now heading for the region. Even before the new Houthi threat, CMA CGM, one of the main Red Sea users over the past two years, said it would scale back plans to send three Asia-Europe westbound services through the Suez, citing the “complex and uncertain international context.” Maersk India-US service due to begin shorter route Maersk’s MECL service from India to the US East Coast is due to be rerouted through the Suez and Red Sea beginning Monday. While no change of plan has been announced, the volatility in the region prompted the carrier to include a caveat in its Jan. 15 advisory announcing a return to the shorter route. “Maersk has contingency plans in place should the security situation deteriorate, which may necessitate reverting individual MECL sailings or the wider structural change of the MECL service back to the Cape of Good Hope route,” the carrier said. While Maersk tests the waters and CMA CGM continues to send regional and back-haul services through the Red Sea, most of the other major carriers are content to maintain longer transits around southern Africa until the fluid geopolitical environment stabilizes. Carriers have used the longer route since the Houthis began attacks against commercial shipping in late 2023 in response to the Israel-Hamas war. Resuming services through the Suez represents more than just a routing change. Oversupplied carriers have benefited from the longer route absorbing about 8% of global capacity, preventing rates from falling. “A full-scale return of liner services to the Red Sea would initially be disruptive, with increased risks of port congestion, landside capacity constraints and short-term cost implications,” Bjoern Schoon, senior vice president of ocean freight at DHL Global Forwarding/Asia-Pacific, said in a market update last week. “However, once networks stabilize, it will benefit shippers through faster transit times, and the trade is likely to become more competitive on pricing,” Schoon added. Contact Greg Knowler at  greg.knowler@spglobal.com .

Latest Houthi threat renews questions about Suez route as US-Iran tensions rise 

<div class="phx-topic abstract-wrapper">The agency ruled in 2024 that shippers can pick their own chassis when they arrange for truck transportation, but compliance with that ruling remains unclear. </div>

The agency ruled in 2024 that shippers can pick their own chassis when they arrange for truck transportation, but compliance with that ruling remains unclear.

<div class="phx-topic">The Federal Maritime Commission (FMC) is launching its second probe into chassis restrictions ocean carriers put on truckers when hauling a container. The probe comes after the agency ruled in 2024 that shippers can choose their own chassis when they contract with their own trucker. In a federal register notice Friday, the FMC said it plans to open a 60-day window for comments about “service contract terms or other means to mandate that motor carriers [truckers] and shippers use the ocean common carriers’ designated chassis.” The comments are sought in relation to an investigation by the FMC over allegations that “ocean common carriers may be in violation of the Shipping Act by unjustly and unreasonably restricting truckers and shippers from negotiating and dealing with chassis providers.”The investigation stems from <a href="https://www.joc.com/article/fmc-rules-for-truckers-in-chassis-dispute-with-ocean-carriers-5234355">the 2024 agency ruling</a> that ocean carriers have to stop mandating what specific chassis must be used under merchant haulage contracts. The agency upheld an administrative law judge’s earlier decision in a case between the American Trucking Association and the Ocean Carrier Equipment Management Association (OCEMA) that <a href="https://www.joc.com/article/ocema-appeals-chassis-ruling-to-fmc-commissioners-5193253">container lines violate the Shipping Act when they restrict chassis choice</a> among shippers who are arranging their own container trucking. <a href="https://www.joc.com/article/fmc-says-investigating-potential-violations-of-recent-ruling-on-chassis-control-5192272">The FMC was already investigating compliance</a> with a cease-and-desist order in the 2024 ruling, which is still ongoing. The new probe is looking for “any information concerning new or ongoing ocean common carrier practices ... to affect, restrict, or inhibit chassis provider selection,” the notice said. Part of the new probe involves whether ocean carriers designate single chassis providers at Chicago and Memphis rail ramps, if providers have enough chassis on-hand, any reimbursement for truckers on chassis split, and whether truckers are given notice about a container being under merchant or carrier haulage, the latter allowing an ocean carrier to choose a chassis. Along with the inland rail ramps, the FMC said its investigation is looking at chassis choice at the Savannah, Los Angeles, and Long Beach ports. As part of the probe into the Southern California market, the FMC is seeking how the “Pool of Pools” (PoP) operated by the three main chassis providers for the LA-LB ports distinguishes between “carrier haulage and merchant haulage containers and coordinate billing accordingly,” the notice said. OCEMA did not immediately respond to a request for comment into the new investigation.<h3>‘Sweetheart Deals’</h3>Robert Loya, chief executive of the Harbor Trucking Association, which represents drayage providers in Southern California, told the Journal of Commerce that some shippers have merchant haulage contracts that include a chassis at no additional cost, requiring the trucker to use the ocean carrier’s designated chassis. But servicing the LA-LB ports with the trucker’s own chassis and one from the PoP can result in wasted miles and more costs, he added.Returning an empty container on a PoP chassis can require a trip back to the trucker’s own yard for a shipper without an ocean carrier-provisioned chassis. Truckers are also forced to pay gate fees that marine terminals charge for temporarily storing PoP chassis.“The intermodal equipment providers have negotiated sweetheart deals with the shipping lines to use their chassis, then that gets negotiated into the ocean contract with the beneficial cargo owner,” Loya said. “That puts pressure on us, so we’re forced by the lines to use their chassis. That’s the rub for us.”<h3>Chassis mis-mounts</h3>An executive of a Tennessee-based drayage provider told the Journal of Commerce that ocean carrier chassis pools at inland rail terminals are vulnerable to shortages in times of high demand, resulting in potential delays if a trucker cannot use their own chassis.Containers can also come off a train and be mis-mounted onto the wrong chassis, causing a trucker to wait for the correct chassis. The executive said that what appears to be a no-cost chassis can mean added costs and inefficiencies for truckers.“The trucker is squeezed,” she said. “The frustration is that there’s no change after years. The US would have been better served if we had chassis choice during the pandemic. We need a faster and more fluid way to move freight.”Contact Michael Angell at <a href="mailto: michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

The Federal Maritime Commission (FMC) is launching its second probe into chassis restrictions ocean carriers put on truckers when hauling a container. The probe comes after the agency ruled in 2024 that shippers can choose their own chassis when they contract with their own trucker. In a federal register notice Friday, the FMC said it plans to open a 60-day window for comments about “service contract terms or other means to mandate that motor carriers [truckers] and shippers use the ocean common carriers’ designated chassis.” The comments are sought in relation to an investigation by the FMC over allegations that “ocean common carriers may be in violation of the Shipping Act by unjustly and unreasonably restricting truckers and shippers from negotiating and dealing with chassis providers.” The investigation stems from the 2024 agency ruling that ocean carriers have to stop mandating what specific chassis must be used under merchant haulage contracts. The agency upheld an administrative law judge’s earlier decision in a case between the American Trucking Association and the Ocean Carrier Equipment Management Association (OCEMA) that container lines violate the Shipping Act when they restrict chassis choice among shippers who are arranging their own container trucking. The FMC was already investigating compliance with a cease-and-desist order in the 2024 ruling, which is still ongoing. The new probe is looking for “any information concerning new or ongoing ocean common carrier practices ... to affect, restrict, or inhibit chassis provider selection,” the notice said. Part of the new probe involves whether ocean carriers designate single chassis providers at Chicago and Memphis rail ramps, if providers have enough chassis on-hand, any reimbursement for truckers on chassis split, and whether truckers are given notice about a container being under merchant or carrier haulage, the latter allowing an ocean carrier to choose a chassis. Along with the inland rail ramps, the FMC said its investigation is looking at chassis choice at the Savannah, Los Angeles, and Long Beach ports. As part of the probe into the Southern California market, the FMC is seeking how the “Pool of Pools” (PoP) operated by the three main chassis providers for the LA-LB ports distinguishes between “carrier haulage and merchant haulage containers and coordinate billing accordingly,” the notice said. OCEMA did not immediately respond to a request for comment into the new investigation. ‘Sweetheart Deals’ Robert Loya, chief executive of the Harbor Trucking Association, which represents drayage providers in Southern California, told the Journal of Commerce that some shippers have merchant haulage contracts that include a chassis at no additional cost, requiring the trucker to use the ocean carrier’s designated chassis. But servicing the LA-LB ports with the trucker’s own chassis and one from the PoP can result in wasted miles and more costs, he added. Returning an empty container on a PoP chassis can require a trip back to the trucker’s own yard for a shipper without an ocean carrier-provisioned chassis. Truckers are also forced to pay gate fees that marine terminals charge for temporarily storing PoP chassis. “The intermodal equipment providers have negotiated sweetheart deals with the shipping lines to use their chassis, then that gets negotiated into the ocean contract with the beneficial cargo owner,” Loya said. “That puts pressure on us, so we’re forced by the lines to use their chassis. That’s the rub for us.” Chassis mis-mounts An executive of a Tennessee-based drayage provider told the Journal of Commerce that ocean carrier chassis pools at inland rail terminals are vulnerable to shortages in times of high demand, resulting in potential delays if a trucker cannot use their own chassis. Containers can also come off a train and be mis-mounted onto the wrong chassis, causing a trucker to wait for the correct chassis. The executive said that what appears to be a no-cost chassis can mean added costs and inefficiencies for truckers. “The trucker is squeezed,” she said. “The frustration is that there’s no change after years. The US would have been better served if we had chassis choice during the pandemic. We need a faster and more fluid way to move freight.” Contact Michael Angell at michael.angell@spglobal.com .

Drayage

FMC takes second look at ocean carrier limits on chassis choice

<div class="phx-topic abstract-wrapper">Tighter capacity amid the federal government’s crackdown on non-domiciled commercial driver’s licenses and English language proficiency among drivers will likely boost rates, the company says.</div>

Tighter capacity amid the federal government’s crackdown on non-domiciled commercial driver’s licenses and English language proficiency among drivers will likely boost rates, the company says.

<div class="phx-topic">Truckload shippers should expect their annual contract rates to rise by low-to mid-single-digit percentages due to the likelihood of tighter capacity this year, according to Knight-Swift Transportation. Negotiations are ongoing or about to begin with many truckload customers. The company said the momentum that propelled rates upward in December had trickled into the first couple of weeks of January, while more shippers are shifting their business from non-asset brokers to asset-based carriers. Shippers are making the move because of uneasiness about the federal government’s crackdown on non-domiciled commercial driver’s licenses (CDLs) and English language proficiency among drivers, Knight Swift said. Shippers who have spoken to the Journal of Commerce have generally said truckload rates are rising 1.5% to 3% in their 2026 bids, although some have been able to lock in unchanged rates by switching away from incumbent carriers. “What we’d be pushing for would be low-to mid-single-digit improvements in contract rates and maybe closer to mid than low,” Knight Swift CEO Adam Miller said during the company’s fourth-quarter earnings call Wednesday. “Maybe that may not align with what our customers want to see in a pre-bid. Some of this stuff is going to go into a bid to see where the market is from a balance standpoint.” Despite what Knight Swift said was a disappointing peak season, it believes capacity is fragile, as the December spot market surge in truckload showed, and more capacity will come out this year. If a disruption occurred, or manufacturing and industrial demand pick up, then capacity might become tight quickly. Knight-Swift, similar to <a href="https://www.joc.com/article/truckload-at-a-tipping-point-intermodal-still-lagging-jb-hunt-6153949">J.B. Hunt Transport Services last week</a>, was careful not to call the end of the freight recession. “We’ve seen head fakes before, but I think we’re feeling better about where this market is headed,” Miller said. “And we do feel better about what the [US Department of Transportation] is doing to clean up capacity in our industry.” The US Department of Transportation and Federal Motor Carrier Safety Administration, a sub-agency, have cracked down on non-domiciled CDLs issued to non-citizens who have certain types of visas, including asylum seekers. Miller also pointed out that temporary protective status is ending for countries such as Ethiopia, Haiti, and Somalia, which would disqualify those drivers from continuing to operate a truck here. “Also, there were 3,000 [driving] schools recently removed because of noncompliance and another 4,000 schools that have placed on notice for noncompliance,” Miller said. “Two of our schools at Swift were audited, and we passed with flying colors, as we’d expect. So, it is real. It is happening.” <h3>Consolidating LTL business </h3>Knight Swift said it saw some “softness” in less-than-truckload (LTL) demand toward the end of the fourth quarter. The company’s emphasis in 2026 is uniting all its LTL businesses under one brand, AAA Cooper Transportation. When Knight Swift started its LTL division in July 2021, it kept the AAA Cooper and Midwest Motor Express brands separate. It continued to keep the brands separate when acquiring the LTL division of Dependable Highway Express in 2024. Nevertheless, it has reversed course because the company believes it has caused confusion among existing and potential LTL shippers. “We had integrated systems from a back-end perspective between the three businesses that we have combined, [but] it was creating confusion in our sales efforts,” Miller said. “We’ve already seen [a united brand] really help us in our sales efforts to present a single face to our customers and get them comfortable with our ability to deliver across our network in a way that meets their needs.” The company’s intermodal volumes decreased 6% year over year in the fourth quarter, but revenue per load rose 2.8%. Nevertheless, the company highlighted that the division’s operating ratio was 100.1%, still losing money, but only barely, after years of significant operating losses in the business. Swift Intermodal and Hub Group are the two companies who would most benefit if federal regulators approved a deal for Union Pacific Railroad to acquire Norfolk Southern Railway. They are the only two asset-owning intermodal providers in the US who are already exclusive partners to both railroads, making any transition in 2027 relatively seamless. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Truckload shippers should expect their annual contract rates to rise by low-to mid-single-digit percentages due to the likelihood of tighter capacity this year, according to Knight-Swift Transportation. Negotiations are ongoing or about to begin with many truckload customers. The company said the momentum that propelled rates upward in December had trickled into the first couple of weeks of January, while more shippers are shifting their business from non-asset brokers to asset-based carriers. Shippers are making the move because of uneasiness about the federal government’s crackdown on non-domiciled commercial driver’s licenses (CDLs) and English language proficiency among drivers, Knight Swift said. Shippers who have spoken to the Journal of Commerce have generally said truckload rates are rising 1.5% to 3% in their 2026 bids, although some have been able to lock in unchanged rates by switching away from incumbent carriers. “What we’d be pushing for would be low-to mid-single-digit improvements in contract rates and maybe closer to mid than low,” Knight Swift CEO Adam Miller said during the company’s fourth-quarter earnings call Wednesday. “Maybe that may not align with what our customers want to see in a pre-bid. Some of this stuff is going to go into a bid to see where the market is from a balance standpoint.” Despite what Knight Swift said was a disappointing peak season, it believes capacity is fragile, as the December spot market surge in truckload showed, and more capacity will come out this year. If a disruption occurred, or manufacturing and industrial demand pick up, then capacity might become tight quickly. Knight-Swift, similar to J.B. Hunt Transport Services last week , was careful not to call the end of the freight recession. “We’ve seen head fakes before, but I think we’re feeling better about where this market is headed,” Miller said. “And we do feel better about what the [US Department of Transportation] is doing to clean up capacity in our industry.” The US Department of Transportation and Federal Motor Carrier Safety Administration, a sub-agency, have cracked down on non-domiciled CDLs issued to non-citizens who have certain types of visas, including asylum seekers. Miller also pointed out that temporary protective status is ending for countries such as Ethiopia, Haiti, and Somalia, which would disqualify those drivers from continuing to operate a truck here. “Also, there were 3,000 [driving] schools recently removed because of noncompliance and another 4,000 schools that have placed on notice for noncompliance,” Miller said. “Two of our schools at Swift were audited, and we passed with flying colors, as we’d expect. So, it is real. It is happening.” Consolidating LTL business Knight Swift said it saw some “softness” in less-than-truckload (LTL) demand toward the end of the fourth quarter. The company’s emphasis in 2026 is uniting all its LTL businesses under one brand, AAA Cooper Transportation. When Knight Swift started its LTL division in July 2021, it kept the AAA Cooper and Midwest Motor Express brands separate. It continued to keep the brands separate when acquiring the LTL division of Dependable Highway Express in 2024. Nevertheless, it has reversed course because the company believes it has caused confusion among existing and potential LTL shippers. “We had integrated systems from a back-end perspective between the three businesses that we have combined, [but] it was creating confusion in our sales efforts,” Miller said. “We’ve already seen [a united brand] really help us in our sales efforts to present a single face to our customers and get them comfortable with our ability to deliver across our network in a way that meets their needs.” The company’s intermodal volumes decreased 6% year over year in the fourth quarter, but revenue per load rose 2.8%. Nevertheless, the company highlighted that the division’s operating ratio was 100.1%, still losing money, but only barely, after years of significant operating losses in the business. Swift Intermodal and Hub Group are the two companies who would most benefit if federal regulators approved a deal for Union Pacific Railroad to acquire Norfolk Southern Railway. They are the only two asset-owning intermodal providers in the US who are already exclusive partners to both railroads, making any transition in 2027 relatively seamless. Contact Ari Ashe at ari.ashe@spglobal.com .

Trucking News

Truckload

Shippers will see rates climb as truckload capacity tightens: Knight Swift

Use code GTW595 at checkout and save $900 on first year of an annual Gold subscription!

Upgrade Subscription - Gold Trials

Become a Gold Subscriber and Save!

Arm your team with the most trusted information portal for the international container shipping industry.

Group Subscriptions - Wide Box

Get into a group subscription today

Use code NYW26 at checkout to save 25% on a Silver or Silver Plus annual subscription! 

Subscribe Now - FT to S/SP - Wide Box

NEW YEAR SALE

Use code NYW595 and upgrade to Gold for just $595! Valid for first year of subscription.

Upgrade Subscription - S/SP to Gold - Wide Box

Subscribe today using code NYW26 at checkout and save 25% on a Silver or Silver Plus annual subscription!

Subscribe Now - Anonymous to S/SP - Wide Box

Use code NYW995 at checkout to save $500 on first year of a Gold subscription!

Subscribe Now - FT to Gold - Wide Box

Get into a Gold subscription today and save $500 by using code NYW995 at checkout!

Subscribe Now - Anonymous to Gold - Wide Box

NEW YEAR SALE: Use code NYW26 to save 25% on first year of a Silver or Silver Plus annual subscription!


Subscribe Now - FT to S/SP - Offer Box

Subscribe and Save

NEW YEAR SALE: Subscribe today using code NYW26 at checkout and save 25% on a Silver or Silver Plus annual subscription!

Subscribe Now - Anonymous to S/SP - Offer Box

SUBSCRIBE TODAY

UPGRADE TO GOLD AND SAVE: Use code GTW595 at checkout and save $900 on first year of a Gold subscription!

Upgrade Subscription

NEW YEAR SALE: Get into a Gold subscription today and save $500 by using code NYW995 at checkout!

Subscribe Now - Anonymous to Gold - Offer Box

NEW YEAR SALE: Use code NYW595 and upgrade to Gold for just $595! Valid on first year of subscription.

Upgrade Subscription - S/SP to Gold - Offer Box

NEW YEAR SALE: Use code NYW995 at checkout to save $500 on a Gold subscription!

Subscribe Now - FT to Gold - Offer Box

SUBSCRIBE AND SAVE

Monthly publication providing an editorial deep dive into global supply chain news

Journal of Commerce Magazine - Rectangle Box

Journal of Commerce Magazine

A premium access index of savings using domestic intermodal vs. OTR 

ISI Report - Rectangle Box

Intermodal Savings Index

An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

Breakbulk Report - Rectangle Box

Breakbulk Quarterly

An extensive dashboard of charts organized by trade lane, mode, and topic

Gateway - Rectangle Box

Gateway

Customers scoring their intermodal partners to identify the best service providers

Intermodal Service Scorecard - Rectangle Box

Intermodal Service Scorecard

A premium access outlook critical to shippers and transportation providers

QI Report - Rectangle Box

Quarterly Intelligence

The premier conference for the global container shipping and supply chain community

TPM Conference - Rectangle Box

Attend TPM26

The only editorially independent conference for the breakbulk & project cargo industry

Breakbulk Conference - Rectangle Box

Attend Breakbulk26

<div class="phx-topic abstract-wrapper">Union Pacific Railroad called the decision by federal regulators to rule its filing as “incomplete” a minor setback that won’t significantly change the timeline for its hoped-for acquisition of NS.</div>

Union Pacific Railroad called the decision by federal regulators to rule its filing as “incomplete” a minor setback that won’t significantly change the timeline for its hoped-for acquisition of NS.

<div class="phx-topic">Union Pacific Railroad (UP) said Tuesday it is moving quickly to address deficiencies that led federal regulators to deem its application to acquire Norfolk Southern Railway (NS) “incomplete,” and expects to refile an updated application within “weeks.” Once UP resubmits its application, the regulatory process will restart with a fresh 30-day review period during which the US Surface Transportation Board (STB) will determine whether the new filing is complete. Interested parties may file comments during that period, and UP and NS can respond. “We are disappointed that the STB determined we needed to provide more information after providing close to 7,000 pages,” UP CEO Jim Vena said during the railroad’s fourth-quarter earnings call Tuesday. “Our response will take a few weeks to prepare and then we will refile our application as soon as possible.  “We view this as a short-term blip and do not expect a significant change to the timeline as we are still targeting closing in the first half of 2027,” he added. Although UP did not provide a specific refiling date, Vena said the company would announce the timing in a subsequent public statement and that a revised application could be sent to the STB in March. The <a href="https://www.joc.com/article/stb-rejects-up-ns-merger-application-as-incomplete-6154074">STB determined that UP failed to provide</a> sufficient information on future growth, citing inconsistencies in baseline assumptions across different sections of its application. Opponents of the $85 billion deal have also argued that Union Pacific’s projections, including removing 2 million truckloads from highways in large part through 1.17 million truckload-to-intermodal conversions within three years, are overly optimistic. Vena said long-haul intermodal routes exceeding 2,000 miles historically have lower rail market share because shippers are reluctant to accept handoffs between railroads in hubs such as Chicago. Under a combined Union Pacific–Norfolk Southern network, he said, market share would more closely resemble that of 1,000- to 1,500-mile lanes, where rail penetration is higher because a single railroad handles the entire move. Other railroads have argued that handling that volume would require UP to operate as many as 15 additional trains per day, potentially congesting the network. UP said it would not degrade overall service. “This morning, we have over 2,000 movements, foreign railroads, and local trains running on our network,” Vena said on the earnings call. “If we add 10 or 15 more trains a day, it's a pretty small rounding error on the impact for the network.”  UP also addressed the STB’s objection to the railroad’s failure to disclose a document known as Schedule 5.6, which outlines conditions under which the company could walk away from the transaction.  “I don’t like it because I don’t think it adds to the merits, but guess what? I wish Jim Vena had a totalitarian system that I could get every decision that I want, but I don’t even get it at home with my wife and kids, let alone with the regulator,” Vena said. <h3>Not banking on economic turnaround this year </h3>While there were few non-merger-related questions on Tuesday’s call, Union Pacific did offer a cautious economic outlook for 2026, acknowledging that pricing gains across its businesses will be difficult to achieve.  “S&amp;P Global’s 2026 economic estimates in key areas such as industrial production, housing starts and auto sales have deteriorated,” said Jennifer Hanneman, UP’s chief financial officer. “In addition, rail inflation is ticking up again. We expect slightly over 4% inflation in 2026. Our commitment to yielding price dollars that exceed inflation dollars has not changed, but price may not be a driver of our improving margins in 2026.” S&amp;P Global is the parent company of the Journal of Commerce. UP said 2026 is likely to be challenging for international intermodal traffic, with port volumes expected to decline year over year through at least the first half. The railroad said it remains bullish on domestic intermodal, which set volume records in 2025, although it did not provide a specific forecast.  Union Pacific took market share from rival BNSF Railway in California during the second half of last year, according to data visibility platform RailState, while also winning freight from the truckload market. “We’ve had over-the-road wins with Uber Freight, over-the-road wins in Phoenix, wins in Kansas City,” Kenny Rocker, UP’s executive vice president of sales and marketing, said on the call. “So we’re coming from a position of strength and we’re excited about it.” Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

Union Pacific Railroad (UP) said Tuesday it is moving quickly to address deficiencies that led federal regulators to deem its application to acquire Norfolk Southern Railway (NS) “incomplete,” and expects to refile an updated application within “weeks.”  Once UP resubmits its application, the regulatory process will restart with a fresh 30-day review period during which the US Surface Transportation Board (STB) will determine whether the new filing is complete. Interested parties may file comments during that period, and UP and NS can respond. “We are disappointed that the STB determined we needed to provide more information after providing close to 7,000 pages,” UP CEO Jim Vena said during the railroad’s fourth-quarter earnings call Tuesday. “Our response will take a few weeks to prepare and then we will refile our application as soon as possible.   “We view this as a short-term blip and do not expect a significant change to the timeline as we are still targeting closing in the first half of 2027,” he added.  Although UP did not provide a specific refiling date, Vena said the company would announce the timing in a subsequent public statement and that a revised application could be sent to the STB in March.  The  STB determined that UP failed to provide  sufficient information on future growth, citing inconsistencies in baseline assumptions across different sections of its application. Opponents of the $85 billion deal have also argued that Union Pacific’s projections, including removing 2 million truckloads from highways in large part through 1.17 million truckload-to-intermodal conversions within three years, are overly optimistic.  Vena said long-haul intermodal routes exceeding 2,000 miles historically have lower rail market share because shippers are reluctant to accept handoffs between railroads in hubs such as Chicago. Under a combined Union Pacific–Norfolk Southern network, he said, market share would more closely resemble that of 1,000- to 1,500-mile lanes, where rail penetration is higher because a single railroad handles the entire move.  Other railroads have argued that handling that volume would require UP to operate as many as 15 additional trains per day, potentially congesting the network. UP said it would not degrade overall service.  “This morning, we have over 2,000 movements, foreign railroads, and local trains running on our network,” Vena said on the earnings call. “If we add 10 or 15 more trains a day, it's a pretty small rounding error on the impact for the network.”   UP also addressed the STB’s objection to the railroad’s failure to disclose a document known as Schedule 5.6, which outlines conditions under which the company could walk away from the transaction.   “I don’t like it because I don’t think it adds to the merits, but guess what? I wish Jim Vena had a totalitarian system that I could get every decision that I want, but I don’t even get it at home with my wife and kids, let alone with the regulator,” Vena said.  Not banking on economic turnaround this year  While there were few non-merger-related questions on Tuesday’s call, Union Pacific did offer a cautious economic outlook for 2026, acknowledging that pricing gains across its businesses will be difficult to achieve.   “S&P Global’s 2026 economic estimates in key areas such as industrial production, housing starts and auto sales have deteriorated,” said Jennifer Hanneman, UP’s chief financial officer. “In addition, rail inflation is ticking up again. We expect slightly over 4% inflation in 2026. Our commitment to yielding price dollars that exceed inflation dollars has not changed, but price may not be a driver of our improving margins in 2026.”  S&P Global is the parent company of the Journal of Commerce.  UP said 2026 is likely to be challenging for international intermodal traffic, with port volumes expected to decline year over year through at least the first half. The railroad said it remains bullish on domestic intermodal, which set volume records in 2025, although it did not provide a specific forecast.   Union Pacific took market share from rival BNSF Railway in California during the second half of last year, according to data visibility platform RailState, while also winning freight from the truckload market. “We’ve had over-the-road wins with Uber Freight, over-the-road wins in Phoenix, wins in Kansas City,” Kenny Rocker, UP’s executive vice president of sales and marketing, said on the call. “So we’re coming from a position of strength and we’re excited about it.”  Contact Ari Ashe at  ari.ashe@spglobal.com . 

Rail News

Revised Norfolk Southern merger application will be refiled in ‘weeks’: UP

<div class="phx-topic abstract-wrapper">The Metro Express Terminal at Pier S will serve smaller, independent container lines on the trans-Pacific that carry e-commerce merchandise requiring rapid movement once onshore.</div>

The Metro Express Terminal at Pier S will serve smaller, independent container lines on the trans-Pacific that carry e-commerce merchandise requiring rapid movement once onshore.

<div class="phx-topic">The new zero-emission container terminal planned for Pier S at the Port of Long Beach will be built to attract independent carriers operating express services geared for the trans-Pacific e-commerce market, according to developers of the project. <a href="https://www.joc.com/article/long-beach-considering-development-of-conventional-zero-emissions-terminal-ceo-6153068">The Metro Express Terminal at Pier S</a> is likely to pull in smaller container lines that operate vessels of 9,000-TEU capacity or less making faster turn-times than the mainline trans-Pacific carriers operating vessels of 15,000-TEU-plus capacity, said Peter Stone, senior vice president/strategic projects at Brookfield Properties. Express services carrying e-commerce merchandise require rapid movement of containers through marine terminals once they are discharged from vessels. “The nature of express services is not that the ships go faster. It’s that they get in and out of the terminal faster,” Stone told the Journal of Commerce Monday. The Pier S terminal will be designed for “regular” e-commerce merchandise that is sold online and shipped by retailers. The e-commerce market that will be served by Pier S is shipped in ocean containers under a speed-to-market model. “The carriers and [third-party logistics] companies we talked to are asking for this type of product,” Stone said. “They want a fast transfer from ship to warehouse.” Metro Express will not be adversely affected by the US eliminating the de minimis exemption on low-value and e-commerce imports, Stone said, because the goods that enjoyed the duty-free exemption — those valued at under $800 — were never shipped in ocean containers. All efforts now by the port and its partners in the Pier S project are geared toward finalizing the business deal and getting the necessary environmental approvals, said Noel Hacegaba, CEO of the Port of Long Beach. “Our next steps include finalizing the negotiation of the preferred assignment agreement, along with design, environmental review and outreach to our many stakeholders, including labor, community members and industry partners,” Hacegaba told the Journal of Commerce. <h3>Short timeline anticipated </h3>Stone said he does not have an answer yet as to how long it will take to finalize the business deals and secure the necessary environmental approvals, but he anticipates it will be rather seamless. The partners will build a conventional marine terminal, ship-to-shore cranes will be electric, and cargo-handling equipment will be zero-emission and manually operated by longshoremen. “This terminal is a very straightforward project and ready for construction,” he said. Hacegaba said Pier S is used now by other terminals for container peel-offs and temporary container storage. “No structures will need to be removed prior to construction,” he said. Given those conditions, once construction begins on the Metro Express Terminal, it should only take three to five years to complete, Stone said. Pier S will utilize about 105 acres of the 160-acre site, and the terminal will have an annual capacity of 1.8 million TEUs, he said. The eventual price tag, Stone added, will be known after the business negotiations are completed. There will be no need for on-dock rail on the terminal because containers will be moved by truck to local warehouses or off-dock transload facilities, said Bob Owens, CEO of Nautilus International Holding Corp., which is partnering with Brookfield on the project. Nautilus provides business administration, management, and strategic oversight for marine transportation companies. Plans are to operate Pier S around the clock in order to better utilize the International Longshore and Warehouse Union (ILWU) workforce. That will reduce container dwell times on the terminal, which in turn will enable the workforce to achieve container crane productivity that rivals terminals along the US Southeast coast, Owens said, adding it all fits in with what the e-commerce business model is built on. “The market is already there,” he said. “We’re just looking to serve that market.” Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

The new zero-emission container terminal planned for Pier S at the Port of Long Beach will be built to attract independent carriers operating express services geared for the trans-Pacific e-commerce market, according to developers of the project. The Metro Express Terminal at Pier S is likely to pull in smaller container lines that operate vessels of 9,000-TEU capacity or less making faster turn-times than the mainline trans-Pacific carriers operating vessels of 15,000-TEU-plus capacity, said Peter Stone, senior vice president/strategic projects at Brookfield Properties. Express services carrying e-commerce merchandise require rapid movement of containers through marine terminals once they are discharged from vessels. “The nature of express services is not that the ships go faster. It’s that they get in and out of the terminal faster,” Stone told the Journal of Commerce Monday. The Pier S terminal will be designed for “regular” e-commerce merchandise that is sold online and shipped by retailers. The e-commerce market that will be served by Pier S is shipped in ocean containers under a speed-to-market model. “The carriers and [third-party logistics] companies we talked to are asking for this type of product,” Stone said. “They want a fast transfer from ship to warehouse.” Metro Express will not be adversely affected by the US eliminating the de minimis exemption on low-value and e-commerce imports, Stone said, because the goods that enjoyed the duty-free exemption — those valued at under $800 — were never shipped in ocean containers. All efforts now by the port and its partners in the Pier S project are geared toward finalizing the business deal and getting the necessary environmental approvals, said Noel Hacegaba, CEO of the Port of Long Beach. “Our next steps include finalizing the negotiation of the preferred assignment agreement, along with design, environmental review and outreach to our many stakeholders, including labor, community members and industry partners,” Hacegaba told the Journal of Commerce. Short timeline anticipated Stone said he does not have an answer yet as to how long it will take to finalize the business deals and secure the necessary environmental approvals, but he anticipates it will be rather seamless. The partners will build a conventional marine terminal, ship-to-shore cranes will be electric, and cargo-handling equipment will be zero-emission and manually operated by longshoremen. “This terminal is a very straightforward project and ready for construction,” he said. Hacegaba said Pier S is used now by other terminals for container peel-offs and temporary container storage. “No structures will need to be removed prior to construction,” he said. Given those conditions, once construction begins on the Metro Express Terminal, it should only take three to five years to complete, Stone said. Pier S will utilize about 105 acres of the 160-acre site, and the terminal will have an annual capacity of 1.8 million TEUs, he said. The eventual price tag, Stone added, will be known after the business negotiations are completed. There will be no need for on-dock rail on the terminal because containers will be moved by truck to local warehouses or off-dock transload facilities, said Bob Owens, CEO of Nautilus International Holding Corp., which is partnering with Brookfield on the project. Nautilus provides business administration, management, and strategic oversight for marine transportation companies. Plans are to operate Pier S around the clock in order to better utilize the International Longshore and Warehouse Union (ILWU) workforce. That will reduce container dwell times on the terminal, which in turn will enable the workforce to achieve container crane productivity that rivals terminals along the US Southeast coast, Owens said, adding it all fits in with what the e-commerce business model is built on. “The market is already there,” he said. “We’re just looking to serve that market.” Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Panama court voids CK Hutchison canal terminal leases

Featured Gateway Chart

Essential Reads

Latest Houthi threat renews questions about Suez route as US-Iran tensions rise

FMC takes second look at ocean carrier limits on chassis choice

Shippers will see rates climb as truckload capacity tightens: Knight Swift

Recent Commentary

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

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

Top 5 Most Read Stories