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<div class="phx-topic abstract-wrapper">Rising fuel prices and memory costs may force buyers to re-think, or at least delay, purchases of pricey electronics this year. </div>

Rising fuel prices and memory costs may force buyers to re-think, or at least delay, purchases of pricey electronics this year.

Feature image

<div class="phx-topic">(The following story appears in the Top 100 Importers and Exporters issue of the Journal of Commerce magazine to be published May 4, 2026.) Importers of consumer electronics affected by rising costs on US households in 2025 are facing dual threats to growth prospects in the year ahead: the impact of increased fuel costs on consumer discretionary spending and the skyrocketing price of memory due to demand from data center construction. That means there might be little respite for consumer electronics manufacturers and retailers after they saw containerized imports of those products dip 2.2% in 2025, according to data from PIERS, a sister product of the Journal of Commerce within S&amp;P Global. “Energy prices and gas prices, that’s going to be a headline budgetary impact on the average household,” Paul Gagnon, vice president of consumer technology at market research firm Circana, told the Journal of Commerce. “We were already expecting consumer demand to not be great this year and that tariffs would have an impact. But food and other necessary purchases will delay demand for discretionary purchases.” A potentially bigger headwind for consumer electronics sales is the impact of memory prices. Gagnon said pricing for memory is up 400% year over year in the last few months. “Data centers use huge amounts of high bandwidth memory and the generators of that memory don’t have bandwidth to supply data centers and lower value memory that goes into consumer products,” he said. The impact of that dynamic won’t be isolated to the types of products most associated with memory, like laptops and tablets, but will be more widespread since virtually every consumer electronic good now has a memory component. “Any product that uses a lot of memory will be susceptible,” Gagnon said. “Even things that use memory indirectly, prices will go up.” Sony, during its fiscal third-quarter earnings call in February, noted the memory cost issue. “We are already in a position to secure the minimum quantity necessary to manage the year-end selling season of next fiscal year,” Sony Group CFO Lin Tao said. “Going forward, we intend to further negotiate with various suppliers to secure enough [memory] supply to meet the demand of our customers.” The way these trends manifest into container volume is not entirely clear, but Gagnon cautioned that with prices likely to increase due to the memory cost issue, retailers might see sales stay steady or rise, but on a lower volume of units. That would, in turn, hit import volume. “It will definitely have a negative impact on volumes,” he said. “Retailers don’t care about volume as much as revenues. And it might be a situation where their revenues hold up because people are willing to pay more or need something and end up having to pay more.” <h3>Sourcing shift </h3>Another sectoral trend affecting volume is changes in sourcing patterns of consumer electronics tied to the size of a product and the composition of parts needed, Gagnon explained. For instance, television supply chains had long ago shifted production to Mexico, but during 2025 saw even more concentration in that market. “What had left China had gone to Southeast Asia but even that had moved to Mexico,” Gagnon said. "But the shift to Mexico didn’t happen broadly outside of large physical size products. For smaller products, there’s not a big benefit to have it more local.” He also said Mexico is suitable to television production because the some of the major component parts — metals and plastics — are not as sophisticated as those needed in other consumer product categories. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="df66d4d5-06ca-41b6-986e-bdb3b6d0346d"></dynamic-object></div>Meanwhile, historical behavior in the electronics sector suggests that when prices rise, consumers will either put off purchases, whether new or replacement, or they will engage in what Gagnon called “trade down behavior,” choosing a less expensive option if they need to buy. The forecast for consumer electronics manufacturing is not much better. S&amp;P Global Market Intelligence in late February revised its projection for global production of consumer electronics downward from 5.5% to 4.4%. The forecast noted that consumer electronics production tends to correlate loosely with global GDP. “Historically, the industry overperformed the global economy by 1.6 percentage points,” the report said. “Over the last 10 years, the gap between industry and global growth even got wider. The industry grew 5.2% on average per year, over-performing GDP growth by 2.4 percentage points.” So a tick down from the average growth rate over the past decade would indicate a slowing sector in a slowing economy. US imports of consumer electronics have lost ground three of the last four years, with 2024 being the outlier, according to PIERS data, adding weight to the slowdown theory not being an isolated trend. While China dominates the supply chain for consumer electronics — it accounted for 53% of global production in 2025 — S&amp;P Global Market Intelligence said the next 10 years will see supply concentration decrease. PIERS data shows that process already occurring, with Vietnam growing its share of US consumer electronic imports from 10.1% in 2020 to 18.1% in 2025, while China’s share decreased from 56.6% to 40.7% in the same period. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

(The following story appears in the Top 100 Importers and Exporters issue of the Journal of Commerce magazine to be published May 4, 2026.) Importers of consumer electronics affected by rising costs on US households in 2025 are facing dual threats to growth prospects in the year ahead: the impact of increased fuel costs on consumer discretionary spending and the skyrocketing price of memory due to demand from data center construction. That means there might be little respite for consumer electronics manufacturers and retailers after they saw containerized imports of those products dip 2.2% in 2025, according to data from PIERS, a sister product of the Journal of Commerce within S&P Global. “Energy prices and gas prices, that’s going to be a headline budgetary impact on the average household,” Paul Gagnon, vice president of consumer technology at market research firm Circana, told the Journal of Commerce. “We were already expecting consumer demand to not be great this year and that tariffs would have an impact. But food and other necessary purchases will delay demand for discretionary purchases.” A potentially bigger headwind for consumer electronics sales is the impact of memory prices. Gagnon said pricing for memory is up 400% year over year in the last few months. “Data centers use huge amounts of high bandwidth memory and the generators of that memory don’t have bandwidth to supply data centers and lower value memory that goes into consumer products,” he said. The impact of that dynamic won’t be isolated to the types of products most associated with memory, like laptops and tablets, but will be more widespread since virtually every consumer electronic good now has a memory component. “Any product that uses a lot of memory will be susceptible,” Gagnon said. “Even things that use memory indirectly, prices will go up.” Sony, during its fiscal third-quarter earnings call in February, noted the memory cost issue. “We are already in a position to secure the minimum quantity necessary to manage the year-end selling season of next fiscal year,” Sony Group CFO Lin Tao said. “Going forward, we intend to further negotiate with various suppliers to secure enough [memory] supply to meet the demand of our customers.” The way these trends manifest into container volume is not entirely clear, but Gagnon cautioned that with prices likely to increase due to the memory cost issue, retailers might see sales stay steady or rise, but on a lower volume of units. That would, in turn, hit import volume. “It will definitely have a negative impact on volumes,” he said. “Retailers don’t care about volume as much as revenues. And it might be a situation where their revenues hold up because people are willing to pay more or need something and end up having to pay more.” Sourcing shift Another sectoral trend affecting volume is changes in sourcing patterns of consumer electronics tied to the size of a product and the composition of parts needed, Gagnon explained. For instance, television supply chains had long ago shifted production to Mexico, but during 2025 saw even more concentration in that market. “What had left China had gone to Southeast Asia but even that had moved to Mexico,” Gagnon said. "But the shift to Mexico didn’t happen broadly outside of large physical size products. For smaller products, there’s not a big benefit to have it more local.” He also said Mexico is suitable to television production because the some of the major component parts — metals and plastics — are not as sophisticated as those needed in other consumer product categories. Meanwhile, historical behavior in the electronics sector suggests that when prices rise, consumers will either put off purchases, whether new or replacement, or they will engage in what Gagnon called “trade down behavior,” choosing a less expensive option if they need to buy. The forecast for consumer electronics manufacturing is not much better. S&P Global Market Intelligence in late February revised its projection for global production of consumer electronics downward from 5.5% to 4.4%. The forecast noted that consumer electronics production tends to correlate loosely with global GDP. “Historically, the industry overperformed the global economy by 1.6 percentage points,” the report said. “Over the last 10 years, the gap between industry and global growth even got wider. The industry grew 5.2% on average per year, over-performing GDP growth by 2.4 percentage points.” So a tick down from the average growth rate over the past decade would indicate a slowing sector in a slowing economy. US imports of consumer electronics have lost ground three of the last four years, with 2024 being the outlier, according to PIERS data, adding weight to the slowdown theory not being an isolated trend. While China dominates the supply chain for consumer electronics — it accounted for 53% of global production in 2025 — S&P Global Market Intelligence said the next 10 years will see supply concentration decrease. PIERS data shows that process already occurring, with Vietnam growing its share of US consumer electronic imports from 10.1% in 2020 to 18.1% in 2025, while China’s share decreased from 56.6% to 40.7% in the same period. Contact Eric Johnson at eric.johnson@spglobal.com .

Container Shipping News

US imports of consumer electronics face threats to growth plans

<div class="phx-topic abstract-wrapper">The repair and rebuilding of oil, gas and petrochemical facilities in the Middle East will provide project cargoes for the specialist fleet at least through the end of the decade, observers say. </div>

The repair and rebuilding of oil, gas and petrochemical facilities in the Middle East will provide project cargoes for the specialist fleet at least through the end of the decade, observers say.

<div class="phx-topic">Rebuilding energy, petrochemical and other critical infrastructure in the Middle East that has been damaged during the war will drive a surge in cargo demand and freight rates in the multipurpose vessel (MPV) and deck carrier markets when the conflict ends, industry executives say. “Reconstruction needs across the region will be considerable,” said Marco Poisler, chief operating officer for global energy and capital projects at project cargo logistics company UTC Overseas. “The pent-up demand wave will hit a market that is not ready for it. And that, historically, is when freight rates for MPV project cargo move most sharply,” Poisler told the Journal of Commerce. The fragile ceasefire in the region after six weeks of air and sea attacks means demand for MPV-related cargo into the region “is likely to increase substantially above pre-conflict baselines,” he said. That comes as Tehran pledged to reopen the Strait of Hormuz as part of the two-week truce agreed to with the US and Israel Tuesday. But Iran maintains effective operational control of the crucial waterway and has said it will charge vessel transit fees of up to $2 million for passage, with the proceeds used to finance post-war reconstruction in the country. <h3>Freight rates holding firm despite conflict </h3>The conflict has had little impact on MPV rates so far, with the April Toepfer Transport Multipurpose Vessel Index (TMI) remaining virtually unchanged at $12,683 per day, down just 0.53% from March. Six-month rates are projected to be 0.27% higher than current levels, and rising 1% in the 12-month forecast, according to executives polled by Toepfer. “The growing concerns about disruptions and high bunker prices due to the war in the Middle East are not currently reflected in the TMI,” Toepfer said in a commentary this week. “This may be due to the fact that the majority of cargoes not destined for the Middle East are still being shipped, as expected, and thus fleet utilization remains high.” The ceasefire was agreed to as damage to energy infrastructure across the region was already estimated to cost more than $25 billion to repair, according to an initial assessment by Rystad Energy in late March. “Spending is likely to be driven primarily by engineering and construction, followed by equipment and materials, the Norway-headquartered energy consultancy said in a commentary.   <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="c421e66c-3cd4-4d1c-8095-6a37bbeeb1cb"></dynamic-object></div>Iranian missile and drone attacks caused extensive damage to refineries and gas and petrochemical plants in neighboring countries including Qatar, Kuwait, Saudi Arabia, the United Arab Emirates, and Bahrain. Similarly, US and Israeli bombing missions targeted Iran’s energy and chemicals industry, especially the country’s South Pars gas field and Kharg Island oil export complex. Anurag Kumar, senior research analyst/MPV at Drewry Maritime Research, said the SAMRAF refinery and Al-Jubail petrochemical complex in Saudi Arabia, Abu Dhabi’s Al Hosn gas field, and Qatar’s Ras Laffan liquefied natural gas (LNG) plant were among the facilities targeted. “They will require repair, replacement, and in some cases [a] complete rebuild,” Kumar told the Journal of Commerce. “The structural steel, pressure vessels, heat exchangers, turbine components and heavy fabricated packages that constitute the core of this reconstruction cargo are precisely the cargo class served by the MPV sector,” Kumar added. Larger components and modules are likely to be transported on deck carriers, providing a lift for that sector. In Qatar, reconstruction of two LNG production trains at Ras Laffan destroyed by Iran will require deck carriers and MPVs to transport heavy and oversized cargoes including LNG modules, compressors, pipelines and structural steel, according to Kumar and Poisler. The attacks took out 17% of Ras Laffan’s LNG production capacity. <h3>MPV demand through 2030 </h3>Rebuilding work is also likely to take place over the long term, potentially supporting the MPV and deck carrier markets until the end of the decade. Poisler said the Ras Laffan plant could take up to five years to become fully operational again. “This is because the large-frame gas turbines required to power LNG main refrigeration compressors are supplied by only three original equipment manufacturers globally, all of which entered 2026 with production backlogs of around two to four years,” he said. Qatar’s Pearl gas-to-liquids facility also sustained damage during aerial attacks on March 20 that is expected to take about a year to repair. Drewry’s Kumar said the outages at Ras Laffan alone are estimated to cost QatarEnergy some $20 billion per year in lost revenue. He said reconstruction work across the region will also drive the need for better port handling capabilities and integrated logistics to handle MPV and deck carrier cargoes. “As projects become more complex, EPC [engineering, procurement and construction] contractors, shipping lines and port operators will likely need to work together more closely,” he said. “In the medium to long term, ongoing expansion and upgrades to Qatar’s energy facilities should keep breakbulk volumes high.” Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Rebuilding energy, petrochemical and other critical infrastructure in the Middle East that has been damaged during the war will drive a surge in cargo demand and freight rates in the multipurpose vessel (MPV) and deck carrier markets when the conflict ends, industry executives say. “Reconstruction needs across the region will be considerable,” said Marco Poisler, chief operating officer for global energy and capital projects at project cargo logistics company UTC Overseas. “The pent-up demand wave will hit a market that is not ready for it. And that, historically, is when freight rates for MPV project cargo move most sharply,” Poisler told the Journal of Commerce. The fragile ceasefire in the region after six weeks of air and sea attacks means demand for MPV-related cargo into the region “is likely to increase substantially above pre-conflict baselines,” he said. That comes as Tehran pledged to reopen the Strait of Hormuz as part of the two-week truce agreed to with the US and Israel Tuesday. But Iran maintains effective operational control of the crucial waterway and has said it will charge vessel transit fees of up to $2 million for passage, with the proceeds used to finance post-war reconstruction in the country. Freight rates holding firm despite conflict The conflict has had little impact on MPV rates so far, with the April Toepfer Transport Multipurpose Vessel Index (TMI) remaining virtually unchanged at $12,683 per day, down just 0.53% from March. Six-month rates are projected to be 0.27% higher than current levels, and rising 1% in the 12-month forecast, according to executives polled by Toepfer. “The growing concerns about disruptions and high bunker prices due to the war in the Middle East are not currently reflected in the TMI,” Toepfer said in a commentary this week. “This may be due to the fact that the majority of cargoes not destined for the Middle East are still being shipped, as expected, and thus fleet utilization remains high.” The ceasefire was agreed to as damage to energy infrastructure across the region was already estimated to cost more than $25 billion to repair, according to an initial assessment by Rystad Energy in late March. “Spending is likely to be driven primarily by engineering and construction, followed by equipment and materials, the Norway-headquartered energy consultancy said in a commentary.   Iranian missile and drone attacks caused extensive damage to refineries and gas and petrochemical plants in neighboring countries including Qatar, Kuwait, Saudi Arabia, the United Arab Emirates, and Bahrain. Similarly, US and Israeli bombing missions targeted Iran’s energy and chemicals industry, especially the country’s South Pars gas field and Kharg Island oil export complex. Anurag Kumar, senior research analyst/MPV at Drewry Maritime Research, said the SAMRAF refinery and Al-Jubail petrochemical complex in Saudi Arabia, Abu Dhabi’s Al Hosn gas field, and Qatar’s Ras Laffan liquefied natural gas (LNG) plant were among the facilities targeted. “They will require repair, replacement, and in some cases [a] complete rebuild,” Kumar told the Journal of Commerce. “The structural steel, pressure vessels, heat exchangers, turbine components and heavy fabricated packages that constitute the core of this reconstruction cargo are precisely the cargo class served by the MPV sector,” Kumar added. Larger components and modules are likely to be transported on deck carriers, providing a lift for that sector. In Qatar, reconstruction of two LNG production trains at Ras Laffan destroyed by Iran will require deck carriers and MPVs to transport heavy and oversized cargoes including LNG modules, compressors, pipelines and structural steel, according to Kumar and Poisler. The attacks took out 17% of Ras Laffan’s LNG production capacity. MPV demand through 2030 Rebuilding work is also likely to take place over the long term, potentially supporting the MPV and deck carrier markets until the end of the decade. Poisler said the Ras Laffan plant could take up to five years to become fully operational again. “This is because the large-frame gas turbines required to power LNG main refrigeration compressors are supplied by only three original equipment manufacturers globally, all of which entered 2026 with production backlogs of around two to four years,” he said. Qatar’s Pearl gas-to-liquids facility also sustained damage during aerial attacks on March 20 that is expected to take about a year to repair. Drewry’s Kumar said the outages at Ras Laffan alone are estimated to cost QatarEnergy some $20 billion per year in lost revenue. He said reconstruction work across the region will also drive the need for better port handling capabilities and integrated logistics to handle MPV and deck carrier cargoes. “As projects become more complex, EPC [engineering, procurement and construction] contractors, shipping lines and port operators will likely need to work together more closely,” he said. “In the medium to long term, ongoing expansion and upgrades to Qatar’s energy facilities should keep breakbulk volumes high.” Contact Keith Wallis at keithwallis@hotmail.com .

MPV, deck carrier operators eye cargo demand surge from Iran war reconstruction

<div class="phx-topic abstract-wrapper">While the ceasefire marks the first diplomatic shift in the 40-day conflict, it is being regarded by transport operators as more of a controlled easing rather than an operational reset. </div>

While the ceasefire marks the first diplomatic shift in the 40-day conflict, it is being regarded by transport operators as more of a controlled easing rather than an operational reset.

<div class="phx-topic">The two-week ceasefire agreed to between the US and Iran this week is too short and too fragile to encourage international air carriers to resume flights to the Middle East, air freight analysts say. While the ceasefire marks the first diplomatic shift in the 40-day conflict, it is being regarded by transport operators as more of a controlled easing rather than an operational reset. “There will be a bit of reluctance from non-Gulf-based carriers to resume normal scheduled activity until there is a feeling that the ceasefire will be more permanent,” said Frederic Horst, managing director of Sydney-based consultancy Trade and Transport Group. “Combined passenger and freight on flights through Gulf-facing hubs have been edging up a little bit over the past couple of weeks, but we are still at less than 40% of previous levels,” Horst told the Journal of Commerce. Niall van de Wouw, chief air freight officer at rate benchmarking platform Xeneta, said bringing air capacity back to the Middle East corridors will provide welcome relief for shippers, many of whom were facing severe disruption to ocean supply chains. But carriers require a far more permanent settlement to the conflict before flights resume, van de Wouw said in a statement from Xeneta Thursday. “A two-week timeline is too short to justify restructuring freight plans,” he said. “Carriers will be in no rush to lower rates given the ceasefire is only temporary and the geopolitical situation remains uncertain. Shippers will also not rush into major routing decisions on the basis of a fragile two-week ceasefire “Even when it is deemed safe to fly, setting up the infrastructure again takes time,” he added. “Customers need to find you again and trust you again. Insurance companies may still advise against transiting these Middle East hubs despite the ceasefire.” Should the ceasefire hold, a full return to pre-conflict capacity and rates on trades transiting Middle East hubs is still one to two months away, van de Wouw said. <h3>Passenger confidence key to restoring networks </h3>Pre-conflict networks routed through the Middle East accounted for about 30% of the Asia-Europe air freight capacity, much of that carried in the bellies of passenger aircraft. Flights to the regional hub of Dubai by Cathay Pacific, Lufthansa and British Airways remain suspended until May 31. Air France as of now has Dubai flights suspended only until April 19, with KLM due to return May 17. Both van de Wouw and Horst identified passenger confidence as a key variable in the recovery of air freight in Middle East corridors. “Gulf carriers such as Emirates and Qatar Airways operate some of the world’s most important air freight networks, but those networks depend on passenger revenue,” van de Wouw said. “If tourist confidence in Middle East destinations takes time to recover — even after the ceasefire — airlines may operate routes at below-sustainable passenger load factors and could cut network capacity as a result,” he noted. Horst said flight frequencies into the Middle East hubs might take a long time to return to pre-conflict levels, with passenger confidence shaken by the war. “In terms of overall flight levels, I don’t know whether they will come back in the next few years because people are probably going to re-evaluate their exposure to the Middle East and travel to alternative locations,” he said. <h3>Cargo backlogs, shuttered airports </h3>Crane Worldwide Logistics wrote in an update Wednesday that cargo backlogs at Dubai International Airport were structural and there was no defined timeline for clearing the logjam. “Full air freight normalization is expected no earlier than three to six weeks post‑ceasefire,” the forwarder noted. Crane added in the update that Bahrain International Airport remains closed, with home carrier Gulf Air operating out of Dammam in Saudi Arabia. Kuwait International Airport will remain closed indefinitely. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="8fc0722e-09e9-4b12-a4ba-76e0a0deaa46"></dynamic-object></div>With air freight routes disrupted through the Middle East, forwarders have scrambled to find direct capacity from Asia to Europe, leaving space limited and pushing rates on the corridor higher. Percentage increases in spot rates provided by Xeneta show a steep increase in the five weeks since the conflict began on Feb. 28, particularly out of Southeast Asia and South Asia. Rates have risen 105% from South Asia to Europe, 84% from South Asia to the Middle East, and 82% from South Asia to North America, according to Xeneta. The rates were up 87% from Europe to the Middle East and 72% from Southeast Asia to Europe. In price per kilogram, air cargo spot rates are at their highest level of the year, according to the Freightos Air Index. Spot rates from China to Europe of $4.69/kg are up 33% compared with the first week of January, while China-Middle East rates are up 43% since the start of the year at $4.20/kg, Freightos data showed. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

The two-week ceasefire agreed to between the US and Iran this week is too short and too fragile to encourage international air carriers to resume flights to the Middle East, air freight analysts say. While the ceasefire marks the first diplomatic shift in the 40-day conflict, it is being regarded by transport operators as more of a controlled easing rather than an operational reset. “There will be a bit of reluctance from non-Gulf-based carriers to resume normal scheduled activity until there is a feeling that the ceasefire will be more permanent,” said Frederic Horst, managing director of Sydney-based consultancy Trade and Transport Group. “Combined passenger and freight on flights through Gulf-facing hubs have been edging up a little bit over the past couple of weeks, but we are still at less than 40% of previous levels,” Horst told the Journal of Commerce. Niall van de Wouw, chief air freight officer at rate benchmarking platform Xeneta, said bringing air capacity back to the Middle East corridors will provide welcome relief for shippers, many of whom were facing severe disruption to ocean supply chains. But carriers require a far more permanent settlement to the conflict before flights resume, van de Wouw said in a statement from Xeneta Thursday. “A two-week timeline is too short to justify restructuring freight plans,” he said. “Carriers will be in no rush to lower rates given the ceasefire is only temporary and the geopolitical situation remains uncertain. Shippers will also not rush into major routing decisions on the basis of a fragile two-week ceasefire “Even when it is deemed safe to fly, setting up the infrastructure again takes time,” he added. “Customers need to find you again and trust you again. Insurance companies may still advise against transiting these Middle East hubs despite the ceasefire.” Should the ceasefire hold, a full return to pre-conflict capacity and rates on trades transiting Middle East hubs is still one to two months away, van de Wouw said. Passenger confidence key to restoring networks Pre-conflict networks routed through the Middle East accounted for about 30% of the Asia-Europe air freight capacity, much of that carried in the bellies of passenger aircraft. Flights to the regional hub of Dubai by Cathay Pacific, Lufthansa and British Airways remain suspended until May 31. Air France as of now has Dubai flights suspended only until April 19, with KLM due to return May 17. Both van de Wouw and Horst identified passenger confidence as a key variable in the recovery of air freight in Middle East corridors. “Gulf carriers such as Emirates and Qatar Airways operate some of the world’s most important air freight networks, but those networks depend on passenger revenue,” van de Wouw said. “If tourist confidence in Middle East destinations takes time to recover — even after the ceasefire — airlines may operate routes at below-sustainable passenger load factors and could cut network capacity as a result,” he noted. Horst said flight frequencies into the Middle East hubs might take a long time to return to pre-conflict levels, with passenger confidence shaken by the war. “In terms of overall flight levels, I don’t know whether they will come back in the next few years because people are probably going to re-evaluate their exposure to the Middle East and travel to alternative locations,” he said. Cargo backlogs, shuttered airports Crane Worldwide Logistics wrote in an update Wednesday that cargo backlogs at Dubai International Airport were structural and there was no defined timeline for clearing the logjam. “Full air freight normalization is expected no earlier than three to six weeks post‑ceasefire,” the forwarder noted. Crane added in the update that Bahrain International Airport remains closed, with home carrier Gulf Air operating out of Dammam in Saudi Arabia. Kuwait International Airport will remain closed indefinitely. With air freight routes disrupted through the Middle East, forwarders have scrambled to find direct capacity from Asia to Europe, leaving space limited and pushing rates on the corridor higher. Percentage increases in spot rates provided by Xeneta show a steep increase in the five weeks since the conflict began on Feb. 28, particularly out of Southeast Asia and South Asia. Rates have risen 105% from South Asia to Europe, 84% from South Asia to the Middle East, and 82% from South Asia to North America, according to Xeneta. The rates were up 87% from Europe to the Middle East and 72% from Southeast Asia to Europe. In price per kilogram, air cargo spot rates are at their highest level of the year, according to the Freightos Air Index. Spot rates from China to Europe of $4.69/kg are up 33% compared with the first week of January, while China-Middle East rates are up 43% since the start of the year at $4.20/kg, Freightos data showed. Contact Greg Knowler at greg.knowler@spglobal.com .

Air Cargo Carriers News

Air Cargo

US-Iran ceasefire unlikely to spur air freight return to Middle East: analysts

<div class="phx-topic abstract-wrapper">The deal, financial details of which were not disclosed, could possibly be the first M&amp;A domino to fall among a growing number of agent vendors catering to the logistics industry.</div>

The deal, financial details of which were not disclosed, could possibly be the first M&A domino to fall among a growing number of agent vendors catering to the logistics industry.

<div class="phx-topic">Logistics technology provider project44 has acquired an automation company focused on building digital agents that cover dozens of pre-built use cases across international and domestic freight, the company announced Thursday. The all-cash acquisition, terms of which were not disclosed, will enable project44 to embed agents from Chicago-based LunaPath into its visibility and transportation management products. Founded in 2024, LunaPath develops logistics orchestration- and execution-focused agents that tackle discrete tasks such as sourcing missing ocean freight milestones and retrieving container location at the port of discharge. The company’s agents, also known as digital workers, undertake tasks in domestic freight as well, such as finding missing equipment identifiers and resolving invalid truck telematics connections. LunaPath’s sale is the first of the dozen or so artificial intelligence-focused agent developers serving the logistics and transportation industry to have emerged in the last three years. project44 CEO Jett McCandless told the Journal of Commerce the company had been trialing a number of these providers side by side over the past 16 months to see which ones performed best using project44’s data. “The reality is there isn’t one that’s the best at everything,” he said. “Some are better at voice, some are better at documents. Some better on Tuesday. Some are better for one carrier than another.” But LunaPath stood out, McCandless said, especially in high-volume voice and messaging execution use cases, prompting the decision to buy the emergent company rather than just use them among a number of other automation vendors. “They outperformed in a lot of use cases,” he said. “They got answers faster and more consistently.” <h3>‘Customers want outcomes’ </h3>The speed component is key in an environment where the cost of computing capacity to power digital workers is a factor that software companies must control. “Faster means it’s taking less capital; less time and less tokens,” McCandless said. “Our customers want outcomes.” Tokens are a unit the makers of AI models use to charge for use of their product. The more tokens used, the more a software company building agents pays, and in general, the faster a task is accomplished, the fewer tokens are used. The cost to build agents is starting to become a key issue as they become more prevalent in logistics, with some arguing that building agents are a cost of doing business for software providers, who should be expected to be enhancing their products continuously. On the other hand, some argue the cost of using AI models will only rise, and software vendors shouldn’t bear those costs alone. “The cost is not a billion dollars, but it’s not free either,” McCandless said. “Every time an agent does something it has a cost.” His contention is that application programming interfaces (APIs) are sometimes a more efficient way to transfer information, with project44 an early advocate for broader use of APIs over more traditional information exchange mechanisms such as electronic data interchange (EDI). “Where an API can do the job reliably, we use it,” McCandless said. “Agents earn their place when the task requires judgment, context or real-time adaptation. We’re not religious about it. We’re focused on outcomes.” <h3>Will also use other AI agent vendors </h3>McCandless said the acquisition of LunaPath won’t preclude project44 from using other AI agent vendors, such as Vooma and HappyRobot, with which it has had longstanding partnerships. project44, which serves more than 1,000 shippers and two-thirds of the world’s biggest logistics providers, has dived headlong into AI and agent-based workflows over the past 18 months to power its data platform and a new transportation management system it unveiled in 2025. A high-profile software vendor snapping up an early-stage AI vendor could, in theory, trigger other such acquisitions, but not all of those vendors are in the same position as LunaPath. Many have raised tens of millions of dollars from venture capital investors and need a return that justifies such investment. But it’s generally recognized that not every AI logistics vendor will survive in a market that appears commoditized, especially for agents that do relatively straightforward tasks that could be built internally by prospective buyers. Indeed, McCandless said project44 has built its own agents, ones that will be combined with those of LunaPath and augmented by those provided by other partner vendors. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>.</div>

Logistics technology provider project44 has acquired an automation company focused on building digital agents that cover dozens of pre-built use cases across international and domestic freight, the company announced Thursday. The all-cash acquisition, terms of which were not disclosed, will enable project44 to embed agents from Chicago-based LunaPath into its visibility and transportation management products. Founded in 2024, LunaPath develops logistics orchestration- and execution-focused agents that tackle discrete tasks such as sourcing missing ocean freight milestones and retrieving container location at the port of discharge. The company’s agents, also known as digital workers, undertake tasks in domestic freight as well, such as finding missing equipment identifiers and resolving invalid truck telematics connections. LunaPath’s sale is the first of the dozen or so artificial intelligence-focused agent developers serving the logistics and transportation industry to have emerged in the last three years. project44 CEO Jett McCandless told the Journal of Commerce the company had been trialing a number of these providers side by side over the past 16 months to see which ones performed best using project44’s data. “The reality is there isn’t one that’s the best at everything,” he said. “Some are better at voice, some are better at documents. Some better on Tuesday. Some are better for one carrier than another.” But LunaPath stood out, McCandless said, especially in high-volume voice and messaging execution use cases, prompting the decision to buy the emergent company rather than just use them among a number of other automation vendors. “They outperformed in a lot of use cases,” he said. “They got answers faster and more consistently.” ‘Customers want outcomes’ The speed component is key in an environment where the cost of computing capacity to power digital workers is a factor that software companies must control. “Faster means it’s taking less capital; less time and less tokens,” McCandless said. “Our customers want outcomes.” Tokens are a unit the makers of AI models use to charge for use of their product. The more tokens used, the more a software company building agents pays, and in general, the faster a task is accomplished, the fewer tokens are used. The cost to build agents is starting to become a key issue as they become more prevalent in logistics, with some arguing that building agents are a cost of doing business for software providers, who should be expected to be enhancing their products continuously. On the other hand, some argue the cost of using AI models will only rise, and software vendors shouldn’t bear those costs alone. “The cost is not a billion dollars, but it’s not free either,” McCandless said. “Every time an agent does something it has a cost.” His contention is that application programming interfaces (APIs) are sometimes a more efficient way to transfer information, with project44 an early advocate for broader use of APIs over more traditional information exchange mechanisms such as electronic data interchange (EDI). “Where an API can do the job reliably, we use it,” McCandless said. “Agents earn their place when the task requires judgment, context or real-time adaptation. We’re not religious about it. We’re focused on outcomes.” Will also use other AI agent vendors McCandless said the acquisition of LunaPath won’t preclude project44 from using other AI agent vendors, such as Vooma and HappyRobot, with which it has had longstanding partnerships. project44, which serves more than 1,000 shippers and two-thirds of the world’s biggest logistics providers, has dived headlong into AI and agent-based workflows over the past 18 months to power its data platform and a new transportation management system it unveiled in 2025. A high-profile software vendor snapping up an early-stage AI vendor could, in theory, trigger other such acquisitions, but not all of those vendors are in the same position as LunaPath. Many have raised tens of millions of dollars from venture capital investors and need a return that justifies such investment. But it’s generally recognized that not every AI logistics vendor will survive in a market that appears commoditized, especially for agents that do relatively straightforward tasks that could be built internally by prospective buyers. Indeed, McCandless said project44 has built its own agents, ones that will be combined with those of LunaPath and augmented by those provided by other partner vendors. Contact Eric Johnson at eric.johnson@spglobal.com .

Logistics Technology News

project44 acquires agent developer to expand AI use cases

<div class="phx-topic abstract-wrapper">The Jacksonville Port Authority said Wednesday the Ocean Alliance will include the port on its Chesapeake Bay Express (CBX) service rotation as of this June. </div>

The Jacksonville Port Authority said Wednesday the Ocean Alliance will include the port on its Chesapeake Bay Express (CBX) service rotation as of this June.

<div class="phx-topic">CMA CGM will add the Port of Jacksonville to its trans-Pacific express service, adding to the port’s roster of direct Asia services and tapping the recent modernization of Jaxport’s main marine terminal. The Jacksonville Port Authority said in a statement Wednesday the Ocean Alliance will include the port on its Chesapeake Bay Express (CBX) service rotation as of this June. The CBX, operated exclusively by CMA CGM, calls Vietnam, China and South Korea before its eastbound rotation that includes US calls at Norfolk, Charleston and Savannah before Jacksonville. The CBX had previously called Miami, which is no longer on its rotation, according to its schedule. Ocean Alliance had previously been planning to <a href="https://www.joc.com/article/ocean-alliance-adding-vietnam-calls-to-north-america-for-2026-6155909">add Jacksonville to one of its Gulf Coast services</a> but instead settled on including it on the CBX. Jaxport will see the first CBX call with the June 27 expected arrival of the 7,327-TEU CMA CGM Passion. Jaxport Chief Executive Eric Green said in the statement the introduction of the CBX “expands routing flexibility between the Southeast United States and key Asian markets.” Jaxport added that its position on the CBX rotation will mean “opportunities for equipment repositioning and expedited transit for US export cargoes.” <h3>Two other direct Far East services </h3>The addition of the CBX marks the third Far East Asia service now calling Jacksonville directly. Premier Alliance’s EC3 service, which made Jacksonville the first US Southeast port of call for that service last July, now dominates the port’s Asian trade volumes. During the past 12 months, Premier Alliance partner Ocean Network Express (ONE) has made 61 port calls to Jacksonville with ships of 14,000-TEU average capacity, according to Sea-web, a sister product of the Journal of Commerce within S&amp;P Global. ONE’s standalone West India North America service also calls the port. Jacksonville also has a jointly-operated trans-Pacific service from Mediterranean Shipping Co. and Zim Integrated Shipping Services. The two accounted for 21 of the post-Panamax ship calls to Jacksonville over the past 12 months. The CBX will be able to tap an expansion and modernization of Jacksonville’s Blount Island container terminal, which was completed last fall. The three-year project included adding six outbound truck lanes, additional staging areas, and newly paved asphalt to allow for higher container stacks. Blount, <a href="https://www.joc.com/article/jaxport-receives-30-million-in-state-funds-for-new-cranes-at-blount-island-5201528">which has six post-Panamax cranes</a>, will have capacity to handle 500,000 TEUs per year. The port is currently undertaking a project to raise power lines that span the St. John’s River and <a href="https://www.joc.com/article/jaxport-secures-funding-to-raise-power-lines-for-blount-island-big-ship-calls-5220798">increase the air clearance for larger vessels</a> to call its Dames Point Container Terminal. Jacksonville’s containerized imports from Asia and the Indian subcontinent slipped to 137,941 TEUs in 2025, according to PIERS, a sister company of the Journal of Commerce, a 1.1% drop from a year earlier. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

CMA CGM will add the Port of Jacksonville to its trans-Pacific express service, adding to the port’s roster of direct Asia services and tapping the recent modernization of Jaxport’s main marine terminal. The Jacksonville Port Authority said in a statement Wednesday the Ocean Alliance will include the port on its Chesapeake Bay Express (CBX) service rotation as of this June. The CBX, operated exclusively by CMA CGM, calls Vietnam, China and South Korea before its eastbound rotation that includes US calls at Norfolk, Charleston and Savannah before Jacksonville. The CBX had previously called Miami, which is no longer on its rotation, according to its schedule. Ocean Alliance had previously been planning to add Jacksonville to one of its Gulf Coast services but instead settled on including it on the CBX. Jaxport will see the first CBX call with the June 27 expected arrival of the 7,327-TEU CMA CGM Passion. Jaxport Chief Executive Eric Green said in the statement the introduction of the CBX “expands routing flexibility between the Southeast United States and key Asian markets.” Jaxport added that its position on the CBX rotation will mean “opportunities for equipment repositioning and expedited transit for US export cargoes.” Two other direct Far East services The addition of the CBX marks the third Far East Asia service now calling Jacksonville directly. Premier Alliance’s EC3 service, which made Jacksonville the first US Southeast port of call for that service last July, now dominates the port’s Asian trade volumes. During the past 12 months, Premier Alliance partner Ocean Network Express (ONE) has made 61 port calls to Jacksonville with ships of 14,000-TEU average capacity, according to Sea-web, a sister product of the Journal of Commerce within S&P Global. ONE’s standalone West India North America service also calls the port. Jacksonville also has a jointly-operated trans-Pacific service from Mediterranean Shipping Co. and Zim Integrated Shipping Services. The two accounted for 21 of the post-Panamax ship calls to Jacksonville over the past 12 months. The CBX will be able to tap an expansion and modernization of Jacksonville’s Blount Island container terminal, which was completed last fall. The three-year project included adding six outbound truck lanes, additional staging areas, and newly paved asphalt to allow for higher container stacks. Blount, which has six post-Panamax cranes , will have capacity to handle 500,000 TEUs per year. The port is currently undertaking a project to raise power lines that span the St. John’s River and increase the air clearance for larger vessels to call its Dames Point Container Terminal. Jacksonville’s containerized imports from Asia and the Indian subcontinent slipped to 137,941 TEUs in 2025, according to PIERS, a sister company of the Journal of Commerce, a 1.1% drop from a year earlier. Contact Michael Angell at michael.angell@spglobal.com .

Port infrastructure

CMA CGM taps Jaxport as newest call for Asia express service

<div class="phx-topic abstract-wrapper">The largest US LTL carrier looks to add new business in the healthcare, food and energy sectors and among small businesses to grow volume and improve profitability. </div>

The largest US LTL carrier looks to add new business in the healthcare, food and energy sectors and among small businesses to grow volume and improve profitability.

<div class="phx-topic">FedEx Freight is planning for growth despite a weak industrial freight economy by reaching into new markets as it prepares for a June 1 spin off from parent company FedEx. The largest US less-than-truckload (LTL) provider and US trucking company sees big opportunities in small businesses, as well as the healthcare, data center, energy, and food and grocery sectors. Those markets represent a $9 billion revenue opportunity largely untapped by FedEx Freight, which had $8.9 billion in revenue in fiscal 2025. “We’re doing little business in those verticals,” John Smith, FedEx Freight’s incoming president and CEO, told analysts Wednesday at the company’s first standalone investor day in New York. The company expects “modest” top-line growth in a transition period from June 1 through Dec. 31, CFO Marshall Witt said at the event, which was webcast. He stressed the company will put profit before short-term volume growth. In its current fiscal year, which ends on the eve of the spin-off on May 31, FedEx Freight expects $8.7 billion in revenue and $1.1 billion in adjusted operating profit. In its last quarter ending February, revenue dropped 4.6% year over year, but operating profit increased 8.5%. Going forward, the company expects a 4% to 6% compound annual growth rate in revenue as it disentangles its operations from FedEx’s parcel business. “We’re focused on improving our financial position within the first 12 months of the spin-off,” Witt said, noting the industry is facing a “tough freight market with macro-economic volatility.” FedEx Freight, which has reduced its physical network by a net of 30 terminals and 400 service center doors over the past three years, doesn’t plan to cut capacity. “We have 30% excess capacity in our network today, and we feel we’re in a good position in the right markets,” said COO Clint McCoy. LTL carriers typically try to keep 20% to 30% excess capacity in their terminal networks to avoid chokepoints and allow for expansion in times of growth. FedEx Freight currently has 355 LTL service centers and 10 linehaul relay centers or hubs. <h3>Shipment shortfall </h3>Most of the company’s shipments come from industrial, transportation, logistics, and consumer goods customers, according to data shared during the event. Those shipments are declining amid industrial weakness. Total shipments per day at FedEx Freight fell 5.7% year over year in the fiscal quarter ending Feb. 28, dropping to 80,233 daily shipments. The year-to-date average daily shipment count, at 85,938 shipments, is down 13.8% from 2023, FedEx data shows. That underscores a long industry-wide decline in LTL shipment volumes attributed to weakness in US manufacturing and lower demand for physical goods. Recent improvements in US manufacturing activity, evident in Purchasing Managers’ Indexes (PMIs) from S&amp;P Global and the Institute for Supply Management, haven’t added much to LTL volumes yet, although XPO and Saia both saw volumes rise in February. “We’re seeing some upside” in manufacturing, compared with other sectors, Witt said. But he expects improved profitability and yield to drive revenue growth more than volume. Weak volumes are driving the focus on growing business with new shippers in markets underserved by LTL carriers. “We are targeting higher growth in end-markets that align with our offerings,” said Mike Lyons, the company’s chief specialized services and commercial officer. The hiring of a dedicated sales force of 500 regional sales representatives “gives us the engine to go out and address markets where we have little penetration today,” Lyons said. <h3>Disciplined pricing </h3>FedEx isn’t the only LTL carrier eyeing new customers and new markets. XPO, the third-largest LTL provider, also has strengthened its sales force and targeted small businesses, while launching new premium services that support higher profit margins. “The expansion we’re driving with local customers and premium services is contributing to our above-market pricing growth,” XPO CEO Mario Harik said during a March earnings call. Increases in yield helped offset lower volumes in the fourth quarter at XPO. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="ccca9ba6-556b-417d-9e3d-83b396f754e8"></dynamic-object></div>The focus on yield, a measure of profitability based partly on pricing, means a rate war for market share is not on the table, even as LTL carriers sweat the decline in shipments. FedEx Freight plans to increase its market share, currently at about 15%, according to SJ Consulting Group data, but only when it can do so profitably. “This will be done through maintaining a disciplined approach to pricing, optimizing productivity, and reducing the overall cost to serve and support growth,” Witt said. LTL carriers are still seeing mid-single-digit price increases, according to the producer price index, but those increases are lower than last year. In February, the LTL producer price index rose 5.3% year over year, compared with a 9.5% average increase for the last six months of 2025. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. </div>

FedEx Freight is planning for growth despite a weak industrial freight economy by reaching into new markets as it prepares for a June 1 spin off from parent company FedEx. The largest US less-than-truckload (LTL) provider and US trucking company sees big opportunities in small businesses, as well as the healthcare, data center, energy, and food and grocery sectors. Those markets represent a $9 billion revenue opportunity largely untapped by FedEx Freight, which had $8.9 billion in revenue in fiscal 2025. “We’re doing little business in those verticals,” John Smith, FedEx Freight’s incoming president and CEO, told analysts Wednesday at the company’s first standalone investor day in New York. The company expects “modest” top-line growth in a transition period from June 1 through Dec. 31, CFO Marshall Witt said at the event, which was webcast. He stressed the company will put profit before short-term volume growth. In its current fiscal year, which ends on the eve of the spin-off on May 31, FedEx Freight expects $8.7 billion in revenue and $1.1 billion in adjusted operating profit. In its last quarter ending February, revenue dropped 4.6% year over year, but operating profit increased 8.5%. Going forward, the company expects a 4% to 6% compound annual growth rate in revenue as it disentangles its operations from FedEx’s parcel business. “We’re focused on improving our financial position within the first 12 months of the spin-off,” Witt said, noting the industry is facing a “tough freight market with macro-economic volatility.” FedEx Freight, which has reduced its physical network by a net of 30 terminals and 400 service center doors over the past three years, doesn’t plan to cut capacity. “We have 30% excess capacity in our network today, and we feel we’re in a good position in the right markets,” said COO Clint McCoy. LTL carriers typically try to keep 20% to 30% excess capacity in their terminal networks to avoid chokepoints and allow for expansion in times of growth. FedEx Freight currently has 355 LTL service centers and 10 linehaul relay centers or hubs. Shipment shortfall Most of the company’s shipments come from industrial, transportation, logistics, and consumer goods customers, according to data shared during the event. Those shipments are declining amid industrial weakness. Total shipments per day at FedEx Freight fell 5.7% year over year in the fiscal quarter ending Feb. 28, dropping to 80,233 daily shipments. The year-to-date average daily shipment count, at 85,938 shipments, is down 13.8% from 2023, FedEx data shows. That underscores a long industry-wide decline in LTL shipment volumes attributed to weakness in US manufacturing and lower demand for physical goods. Recent improvements in US manufacturing activity, evident in Purchasing Managers’ Indexes (PMIs) from S&P Global and the Institute for Supply Management, haven’t added much to LTL volumes yet, although XPO and Saia both saw volumes rise in February. “We’re seeing some upside” in manufacturing, compared with other sectors, Witt said. But he expects improved profitability and yield to drive revenue growth more than volume. Weak volumes are driving the focus on growing business with new shippers in markets underserved by LTL carriers. “We are targeting higher growth in end-markets that align with our offerings,” said Mike Lyons, the company’s chief specialized services and commercial officer. The hiring of a dedicated sales force of 500 regional sales representatives “gives us the engine to go out and address markets where we have little penetration today,” Lyons said. Disciplined pricing FedEx isn’t the only LTL carrier eyeing new customers and new markets. XPO, the third-largest LTL provider, also has strengthened its sales force and targeted small businesses, while launching new premium services that support higher profit margins. “The expansion we’re driving with local customers and premium services is contributing to our above-market pricing growth,” XPO CEO Mario Harik said during a March earnings call. Increases in yield helped offset lower volumes in the fourth quarter at XPO. The focus on yield, a measure of profitability based partly on pricing, means a rate war for market share is not on the table, even as LTL carriers sweat the decline in shipments. FedEx Freight plans to increase its market share, currently at about 15%, according to SJ Consulting Group data, but only when it can do so profitably. “This will be done through maintaining a disciplined approach to pricing, optimizing productivity, and reducing the overall cost to serve and support growth,” Witt said. LTL carriers are still seeing mid-single-digit price increases, according to the producer price index, but those increases are lower than last year. In February, the LTL producer price index rose 5.3% year over year, compared with a 9.5% average increase for the last six months of 2025. Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Surface

FedEx Freight plans diversification as spin-off date approaches

<div class="phx-topic abstract-wrapper">GLP-1 weight loss drugs are the most visible example of a force reshaping freight that supply chains weren’t built to detect, writes Paul Tonsager. </div>

GLP-1 weight loss drugs are the most visible example of a force reshaping freight that supply chains weren’t built to detect, writes Paul Tonsager.

<div class="phx-topic">Plus-size apparel is contracting. The numbers are in the earnings calls — store closures accelerating, revenues declining, and CEOs attributing the cause directly to GLP-1 weight loss medications. Approximately 25% of customers at major plus-size retailers are actively losing weight and deferring purchases until they reach their goal size. For freight operators, the translation is straightforward: fewer container bookings out of Bangladesh, softening elastane import volumes from South Korea and China, rising return flows through apparel distribution centers, and athleisure volume shifting to different origins, different factories, different lanes. That’s the GLP-1 story in freight terms. But the more important question isn’t what GLP-1 does to one commodity flow. It’s what GLP-1 represents — and whether the industry is paying attention to the category it belongs to. <h3>A different kind of demand shift </h3>Supply chains are inference machines. They watch what moved last season and build a model of what will move next. Carrier contracts, network design, capacity commitments, inventory positioning — all of them are calibrated to demand cycles that move in human decision-time. A trend emerges. Shippers respond. Freight adjusts. That’s the model. GLP-1 doesn’t fit the model. The consumer isn’t choosing differently based on preference. Their body is changing on a pharmaceutical timeline with no seasonal pattern and no historical precedent in any demand planning system. The signal isn’t coming from the market. It’s coming from a lab. That’s the category: structural demand shifts originating outside the market. And GLP-1 is not the only one in play. <h3>The pattern repeating </h3>The electric vehicle transition is doing to auto parts freight what GLP-1 is doing to apparel — but slower and at far larger scale. An internal combustion vehicle contains approximately 30,000 parts. An EV eliminates approximately 10,000 of them. Transmissions, exhaust systems, fuel injectors — the freight lanes serving these components are in structural decline. The lanes serving battery materials — lithium, cobalt, copper — are being built in real time, often on entirely different corridors with different modal requirements. Carriers and third-party logistics providers (3PLs) who built capacity around internal combustion engine component flows are holding assets against a demand base that is shrinking by design. Food and beverage may be the next GLP-1 impact larger than apparel. If 23% of US households are on these medications — up four points in a single year, according to Circana — and consuming meaningfully fewer calories, the freight infrastructure built around the old consumption baseline is exposed. Bulk grain movements, refrigerated less-than-truckload networks, warehouse footprint, replenishment frequency — all sized to a caloric demand curve that is quietly bending downward. The volume impact hasn’t fully materialized. It will. Remote work ran the same playbook earlier this decade. Office-bound freight flows — commercial furniture, facilities supplies, workplace technology, food service — didn’t disappear. They redistributed to suburbs and residential addresses in patterns that no demand planning model had anticipated. Last-mile density assumptions broke. The signal came from a public health event, not a consumer preference survey. <h3>What the industry is missing </h3>The common thread isn’t the specific force — pharmaceutical, technological, epidemiological. It’s the origin. These signals don’t come from the market. They come from labs, legislatures and external shocks. Freight networks optimized to read market signals — booking velocity, tender acceptance, seasonal lift — are structurally late to detect them. GLP-1 is the most legible example yet because it has a drug name, a measurable penetration curve, and identifiable freight consequences already showing up in origin mix and return volumes. That clarity is unusual. Most structural demand shifts are harder to see until capacity is misaligned, contracts don’t match the freight, and the repositioning cost is already real. The operators who outperform in the next decade won’t necessarily be the ones who move the most freight. They’ll be the ones who developed the capability to read demand signals that don’t originate in the market — and built network flexibility before the curve arrived. GLP-1 is the canary. The question is whether the industry treats it as a one-time anomaly or as a preview of the operating environment it now lives in. Paul Tonsager is founder and principal of IMS Advisory and writes the Signals &amp; Switches newsletter on freight strategy at aet1998.substack.com. Contact him at <a href="mailto:paul.tonsager@multimodalsolutions.io">paul.tonsager@multimodalsolutions.io</a>. </div>

Plus-size apparel is contracting. The numbers are in the earnings calls — store closures accelerating, revenues declining, and CEOs attributing the cause directly to GLP-1 weight loss medications. Approximately 25% of customers at major plus-size retailers are actively losing weight and deferring purchases until they reach their goal size. For freight operators, the translation is straightforward: fewer container bookings out of Bangladesh, softening elastane import volumes from South Korea and China, rising return flows through apparel distribution centers, and athleisure volume shifting to different origins, different factories, different lanes. That’s the GLP-1 story in freight terms. But the more important question isn’t what GLP-1 does to one commodity flow. It’s what GLP-1 represents — and whether the industry is paying attention to the category it belongs to. A different kind of demand shift Supply chains are inference machines. They watch what moved last season and build a model of what will move next. Carrier contracts, network design, capacity commitments, inventory positioning — all of them are calibrated to demand cycles that move in human decision-time. A trend emerges. Shippers respond. Freight adjusts. That’s the model. GLP-1 doesn’t fit the model. The consumer isn’t choosing differently based on preference. Their body is changing on a pharmaceutical timeline with no seasonal pattern and no historical precedent in any demand planning system. The signal isn’t coming from the market. It’s coming from a lab. That’s the category: structural demand shifts originating outside the market. And GLP-1 is not the only one in play. The pattern repeating The electric vehicle transition is doing to auto parts freight what GLP-1 is doing to apparel — but slower and at far larger scale. An internal combustion vehicle contains approximately 30,000 parts. An EV eliminates approximately 10,000 of them. Transmissions, exhaust systems, fuel injectors — the freight lanes serving these components are in structural decline. The lanes serving battery materials — lithium, cobalt, copper — are being built in real time, often on entirely different corridors with different modal requirements. Carriers and third-party logistics providers (3PLs) who built capacity around internal combustion engine component flows are holding assets against a demand base that is shrinking by design. Food and beverage may be the next GLP-1 impact larger than apparel. If 23% of US households are on these medications — up four points in a single year, according to Circana — and consuming meaningfully fewer calories, the freight infrastructure built around the old consumption baseline is exposed. Bulk grain movements, refrigerated less-than-truckload networks, warehouse footprint, replenishment frequency — all sized to a caloric demand curve that is quietly bending downward. The volume impact hasn’t fully materialized. It will. Remote work ran the same playbook earlier this decade. Office-bound freight flows — commercial furniture, facilities supplies, workplace technology, food service — didn’t disappear. They redistributed to suburbs and residential addresses in patterns that no demand planning model had anticipated. Last-mile density assumptions broke. The signal came from a public health event, not a consumer preference survey. What the industry is missing The common thread isn’t the specific force — pharmaceutical, technological, epidemiological. It’s the origin. These signals don’t come from the market. They come from labs, legislatures and external shocks. Freight networks optimized to read market signals — booking velocity, tender acceptance, seasonal lift — are structurally late to detect them. GLP-1 is the most legible example yet because it has a drug name, a measurable penetration curve, and identifiable freight consequences already showing up in origin mix and return volumes. That clarity is unusual. Most structural demand shifts are harder to see until capacity is misaligned, contracts don’t match the freight, and the repositioning cost is already real. The operators who outperform in the next decade won’t necessarily be the ones who move the most freight. They’ll be the ones who developed the capability to read demand signals that don’t originate in the market — and built network flexibility before the curve arrived. GLP-1 is the canary. The question is whether the industry treats it as a one-time anomaly or as a preview of the operating environment it now lives in. Paul Tonsager is founder and principal of IMS Advisory and writes the Signals & Switches newsletter on freight strategy at aet1998.substack.com. Contact him at paul.tonsager@multimodalsolutions.io .

Container lines

When the demand signal comes from outside the market

<div class="phx-topic abstract-wrapper">Southern California’s traditional solutions to surging freight volumes ignore the fact that they might well have reached the limits of being effective, writes Ted Prince.</div>

Southern California’s traditional solutions to surging freight volumes ignore the fact that they might well have reached the limits of being effective, writes Ted Prince.

<div class="phx-topic">The Journal of Commerce’s TPM conference has completed another big show in Long Beach. And while most attendees were living with the lingering impacts of the Trump administration’s tariff policy, we were all faced with the added geopolitical suspense brought about by the US and Israeli strikes on Iran that commenced as TPM attendees arrived. While this drama played out, I thought back to Michelle Phillips of the Mamas and the Papas eating a banana during a 1967 performance of “California Dreamin’” on the Ed Sullivan Show. This was to protest the band being forced to lip-sync rather than perform live. Just as the protest distracted from the singing, war and tariffs effectively blocked out any consideration of how California is planning to handle current volumes, let alone a doubling by 2050. Traditionally, this has meant bemoaning California’s “socialist state” — albeit with the fourth- or fifth-largest economy in the world. There is no shortage of issues. California Air Resources Board (CARB) rules on advanced clean trucks and advanced clean fleets impact freight transportation by mandating a transition to zero-emission trucks over time. These are on top of previous diesel tractor emission and “clean” diesel truck regulations. CARB has also adopted policies to reduce emissions from marine terminals and at-berth ship emissions. In addition, the harbor drayage community continues to deal with the AB5 legislation dealing with worker classification. Much like tariffs, all of these are subject to conflicting interpretations with the federal government. And, on a global level, confusion reigns over the International Maritime Organization’s net-zero framework. But the list of greatest hits being lip-synched is much larger. Let’s roll the tape. <h3>Will projects become reality? </h3>The Port of Long Beach continues to talk up its Pier B Rail expansion. But this project doesn’t solve the problem of destination disaggregation. Assembling less-than-fully-loaded stack cars to a plethora of destinations actually cannibalizes double-stack linehaul economics. (This network scope vs. scale issue is also pertinent in the current transcontinental railroad debate.) The Port of Los Angeles has its own multi-billion-dollar long shot — Pier 500. Given its configuration, the most realistic method to handle bigger, next-generation cargo ships is to make it an adjunct to APM Terminals’ Pier 400 — and obviate the need to replicate gates, buildings and on-dock rail. Otherwise, there simply isn’t enough land short of container levitation. The Barstow International Gateway (BIG) is BNSF’s planned inland intermodal and logistics complex. It is still in the environmental review and permitting stage. I am sure that BNSF hopes it progresses better than its current Phoenix project, which is even more ambitious than BIG. BNSF’s need for BIG is no doubt driven by previous Southern California failures: passing on the Intermodal Container Transfer Facility (ICTF) and failing to garner approval for the Southern California Intermodal Gateway (SCIG). Part of BIG’s value proposition is that distribution centers will locate there because traffic will be processed using zero- and near-zero-emission cargo-handling equipment. However, getting new or upgraded electric service in the Inland Empire has proven problematic, so a clear trajectory of electrified warehouse space cannot be assumed. Further north, the Wonderful Logistics Center has a SeaCube Cold Solutions container depot already supporting local refrigerated exporters; however, the planned international rail shuttle linking Shafter to the Port of Los Angeles using BNSF is still under development. Whereas BIG is a many-to-one network, this is more complicated because traffic is not transitive and it is one-to-many. (Pesky car utilization issues again.) Also, refrigerated produce is a much more complicated rail transportation product than dry imports. Meanwhile, the Mojave Inland Port remains a proposed, private development that has not progressed beyond county-level approvals in 2022. Perhaps the issue is that there does not appear to be a sustainable desire to build distribution centers in the middle of a desert. For decades, Southern California has held itself out to be the answer to the impending freight tsunami, yet a focus on more-of-the-same traditional solutions ignores the fact that these might well have reached their limits. Otherwise, the greatest hits lip-synching will continue, and we may be reminded that “banana” can come to stand for “Build Absolutely Nothing Anywhere Near Anything.” In that case, the global supply chain will need to sing a new song. 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>

The Journal of Commerce’s TPM conference has completed another big show in Long Beach. And while most attendees were living with the lingering impacts of the Trump administration’s tariff policy, we were all faced with the added geopolitical suspense brought about by the US and Israeli strikes on Iran that commenced as TPM attendees arrived. While this drama played out, I thought back to Michelle Phillips of the Mamas and the Papas eating a banana during a 1967 performance of “California Dreamin’” on the Ed Sullivan Show. This was to protest the band being forced to lip-sync rather than perform live. Just as the protest distracted from the singing, war and tariffs effectively blocked out any consideration of how California is planning to handle current volumes, let alone a doubling by 2050. Traditionally, this has meant bemoaning California’s “socialist state” — albeit with the fourth- or fifth-largest economy in the world. There is no shortage of issues. California Air Resources Board (CARB) rules on advanced clean trucks and advanced clean fleets impact freight transportation by mandating a transition to zero-emission trucks over time. These are on top of previous diesel tractor emission and “clean” diesel truck regulations. CARB has also adopted policies to reduce emissions from marine terminals and at-berth ship emissions. In addition, the harbor drayage community continues to deal with the AB5 legislation dealing with worker classification. Much like tariffs, all of these are subject to conflicting interpretations with the federal government. And, on a global level, confusion reigns over the International Maritime Organization’s net-zero framework. But the list of greatest hits being lip-synched is much larger. Let’s roll the tape. Will projects become reality? The Port of Long Beach continues to talk up its Pier B Rail expansion. But this project doesn’t solve the problem of destination disaggregation. Assembling less-than-fully-loaded stack cars to a plethora of destinations actually cannibalizes double-stack linehaul economics. (This network scope vs. scale issue is also pertinent in the current transcontinental railroad debate.) The Port of Los Angeles has its own multi-billion-dollar long shot — Pier 500. Given its configuration, the most realistic method to handle bigger, next-generation cargo ships is to make it an adjunct to APM Terminals’ Pier 400 — and obviate the need to replicate gates, buildings and on-dock rail. Otherwise, there simply isn’t enough land short of container levitation. The Barstow International Gateway (BIG) is BNSF’s planned inland intermodal and logistics complex. It is still in the environmental review and permitting stage. I am sure that BNSF hopes it progresses better than its current Phoenix project, which is even more ambitious than BIG. BNSF’s need for BIG is no doubt driven by previous Southern California failures: passing on the Intermodal Container Transfer Facility (ICTF) and failing to garner approval for the Southern California Intermodal Gateway (SCIG). Part of BIG’s value proposition is that distribution centers will locate there because traffic will be processed using zero- and near-zero-emission cargo-handling equipment. However, getting new or upgraded electric service in the Inland Empire has proven problematic, so a clear trajectory of electrified warehouse space cannot be assumed. Further north, the Wonderful Logistics Center has a SeaCube Cold Solutions container depot already supporting local refrigerated exporters; however, the planned international rail shuttle linking Shafter to the Port of Los Angeles using BNSF is still under development. Whereas BIG is a many-to-one network, this is more complicated because traffic is not transitive and it is one-to-many. (Pesky car utilization issues again.) Also, refrigerated produce is a much more complicated rail transportation product than dry imports. Meanwhile, the Mojave Inland Port remains a proposed, private development that has not progressed beyond county-level approvals in 2022. Perhaps the issue is that there does not appear to be a sustainable desire to build distribution centers in the middle of a desert. For decades, Southern California has held itself out to be the answer to the impending freight tsunami, yet a focus on more-of-the-same traditional solutions ignores the fact that these might well have reached their limits. Otherwise, the greatest hits lip-synching will continue, and we may be reminded that “banana” can come to stand for “Build Absolutely Nothing Anywhere Near Anything.” In that case, the global supply chain will need to sing a new song. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at ted@tricitiesintermodal.com .

Are SoCal’s planned freight projects a matter of ‘California Dreamin’’?

Shanghai to Korea

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{dateX.formatDate('MMM dd, yyyy')}: ${valueY} 
Y-o-Y: {percet_year_Pusan.formatNumber("##.#%")}

The Shanghai Shipping Exchange’s (SSE) Shanghai Containerized Freight Index (SCFI) reflects spot rates and associated seaborne charges for containerized exports from Shanghai. The SCFI includes indices of freight rates in 13 individual shipping routes and a composite index, using Oct. 16, 2009, as the base period (Oct. 16, 2009 = 1,000). [SSE](https://en.sse.net.cn/indices/scfinew.jsp)

Shanghai to Korea container spot rates (SSE)

Shanghai to Korea Containe Spot Rates (SCFI-Weekly) Gateway

<div class="phx-topic abstract-wrapper">It has become difficult, if not impossible, for Los Angeles-Long Beach terminals wishing to automate to gain the necessary approvals from port commissions, despite the terminals’ right to automate being guaranteed since 2008. </div>

It has become difficult, if not impossible, for Los Angeles-Long Beach terminals wishing to automate to gain the necessary approvals from port commissions, despite the terminals’ right to automate being guaranteed since 2008.

<div class="phx-topic">An article of faith for nearly two decades — that marine terminals along the US West Coast have the right to automate and thereby increase capacity despite limited port land to physically expand — is under threat in Southern California. It has become difficult, if not impossible, for terminals wishing to automate to gain the necessary approvals from port commissions to proceed. This is despite the terminals’ right to automate being guaranteed since 2008 in the collective bargaining agreement between the International Longshore and Warehouse Union (ILWU) and employers represented by the Pacific Maritime Association (PMA). <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6199901_0.1.jpg"></img></div>The result of this hesitance means the largest port gateway in North America being denied the easiest route to capacity expansion to mitigate bottlenecks that for years have bogged down flow during periods of surge demand. “It doesn’t matter what is in the contract or who has negotiated what,” said a knowledgeable observer of longshore labor in Southern California. “The ports are not going to agree to any redevelopment that supports automation and goes against the will of the ILWU.” The long-term consequences are limits on effective capacity able to handle US container flows, increasing the potential for bottlenecks and delays given limited new terminal acreage coming online. The roadblocks come despite the known benefits of automation. During the COVID-19 disruptions, throughput at existing automated terminals at the ports of Los Angeles and Long Beach was 44% higher than at nonautomated terminals, <a href="https://www.pmanet.org/fact-sheets/technology-automation/">according to a recent study cited</a> by the PMA. Also, longshore employment rose faster than at nonautomated terminals, countering the union’s argument that automation is a job killer. “Technological advancement, including automation, is essential to maintaining the competitiveness, efficiency and long-term viability of West Coast ports,” the PMA said in a statement to the Journal of Commerce late last week. <h3>The need to work ‘hand-in-hand’ with the union </h3>Illustrations of the snail’s pace at which automation is proceeding can be seen in two scenarios in Southern California where terminals aspire to automate. At TTI, the largest terminal at the Port of Long Beach, a manning agreement was struck three years ago with the ILWU Southern California local, sources said. The deal was meant to allow automation to proceed at the former Hanjin terminal, now owned by Terminal Investment Limited (TiL), the terminal arm of Mediterranean Shipping Co. (MSC). But despite concessions to the union that would undermine the financial case for automation by increasing labor costs, there is no sign of automation being announced to allow MSC to increase throughput, let alone being approved by the Long Beach Board of Harbor Commissioners. Similarly, at the Pier 300 Fenix terminal at Los Angeles owned by CMA CGM, no application has been filed to automate, according to the port. This is despite the terminal allowing construction to proceed on a rail project in return for what it hoped, sources said, would be the port’s support to automate a new berth slated for a long-vacant lot next to the existing terminal. The knowledgeable observer of Southern California longshore labor said TTI and Fenix might be far enough along to eventually implement automation, but “anything beyond that, you are not going to see it unless something changes politically.” The unofficial view at the two ports, based on numerous interviews, is that for automation to proceed, a terminal must come to the port commission hand-in-hand with the union. The precedent, sources said, is Long Beach Container Terminal, which secured the union’s approval to engage in a multiyear automation project completed in 2021. It is now widely regarded as the most efficient facility in the harbor. “Technology is moving fast, but it cannot leave the workforce behind,” Port of Los Angeles Executive Director Gene Seroka told the Journal of Commerce. “There is a way to combine both, an employer and the union coming together with politicians to find a way forward.” Without ILWU sign-off, the ports risk — and wish to avoid — a repeat of the headline-grabbing union protests that disrupted meetings of the Los Angeles Board of Harbor Commissioners in 2019, when it was considering a construction permit necessary for automation at APM Terminals’ Pier 400 facility. That clash, over what in prior years would have been a routine construction permit to be signed off by the port commission, signaled a new phase wherein the union would seek to slow or stop automation by going outside the collective bargaining agreement. “This all started with Pier 400 and APMT,” said one management source. The union’s views over automation had hardened since 2008, in parallel with the emergence of new labor-saving technology like AI and, more recently, a global anti-automation crusade led by International Longshoremen’s Association President Harold Daggett. The risk of negative publicity for the ports, and the opportunity for the union to grab a global megaphone, is heighted due to the 2028 Summer Olympics in Los Angeles — set to begin two weeks after the current West Coast longshore contract expires on July 1, 2028. The ports also wish to avoid a labor showdown that could lead to further market share loss to the East and Gulf coasts. The ILWU declined to comment. <h3>The legislative route </h3>It isn’t just influence at the port commissions, moreover, where dockworkers are trying to thwart automation. In recent years, the PMA has found itself fighting off efforts by the union to undermine automation through legislation in Sacramento. Employers prevailed last October, for example, when Gov. Gavin Newsom vetoed a bill that would have banned current and future automated or remotely operated technology at California ports from plugging into the state’s power grid, in effect killing automation. “Efforts to use the political process to block or delay automation have not succeeded and will not alter the terms of the collective bargaining agreement, which explicitly allows for automation at port terminals,” the PMA said in its statement. The PMA now carefully scrutinizes all proposed legislation for possible new restrictions on automation inserted by ILWU lobbyists. Union efforts to thwart automation, whether at the state or port level, raise the question of whether in doing so it is in violation of the contract. According to the PMA website, the contract states, “There shall be no interference by the union with the employers’ right to operate efficiently and to change methods of work to utilize labor-saving devices.” To this point, some argue the labor activity is merely individual union members engaging in First Amendment-protected speech. But others point to apparently official union views, including “profound disappointment” at the Newsom veto <a href="https://ilwu13.com/wp-content/uploads/2025/10/10-13-25-ILWU-President-Olvera-Jr-letter-to-Gov.-Newsom-re-SB-34-Veto.pdf">expressed in a toughly worded letter</a> by ILWU International President Robert Olvera Jr. The union’s assertive anti-automation stance raises the possibility it will seek to roll back terminals’ automation rights during negotiations for the next coastwide contract. “I do believe that ILWU will take a run at further restricting automation on the USWC,” said a second knowledgeable source. “They are actively seeking to control automation today through other means including licensing, permitting and trying to use legislation to restrict the use of green electricity.” Other sources believe the PMA will never negotiate away its automation rights, while others believe the ILWU has already effectively won the issue. Said the first informed source: “The union can move on to other topics. They have their playbook, so they don’t need to renegotiate automation.” Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>. </div>

An article of faith for nearly two decades — that marine terminals along the US West Coast have the right to automate and thereby increase capacity despite limited port land to physically expand — is under threat in Southern California. It has become difficult, if not impossible, for terminals wishing to automate to gain the necessary approvals from port commissions to proceed. This is despite the terminals’ right to automate being guaranteed since 2008 in the collective bargaining agreement between the International Longshore and Warehouse Union (ILWU) and employers represented by the Pacific Maritime Association (PMA). The result of this hesitance means the largest port gateway in North America being denied the easiest route to capacity expansion to mitigate bottlenecks that for years have bogged down flow during periods of surge demand. “It doesn’t matter what is in the contract or who has negotiated what,” said a knowledgeable observer of longshore labor in Southern California. “The ports are not going to agree to any redevelopment that supports automation and goes against the will of the ILWU.” The long-term consequences are limits on effective capacity able to handle US container flows, increasing the potential for bottlenecks and delays given limited new terminal acreage coming online. The roadblocks come despite the known benefits of automation. During the COVID-19 disruptions, throughput at existing automated terminals at the ports of Los Angeles and Long Beach was 44% higher than at nonautomated terminals, according to a recent study cited by the PMA. Also, longshore employment rose faster than at nonautomated terminals, countering the union’s argument that automation is a job killer. “Technological advancement, including automation, is essential to maintaining the competitiveness, efficiency and long-term viability of West Coast ports,” the PMA said in a statement to the Journal of Commerce late last week. The need to work ‘hand-in-hand’ with the union Illustrations of the snail’s pace at which automation is proceeding can be seen in two scenarios in Southern California where terminals aspire to automate. At TTI, the largest terminal at the Port of Long Beach, a manning agreement was struck three years ago with the ILWU Southern California local, sources said. The deal was meant to allow automation to proceed at the former Hanjin terminal, now owned by Terminal Investment Limited (TiL), the terminal arm of Mediterranean Shipping Co. (MSC). But despite concessions to the union that would undermine the financial case for automation by increasing labor costs, there is no sign of automation being announced to allow MSC to increase throughput, let alone being approved by the Long Beach Board of Harbor Commissioners. Similarly, at the Pier 300 Fenix terminal at Los Angeles owned by CMA CGM, no application has been filed to automate, according to the port. This is despite the terminal allowing construction to proceed on a rail project in return for what it hoped, sources said, would be the port’s support to automate a new berth slated for a long-vacant lot next to the existing terminal. The knowledgeable observer of Southern California longshore labor said TTI and Fenix might be far enough along to eventually implement automation, but “anything beyond that, you are not going to see it unless something changes politically.” The unofficial view at the two ports, based on numerous interviews, is that for automation to proceed, a terminal must come to the port commission hand-in-hand with the union. The precedent, sources said, is Long Beach Container Terminal, which secured the union’s approval to engage in a multiyear automation project completed in 2021. It is now widely regarded as the most efficient facility in the harbor. “Technology is moving fast, but it cannot leave the workforce behind,” Port of Los Angeles Executive Director Gene Seroka told the Journal of Commerce. “There is a way to combine both, an employer and the union coming together with politicians to find a way forward.” Without ILWU sign-off, the ports risk — and wish to avoid — a repeat of the headline-grabbing union protests that disrupted meetings of the Los Angeles Board of Harbor Commissioners in 2019, when it was considering a construction permit necessary for automation at APM Terminals’ Pier 400 facility. That clash, over what in prior years would have been a routine construction permit to be signed off by the port commission, signaled a new phase wherein the union would seek to slow or stop automation by going outside the collective bargaining agreement. “This all started with Pier 400 and APMT,” said one management source. The union’s views over automation had hardened since 2008, in parallel with the emergence of new labor-saving technology like AI and, more recently, a global anti-automation crusade led by International Longshoremen’s Association President Harold Daggett. The risk of negative publicity for the ports, and the opportunity for the union to grab a global megaphone, is heighted due to the 2028 Summer Olympics in Los Angeles — set to begin two weeks after the current West Coast longshore contract expires on July 1, 2028. The ports also wish to avoid a labor showdown that could lead to further market share loss to the East and Gulf coasts. The ILWU declined to comment. The legislative route It isn’t just influence at the port commissions, moreover, where dockworkers are trying to thwart automation. In recent years, the PMA has found itself fighting off efforts by the union to undermine automation through legislation in Sacramento. Employers prevailed last October, for example, when Gov. Gavin Newsom vetoed a bill that would have banned current and future automated or remotely operated technology at California ports from plugging into the state’s power grid, in effect killing automation. “Efforts to use the political process to block or delay automation have not succeeded and will not alter the terms of the collective bargaining agreement, which explicitly allows for automation at port terminals,” the PMA said in its statement. The PMA now carefully scrutinizes all proposed legislation for possible new restrictions on automation inserted by ILWU lobbyists. Union efforts to thwart automation, whether at the state or port level, raise the question of whether in doing so it is in violation of the contract. According to the PMA website, the contract states, “There shall be no interference by the union with the employers’ right to operate efficiently and to change methods of work to utilize labor-saving devices.” To this point, some argue the labor activity is merely individual union members engaging in First Amendment-protected speech. But others point to apparently official union views, including “profound disappointment” at the Newsom veto expressed in a toughly worded letter by ILWU International President Robert Olvera Jr. The union’s assertive anti-automation stance raises the possibility it will seek to roll back terminals’ automation rights during negotiations for the next coastwide contract. “I do believe that ILWU will take a run at further restricting automation on the USWC,” said a second knowledgeable source. “They are actively seeking to control automation today through other means including licensing, permitting and trying to use legislation to restrict the use of green electricity.” Other sources believe the PMA will never negotiate away its automation rights, while others believe the ILWU has already effectively won the issue. Said the first informed source: “The union can move on to other topics. They have their playbook, so they don’t need to renegotiate automation.” Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

Hesitation from port authorities slows automation in Southern California

<div class="phx-topic abstract-wrapper">The state was largely insulated from the volatility seen in the Midwest and Northeast over the winter because it did not face the same prolonged cold and snowstorms. </div>

The state was largely insulated from the volatility seen in the Midwest and Northeast over the winter because it did not face the same prolonged cold and snowstorms.

<div class="phx-topic">The war with Iran has pushed up diesel prices and driven spot truckload rates sharply higher in California, the one major freight market that had largely avoided the winter pricing pressure seen in the Midwest and Northeast. California has been the clearest holdout in a truckload market that has shown signs of tightening after a prolonged freight recession. Outbound dry-van spot rates from Illinois climbed 55 cents per mile between Dec. 1 and Feb. 28 while rates from New York rose 49 cents due to snowstorms and frigid temperatures during that period, according to a Journal of Commerce analysis of trucking data covering more than 4,000 lanes from DAT Freight &amp; Analytics, Loadsmart, Sunset Transportation, and a survey of other brokers and shippers. By contrast, California outbound rates rose only 11 cents in the same three months. California was largely insulated from the volatility seen in the Midwest and Northeast because it did not face the same prolonged cold and snowstorms. That enabled some shippers to believe rates would ease when the winter weather ended, something that went by the boards once the war with Iran began on the last day of February. Since then, average US diesel prices have climbed approximately $1.50 per gallon through the first month of the conflict, according to the US Energy Information Administration. In a state that already has some of the nation’s highest fuel costs because of taxes and specialized environmental fuel rules, the increase quickly changed California’s pricing picture. The state’s average diesel price jumped $2.23 during the first month of the war, to $7.22/gal, according to the EIA. At the same time, California canceled 13,000 non-domiciled commercial driver’s licenses last month. The higher diesel prices and tighter capacity caused spot truckload rates in the state to jump 18 cents in March from February, according to the Journal of Commerce analysis, while national rates rose approximately the same amount. The latest figures from DAT Freight &amp; Analytics show spot rates climbing across all major equipment types as capacity tightens and fuel costs increase. The national average dry-van linehaul spot rate reached $2.04 per mile last week, up 12 cents over two weeks and 24% higher year over year. Refrigerated rates averaged $2.43 per mile, up 53 cents from a year ago, while flatbed rates rose to $2.55 per mile — the highest in four years. “The trucking industry is doing quite well,” Avery Vise, vice president of trucking at FTR Intelligence, said in an interview on SiriusXM’s Channel 146. “A lot of these fuel costs have been recovered. It’s a cash flow problem for some carriers, but capacity is driving this. It is steadily declining and has been since 2022 and 2023. Capacity is very tight. I think we can declare the freight rate recession is over.” While midsize and large carriers can pass through higher diesel costs to customers via fuel surcharges, which have risen approximately 25 to 30 cents per mile since March 1, smaller owner-operators and port drayage drivers often negotiate all-in rates that include fuel. That means a sudden jolt in rates intensifies short-term cash-flow pressure. Robert Loya, president of the West Coast-based Harbor Trucking Association, said port drayage operators are often waiting weeks to recover those costs. “It’s insane,” Loya said. “Especially if you are doing ocean carrier business, you are looking at 45 days minimum before you are paid. With beneficial cargo owners, some may pay you in two or three weeks, but at the end of the day you are still carrying those costs.” Despite the pressure, Loya said he has not seen fleets or independent operators pull capacity off the road — an indication that underlying freight demand remains firm enough to sustain operations. On the demand side, manufacturing is showing early signs of recovery that could support additional freight volumes. The Institute for Supply Management’s Manufacturing Purchasing Managers Index registered 52.7 in March, marking a third consecutive month of expansion. Whether the current shift develops into a sustained recovery will depend on the consistency of freight demand in the months ahead. <h3>Pushing freight to intermodal</h3>Three intermodal providers, who asked not to be identified, said they have seen a resurgence in shippers investigating the rail option amid the strength in truckload. A western US asset-based intermodal provider said the inquiries have picked up in recent weeks. “It isn’t necessarily desperation. The shippers are contacting us after not hearing them for a few years to ask about rates on certain lanes or asking what lanes might work [on intermodal] that they hadn’t thought of before,” the president of the carrier said. “Shippers are offering us freight starting as soon as next week.” A non-asset-based intermodal marketing company (IMC) based in the Northeast said its business last month was double that of March 2025. The owner of the IMC agreed the conversations did not feel like shippers were desperate, just inquisitive. “We haven’t received many customers who are converting from truckload,” the source said. “They’re using other intermodal providers who have struggled with the business, and they turn to us.” One Midwest-based truckload and intermodal broker told the Journal of Commerce that many of its long-term existing customers are shifting their freight from truckload to rail. Domestic intermodal data for March has not been released yet by the Intermodal Association of North America. J.B. Hunt Transport Services, the largest US intermodal provider, will hold a call with industry analysts after reporting earnings on April 15. Contact Dan Ronan at <a href="mailto:contactdanronan@gmail.com">contactdanronan@gmail.com</a>. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

The war with Iran has pushed up diesel prices and driven spot truckload rates sharply higher in California, the one major freight market that had largely avoided the winter pricing pressure seen in the Midwest and Northeast. California has been the clearest holdout in a truckload market that has shown signs of tightening after a prolonged freight recession. Outbound dry-van spot rates from Illinois climbed 55 cents per mile between Dec. 1 and Feb. 28 while rates from New York rose 49 cents due to snowstorms and frigid temperatures during that period, according to a Journal of Commerce analysis of trucking data covering more than 4,000 lanes from DAT Freight & Analytics, Loadsmart, Sunset Transportation, and a survey of other brokers and shippers. By contrast, California outbound rates rose only 11 cents in the same three months. California was largely insulated from the volatility seen in the Midwest and Northeast because it did not face the same prolonged cold and snowstorms. That enabled some shippers to believe rates would ease when the winter weather ended, something that went by the boards once the war with Iran began on the last day of February. Since then, average US diesel prices have climbed approximately $1.50 per gallon through the first month of the conflict, according to the US Energy Information Administration. In a state that already has some of the nation’s highest fuel costs because of taxes and specialized environmental fuel rules, the increase quickly changed California’s pricing picture. The state’s average diesel price jumped $2.23 during the first month of the war, to $7.22/gal, according to the EIA. At the same time, California canceled 13,000 non-domiciled commercial driver’s licenses last month. The higher diesel prices and tighter capacity caused spot truckload rates in the state to jump 18 cents in March from February, according to the Journal of Commerce analysis, while national rates rose approximately the same amount. The latest figures from DAT Freight & Analytics show spot rates climbing across all major equipment types as capacity tightens and fuel costs increase. The national average dry-van linehaul spot rate reached $2.04 per mile last week, up 12 cents over two weeks and 24% higher year over year. Refrigerated rates averaged $2.43 per mile, up 53 cents from a year ago, while flatbed rates rose to $2.55 per mile — the highest in four years. “The trucking industry is doing quite well,” Avery Vise, vice president of trucking at FTR Intelligence, said in an interview on SiriusXM’s Channel 146. “A lot of these fuel costs have been recovered. It’s a cash flow problem for some carriers, but capacity is driving this. It is steadily declining and has been since 2022 and 2023. Capacity is very tight. I think we can declare the freight rate recession is over.” While midsize and large carriers can pass through higher diesel costs to customers via fuel surcharges, which have risen approximately 25 to 30 cents per mile since March 1, smaller owner-operators and port drayage drivers often negotiate all-in rates that include fuel. That means a sudden jolt in rates intensifies short-term cash-flow pressure. Robert Loya, president of the West Coast-based Harbor Trucking Association, said port drayage operators are often waiting weeks to recover those costs. “It’s insane,” Loya said. “Especially if you are doing ocean carrier business, you are looking at 45 days minimum before you are paid. With beneficial cargo owners, some may pay you in two or three weeks, but at the end of the day you are still carrying those costs.” Despite the pressure, Loya said he has not seen fleets or independent operators pull capacity off the road — an indication that underlying freight demand remains firm enough to sustain operations. On the demand side, manufacturing is showing early signs of recovery that could support additional freight volumes. The Institute for Supply Management’s Manufacturing Purchasing Managers Index registered 52.7 in March, marking a third consecutive month of expansion. Whether the current shift develops into a sustained recovery will depend on the consistency of freight demand in the months ahead. Pushing freight to intermodal Three intermodal providers, who asked not to be identified, said they have seen a resurgence in shippers investigating the rail option amid the strength in truckload. A western US asset-based intermodal provider said the inquiries have picked up in recent weeks. “It isn’t necessarily desperation. The shippers are contacting us after not hearing them for a few years to ask about rates on certain lanes or asking what lanes might work [on intermodal] that they hadn’t thought of before,” the president of the carrier said. “Shippers are offering us freight starting as soon as next week.” A non-asset-based intermodal marketing company (IMC) based in the Northeast said its business last month was double that of March 2025. The owner of the IMC agreed the conversations did not feel like shippers were desperate, just inquisitive. “We haven’t received many customers who are converting from truckload,” the source said. “They’re using other intermodal providers who have struggled with the business, and they turn to us.” One Midwest-based truckload and intermodal broker told the Journal of Commerce that many of its long-term existing customers are shifting their freight from truckload to rail. Domestic intermodal data for March has not been released yet by the Intermodal Association of North America. J.B. Hunt Transport Services, the largest US intermodal provider, will hold a call with industry analysts after reporting earnings on April 15. Contact Dan Ronan at contactdanronan@gmail.com . Contact Ari Ashe at ari.ashe@spglobal.com .

Truckload

California truckload rates rise as fuel spikes, capacity cuts tighten market

<div class="phx-topic abstract-wrapper">Earnings calls across home builders and home improvement and furniture retailers show an uneven market where consumers are choosing smaller maintenance and repair projects and delaying large discretionary purchases.</div>

Earnings calls across home builders and home improvement and furniture retailers show an uneven market where consumers are choosing smaller maintenance and repair projects and delaying large discretionary purchases.

<div class="phx-topic">(The following story appears in the Top 100 Importers and Exporters issue of the Journal of Commerce magazine to be published May 4, 2026.) US imports of household goods declined slightly in 2025, a pause driven by a weak housing market, persistent inflation, and affordability concerns weighing on the demand for furniture, appliances, and home furnishings. Earnings calls across home builders and home improvement and furniture retailers show an uneven market where consumers are choosing smaller maintenance and repair projects and delaying large discretionary purchases. Imports of household goods fell 1.3% last year to 5.3 million TEUs, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. The compound annual growth rate was 3.4% in the last five years, but it has been a volatile and rocky road. Imports jumped 25% year over year in 2021 during the pandemic, then declined 5.8% in 2022 and 16.1% in 2023, before jumping 21.2% in 2024. Volume was approximately flat year over year at the ports of Los Angeles, Long Beach, New York and New Jersey, and Savannah. China remained the largest origin for US household goods imports, but its share fell to 49.9% last year from 55.4% in 2024 amid the tariff conflict and move for alternative sourcing. Vietnam increased its share to 23.9%, up from 20.3% the prior year. <h3>Industry fundamentals are weak </h3>The data points to a sector struggling with underlying housing fundamentals. Industrial production of household appliances fell 8.5% year over year in February, according to the US Federal Reserve. The biggest culprit is a continued imbalance between homebuyers and home inventory. “A typical home sale generates about $134,000 in economic activity, and a part of that is tied to furniture, appliances, and home-related goods,” Nadia Evangelou, principal economist for the National Association of Realtors (NAR), told the Journal of Commerce. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e18618ef-aa21-4767-bb0a-eea49b17ddf2"></dynamic-object></div>However, existing home sales dropped 1.4% year over year in February, while housing inventory grew 4.9% during the same period, according to NAR. New home construction, or “housing starts,” rose 9.2% year over year in January, according to the US Census Bureau, meaning there is even more inventory coming. “It’s very hard to predict how housing will play out,” Wayfair CEO Niraj Shah said during the company’s fourth-quarter earnings call. “Every quarter that goes by, the percentage of mortgages that get refinanced at the current rates keeps ticking up, but it’s a relatively slow process.” Jason Miller, an associate professor of supply chain management at Michigan State University, told the Journal of Commerce that this uncertainty is not good for freight volume. “The current ‘slow burn’ suggests at best a stabilization of freight volumes at lower levels than 2017-2019 for these types of goods, such as appliances,” Miller said. “It isn’t pointing towards a slow recovery.” <h3>Remodeling vs. repairs </h3>The Joint Center for Housing Studies at Harvard University forecasts just 1.6% growth in US remodeling spending later this year. Because that figure is nominal and not adjusted for inflation — currently about 2.5% to 3% — it effectively signals a decline in actual renovation activity. Dr. Rachel Bogardus Drew, director of the Remodeling Futures Program at Harvard, said people who are moving spend more on renovations than those staying in their existing homes. “People who have recently moved spend 50% more in the first year on home renovation than a similar homeowner who has not moved,” she told the Journal of Commerce. “Sometimes there’s upgrading that needs to be done, or they just want to remake the home to meet their needs or their tastes. So, a slowdown in existing home sales can cause a break on some remodeling activity.” For people remaining in their current homes, Drew said the tendency is to forego huge remodeling projects in favor of less expensive maintenance and repair work. That is consistent with commentary from home improvement retailers. “Consumers are still cautious about discretionary big-ticket purchases,” Brandon Sink, CFO for Lowe’s Companies, said on a February earnings call. “We forecast the home improvement market to be roughly flat this year.” Home construction companies such as D.R. Horton and Lennar can also drive demand for household goods like sofas and appliances, but mortgage rates hurt them as much as they hurt Home Depot and Lowe’s. “Mortgage interest rates, which showed some early signs of easing towards the end of last year, have remained stubbornly over 6%, hovering around 6.2% to 6.4%,” Stewart Miller, Lennar’s executive chairman, said on a March earnings call. “Affordability remains the central challenge facing our buyers. Consumer confidence, while not collapsing, continues to be tested by a range of uncertainties.” <h3>Outlook tied to housing recovery </h3>The outlook for household goods imports remains tied to the housing market. Harvard’s Drew said there is no silver bullet, but many things that can trigger a housing recovery. “Interest rates go down, then people start to think, ‘It’s a little more affordable now for me to look at moving, or to take out the funds to do renovations on my existing house, to tap that home equity,’” she said. “But the same thing could happen if house prices were to soften ... or if labor costs went down, or if it was cheaper to buy that sofa. Any one of these levers could kick start more activity, and all of them operating together is ideal.” NAR’s Evangelou said existing home sales should improve through the year, which will gradually increase demand for household goods, but it will also be a slow process that might drag into 2027. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

(The following story appears in the Top 100 Importers and Exporters issue of the Journal of Commerce magazine to be published May 4, 2026.) US imports of household goods declined slightly in 2025, a pause driven by a weak housing market, persistent inflation, and affordability concerns weighing on the demand for furniture, appliances, and home furnishings. Earnings calls across home builders and home improvement and furniture retailers show an uneven market where consumers are choosing smaller maintenance and repair projects and delaying large discretionary purchases. Imports of household goods fell 1.3% last year to 5.3 million TEUs, according to PIERS, a sister product of the Journal of Commerce within S&P Global. The compound annual growth rate was 3.4% in the last five years, but it has been a volatile and rocky road. Imports jumped 25% year over year in 2021 during the pandemic, then declined 5.8% in 2022 and 16.1% in 2023, before jumping 21.2% in 2024. Volume was approximately flat year over year at the ports of Los Angeles, Long Beach, New York and New Jersey, and Savannah. China remained the largest origin for US household goods imports, but its share fell to 49.9% last year from 55.4% in 2024 amid the tariff conflict and move for alternative sourcing. Vietnam increased its share to 23.9%, up from 20.3% the prior year. Industry fundamentals are weak The data points to a sector struggling with underlying housing fundamentals. Industrial production of household appliances fell 8.5% year over year in February, according to the US Federal Reserve. The biggest culprit is a continued imbalance between homebuyers and home inventory. “A typical home sale generates about $134,000 in economic activity, and a part of that is tied to furniture, appliances, and home-related goods,” Nadia Evangelou, principal economist for the National Association of Realtors (NAR), told the Journal of Commerce. However, existing home sales dropped 1.4% year over year in February, while housing inventory grew 4.9% during the same period, according to NAR. New home construction, or “housing starts,” rose 9.2% year over year in January, according to the US Census Bureau, meaning there is even more inventory coming. “It’s very hard to predict how housing will play out,” Wayfair CEO Niraj Shah said during the company’s fourth-quarter earnings call. “Every quarter that goes by, the percentage of mortgages that get refinanced at the current rates keeps ticking up, but it’s a relatively slow process.” Jason Miller, an associate professor of supply chain management at Michigan State University, told the Journal of Commerce that this uncertainty is not good for freight volume. “The current ‘slow burn’ suggests at best a stabilization of freight volumes at lower levels than 2017-2019 for these types of goods, such as appliances,” Miller said. “It isn’t pointing towards a slow recovery.” Remodeling vs. repairs The Joint Center for Housing Studies at Harvard University forecasts just 1.6% growth in US remodeling spending later this year. Because that figure is nominal and not adjusted for inflation — currently about 2.5% to 3% — it effectively signals a decline in actual renovation activity. Dr. Rachel Bogardus Drew, director of the Remodeling Futures Program at Harvard, said people who are moving spend more on renovations than those staying in their existing homes. “People who have recently moved spend 50% more in the first year on home renovation than a similar homeowner who has not moved,” she told the Journal of Commerce. “Sometimes there’s upgrading that needs to be done, or they just want to remake the home to meet their needs or their tastes. So, a slowdown in existing home sales can cause a break on some remodeling activity.” For people remaining in their current homes, Drew said the tendency is to forego huge remodeling projects in favor of less expensive maintenance and repair work. That is consistent with commentary from home improvement retailers. “Consumers are still cautious about discretionary big-ticket purchases,” Brandon Sink, CFO for Lowe’s Companies, said on a February earnings call. “We forecast the home improvement market to be roughly flat this year.” Home construction companies such as D.R. Horton and Lennar can also drive demand for household goods like sofas and appliances, but mortgage rates hurt them as much as they hurt Home Depot and Lowe’s. “Mortgage interest rates, which showed some early signs of easing towards the end of last year, have remained stubbornly over 6%, hovering around 6.2% to 6.4%,” Stewart Miller, Lennar’s executive chairman, said on a March earnings call. “Affordability remains the central challenge facing our buyers. Consumer confidence, while not collapsing, continues to be tested by a range of uncertainties.” Outlook tied to housing recovery The outlook for household goods imports remains tied to the housing market. Harvard’s Drew said there is no silver bullet, but many things that can trigger a housing recovery. “Interest rates go down, then people start to think, ‘It’s a little more affordable now for me to look at moving, or to take out the funds to do renovations on my existing house, to tap that home equity,’” she said. “But the same thing could happen if house prices were to soften ... or if labor costs went down, or if it was cheaper to buy that sofa. Any one of these levers could kick start more activity, and all of them operating together is ideal.” NAR’s Evangelou said existing home sales should improve through the year, which will gradually increase demand for household goods, but it will also be a slow process that might drag into 2027. Contact Ari Ashe at ari.ashe@spglobal.com .

US household goods imports flatten as housing weakness weighs on demand

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<div class="phx-topic abstract-wrapper">The CMA CGM Kribi successfully transited the strait late Thursday, the first passage for a Western-operated container ship since the war between the US/Israel and Iran disrupted access to the crucial waterway five weeks ago.</div>

The CMA CGM Kribi successfully transited the strait late Thursday, the first passage for a Western-operated container ship since the war between the US/Israel and Iran disrupted access to the crucial waterway five weeks ago.

<div class="phx-topic">French ocean carrier CMA CGM is understood to have secured assurances from Iranian authorities guaranteeing safe passage for its 14 container ships trapped inside the Strait of Hormuz since the war began, industry sources with knowledge of the matter told the Journal of Commerce Friday. Signaling that breakthrough, the Malta-flagged CMA CGM Kribi successfully transited the strait late Thursday local time, the first passage for a Western-operated container ship since the war between the US/Israel and Iran disrupted access to the crucial waterway five weeks ago. The 5,500-TEU Kribi is part of the Marseille-based carrier’s Middle East-India-West Africa network known as Midas1 and operated in conjunction with Maersk, available data shows. The industry sources also indicated that there are another six CMA CGM container vessels held up in the Persian Gulf and awaiting clearance to transit Hormuz. The sources believe the measured approach adopted by French President Emmanuel Macron during the Persian Gulf conflict has helped CMA CGM strike a deal with Iran, which recently reiterated that Hormuz would only remain open to maritime traffic from nonhostile countries. Specifics of any possible deal between the carrier and Iran were not known. There have been unconfirmed reports that Tehran is asking carriers to pay a “toll fee” of $1 million or $2 million per ship to guarantee safe passage through the strait. During a briefing with reporters last week, <a href="https://www.joc.com/article/war-adding-40-50-million-per-week-to-hapag-lloyds-costs-ceo-6193532">Hapag-Lloyd CEO Rolf Habben Jansen was asked</a> whether the carrier would pay Tehran to secure safe passage for its six ships that remain trapped in the war zone. “We are pursuing every avenue that we can to try to get the ships and the crews safely out, and I would not rule out anything at this point,” Habben Jansen said. Earlier this week, three Chinese-linked vessels, including two container ships operated by Cosco Shipping, transited through Hormuz. The industry sources also told the Journal of Commerce that 15 ships operated by Mediterranean Shipping Co. are stuck in the conflict zone, as well as six from Maersk. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com.</a></div>

French ocean carrier CMA CGM is understood to have secured assurances from Iranian authorities guaranteeing safe passage for its 14 container ships trapped inside the Strait of Hormuz since the war began, industry sources with knowledge of the matter told the Journal of Commerce Friday. Signaling that breakthrough, the Malta-flagged CMA CGM Kribi successfully transited the strait late Thursday local time, the first passage for a Western-operated container ship since the war between the US/Israel and Iran disrupted access to the crucial waterway five weeks ago. The 5,500-TEU Kribi is part of the Marseille-based carrier’s Middle East-India-West Africa network known as Midas1 and operated in conjunction with Maersk, available data shows. The industry sources also indicated that there are another six CMA CGM container vessels held up in the Persian Gulf and awaiting clearance to transit Hormuz. The sources believe the measured approach adopted by French President Emmanuel Macron during the Persian Gulf conflict has helped CMA CGM strike a deal with Iran, which recently reiterated that Hormuz would only remain open to maritime traffic from nonhostile countries. Specifics of any possible deal between the carrier and Iran were not known. There have been unconfirmed reports that Tehran is asking carriers to pay a “toll fee” of $1 million or $2 million per ship to guarantee safe passage through the strait. During a briefing with reporters last week, Hapag-Lloyd CEO Rolf Habben Jansen was asked whether the carrier would pay Tehran to secure safe passage for its six ships that remain trapped in the war zone. “We are pursuing every avenue that we can to try to get the ships and the crews safely out, and I would not rule out anything at this point,” Habben Jansen said. Earlier this week, three Chinese-linked vessels, including two container ships operated by Cosco Shipping, transited through Hormuz. The industry sources also told the Journal of Commerce that 15 ships operated by Mediterranean Shipping Co. are stuck in the conflict zone, as well as six from Maersk. Contact Bency Mathew at bencyvmathew@gmail.com.

CMA CGM said to have deal with Iran to allow safe passage through Hormuz: sources

<div class="phx-topic abstract-wrapper">With more than 50% of the city-state's bunker fuel imported via the Strait of Hormuz, which has been effectively closed since the war started on Feb. 28, suppliers are feeling the pinch.</div>

With more than 50% of the city-state's bunker fuel imported via the Strait of Hormuz, which has been effectively closed since the war started on Feb. 28, suppliers are feeling the pinch.

<div class="phx-topic">Suppliers in the world’s largest bunkering hub of Singapore are under growing stress, with analysts reporting less than a month’s supply remaining and no replenishment in sight from one of its most important fuel supply lines. More than 50% of the city-state's bunker fuel is believed to be imported via the Strait of Hormuz, which has been effectively closed since the war in the Middle East started on Feb. 28. Although Singapore remains able to refuel ships, the clock is ticking on the available supply, according to Fotios Katsoulas, director and head of tankers, freight and alternative fuels research at S&amp;P Global Energy. "If the current supply-demand imbalance persists, we expect a rapid acceleration in stock drawdowns as existing inventories — currently sufficient for about three weeks of typical demand — begin to deplete,” he said. S&amp;P Global is the parent company of the Journal of Commerce. Katsoulas said the Singapore market was under “significant stress,” with recommended lead times for ocean carriers replenishing very low sulfur fuel oil (VLSFO) currently stretching to more than a week in some cases. “Prompt availability is extremely tight,” he said. “We are seeing reports of suppliers already prioritizing existing term contracts and resisting new tenders for the next (few) months.” The immense scale of Singapore’s bunkering industry underlines the problem facing fuel suppliers in the port should the Strait of Hormuz remain closed. Singapore sold 56.2 million metric tons (mt) of bunker fuel in 2025, up 3.2% year over year, according to data from the Maritime and Port Authority of Singapore. That was more than five times the bunker sales at the world’s second-largest ship refueling hub of Rotterdam, with sales driven by strong high sulfur fuel oil (HSFO) demand as VLSFO sales dropped off. Traders in Singapore have been sourcing oil from areas outside the Middle East, such as Brazil and Russia, according to reports. The US in March issued a 30-day waiver allowing the purchase of previously sanctioned Russian oil and gas, and Singapore is taking advantage of that by increasing imports to support bunker availability. <h3>Fuel prices drop off mid-March highs </h3>The scarcity of supply since Feb. 28 has pushed up bunker fuel prices in Singapore, but prices have declined since the mid-March highs. On April 1, VLSFO in Singapore was selling at $873.50 per metric ton, up 70% since Feb. 27 but far below its March 16 high of $1,119/mt, according to the Ship &amp; Bunker platform. HSFO has followed a similar path, up 60% from Feb. 27 at $695/mt, but down 35% from the March 9 price of $1,073/mt. Bucking the trend is low sulfur marine gas oil (MGO), used by carriers in emission control areas such as the coasts of North America, the Caribbean, the Baltic and North seas, and the Mediterranean. MGO prices in Singapore on April 1 were at $1,836/mt, not far off the March 23 high of $1,940, but 160% above the pre-war price, Ship &amp; Bunker data showed. In Rotterdam, VLSFO was trading at $716.50/mt on April 1, up almost 50% from Feb. 27. HSFO was at $661.50, up 50% since before the war, while MGO was 85% higher at $1,331/mt, Ship &amp; Bunker’s latest pricing showed. Katsoulas said Rotterdam was currently the most stable and well-supplied bunkering point compared to the hubs east of the Suez Canal. “It is shielded from the immediate Middle East disruptions, and as a result, Singapore is trading at a massive $140 to $250 per ton premium over Rotterdam prices,” he told the Journal of Commerce. Peter Sand, chief analyst at rate benchmarking platform Xeneta, said bunker fuel in Singapore was available at prices almost double pre-conflict levels, but the prices were trending slowly downwards after the initial spike of 200%. “With no visible end to the crisis, however, carriers are almost certainly drawing up another set of contingency plans,” Sand said in a market update Thursday. “The coming weeks will show whether slow steaming and alternative routing can hold the line, or whether blank sailings become the next lever carriers reach for.” <h3>Emergency surcharge prices rise </h3>One of the contingency plans being aggressively pursued by carriers are emergency bunker fuel surcharges piled on top of existing quarterly fuel cost recovery mechanisms. For instance, Maersk from March 25 has been charging $400 per FEU on long-haul head-haul routes and $600/FEU for reefers, while CMA CGM since March 27 has been charging emergency fuel surcharges of $265/TEU, and $320/TEU for reefers. Ocean Network Express set long-haul head-haul surcharges at $160/TEU, with $210/TEU for reefers, while Mediterranean Shipping Co. has implemented a range of fuel surcharges covering specific regional routes. Maersk this week again asked US maritime regulators to <a href="https://www.joc.com/article/maersk-again-asks-fmc-to-waive-30-day-review-period-for-emergency-fuel-surcharge-6197792">waive the 30-day notice period</a> required before liners can implement surcharges so it could immediately roll out emergency fuel surcharges on long-haul US trades. The Federal Maritime Commission <a href="https://www.joc.com/article/fmc-rejects-requests-by-carriers-to-waive-waiting-period-for-middle-east-surcharges-6191881">previously rejected an initial attempt by Maersk and three other carriers to waive the notice period</a> and is expected to rule on the second request soon. Rolf Habben Jansen, CEO of Hapag-Lloyd, last week put a price on the Middle East war, telling reporters that the carrier <a href="https://www.joc.com/article/war-adding-40-50-million-per-week-to-hapag-lloyds-costs-ceo-6193532">was shouldering added operating costs of $40 million to $50 million a week</a>. Most of that was driven by higher bunker fuel prices and rising insurance premiums in the Middle East. “Our intention is not to make a profit (from surcharges),” Habben Jansen told reporters during a media briefing. “We are trying to limit the charges to the extra costs we need to recover. We are trying to ring-fence the problem as much as possible.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Suppliers in the world’s largest bunkering hub of Singapore are under growing stress, with analysts reporting less than a month’s supply remaining and no replenishment in sight from one of its most important fuel supply lines. More than 50% of the city-state's bunker fuel is believed to be imported via the Strait of Hormuz, which has been effectively closed since the war in the Middle East started on Feb. 28. Although Singapore remains able to refuel ships, the clock is ticking on the available supply, according to Fotios Katsoulas, director and head of tankers, freight and alternative fuels research at S&P Global Energy. "If the current supply-demand imbalance persists, we expect a rapid acceleration in stock drawdowns as existing inventories — currently sufficient for about three weeks of typical demand — begin to deplete,” he said. S&P Global is the parent company of the Journal of Commerce. Katsoulas said the Singapore market was under “significant stress,” with recommended lead times for ocean carriers replenishing very low sulfur fuel oil (VLSFO) currently stretching to more than a week in some cases. “Prompt availability is extremely tight,” he said. “We are seeing reports of suppliers already prioritizing existing term contracts and resisting new tenders for the next (few) months.” The immense scale of Singapore’s bunkering industry underlines the problem facing fuel suppliers in the port should the Strait of Hormuz remain closed. Singapore sold 56.2 million metric tons (mt) of bunker fuel in 2025, up 3.2% year over year, according to data from the Maritime and Port Authority of Singapore. That was more than five times the bunker sales at the world’s second-largest ship refueling hub of Rotterdam, with sales driven by strong high sulfur fuel oil (HSFO) demand as VLSFO sales dropped off. Traders in Singapore have been sourcing oil from areas outside the Middle East, such as Brazil and Russia, according to reports. The US in March issued a 30-day waiver allowing the purchase of previously sanctioned Russian oil and gas, and Singapore is taking advantage of that by increasing imports to support bunker availability. Fuel prices drop off mid-March highs The scarcity of supply since Feb. 28 has pushed up bunker fuel prices in Singapore, but prices have declined since the mid-March highs. On April 1, VLSFO in Singapore was selling at $873.50 per metric ton, up 70% since Feb. 27 but far below its March 16 high of $1,119/mt, according to the Ship & Bunker platform. HSFO has followed a similar path, up 60% from Feb. 27 at $695/mt, but down 35% from the March 9 price of $1,073/mt. Bucking the trend is low sulfur marine gas oil (MGO), used by carriers in emission control areas such as the coasts of North America, the Caribbean, the Baltic and North seas, and the Mediterranean. MGO prices in Singapore on April 1 were at $1,836/mt, not far off the March 23 high of $1,940, but 160% above the pre-war price, Ship & Bunker data showed. In Rotterdam, VLSFO was trading at $716.50/mt on April 1, up almost 50% from Feb. 27. HSFO was at $661.50, up 50% since before the war, while MGO was 85% higher at $1,331/mt, Ship & Bunker’s latest pricing showed. Katsoulas said Rotterdam was currently the most stable and well-supplied bunkering point compared to the hubs east of the Suez Canal. “It is shielded from the immediate Middle East disruptions, and as a result, Singapore is trading at a massive $140 to $250 per ton premium over Rotterdam prices,” he told the Journal of Commerce. Peter Sand, chief analyst at rate benchmarking platform Xeneta, said bunker fuel in Singapore was available at prices almost double pre-conflict levels, but the prices were trending slowly downwards after the initial spike of 200%. “With no visible end to the crisis, however, carriers are almost certainly drawing up another set of contingency plans,” Sand said in a market update Thursday. “The coming weeks will show whether slow steaming and alternative routing can hold the line, or whether blank sailings become the next lever carriers reach for.” Emergency surcharge prices rise One of the contingency plans being aggressively pursued by carriers are emergency bunker fuel surcharges piled on top of existing quarterly fuel cost recovery mechanisms. For instance, Maersk from March 25 has been charging $400 per FEU on long-haul head-haul routes and $600/FEU for reefers, while CMA CGM since March 27 has been charging emergency fuel surcharges of $265/TEU, and $320/TEU for reefers. Ocean Network Express set long-haul head-haul surcharges at $160/TEU, with $210/TEU for reefers, while Mediterranean Shipping Co. has implemented a range of fuel surcharges covering specific regional routes. Maersk this week again asked US maritime regulators to waive the 30-day notice period required before liners can implement surcharges so it could immediately roll out emergency fuel surcharges on long-haul US trades. The Federal Maritime Commission previously rejected an initial attempt by Maersk and three other carriers to waive the notice period and is expected to rule on the second request soon. Rolf Habben Jansen, CEO of Hapag-Lloyd, last week put a price on the Middle East war, telling reporters that the carrier was shouldering added operating costs of $40 million to $50 million a week . Most of that was driven by higher bunker fuel prices and rising insurance premiums in the Middle East. “Our intention is not to make a profit (from surcharges),” Habben Jansen told reporters during a media briefing. “We are trying to limit the charges to the extra costs we need to recover. We are trying to ring-fence the problem as much as possible.” Contact Greg Knowler at greg.knowler@spglobal.com .

Singapore bunker supply continues to run down as Middle East war drags on

<div class="phx-topic abstract-wrapper">The departure of the Montreal Port Authority CEO comes just as development work begins on a new US$1.15 billion container terminal.</div>

The departure of the Montreal Port Authority CEO comes just as development work begins on a new US$1.15 billion container terminal.

<div class="phx-topic">The two-year tenure of Montreal Port Authority (MPA) chief Julie Gascon ended abruptly Friday, just as development work is beginning on a C$1.6 billion (US$1.15 billion) container terminal to be operated by DP World. A statement from the port authority gave no reason for the departure of Gascon, who became president and CEO of the agency in February 2024. A committee of the port authority’s board of directors will work to ensure interim leadership is in place as Gascon’s successor is sought, according to the statement. “With the Contrecoeur terminal expansion project actively progressing, the Port of Montreal is entering a new phase in its development, which will take place as part of a new strategic cycle for the MPA,” said Nathalie Pilon, chair of the MPA’s board of directors. “The organization is in an excellent position to fulfill its mandate and contribute to Canada’s competitiveness in global markets.” Gascon oversaw DP World <a href="https://www.joc.com/article/dp-world-aims-to-run-carney-backed-montreal-terminal-6072977">being awarded the winning bid</a> to operate the Contrecoeur terminal, which, with a planned annual capacity of 1.15 million TEUs, would increase the total capacity of Canada’s second-largest container port by 150%. Gascon was viewed locally as bringing more maritime expertise and a greater commercial understanding to the role as MPA chief when she succeeded utility veteran Martin Imbleau, who also abruptly exited in July 2023. Contact the JOC news team at <a href="mailto:News@joc.com">news@joc.com.</a></div>

The two-year tenure of Montreal Port Authority (MPA) chief Julie Gascon ended abruptly Friday, just as development work is beginning on a C$1.6 billion (US$1.15 billion) container terminal to be operated by DP World. A statement from the port authority gave no reason for the departure of Gascon, who became president and CEO of the agency in February 2024. A committee of the port authority’s board of directors will work to ensure interim leadership is in place as Gascon’s successor is sought, according to the statement. “With the Contrecoeur terminal expansion project actively progressing, the Port of Montreal is entering a new phase in its development, which will take place as part of a new strategic cycle for the MPA,” said Nathalie Pilon, chair of the MPA’s board of directors. “The organization is in an excellent position to fulfill its mandate and contribute to Canada’s competitiveness in global markets.” Gascon oversaw DP World being awarded the winning bid to operate the Contrecoeur terminal, which, with a planned annual capacity of 1.15 million TEUs, would increase the total capacity of Canada’s second-largest container port by 150%. Gascon was viewed locally as bringing more maritime expertise and a greater commercial understanding to the role as MPA chief when she succeeded utility veteran Martin Imbleau, who also abruptly exited in July 2023. Contact the JOC news team at news@joc.com.

Montreal Port chief Gascon exits abruptly after two-year tenure

<div class="phx-topic abstract-wrapper">The ocean carrier said it would no longer call Oakland on one of its trans-Pacific services, with another service into the Pacific Northwest dropping a Vietnam call.</div>

The ocean carrier said it would no longer call Oakland on one of its trans-Pacific services, with another service into the Pacific Northwest dropping a Vietnam call.

<div class="phx-topic">Mediterranean Shipping Co. (MSC) is reducing the number of West Coast port calls it makes on one of its trans-Pacific services and changing its Asian port rotations in a bid to improve schedule reliability and service consistency. MSC said in a customer advisory late last week that its Orient service from China would no longer call Oakland, effective as of the April 30 departure of the 8,827-TEU MSC Naomi from Qingdao. MSC said it made the change so “the service will be less exposed to port congestion risks, allowing for improved schedule reliability and more consistent on-time arrivals.” Amid last year’s tariff turmoil, Oakland saw an 8.6% drop in imports from China in 2025, according to PIERS, a sister company of the Journal of Commerce within S&amp;P Global, close to the overall 8.1% drop for all inbound volumes from China to West Coast ports. Although not in MSC’s advisory, the Orient service, whose only West Coast call will be the carrier’s Long Beach terminal, has also effectively dropped Portland, Oregon, as a regular call, even though the port was listed on the rotation in earlier Orient service brochures. MSC, <a href="https://www.joc.com/article/msc-restores-trans-pacific-liberty-service-with-new-call-at-philadelphia-5703074">which has offered intermittent service to Portland since the pandemic</a>, last called Portland with a post-Panamax container ship in May 2025, according to Sea-web, a sister company of the Journal of Commerce. The carrier, meanwhile, is adding Vietnam’s Haiphong as a regular call to its Sentosa service from Southeast Asia to Long Beach and Oakland. The new call from Haiphong, MSC’s first direct service from that port into Long Beach, will be in effect as of the April 16 departure from Haiphong of the 16,616-TEU MSC Lorenza. MSC said the change “will offer improved transit times compared to the previous routing, while optimizing port coverage within a more stable network structure.” <h3>Dropping Haiphong on Chinook service </h3>However, MSC will be dropping Haiphong as a call on its Chinook service into the Pacific Northwest, leaving Vietnam’s Vung Tau, major Chinese ports, and South Korea’s Busan on the service. The new Chinook rotation will be in effect as of the April 13 departure of the 10,114-TEU Express Athens from Vung Tau. MSC said the dropped call from Haiphong will provide Pacific Northwest shippers with more schedule buffer in the event of delays. But it also comes as the Pacific Northwest saw only 3% growth in imports from Southeast Asia last year, according to PIERS data, versus a 19.6% overall growth for Southeast Asian imports into West Coast ports. Third-party logistics provider <a href="https://www.joc.com/article/uwl-locks-in-new-vessel-partner-for-trans-pacific-vietnam-service-6032327">UWL recently shut down its express service from northern Vietnam into the Pacific Northwest</a> due to the lack of business. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Mediterranean Shipping Co. (MSC) is reducing the number of West Coast port calls it makes on one of its trans-Pacific services and changing its Asian port rotations in a bid to improve schedule reliability and service consistency. MSC said in a customer advisory late last week that its Orient service from China would no longer call Oakland, effective as of the April 30 departure of the 8,827-TEU MSC Naomi from Qingdao. MSC said it made the change so “the service will be less exposed to port congestion risks, allowing for improved schedule reliability and more consistent on-time arrivals.” Amid last year’s tariff turmoil, Oakland saw an 8.6% drop in imports from China in 2025, according to PIERS, a sister company of the Journal of Commerce within S&P Global, close to the overall 8.1% drop for all inbound volumes from China to West Coast ports. Although not in MSC’s advisory, the Orient service, whose only West Coast call will be the carrier’s Long Beach terminal, has also effectively dropped Portland, Oregon, as a regular call, even though the port was listed on the rotation in earlier Orient service brochures. MSC, which has offered intermittent service to Portland since the pandemic , last called Portland with a post-Panamax container ship in May 2025, according to Sea-web, a sister company of the Journal of Commerce. The carrier, meanwhile, is adding Vietnam’s Haiphong as a regular call to its Sentosa service from Southeast Asia to Long Beach and Oakland. The new call from Haiphong, MSC’s first direct service from that port into Long Beach, will be in effect as of the April 16 departure from Haiphong of the 16,616-TEU MSC Lorenza. MSC said the change “will offer improved transit times compared to the previous routing, while optimizing port coverage within a more stable network structure.” Dropping Haiphong on Chinook service However, MSC will be dropping Haiphong as a call on its Chinook service into the Pacific Northwest, leaving Vietnam’s Vung Tau, major Chinese ports, and South Korea’s Busan on the service. The new Chinook rotation will be in effect as of the April 13 departure of the 10,114-TEU Express Athens from Vung Tau. MSC said the dropped call from Haiphong will provide Pacific Northwest shippers with more schedule buffer in the event of delays. But it also comes as the Pacific Northwest saw only 3% growth in imports from Southeast Asia last year, according to PIERS data, versus a 19.6% overall growth for Southeast Asian imports into West Coast ports. Third-party logistics provider UWL recently shut down its express service from northern Vietnam into the Pacific Northwest due to the lack of business. Contact Michael Angell at michael.angell@spglobal.com .

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