<div class="phx-topic abstract-wrapper">Port officials say the next Army Corps spending bill needs to make sure that dredging funds set aside under a 2020 law actually get distributed. </div>

Port officials say the next Army Corps spending bill needs to make sure that dredging funds set aside under a 2020 law actually get distributed.

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<div class="phx-topic">Large US ports face the prospect of less federal support for dredging and maintenance projects next year if Congress doesn’t ensure fairer distribution of monies from a government-run maintenance fund, lawmakers were told Wednesday. Port of Long Beach Chief Operating Officer Noel Hacegaba told the House Transportation and Infrastructure Committee that Congress needs to require the US Army Corps of Engineers’ (USACE’s) next spending authorization to comply with a law passed during its 2020 authorization that aimed at more even distribution of dredging funds. That law, known as Section 102, aimed to distribute at least 12% of the federal Harbor Maintenance Trust Fund back to so-called “donor and energy ports,” which contribute about half of the funds. Hacegaba’s testimony comes as Congress looks to draft a biennial spending authorization for the USACE. The Harbor Maintenance Trust Fund is expected to reach $7.8 billion next year. Sen. John Kennedy (R-Louisiana) introduced a spending bill earlier this month that would require the USACE to use $417 million from the trust toward Section 102 funding in 2026. The House version of the next USACE, however, does not have that provision. Hacegaba said the 2025 US Army Corps of Engineers (USACE) budget failed to include some $380 million that should be available under Section 102. Without that, Hacegaba said there was a $43 million shortfall in federal funds available this year to Long Beach for dredging and other maintenance. “You’re talking about nearly a 90% drop in funding that is critical for this project,” Hacegaba said. “[Long Beach] respectfully requests your continued support to ensure that annual distribution of these funds is not viewed as optional,” he added. “We are asking for equitable funding for donor and energy ports.” The American Association of Port Authorities (AAPA), which has estimated that <a href="https://www.joc.com/article/big-us-ports-ask-congress-to-follow-law-for-equal-funding-of-dredging-work-6055791">lax enforcement of Section 102 could mean a $1 billion loss in dredging funds</a>, said in a letter to Congress the law itself needs to be redrafted due to having too many qualifiers that “have led to inconsistent implementation.” Changing the law “would provide stability and ensure that these critical hubs receive the support needed to maintain safe and efficient operations,” AAPA said. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com ">michael.angell@spglobal.com</a>. </div>

Large US ports face the prospect of less federal support for dredging and maintenance projects next year if Congress doesn’t ensure fairer distribution of monies from a government-run maintenance fund, lawmakers were told Wednesday. Port of Long Beach Chief Operating Officer Noel Hacegaba told the House Transportation and Infrastructure Committee that Congress needs to require the US Army Corps of Engineers’ (USACE’s) next spending authorization to comply with a law passed during its 2020 authorization that aimed at more even distribution of dredging funds. That law, known as Section 102, aimed to distribute at least 12% of the federal Harbor Maintenance Trust Fund back to so-called “donor and energy ports,” which contribute about half of the funds. Hacegaba’s testimony comes as Congress looks to draft a biennial spending authorization for the USACE. The Harbor Maintenance Trust Fund is expected to reach $7.8 billion next year. Sen. John Kennedy (R-Louisiana) introduced a spending bill earlier this month that would require the USACE to use $417 million from the trust toward Section 102 funding in 2026. The House version of the next USACE, however, does not have that provision. Hacegaba said the 2025 US Army Corps of Engineers (USACE) budget failed to include some $380 million that should be available under Section 102. Without that, Hacegaba said there was a $43 million shortfall in federal funds available this year to Long Beach for dredging and other maintenance. “You’re talking about nearly a 90% drop in funding that is critical for this project,” Hacegaba said. “[Long Beach] respectfully requests your continued support to ensure that annual distribution of these funds is not viewed as optional,” he added. “We are asking for equitable funding for donor and energy ports.” The American Association of Port Authorities (AAPA), which has estimated that lax enforcement of Section 102 could mean a $1 billion loss in dredging funds , said in a letter to Congress the law itself needs to be redrafted due to having too many qualifiers that “have led to inconsistent implementation.” Changing the law “would provide stability and ensure that these critical hubs receive the support needed to maintain safe and efficient operations,” AAPA said. Contact Michael Angell at michael.angell@spglobal.com .

Transport, Trade and Regulation News

Port infrastructure

North American ports

Big US ports ask Congress to ensure fair funding for dredging

<div class="phx-topic abstract-wrapper">Zvi Schreiber oversaw key milestones such as Freightos’ public listing and a transformative acquisition of air freight booking platform WebCargo, but the company has yet to turn a profit. </div>

Zvi Schreiber oversaw key milestones such as Freightos’ public listing and a transformative acquisition of air freight booking platform WebCargo, but the company has yet to turn a profit.

<div class="phx-topic">Freightos founder and CEO Zvi Schreiber will step down on Jan. 31, the company announced Wednesday, as the freight technology and marketplace provider looks for new leadership to guide it into its “next phase.” CFO Pablo Pinillos will become interim CEO from Feb. 1, Freightos said in a statement, adding that Schreiber will remain as a non-executive board member with the company after his departure as CEO. “The time is right for Freightos to have a CEO laser-focused on our next stage of scale-up, while I turn my attention to new adventures,” Schreiber said in the statement. Founded by Schreiber in 2012, Freightos provides a range of procurement, booking, rate management and rate data services. Among the notable milestones in Schreiber’s tenure as CEO was the launch of the now-widely used FBX spot rate index, the move to take Freightos public in 2023 on the NASDAQ exchange, and the transformative acquisition of air freight booking platform WebCargo. Along with launching a freight rate marketplace used primarily by forwarders and smaller importers and exporters, Freightos provides tools for cargo airlines and a digital customs brokerage service. Despite sizable growth in two key metrics it tracks — the number of bookings and gross booking value passing through its marketplace — Freightos has yet to turn a profit. The company’s third-quarter financials showed losses before interest, taxes, depreciation and amortization of $2.6 million on revenue of $7.7 million. For context, those losses are the lowest since the company went public two years ago and its revenue is 25% higher over the last year. “Zvi poured himself into this company,” Udo Lange, non-executive chairman of Freightos, said in the statement. “His vision and his belief in a connected, digital freight ecosystem have shaped Freightos at every step. We’re now moving into Freightos’ next phase ... as we scale, implementing ongoing improvements for operational discipline, and delivering the full potential of the platform that Zvi envisioned.” Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>.</div>

Freightos founder and CEO Zvi Schreiber will step down on Jan. 31, the company announced Wednesday, as the freight technology and marketplace provider looks for new leadership to guide it into its “next phase.” CFO Pablo Pinillos will become interim CEO from Feb. 1, Freightos said in a statement, adding that Schreiber will remain as a non-executive board member with the company after his departure as CEO. “The time is right for Freightos to have a CEO laser-focused on our next stage of scale-up, while I turn my attention to new adventures,” Schreiber said in the statement. Founded by Schreiber in 2012, Freightos provides a range of procurement, booking, rate management and rate data services. Among the notable milestones in Schreiber’s tenure as CEO was the launch of the now-widely used FBX spot rate index, the move to take Freightos public in 2023 on the NASDAQ exchange, and the transformative acquisition of air freight booking platform WebCargo. Along with launching a freight rate marketplace used primarily by forwarders and smaller importers and exporters, Freightos provides tools for cargo airlines and a digital customs brokerage service. Despite sizable growth in two key metrics it tracks — the number of bookings and gross booking value passing through its marketplace — Freightos has yet to turn a profit. The company’s third-quarter financials showed losses before interest, taxes, depreciation and amortization of $2.6 million on revenue of $7.7 million. For context, those losses are the lowest since the company went public two years ago and its revenue is 25% higher over the last year. “Zvi poured himself into this company,” Udo Lange, non-executive chairman of Freightos, said in the statement. “His vision and his belief in a connected, digital freight ecosystem have shaped Freightos at every step. We’re now moving into Freightos’ next phase ... as we scale, implementing ongoing improvements for operational discipline, and delivering the full potential of the platform that Zvi envisioned.” Contact Eric Johnson at eric.johnson@spglobal.com .

Logistics Technology News

Freightos founder to step down as CEO as company moves into ‘next phase’

<div class="phx-topic abstract-wrapper">The head of one opposition union says the job protection deals agreed to by other unions in exchange for their support of the merger have “loopholes big enough to traverse freight trains through.”</div>

The head of one opposition union says the job protection deals agreed to by other unions in exchange for their support of the merger have “loopholes big enough to traverse freight trains through.”

<div class="phx-topic">The second- and third-largest railroad worker unions in the US on Wednesday came out in opposition to Union Pacific’s (UP’s) proposed $85 billion acquisition of Norfolk Southern (NS). The move by the Brotherhood of Locomotive Engineers and Trainmen (BLET) and Brotherhood of Maintenance of Way Employees (BMWED), both part of the Teamsters Union, comes just days before UP is expected to file its formal application seeking approval for the deal from the US Surface Transportation Board (STB). BLET National President Mark Wallace said the decision to oppose the merger came after five months of review, as well as meetings across the US with rank-and-file workers and direct negotiations with UP CEO Jim Vena over post-merger job protections. “We believe this transcontinental railroad will make shipping by rail less attractive as the merged carrier passes off rail lines that service small towns, factories, and farms to short-line railroads,” Wallace said in a statement. “For rail customers, it will be a choice between Hell or the highway.” BLET also cited safety concerns, referring to the high-profile NS derailment in East Palestine, Ohio, in 2023, and UP’s propensity to run “extremely long trains, some three miles in length” as key factors behind its opposition to the merger. The unions also rejected Vena’s promise to protect the jobs of workers, which convinced other unions to back the deal. “We don’t believe anything Vena says about how workers would be treated in the supersized Union Pacific,” Tony Cardwell, BMWED’s president, said in the statement. “The agreements reached with some other unions related to job protections post-merger have loopholes big enough to traverse freight trains through. We refuse to accept the same terms in return for unions’ support for the merger.” <h3>UP reiterates job protections </h3>Union Pacific responded in a statement Wednesday, saying the growth opportunities in the merger are “unprecedented in railroad history.” UP also reiterated its job protection stance and emphasized that five unions have come out in support of the deal. UP flagged what it said was its commitment to unions, notably an average annual compensation and benefits package worth $160,000 that it said is approximately 40% above the national industrial average and retirement income that is nearly twice the average Social Security recipient. BLET and BMWED become the first major rail unions to oppose the proposed merger. Five have come out in favor, driven mainly by the job protections UP has offered to all union workers. The railroad has vowed that anyone who has a job after the deal is approved is protected against losing their job for any reason linked to the merger. The Sheet Metal, Air, Rail, and Transportation Workers-Transportation Division (SMART-TD) — the largest US rail union — <a href="https://www.joc.com/article/major-rail-union-backs-up-ns-merger-after-job-protection-deal-6084510">endorsed the deal in September</a>, while the International Brotherhood of Railway Boilermakers <a href="https://www.joc.com/article/up-reaches-agreement-with-ibb-union-to-support-ns-merger-6122657">pledged support</a> last month. Three other smaller unions — the Brotherhood of Railway Carmen, the National Conference of Firemen and Oilers, and the United Supervisors Council of America — have also come out in favor of the merger. “We’ve formalized this ‘jobs-for-life’ agreement with five unions ... and we look forward to filing our application with the STB this week,” UP said. There is also a split among other interested parties. Nine Republican Attorneys General wrote a letter opposing the deal on Nov. 14, but the Attorneys General from three other US states, also all Republicans, wrote their own letter nearly two weeks later supporting the deal. The STB is not expected to rule on the UP-NS application until 2027. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

The second- and third-largest railroad worker unions in the US on Wednesday came out in opposition to Union Pacific’s (UP’s) proposed $85 billion acquisition of Norfolk Southern (NS). The move by the Brotherhood of Locomotive Engineers and Trainmen (BLET) and Brotherhood of Maintenance of Way Employees (BMWED), both part of the Teamsters Union, comes just days before UP is expected to file its formal application seeking approval for the deal from the US Surface Transportation Board (STB). BLET National President Mark Wallace said the decision to oppose the merger came after five months of review, as well as meetings across the US with rank-and-file workers and direct negotiations with UP CEO Jim Vena over post-merger job protections. “We believe this transcontinental railroad will make shipping by rail less attractive as the merged carrier passes off rail lines that service small towns, factories, and farms to short-line railroads,” Wallace said in a statement. “For rail customers, it will be a choice between Hell or the highway.” BLET also cited safety concerns, referring to the high-profile NS derailment in East Palestine, Ohio, in 2023, and UP’s propensity to run “extremely long trains, some three miles in length” as key factors behind its opposition to the merger. The unions also rejected Vena’s promise to protect the jobs of workers, which convinced other unions to back the deal. “We don’t believe anything Vena says about how workers would be treated in the supersized Union Pacific,” Tony Cardwell, BMWED’s president, said in the statement. “The agreements reached with some other unions related to job protections post-merger have loopholes big enough to traverse freight trains through. We refuse to accept the same terms in return for unions’ support for the merger.” UP reiterates job protections Union Pacific responded in a statement Wednesday, saying the growth opportunities in the merger are “unprecedented in railroad history.” UP also reiterated its job protection stance and emphasized that five unions have come out in support of the deal. UP flagged what it said was its commitment to unions, notably an average annual compensation and benefits package worth $160,000 that it said is approximately 40% above the national industrial average and retirement income that is nearly twice the average Social Security recipient. BLET and BMWED become the first major rail unions to oppose the proposed merger. Five have come out in favor, driven mainly by the job protections UP has offered to all union workers. The railroad has vowed that anyone who has a job after the deal is approved is protected against losing their job for any reason linked to the merger. The Sheet Metal, Air, Rail, and Transportation Workers-Transportation Division (SMART-TD) — the largest US rail union — endorsed the deal in September , while the International Brotherhood of Railway Boilermakers pledged support last month. Three other smaller unions — the Brotherhood of Railway Carmen, the National Conference of Firemen and Oilers, and the United Supervisors Council of America — have also come out in favor of the merger. “We’ve formalized this ‘jobs-for-life’ agreement with five unions ... and we look forward to filing our application with the STB this week,” UP said. There is also a split among other interested parties. Nine Republican Attorneys General wrote a letter opposing the deal on Nov. 14, but the Attorneys General from three other US states, also all Republicans, wrote their own letter nearly two weeks later supporting the deal. The STB is not expected to rule on the UP-NS application until 2027. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

North-American rail

Two large rail unions say they oppose planned UP-NS merger

<div class="phx-topic abstract-wrapper">The Hamburg-based carrier will share the tender with feeder carrier North Sea Container Line that will operate e-ammonia services on a northern intra-Europe trade lane. </div>

The Hamburg-based carrier will share the tender with feeder carrier North Sea Container Line that will operate e-ammonia services on a northern intra-Europe trade lane. 

<div class="phx-topic">Hapag-Lloyd has won the deep-sea portion of an e-fuel-focused tender issued by the Zero Emission Maritime Buyers Alliance (ZEMBA), the second green shipping tender the carrier has secured from the group of global shippers. The Hamburg-based carrier will share the tender with feeder carrier North Sea Container Line (NCL) that will operate e-fuel services on a northern intra-Europe lane, ZEMBA said in a statement Wednesday. “At a time when sourcing scalable e-fuels remains a major challenge for the entire industry, winning the second ZEMBA tender is a significant milestone for us,” Hapag-Lloyd CEO Rolf Habben Jansen said in the statement, adding that deploying e-methanol vessels was “an essential step in our journey to reach net-zero fleet operations by 2045.”    The <a href="https://www.joc.com/article/hapag-lloyd-wins-asia-europe-green-shipping-tender-to-launch-next-year-5240949">first ZEMBA tender won by Hapag-Lloyd</a> in 2024 was based on biomethane sourced from the carrier’s suppliers via the European gas grid, but the second tender is focused on two fuel pathways — e-methanol and e-ammonia. Hapag-Lloyd has committed to using e-methanol on dual-fuel container ships on a to-be-determined deep-sea trade lane from 2027, while NCL will deploy the world’s first e-ammonia-powered vessel on a northern European trade lane. The timing of the tender announcement was intended to follow the hoped-for adoption in October of the International Maritime Organization’s (IMO’s) net-zero framework of measures aimed at closing the cost gap between conventional and alternative fuels while accelerating investment in production. But despite the IMO being <a href="https://www.joc.com/article/imo-punts-on-pivotal-net-zero-shipping-regulation-6099141">forced to postpone the net-zero framework process for a year</a> after the adoption was derailed by US-led opposition, the private sector continues to pick up the slack. “This voluntary private sector initiative remains on track to invest in rapid on-the-water deployment of vastly scalable, next-generation maritime fuels,” Ingrid Irigoyen, president and CEO of ZEMBA, said in the statement.  <h3>Great potential for economies of scale </h3>Based on commitments to date, the more than 40 members of ZEMBA — including co-founders Amazon, Patagonia and Tchibo, and members including Beiersdorf, Brooks Running, IKEA and Nike — will be able to deploy e-fuels on an initial 22 billion metric ton-nautical miles of transport activity over three years, with some members extending to five years, ZEMBA’s statement said. It is estimated that a combined 132,000 of greenhouse gas emissions will be abated starting in 2027.   “Just as global renewable energy costs have declined significantly in recent years as the market has matured, e-methanol and e-ammonia that are produced with clean energy offer great potential for economies of scale,” ZEMBA said.  “With this announcement, ZEMBA’s first-mover members are demonstrating support for scalable, strategic, and holistic supply chain sustainability solutions that can enable them to meet long-term goals,” it added. Hapag-Lloyd has made big moves to bolster its fleet of methanol vessels. Earlier this month, the carrier announced <a href="https://www.joc.com/article/hapag-lloyd-to-expand-feeder-fleet-with-new-methanol-ready-ships-6133938">plans to spend $500 million building eight dual-fuel methanol feeder vessels</a> of 4,500-TEU capacity for delivery in 2028 and 2029. And last year, it said it was <a href="https://www.joc.com/article/hapag-lloyd-joins-maersk-in-chinese-methanol-supply-deal-5866031">retrofitting five of its post-Panamax chartered ships into dual-fuel methanol</a> while securing a long-term supply deal with Chinese methanol producer Goldwind. In the inaugural tender, ZEMBA members collectively committed to purchase alternative fuels associated with over 1 billion TEU-miles of zero-emission shipping on the Singapore-to-Rotterdam trade lane in 2025 and 2026. The tender covered a negotiated “green premium” paid by shippers and does not involve the base freight rate. As Hapag-Lloyd nears the halfway mark of the first tender, Arne Maibohm, the carrier’s director of decarbonization, told the Journal of Commerce the company was “fully on track and meeting all commitments.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Hapag-Lloyd has won the deep-sea portion of an e-fuel-focused tender issued by the Zero Emission Maritime Buyers Alliance (ZEMBA), the second green shipping tender the carrier has secured from the group of global shippers.  The Hamburg-based carrier will share the tender with feeder carrier North Sea Container Line (NCL) that will operate e-fuel services on a northern intra-Europe lane, ZEMBA said in a statement Wednesday.  “At a time when sourcing scalable e-fuels remains a major challenge for the entire industry, winning the second ZEMBA tender is a significant milestone for us,” Hapag-Lloyd CEO Rolf Habben Jansen said in the statement, adding that deploying e-methanol vessels was “an essential step in our journey to reach net-zero fleet operations by 2045.”     The  first ZEMBA tender won by Hapag-Lloyd  in 2024 was based on biomethane sourced from the carrier’s suppliers via the European gas grid, but the second tender is focused on two fuel pathways — e-methanol and e-ammonia.  Hapag-Lloyd has committed to using e-methanol on dual-fuel container ships on a to-be-determined deep-sea trade lane from 2027, while NCL will deploy the world’s first e-ammonia-powered vessel on a northern European trade lane.  The timing of the tender announcement was intended to follow the hoped-for adoption in October of the International Maritime Organization’s (IMO’s) net-zero framework of measures aimed at closing the cost gap between conventional and alternative fuels while accelerating investment in production. But despite the IMO being  forced to postpone the net-zero framework process for a year  after the adoption was derailed by US-led opposition, the private sector continues to pick up the slack.  “This voluntary private sector initiative remains on track to invest in rapid on-the-water deployment of vastly scalable, next-generation maritime fuels,” Ingrid Irigoyen, president and CEO of ZEMBA, said in the statement.   Great potential for economies of scale  Based on commitments to date, the more than 40 members of ZEMBA — including co-founders Amazon, Patagonia and Tchibo, and members including Beiersdorf, Brooks Running, IKEA and Nike — will be able to deploy e-fuels on an initial 22 billion metric ton-nautical miles of transport activity over three years, with some members extending to five years, ZEMBA’s statement said. It is estimated that a combined 132,000 of greenhouse gas emissions will be abated starting in 2027.    “Just as global renewable energy costs have declined significantly in recent years as the market has matured, e-methanol and e-ammonia that are produced with clean energy offer great potential for economies of scale,” ZEMBA said.  “With this announcement, ZEMBA’s first-mover members are demonstrating support for scalable, strategic, and holistic supply chain sustainability solutions that can enable them to meet long-term goals,” it added. Hapag-Lloyd has made big moves to bolster its fleet of methanol vessels. Earlier this month, the carrier announced  plans to spend $500 million building eight dual-fuel methanol feeder vessels  of 4,500-TEU capacity for delivery in 2028 and 2029. And last year, it said it was  retrofitting five of its post-Panamax chartered ships into dual-fuel methanol  while securing a long-term supply deal with Chinese methanol producer Goldwind.  In the inaugural tender, ZEMBA members collectively committed to purchase alternative fuels associated with over 1 billion TEU-miles of zero-emission shipping on the Singapore-to-Rotterdam trade lane in 2025 and 2026. The tender covered a negotiated “green premium” paid by shippers and does not involve the base freight rate.  As Hapag-Lloyd nears the halfway mark of the first tender, Arne Maibohm, the carrier’s director of decarbonization, told the Journal of Commerce the company was “fully on track and meeting all commitments.”  Contact Greg Knowler at  greg.knowler@spglobal.com . 

Container lines

Container Shipping News

Maritime

Hapag-Lloyd wins second green tender from global shipper group 

<div class="phx-topic abstract-wrapper">But a spokesperson for ONE would not be drawn on whether the agreement was a precursor to the carrier relaunching its own services through the Red Sea and Suez Canal.</div>

But a spokesperson for ONE would not be drawn on whether the agreement was a precursor to the carrier relaunching its own services through the Red Sea and Suez Canal.

<div class="phx-topic">Ocean Network Express (ONE) is making a tentative return to the Red Sea cargo market under a slot charter agreement with three regional carriers, including Thailand’s Regional Container Lines (RCL), which launched its Red Sea-China Service (RCS) last month. ONE confirmed the move in a customer advisory Wednesday and said the agreement would start on Jan. 15 with the departure of the 3,534-TEU SSF Dream from Shanghai. The carrier declined to comment on how much space it was taking on the service. “We do not comment on slot allocations and are unable to provide added color,” a spokesperson for Singapore-headquartered ONE told the Journal of Commerce. ONE said its involvement in the service is being done, “to meet the demand between China and Red Sea ports, allowing us to better serve our customers with optimized network coverage and reliable shipping solutions.” ONE joins Taiwan’s Evergreen Marine, which recently signed a slot charter agreement on the same express service. Evergreen’s participation started on Dec. 3 when the 3,700-TEU SSF Valence sailed from Shanghai. The RCS was launched by RCL and partners — Hong Kong-listed TS Lines and Dubai-headquartered Global Feeder Shipping — on Nov. 14. Five ships are deployed on the service that will provide four sailings a month starting in January. The full rotation is four Chinese ports — Shanghai, Qingdao, Nansha and Shekou — before calling Jeddah (Saudi Arabia), Sokhna (Egypt), Aqaba (Jordan), Jeddah and Shanghai on an eight-week return voyage. There is a 31-day transit from Shanghai to Aqaba and 23 days from Nansha to Aqaba. <h3>Carriers mostly avoiding Red Sea transits </h3>ONE previously operated three Red Sea-related services connecting Aqaba, Jeddah and Sokhna with ports in Asia before those services were suspended due to the missile and drone attacks by Houthi rebels operating from Yemen that began two years ago, forcing liners to divert around southern Africa. Ocean carriers have been weighing a resumption of mainline Red Sea/Suez Canal transits in the aftermath of what has been a shaky ceasefire between Israel and Hamas in Gaza, but most shipping executives say the security situation is still too unsettled. The Premier Alliance <a href="https://www.joc.com/article/premier-alliances-2026-network-to-maintain-red-sea-diversions-6134989">unveiled its updated 2026 network this week</a> with services from Asia to Europe, the Mediterranean and the US East Coast continuing to divert around southern Africa to avoid passing through the Red Sea. The ONE spokesperson would not be drawn on whether the slot charter deal with RCL and its partners was a precursor to relaunching its own services through the Red Sea and Suez Canal. “On Red Sea transits, our priority remains ensuring the safety of vessels, crew, and cargo,” the spokesperson said. “We will continue to monitor the situation in the region closely and assess market conditions and customer needs. Any future service decisions will be made based on a careful evaluation of safety, demand, and operational feasibility.” The return of ONE and Evergreen to the Red Sea follows the upgrading of CMA CGM’s Red Sea Express 2 (REX2) service in October between five ports in China, Singapore and Djibouti and three Red Sea ports. CMA CGM said the upgrade included a direct call at Qingdao and Aqaba and double calls at Jeddah. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Ocean Network Express (ONE) is making a tentative return to the Red Sea cargo market under a slot charter agreement with three regional carriers, including Thailand’s Regional Container Lines (RCL), which launched its Red Sea-China Service (RCS) last month. ONE confirmed the move in a customer advisory Wednesday and said the agreement would start on Jan. 15 with the departure of the 3,534-TEU SSF Dream from Shanghai. The carrier declined to comment on how much space it was taking on the service. “We do not comment on slot allocations and are unable to provide added color,” a spokesperson for Singapore-headquartered ONE told the Journal of Commerce. ONE said its involvement in the service is being done, “to meet the demand between China and Red Sea ports, allowing us to better serve our customers with optimized network coverage and reliable shipping solutions.” ONE joins Taiwan’s Evergreen Marine, which recently signed a slot charter agreement on the same express service. Evergreen’s participation started on Dec. 3 when the 3,700-TEU SSF Valence sailed from Shanghai. The RCS was launched by RCL and partners — Hong Kong-listed TS Lines and Dubai-headquartered Global Feeder Shipping — on Nov. 14. Five ships are deployed on the service that will provide four sailings a month starting in January. The full rotation is four Chinese ports — Shanghai, Qingdao, Nansha and Shekou — before calling Jeddah (Saudi Arabia), Sokhna (Egypt), Aqaba (Jordan), Jeddah and Shanghai on an eight-week return voyage. There is a 31-day transit from Shanghai to Aqaba and 23 days from Nansha to Aqaba. Carriers mostly avoiding Red Sea transits ONE previously operated three Red Sea-related services connecting Aqaba, Jeddah and Sokhna with ports in Asia before those services were suspended due to the missile and drone attacks by Houthi rebels operating from Yemen that began two years ago, forcing liners to divert around southern Africa. Ocean carriers have been weighing a resumption of mainline Red Sea/Suez Canal transits in the aftermath of what has been a shaky ceasefire between Israel and Hamas in Gaza, but most shipping executives say the security situation is still too unsettled. The Premier Alliance unveiled its updated 2026 network this week with services from Asia to Europe, the Mediterranean and the US East Coast continuing to divert around southern Africa to avoid passing through the Red Sea. The ONE spokesperson would not be drawn on whether the slot charter deal with RCL and its partners was a precursor to relaunching its own services through the Red Sea and Suez Canal. “On Red Sea transits, our priority remains ensuring the safety of vessels, crew, and cargo,” the spokesperson said. “We will continue to monitor the situation in the region closely and assess market conditions and customer needs. Any future service decisions will be made based on a careful evaluation of safety, demand, and operational feasibility.” The return of ONE and Evergreen to the Red Sea follows the upgrading of CMA CGM’s Red Sea Express 2 (REX2) service in October between five ports in China, Singapore and Djibouti and three Red Sea ports. CMA CGM said the upgrade included a direct call at Qingdao and Aqaba and double calls at Jeddah. Contact Keith Wallis at keithwallis@hotmail.com .

Port News

International ports

ONE returns to Red Sea under slot charter deal with Thailand’s RCL, partners

<div class="phx-topic abstract-wrapper">Unless shipowners significantly postpone or cancel orders, the wallops of new tonnage added in 2027 and 2028 will dwarf the deliveries made this year and next.</div>

Unless shipowners significantly postpone or cancel orders, the wallops of new tonnage added in 2027 and 2028 will dwarf the deliveries made this year and next.

<div class="phx-topic">There is less new container tonnage scheduled to be delivered in 2026 than 2025, but the impact to the market will be larger, both in terms of putting downward pressure on pricing and inching toward what some carrier executives say is inevitable: a significant idling of tonnage. Signs that the absorption of the 1.8 million TEUs of tonnage received this year from shipyards is reaching saturation are emerging as container demand slows. And unless shipowners significantly postpone or cancel orders, the wallops of new tonnage added in 2027 and 2028 will dwarf the deliveries made this year and next, according to Sea-web, a sister product of the Journal of Commerce within S&amp;P Global. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6135193_0.1.jpg"></img></div>Some 1.48 million TEUs of tonnage are set to be delivered to shipowners in 2026, a 17.7% decrease from what was received this year. But another 2.3 million TEUs of tonnage is due in 2027, with 3.4 million TEUs slated for delivery in 2028, which is approximately equal to all the tonnage received in 2022 and 2023. Demand growth is going in the other direction. Global container volumes in 2026 will grow in the range of 2.5% to 3.5%, according to shipowner association Bimco. Comparably, container volume grew 4.5% to 5.5% in 2025 versus 2024. Container lines and shipowners this year received approximately 155,000 TEUs of capacity from ultra-large container ships, which can handle more than 20,000 TEUs, and deployed them on the Asia-North Europe trade, according to Sea-web. Global container volume growth in October <a href="https://www.joc.com/article/global-container-volume-growth-slows-on-us-eu-declines-6130629">fell to its slowest pace</a> since February, expanding 2.1% year over year, according to the most recent data from Container Trades Statistics. On a 20-month rolling average, global demand growth in October hit the lowest level in 20 months, according to Simon Heaney, senior manager of container research at Drewry. <h3>Capacity absorbers </h3>Port congestion in Europe and sporadically in Asia mitigated some of the overcapacity this year, and, to a lesser degree, <a href="https://www.joc.com/article/widening-china-import-export-imbalance-soaking-up-container-capacity-6118386">China’s widening import-export ratio</a> is whittling some functional capacity. This year began with congestion tying up at least 30% of the global fleet, according to Clarksons’ Port Congestion Index, with the persistent and sporadic congestion in Europe and Asia, respectively, continuing through the year. That absorption of functional capacity pales in comparison to the proverbial finger in the dike: Suez Canal routing diversions. If other carriers follow CMA CGM in regularly sailing through the Red Sea amid a shaky Gaza truce that is keeping Houthi rebels at bay, the industry can expect months of congestion, carriers and forwarders warn. That would only delay the return of functional capacity released by shorter sailings through the canal. Slow steaming vessels could help absorb capacity on the margins, with each type of engine and vessel facing limits on how slow they can operate before becoming energy inefficient. Container ships sailing from Asia to North Europe on average were 21.7% faster in the first three quarters of this year compared with the same period in 2018, according to an analysis of S&amp;P’s Maritime Emissions Registry. But, ultimately, only idling and scrapping of aging vessels will blunt the rising global overcapacity, barring nearly miraculous demand growth. As of mid-November, only 0.8% of the global fleet, equating to about 273,000 TEUs, was idled, according to analyst Alphaliner. Just a dozen ships, totaling 10,200 TEUs, were scrapped in 2025, according to an early December analysis of Sea-web data. Shipowners and carriers scrapped 19 times more TEU tonnage in 2019 and 2020, before the pandemic-driven US import surge showed how quickly overcapacity becomes emergency capacity. But the cost analysis of keeping spare capacity is changing as carriers’ operating costs rise, rates soften and the benefits of extending the life of aging vessels to keep up with global energy and design regulations weaken. Strong idling and then ramped-up scrapping seem inevitable unless carriers have forgotten the recent benefits of pulling capacity fast, such as in the spring of 2020, when US import demand plunged at the outset of the pandemic before rocketing. Contact Mark Szakonyi at <a href="https://www.joc.com/article/mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>.</div>

There is less new container tonnage scheduled to be delivered in 2026 than 2025, but the impact to the market will be larger, both in terms of putting downward pressure on pricing and inching toward what some carrier executives say is inevitable: a significant idling of tonnage. Signs that the absorption of the 1.8 million TEUs of tonnage received this year from shipyards is reaching saturation are emerging as container demand slows. And unless shipowners significantly postpone or cancel orders, the wallops of new tonnage added in 2027 and 2028 will dwarf the deliveries made this year and next, according to Sea-web, a sister product of the Journal of Commerce within S&P Global. Some 1.48 million TEUs of tonnage are set to be delivered to shipowners in 2026, a 17.7% decrease from what was received this year. But another 2.3 million TEUs of tonnage is due in 2027, with 3.4 million TEUs slated for delivery in 2028, which is approximately equal to all the tonnage received in 2022 and 2023. Demand growth is going in the other direction. Global container volumes in 2026 will grow in the range of 2.5% to 3.5%, according to shipowner association Bimco. Comparably, container volume grew 4.5% to 5.5% in 2025 versus 2024. Container lines and shipowners this year received approximately 155,000 TEUs of capacity from ultra-large container ships, which can handle more than 20,000 TEUs, and deployed them on the Asia-North Europe trade, according to Sea-web. Global container volume growth in October fell to its slowest pace since February, expanding 2.1% year over year, according to the most recent data from Container Trades Statistics. On a 20-month rolling average, global demand growth in October hit the lowest level in 20 months, according to Simon Heaney, senior manager of container research at Drewry. Capacity absorbers Port congestion in Europe and sporadically in Asia mitigated some of the overcapacity this year, and, to a lesser degree, China’s widening import-export ratio is whittling some functional capacity. This year began with congestion tying up at least 30% of the global fleet, according to Clarksons’ Port Congestion Index, with the persistent and sporadic congestion in Europe and Asia, respectively, continuing through the year. That absorption of functional capacity pales in comparison to the proverbial finger in the dike: Suez Canal routing diversions. If other carriers follow CMA CGM in regularly sailing through the Red Sea amid a shaky Gaza truce that is keeping Houthi rebels at bay, the industry can expect months of congestion, carriers and forwarders warn. That would only delay the return of functional capacity released by shorter sailings through the canal. Slow steaming vessels could help absorb capacity on the margins, with each type of engine and vessel facing limits on how slow they can operate before becoming energy inefficient. Container ships sailing from Asia to North Europe on average were 21.7% faster in the first three quarters of this year compared with the same period in 2018, according to an analysis of S&P’s Maritime Emissions Registry. But, ultimately, only idling and scrapping of aging vessels will blunt the rising global overcapacity, barring nearly miraculous demand growth. As of mid-November, only 0.8% of the global fleet, equating to about 273,000 TEUs, was idled, according to analyst Alphaliner. Just a dozen ships, totaling 10,200 TEUs, were scrapped in 2025, according to an early December analysis of Sea-web data. Shipowners and carriers scrapped 19 times more TEU tonnage in 2019 and 2020, before the pandemic-driven US import surge showed how quickly overcapacity becomes emergency capacity. But the cost analysis of keeping spare capacity is changing as carriers’ operating costs rise, rates soften and the benefits of extending the life of aging vessels to keep up with global energy and design regulations weaken. Strong idling and then ramped-up scrapping seem inevitable unless carriers have forgotten the recent benefits of pulling capacity fast, such as in the spring of 2020, when US import demand plunged at the outset of the pandemic before rocketing. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Asia-Europe

Trans-Pacific

Easing container tonnage delivery in 2026 belies signs of saturation

<div class="phx-topic abstract-wrapper">The Department of Justice seems to be suggesting that if the Supreme Court pulls the plug on the IEEPA tariffs, it won’t stand in the way of refunds — at least not for parties who get themselves properly in front of the Court.</div>

The Department of Justice seems to be suggesting that if the Supreme Court pulls the plug on the IEEPA tariffs, it won’t stand in the way of refunds — at least not for parties who get themselves properly in front of the Court.

<div class="phx-topic">The US Department of Justice (DOJ) quietly dropped a filing in the Court of International Trade (CIT) last week that, depending on your tolerance for customs law drama, is either deeply boring or absolutely fascinating. Buried in the filing was a declaration from Customs and Border Protection (CBP) with some eye-opening numbers: as of Dec. 10, 2025, the US government has collected approximately $129 billion in International Emergency Economic Powers Act (IEEPA) tariffs. That money came from about 301,000 importers spread across approximately 34 million entries. If you’ve ever wondered how big this issue really is, that’s your answer. It’s not a rounding error. Against that backdrop, DOJ told the CIT something very specific — and very carefully worded. If the US Supreme Court ultimately rules that the IEEPA tariffs are unlawful, the Trump administration would not oppose the Court’s authority to order reliquidation of the plaintiffs’ entries. In plain English, DOJ is acknowledging that the CIT could order those entries to be unwound and the duties refunded through reliquidation. No foot-stomping. No jurisdictional theatrics. Just a quiet concession that the Court has the power to fix this. Put even more simply, DOJ is signaling that if SCOTUS pulls the plug on the IEEPA tariffs, it won’t stand in the way of refunds — at least not for parties who get themselves properly in front of the Court. This lines up neatly with what DOJ has already told the Supreme Court in the pending cases: If the challengers win, they’re entitled to their money back. The only real question has always been how that happens, not whether refunds are theoretically available. <h3>Don’t expect ‘nice, clean’ refund program </h3>And that’s where the subtext starts doing some heavy lifting. What DOJ is very much not saying is that the administration plans to roll out a nice, clean, importer-friendly administrative refund program. There’s no promise of automatic reliquidations, mass refunds or CBP proactively cutting checks. Instead, the filing implicitly points importers toward the Court. If you want your money back, you may need to go to the CIT and ask for an order directing reliquidation. DOJ is saying it won’t object to the Court’s authority to do that — not that it intends to do everyone any favors administratively. This fits squarely with the broader reality importers should be preparing for post-decision. Even if the Supreme Court strikes down the tariffs, refunds are unlikely to be frictionless. Liquidated entries will still need to be protested to CBP. Unliquidated entries will need to be protected. Some companies may pursue litigation; others may try to navigate administrative channels. Many will end up doing both. The idea that $129 billion is just going to flow back to importers on autopilot is, at best, optimistic. The takeaway is straightforward, even if the process won’t be. The government is already laying the groundwork for a refund framework that runs through the courts, not around them. Importers who assume this will all sort itself out may find themselves watching the reliquidation train leave the station without them. The smart money is on preparation, strategy, and knowing exactly which procedural doors need to be opened — before the Supreme Court tells everyone it’s time to start knocking. Contact Pete Mento at <a href="mailto:pete.mento@bakertilly.com">pete.mento@bakertilly.com</a>.</div>

The US Department of Justice (DOJ) quietly dropped a filing in the Court of International Trade (CIT) last week that, depending on your tolerance for customs law drama, is either deeply boring or absolutely fascinating. Buried in the filing was a declaration from Customs and Border Protection (CBP) with some eye-opening numbers: as of Dec. 10, 2025, the US government has collected approximately $129 billion in International Emergency Economic Powers Act (IEEPA) tariffs. That money came from about 301,000 importers spread across approximately 34 million entries. If you’ve ever wondered how big this issue really is, that’s your answer. It’s not a rounding error. Against that backdrop, DOJ told the CIT something very specific — and very carefully worded. If the US Supreme Court ultimately rules that the IEEPA tariffs are unlawful, the Trump administration would not oppose the Court’s authority to order reliquidation of the plaintiffs’ entries. In plain English, DOJ is acknowledging that the CIT could order those entries to be unwound and the duties refunded through reliquidation. No foot-stomping. No jurisdictional theatrics. Just a quiet concession that the Court has the power to fix this. Put even more simply, DOJ is signaling that if SCOTUS pulls the plug on the IEEPA tariffs, it won’t stand in the way of refunds — at least not for parties who get themselves properly in front of the Court. This lines up neatly with what DOJ has already told the Supreme Court in the pending cases: If the challengers win, they’re entitled to their money back. The only real question has always been how that happens, not whether refunds are theoretically available. Don’t expect ‘nice, clean’ refund program And that’s where the subtext starts doing some heavy lifting. What DOJ is very much not saying is that the administration plans to roll out a nice, clean, importer-friendly administrative refund program. There’s no promise of automatic reliquidations, mass refunds or CBP proactively cutting checks. Instead, the filing implicitly points importers toward the Court. If you want your money back, you may need to go to the CIT and ask for an order directing reliquidation. DOJ is saying it won’t object to the Court’s authority to do that — not that it intends to do everyone any favors administratively. This fits squarely with the broader reality importers should be preparing for post-decision. Even if the Supreme Court strikes down the tariffs, refunds are unlikely to be frictionless. Liquidated entries will still need to be protested to CBP. Unliquidated entries will need to be protected. Some companies may pursue litigation; others may try to navigate administrative channels. Many will end up doing both. The idea that $129 billion is just going to flow back to importers on autopilot is, at best, optimistic. The takeaway is straightforward, even if the process won’t be. The government is already laying the groundwork for a refund framework that runs through the courts, not around them. Importers who assume this will all sort itself out may find themselves watching the reliquidation train leave the station without them. The smart money is on preparation, strategy, and knowing exactly which procedural doors need to be opened — before the Supreme Court tells everyone it’s time to start knocking. Contact Pete Mento at pete.mento@bakertilly.com .

US signaling importers will need to do ‘heavy lifting’ to secure possible tariff refunds

<div class="phx-topic abstract-wrapper">Until the whole container shipping industry improves its reliability, the scope for any form of premium/bonus for above-target performance is low, writes John McCauley. </div>

Until the whole container shipping industry improves its reliability, the scope for any form of premium/bonus for above-target performance is low, writes John McCauley.

<div class="phx-topic">We are a strange bunch, we logisticians. One of our self-designed millstones is our key definition of success, and it is always unattainable either at an individual or aggregate level. For container shipping, I refer to on-time arrival (OTA), although for other modes this is usually on-time delivery. We measure on-time arrival as a percentage, with the only feasible outcome to fail; the only question is by how much. Those odds aren’t acceptable outside of shipping. The analogy frequently used is patient operation success in a hospital. If a patient operation is successful 999 times out of 1,000, do we want to be the one that didn’t make it? But seriously, as pertains to container shipping, there are factors beyond the control of the carrier, including severe weather at ports and on the water and strikes and other labor disruptions. That means a 100% on-time arrival within 24 hours of schedule is unachievable on a volume and consistent basis. However, levels of 60% to 65% at the industry level, with no historical precedent for greater achievement nor likelihood of ever getting there, mean we are in a doom loop of trying, other than hoping, to make it better. This is despite <a href="https://www.joc.com/article/value-unlocked-by-gemini-will-clear-path-for-premium-charge-maersk-ceo-6111339">the admirable efforts of the Gemini Cooperation alliance</a> of Maersk and Hapag-Lloyd to achieve superior reliability. Which leads to my observations about the suggestions of a premium for higher reliability levels, and particularly that carriers would want to claw back some of the benefits of lower inventory costs for beneficial cargo owners (BCOs). <h3>A few obstacles </h3>Firstly, all BCOs will keep a mix of carriers (dual or multi-sourcing) for multiple reasons, including schedule, risk of losing space, price, etc., which means that while one carrier may achieve above-market reliability, their benefit to BCOs will be dragged down by the performance of their other choices in the industry. As an example, Carrier A achieves 90% reliability, Carrier B 60%. You have to program your planning systems for one, not multiple, delivery durations. Which do you choose? None are ideal, too long and you unnecessarily extend inventory carry, but if those same shipments arrive early, you need warehousing. Secondly, what about all the other problems caused by poor reliability? Stock-outs, air freight, extra staffing, warehousing and more. Focusing on inventory highlights a cash flow problem; many of the others are either opportunity costs (stock-outs, lost sales) or real costs (additional warehousing, staffing, sales contract non-compliance). I am not at all saying that container shipping is responsible for all of this, but it is an important contributor to the problem. Thirdly, any premium/bonus for above-target performance must surely have an offset for under-performance. And by this I don’t mean adjusted performance taking account of externalities. The non-performance must be explanation/excuse agnostic, meaning if the one-time arrival is not met, then this is a fail. In other modes of transport, this is the norm and why targets are never set at 100% even for best-in-class. Finally, I am all for improved reliability; most actors in container shipping share that view. How to get there is tricky and requires strategic intent. Many carriers will see it as unachievable and not worth the effort given the likelihood of high uncertainty of any reward other than some degree of customer stickiness. Until the whole industry improves its reliability, the scope for any form of premium/bonus for above-target performance is low. The only way I can see it working is to have a premium attached to index-linked contracts, and even then, that must be linked to performance against an agreed target level with penalties. Given the favorable buy-side economics in current contracting, this may be one for carriers to put on the backburner. John McCauley, formerly a vice president of transportation and logistics at Cargill, now consults for shippers. Contact him at <a href="mailto:john-mccauley1@outlook.com">john-mccauley1@outlook.com</a>. </div>

We are a strange bunch, we logisticians. One of our self-designed millstones is our key definition of success, and it is always unattainable either at an individual or aggregate level. For container shipping, I refer to on-time arrival (OTA), although for other modes this is usually on-time delivery. We measure on-time arrival as a percentage, with the only feasible outcome to fail; the only question is by how much. Those odds aren’t acceptable outside of shipping. The analogy frequently used is patient operation success in a hospital. If a patient operation is successful 999 times out of 1,000, do we want to be the one that didn’t make it? But seriously, as pertains to container shipping, there are factors beyond the control of the carrier, including severe weather at ports and on the water and strikes and other labor disruptions. That means a 100% on-time arrival within 24 hours of schedule is unachievable on a volume and consistent basis. However, levels of 60% to 65% at the industry level, with no historical precedent for greater achievement nor likelihood of ever getting there, mean we are in a doom loop of trying, other than hoping, to make it better. This is despite the admirable efforts of the Gemini Cooperation alliance of Maersk and Hapag-Lloyd to achieve superior reliability. Which leads to my observations about the suggestions of a premium for higher reliability levels, and particularly that carriers would want to claw back some of the benefits of lower inventory costs for beneficial cargo owners (BCOs). A few obstacles Firstly, all BCOs will keep a mix of carriers (dual or multi-sourcing) for multiple reasons, including schedule, risk of losing space, price, etc., which means that while one carrier may achieve above-market reliability, their benefit to BCOs will be dragged down by the performance of their other choices in the industry. As an example, Carrier A achieves 90% reliability, Carrier B 60%. You have to program your planning systems for one, not multiple, delivery durations. Which do you choose? None are ideal, too long and you unnecessarily extend inventory carry, but if those same shipments arrive early, you need warehousing. Secondly, what about all the other problems caused by poor reliability? Stock-outs, air freight, extra staffing, warehousing and more. Focusing on inventory highlights a cash flow problem; many of the others are either opportunity costs (stock-outs, lost sales) or real costs (additional warehousing, staffing, sales contract non-compliance). I am not at all saying that container shipping is responsible for all of this, but it is an important contributor to the problem. Thirdly, any premium/bonus for above-target performance must surely have an offset for under-performance. And by this I don’t mean adjusted performance taking account of externalities. The non-performance must be explanation/excuse agnostic, meaning if the one-time arrival is not met, then this is a fail. In other modes of transport, this is the norm and why targets are never set at 100% even for best-in-class. Finally, I am all for improved reliability; most actors in container shipping share that view. How to get there is tricky and requires strategic intent. Many carriers will see it as unachievable and not worth the effort given the likelihood of high uncertainty of any reward other than some degree of customer stickiness. Until the whole industry improves its reliability, the scope for any form of premium/bonus for above-target performance is low. The only way I can see it working is to have a premium attached to index-linked contracts, and even then, that must be linked to performance against an agreed target level with penalties. Given the favorable buy-side economics in current contracting, this may be one for carriers to put on the backburner. John McCauley, formerly a vice president of transportation and logistics at Cargill, now consults for shippers. Contact him at john-mccauley1@outlook.com .

Premium pricing linked to vessel schedule reliability faces rough waters

Composite

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

The World Container Index (WCI) assessed by Drewry reports actual spot container freight rates, including terminal handling charges, for major east–west trades. The index consists of eight trade-specific indices representing individual shipping routes and a composite index. Drewry reports all indices in US dollars per 40-foot container (FEU), weighted for volume as expressed in millions of 20-foot equivalent units (TEUs). Data for the index comes from transport intermediaries (freight forwarders and non-vessel-operating common carriers) in Europe, North America and Asia. [Drewry](https://drewry.co.uk)

World Container Shipping Index (Drewry)

World Container Shipping Index (Drewry) Gateway

<div class="phx-topic abstract-wrapper">Alliance members Ocean Network Express, HMM and Yang Ming said they were “closely monitoring” the situation around the Red Sea with the focus on the safety of crew, ship and cargo.</div>

Alliance members Ocean Network Express, HMM and Yang Ming said they were “closely monitoring” the situation around the Red Sea with the focus on the safety of crew, ship and cargo.

<div class="phx-topic">The Premier Alliance unveiled its updated 2026 network Monday with services from Asia to Europe, the Mediterranean and US East Coast continuing to divert around southern Africa to avoid passing through the Red Sea. Premier Alliance members Ocean Network Express (ONE), HMM and Yang Ming said they were “closely monitoring” the situation around the Red Sea with the focus on the safety of the crew, ship and cargo. ONE CEO Jeremy Nixon said in a statement that the 2026 product was designed to be flexible and reliable to support global trade “while prioritizing safety and stability amid geopolitical uncertainties.” South Korean flagship HMM noted the “evolving situation in the Red Sea, Bab al-Mandab Strait and the Suez Canal” and promised “timely communication and support” for customers should services return to the shorter route. Peter Sand, chief analyst for rate benchmarking platform Xeneta, said the risk assessment currently being carried out by ocean carriers would consider the ability, opportunity and intent of Houthi militants to attack ships from their base in Yemen. “Though we have seen a growing interest in Suez transits in the past months, it’s still not at a point where the large-scale return is imminent,” Sand told the Journal of Commerce. “Premier Alliance have not been leading the ‘testing of waters,’ and we know that Japanese owners [of ONE] in general are amongst the most risk-averse ship owners.” CMA CGM’s Indamex service from Jan. 15 will transit the Suez Canal on fronthaul and backhaul voyages between India/Pakistan and the US East Coast. <h3>Tempering market optimism </h3>Lars Jensen, CEO of Vespucci Maritime and a Journal of Commerce contributor, said although there was growing market optimism related to a return to the Red Sea, there was little clarity to support this. “Today, the Houthi Ministry of Foreign Affairs cautioned against what they termed ‘continued Zionist escalation in Gaza and flagrant violations of the ceasefire agreement,’” Jensen wrote in a LinkedIn post Monday. “This can be interpreted as a thinly veiled threat that they could choose to end their self-imposed ceasefire against merchant shipping unless the situation in Gaza develops in a way they see as more favorable,” he added. While the Premier Alliance rolls out its 2026 network, Sand said one area where shippers will be looking closely is schedule reliability. Xeneta data shows that Premier Alliance began at a global reliability of 36% in the first quarter, sliding to 22% in the third quarter before inching up to 23% thus far in the fourth quarter. Sand said across the services offered under the 2026 network, it appears the alliance will call fewer ports and, “that in itself could prove to be one pathway to better on-time performance.” In its updated 2026 product, HMM said its role in the Premier Alliance network would be bolstered by additional capacity from new vessels that will be delivered through 2026. The carrier has eight methanol-ready ships of 9,000 TEUs from a nine-ship order that will be completed in 2026 and in October announced orders for <a href="HMM inks $2.5 billion LNG container ship order | Journal of Commerce">12 dual-fuel LNG-capable vessels </a>of 13,000 TEUs with deliveries to start in 2027. “This updated network aims to deliver improved service reliability by means of an optimized global structure ... the refined network is designed to strengthen overall operational stability whilst preserving the company’s broad international reach,” HMM said. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>.</div>

The Premier Alliance unveiled its updated 2026 network Monday with services from Asia to Europe, the Mediterranean and US East Coast continuing to divert around southern Africa to avoid passing through the Red Sea. Premier Alliance members Ocean Network Express (ONE), HMM and Yang Ming said they were “closely monitoring” the situation around the Red Sea with the focus on the safety of the crew, ship and cargo. ONE CEO Jeremy Nixon said in a statement that the 2026 product was designed to be flexible and reliable to support global trade “while prioritizing safety and stability amid geopolitical uncertainties.” South Korean flagship HMM noted the “evolving situation in the Red Sea, Bab al-Mandab Strait and the Suez Canal” and promised “timely communication and support” for customers should services return to the shorter route. Peter Sand, chief analyst for rate benchmarking platform Xeneta, said the risk assessment currently being carried out by ocean carriers would consider the ability, opportunity and intent of Houthi militants to attack ships from their base in Yemen. “Though we have seen a growing interest in Suez transits in the past months, it’s still not at a point where the large-scale return is imminent,” Sand told the Journal of Commerce. “Premier Alliance have not been leading the ‘testing of waters,’ and we know that Japanese owners [of ONE] in general are amongst the most risk-averse ship owners.” CMA CGM’s Indamex service from Jan. 15 will transit the Suez Canal on fronthaul and backhaul voyages between India/Pakistan and the US East Coast. Tempering market optimism Lars Jensen, CEO of Vespucci Maritime and a Journal of Commerce contributor, said although there was growing market optimism related to a return to the Red Sea, there was little clarity to support this. “Today, the Houthi Ministry of Foreign Affairs cautioned against what they termed ‘continued Zionist escalation in Gaza and flagrant violations of the ceasefire agreement,’” Jensen wrote in a LinkedIn post Monday. “This can be interpreted as a thinly veiled threat that they could choose to end their self-imposed ceasefire against merchant shipping unless the situation in Gaza develops in a way they see as more favorable,” he added. While the Premier Alliance rolls out its 2026 network, Sand said one area where shippers will be looking closely is schedule reliability. Xeneta data shows that Premier Alliance began at a global reliability of 36% in the first quarter, sliding to 22% in the third quarter before inching up to 23% thus far in the fourth quarter. Sand said across the services offered under the 2026 network, it appears the alliance will call fewer ports and, “that in itself could prove to be one pathway to better on-time performance.” In its updated 2026 product, HMM said its role in the Premier Alliance network would be bolstered by additional capacity from new vessels that will be delivered through 2026. The carrier has eight methanol-ready ships of 9,000 TEUs from a nine-ship order that will be completed in 2026 and in October announced orders for 12 dual-fuel LNG-capable vessels of 13,000 TEUs with deliveries to start in 2027. “This updated network aims to deliver improved service reliability by means of an optimized global structure ... the refined network is designed to strengthen overall operational stability whilst preserving the company’s broad international reach,” HMM said. Contact Greg Knowler at greg.knowler@spglobal.com .

Premier Alliance’s 2026 network to maintain Red Sea diversions

<div class="phx-topic abstract-wrapper">New analysis shows a systematic displacement of tonnage from primary to secondary trade lanes has occurred over the past two years, while a shortage of capacity is looming over the smaller shipping segment. </div>

New analysis shows a systematic displacement of tonnage from primary to secondary trade lanes has occurred over the past two years, while a shortage of capacity is looming over the smaller shipping segment.

<div class="phx-topic">The massive injection of larger vessels into the Asia-Europe and Asia-Mediterranean trades over the past two years has pushed smaller vessels into the trans-Atlantic and Latin America corridors, spreading structural overcapacity to secondary lanes. However, despite more than 1.7 million TEUs of new tonnage set to be delivered in 2026, mostly in the 15,000-to-24,000-TEU range, there is a growing mismatch in terms of the size of ships needed, with vessels in the sub-5,000-TEU segment — the backbone of intra-regional and feeder networks — aging rapidly, according to new analysis. A systematic displacement of tonnage from primary to secondary trade lanes over the past two years was driven by extreme outward pressure from the Red Sea diversions, drought in the Panama Canal and the reshuffling of alliances in the first half of 2025, according to Sea-Intelligence Maritime Analysis. “To maintain weekly service frequency while navigating the longer sailing distances on Asia-Europe, carriers were forced to inject significant additional tonnage into Asia-North Europe,” Alan Murphy, CEO of Sea-Intelligence, wrote in this week’s Sunday Spotlight newsletter. The injection of so much capacity triggered a massive downstream effect. As carriers introduced new 24,000-TEU vessels into the extended North Europe services, the existing 14,000-to-20,000-TEU vessels were cascaded directly into the Asia-Mediterranean trade lane. In the trans-Pacific, the capacity management on the Asia-North America West and East coast trades through 2024 was operational in nature as carriers shuffled tonnage between the two trade lanes to mitigate Panama Canal draft restrictions, US port labor disruptions and the after-effects of the pandemic-induced volatility. The net effect was high movement of ships but not much change in capacity. In February of this year, the launch of new alliance structures — Gemini Cooperation, Premier Alliance and Mediterranean Shipping Co. as a standalone venture — provided the catalyst for a massive network shakeup, Sea-Intelligence noted. Carriers broke up established service loops and repositioned vessels globally to fit the new service networks. Volatile demand on Asia-North America West Coast saw a net reduction of 427,432 TEUs in the first half of 2025 as carriers blanked sailings to try to support rates, Murphy noted in the Sunday Spotlight. At the same time, the rapid growth on Asia-Mediterranean subsided, with Murphy surmising that after 18 months of absorbing cascaded tonnage from Asia-North Europe, the trade lane had likely reached a saturation point. In the first half of this year, the net capacity growth into Asia-Mediterranean decelerated by 79% compared with 2024. <h3>Steady operational state </h3>By the second half of 2025, the new alliance networks had reached a relatively steady operational state with the Mediterranean-North America East Coast trade lane emerging as a key cascading corridor, absorbing 127,686 TEUs in the second half, with most of that capacity from the Asia-Mediterranean trade, the Sunday Spotlight noted. A total of 14 vessels were shifted in the second half, 11 of those of 14,000 to 15,000 TEUs. Asia-East Coast South America (ECSA) was the next biggest net gainer in the second half, absorbing 112,998 TEUs. Most of that was from the two Asia-North America trade lanes that cascaded a combined 283,946 TEUs. A total of 32 vessels were shifted, with 72% of them in the 8,000- to 14,000-TEU segment. But Murphy noted that the nature of the growth in capacity was fundamentally different from the previous year, with 97% of the vessels entering the Asia-East Coast South America trade taking up permanent employment there and not being returned to their previous routes. “This meant that Asia-ECSA became a seemingly preferred destination for mid-size tonnage of 8,000-14,000 TEU vessels that had been cycled out of the main east-west trade lanes,” he said. As the dust settles from the alliance reshuffling of capacity, new analysis from consultancy MDS Transmodal notes that should carriers return to large-scale Red Sea transits, it will expose the imbalance that has built up in the global fleet over the past few years. “While much of the industry has focused on the temporary capacity absorption created by rerouting around Africa, the underlying fundamentals point to something far more persistent: a container fleet that is oversupplied at the top end but increasingly shrinking at the bottom,” Antonella Teodoro, senior consultant at MDS Transmodal, noted in her analysis titled The Post-Red Sea Fleet Paradox: Oversupply at the Top, Shortages at the Bottom. “As diversions unwind and new ships continue to arrive, the industry faces two very different capacity problems — one defined by excess, the other by scarcity,” Teodoro said. <h3>Small ships crucial to regional segment </h3>In 2025, the capacity ordered in the 10,000-to-20,000-TEU bracket was 1.6 million TEUs and the ships greater than 20,000 TEUs comprised 1.3 million TEUs. By contrast, in the less-than-5,000-TEU segment, the 2025 order book was at 442,182 TEUs, according to Sea-web, a sister company of the Journal of Commerce within S&amp;P Global. Teodoro said the sub-5,000-TEU segment was crucial for the intra-regional and feeder networks, but more than 60% of the vessels were at least 25 years old or older, making them prime scrapping candidates. Yet the order book in these size categories was almost non-existent. “By 2030, the global fleet below 2,500 TEUs could contract by 40% to 80%, with the 500-to-999-TEU category almost disappearing entirely,” she said. “This matters because many port systems depend on these vessels in a way that cannot be substituted ... by larger tonnage, regardless of how cheap or abundant it becomes.” <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="5ea90874-1017-4ee9-a80c-de2dfc51d88b"></dynamic-object></div>Alphaliner shipping analyst Mael Pape-Léostic said there are 593 vessels in the sub-5,000-TEU bracket that are 25 years old or older out of 4,473 ships currently trading — 13% of the fleet. In the sub-2,500-TEU segment, 17% of the trading fleet is 25 years old or older. “After a first wave of orders mainly focusing on large ships, we saw carriers this year in particular ordering smaller units with a high interest for specific classes like Bangkokmax [1,700-1,900 TEUs] and Chittagongmax [2,800 TEUs],” Pape-Léostic told the Journal of Commerce. “The ships of smaller segments of the market are aging, but it seems that carriers and non-operating owners are now in the process of rejuvenating this fleet after having focused on mainliners,” he added. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

The massive injection of larger vessels into the Asia-Europe and Asia-Mediterranean trades over the past two years has pushed smaller vessels into the trans-Atlantic and Latin America corridors, spreading structural overcapacity to secondary lanes. However, despite more than 1.7 million TEUs of new tonnage set to be delivered in 2026, mostly in the 15,000-to-24,000-TEU range, there is a growing mismatch in terms of the size of ships needed, with vessels in the sub-5,000-TEU segment — the backbone of intra-regional and feeder networks — aging rapidly, according to new analysis. A systematic displacement of tonnage from primary to secondary trade lanes over the past two years was driven by extreme outward pressure from the Red Sea diversions, drought in the Panama Canal and the reshuffling of alliances in the first half of 2025, according to Sea-Intelligence Maritime Analysis. “To maintain weekly service frequency while navigating the longer sailing distances on Asia-Europe, carriers were forced to inject significant additional tonnage into Asia-North Europe,” Alan Murphy, CEO of Sea-Intelligence, wrote in this week’s Sunday Spotlight newsletter. The injection of so much capacity triggered a massive downstream effect. As carriers introduced new 24,000-TEU vessels into the extended North Europe services, the existing 14,000-to-20,000-TEU vessels were cascaded directly into the Asia-Mediterranean trade lane. In the trans-Pacific, the capacity management on the Asia-North America West and East coast trades through 2024 was operational in nature as carriers shuffled tonnage between the two trade lanes to mitigate Panama Canal draft restrictions, US port labor disruptions and the after-effects of the pandemic-induced volatility. The net effect was high movement of ships but not much change in capacity. In February of this year, the launch of new alliance structures — Gemini Cooperation, Premier Alliance and Mediterranean Shipping Co. as a standalone venture — provided the catalyst for a massive network shakeup, Sea-Intelligence noted. Carriers broke up established service loops and repositioned vessels globally to fit the new service networks. Volatile demand on Asia-North America West Coast saw a net reduction of 427,432 TEUs in the first half of 2025 as carriers blanked sailings to try to support rates, Murphy noted in the Sunday Spotlight. At the same time, the rapid growth on Asia-Mediterranean subsided, with Murphy surmising that after 18 months of absorbing cascaded tonnage from Asia-North Europe, the trade lane had likely reached a saturation point. In the first half of this year, the net capacity growth into Asia-Mediterranean decelerated by 79% compared with 2024. Steady operational state By the second half of 2025, the new alliance networks had reached a relatively steady operational state with the Mediterranean-North America East Coast trade lane emerging as a key cascading corridor, absorbing 127,686 TEUs in the second half, with most of that capacity from the Asia-Mediterranean trade, the Sunday Spotlight noted. A total of 14 vessels were shifted in the second half, 11 of those of 14,000 to 15,000 TEUs. Asia-East Coast South America (ECSA) was the next biggest net gainer in the second half, absorbing 112,998 TEUs. Most of that was from the two Asia-North America trade lanes that cascaded a combined 283,946 TEUs. A total of 32 vessels were shifted, with 72% of them in the 8,000- to 14,000-TEU segment. But Murphy noted that the nature of the growth in capacity was fundamentally different from the previous year, with 97% of the vessels entering the Asia-East Coast South America trade taking up permanent employment there and not being returned to their previous routes. “This meant that Asia-ECSA became a seemingly preferred destination for mid-size tonnage of 8,000-14,000 TEU vessels that had been cycled out of the main east-west trade lanes,” he said. As the dust settles from the alliance reshuffling of capacity, new analysis from consultancy MDS Transmodal notes that should carriers return to large-scale Red Sea transits, it will expose the imbalance that has built up in the global fleet over the past few years. “While much of the industry has focused on the temporary capacity absorption created by rerouting around Africa, the underlying fundamentals point to something far more persistent: a container fleet that is oversupplied at the top end but increasingly shrinking at the bottom,” Antonella Teodoro, senior consultant at MDS Transmodal, noted in her analysis titled The Post-Red Sea Fleet Paradox: Oversupply at the Top, Shortages at the Bottom. “As diversions unwind and new ships continue to arrive, the industry faces two very different capacity problems — one defined by excess, the other by scarcity,” Teodoro said. Small ships crucial to regional segment In 2025, the capacity ordered in the 10,000-to-20,000-TEU bracket was 1.6 million TEUs and the ships greater than 20,000 TEUs comprised 1.3 million TEUs. By contrast, in the less-than-5,000-TEU segment, the 2025 order book was at 442,182 TEUs, according to Sea-web, a sister company of the Journal of Commerce within S&P Global. Teodoro said the sub-5,000-TEU segment was crucial for the intra-regional and feeder networks, but more than 60% of the vessels were at least 25 years old or older, making them prime scrapping candidates. Yet the order book in these size categories was almost non-existent. “By 2030, the global fleet below 2,500 TEUs could contract by 40% to 80%, with the 500-to-999-TEU category almost disappearing entirely,” she said. “This matters because many port systems depend on these vessels in a way that cannot be substituted ... by larger tonnage, regardless of how cheap or abundant it becomes.” Alphaliner shipping analyst Mael Pape-Léostic said there are 593 vessels in the sub-5,000-TEU bracket that are 25 years old or older out of 4,473 ships currently trading — 13% of the fleet. In the sub-2,500-TEU segment, 17% of the trading fleet is 25 years old or older. “After a first wave of orders mainly focusing on large ships, we saw carriers this year in particular ordering smaller units with a high interest for specific classes like Bangkokmax [1,700-1,900 TEUs] and Chittagongmax [2,800 TEUs],” Pape-Léostic told the Journal of Commerce. “The ships of smaller segments of the market are aging, but it seems that carriers and non-operating owners are now in the process of rejuvenating this fleet after having focused on mainliners,” he added. Contact Greg Knowler at greg.knowler@spglobal.com .

Trans-Atlantic

Cascading container tonnage spreads structural overcapacity to secondary lanes

<div class="phx-topic abstract-wrapper">Data from consultants Trade and Transport Group shows the impact of regulatory changes as de minimis traffic fell significantly while regular air cargo increased.</div>

Data from consultants Trade and Transport Group shows the impact of regulatory changes as de minimis traffic fell significantly while regular air cargo increased.

<div class="phx-topic">A fundamental shift in trans-Pacific air freight trade flows since the US eliminated the de minimis exemption for low-value goods in May is becoming clearer, with a decline in China-US traffic replaced by booming imports from Taiwan and Vietnam. Data from consultants Trade and Transport Group shows the impact of the regulatory changes as de minimis traffic fell significantly while regular air cargo increased. “The decline in China to US traffic has been more than offset, particularly by air freight from Taiwan and Vietnam, and it is mainly linked to computers and parts, as well as industrial equipment,” Frederic Horst, managing director of Trade and Transport Group, told the Journal of Commerce. In the first nine months of the year, US imports of air cargo from China were down 10.1% year over year, Trade and Transport data shows. But imports from Northeast Asia as a whole rose 36.4%, while imports from Southeast Asian origins were up almost 50%.  A deeper dive into the data shows US air cargo imports from Taiwan from January through September jumped almost 91% year over year, imports from Vietnam rose almost 80% and imports from Thailand were up more than 40%. Computers and accessories, industrial equipment and parts; audio, video and optical components; and mobile phones comprised the bulk of the air freight shipments. The trend has also been picked up by Taiwan-based Dimerco Express Group, which has urged shippers to factor the supply chain changes into their 2026 shipment plans. “Following changes to US de minimis rules, some direct China-US e-commerce flows have decreased, but more cargo is now routed via alternative hubs and forward-stocking models, making trade lanes more diversified,” Catherine Chien, chairwoman of Dimerco Express Group, said in a market update.  “Demand for high-tech, AI-related and e-commerce shipments continues to drive growth in air freight from the Asia-Pacific region to North America and Europe,” Chien added. “Shippers that can flex between multiple lanes, multiple modes and multiple origin countries will be better positioned than those relying on a single country or mode.” <h3>US import data distorted by e-commerce </h3>The main driver of inbound air cargo from Asia to the US has been e-commerce, which, over the past few years, has created a growing gap in US air cargo data. But the removal in May of the de minimis exemption for low-value imports from China, followed by the removal of de minimis rules for all US trading partners in August, has led to a fundamental change in the mix of air cargo. “Regular air freight imports — i.e. consignments greater than $2,000 — are up 16.5% for the first nine months, while overall inbound air cargo traffic [to the US] is down 2.5%,” Horst said. Data from air cargo analyst Rotate shows freighter operators have shifted capacity in Asia to follow the moving export trend. Direct air freight capacity offered from Southeast Asia to North America from May 2 — when the de minimis tariff on China imports was eliminated — through November was up 89% at 102,700 metric tons.  <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="8d7ed0b1-01de-471d-b540-bed610465c9a"></dynamic-object></div>However, the analyst pointed out that much of Vietnam’s air freight trade is shipped indirectly through Asian hubs in mainland China, Hong Kong, South Korea and Japan, so the actual volume from Southeast Asia to North America is higher. The Freightos Air Index shows China-US rates at a 2025 high exceeding $8/kg this week, higher than last year’s $7.30/kg peak, according to a market update from Freightos Tuesday.  The International Air Transport Association expects global air volume growth of 3.1% for 2025 and 2.6% for 2026 despite the impact of the US tariffs on volume flows. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

A fundamental shift in trans-Pacific air freight trade flows since the US eliminated the de minimis exemption for low-value goods in May is becoming clearer, with a decline in China-US traffic replaced by booming imports from Taiwan and Vietnam.  Data from consultants Trade and Transport Group shows the impact of the regulatory changes as de minimis traffic fell significantly while regular air cargo increased.  “The decline in China to US traffic has been more than offset, particularly by air freight from Taiwan and Vietnam, and it is mainly linked to computers and parts, as well as industrial equipment,” Frederic Horst, managing director of Trade and Transport Group, told the Journal of Commerce.  In the first nine months of the year, US imports of air cargo from China were down 10.1% year over year, Trade and Transport data shows. But imports from Northeast Asia as a whole rose 36.4%, while imports from Southeast Asian origins were up almost 50%.   A deeper dive into the data shows US air cargo imports from Taiwan from January through September jumped almost 91% year over year, imports from Vietnam rose almost 80% and imports from Thailand were up more than 40%. Computers and accessories, industrial equipment and parts; audio, video and optical components; and mobile phones comprised the bulk of the air freight shipments.  The trend has also been picked up by Taiwan-based Dimerco Express Group, which has urged shippers to factor the supply chain changes into their 2026 shipment plans.  “Following changes to US de minimis rules, some direct China-US e-commerce flows have decreased, but more cargo is now routed via alternative hubs and forward-stocking models, making trade lanes more diversified,” Catherine Chien, chairwoman of Dimerco Express Group, said in a market update.   “Demand for high-tech, AI-related and e-commerce shipments continues to drive growth in air freight from the Asia-Pacific region to North America and Europe,” Chien added. “Shippers that can flex between multiple lanes, multiple modes and multiple origin countries will be better positioned than those relying on a single country or mode.”  US import data distorted by e-commerce  The main driver of inbound air cargo from Asia to the US has been e-commerce, which, over the past few years, has created a growing gap in US air cargo data. But the removal in May of the de minimis exemption for low-value imports from China, followed by the removal of de minimis rules for all US trading partners in August, has led to a fundamental change in the mix of air cargo.  “Regular air freight imports — i.e. consignments greater than $2,000 — are up 16.5% for the first nine months, while overall inbound air cargo traffic [to the US] is down 2.5%,” Horst said.  Data from air cargo analyst Rotate shows freighter operators have shifted capacity in Asia to follow the moving export trend. Direct air freight capacity offered from Southeast Asia to North America from May 2 — when the de minimis tariff on China imports was eliminated — through November was up 89% at 102,700 metric tons.   However, the analyst pointed out that much of Vietnam’s air freight trade is shipped indirectly through Asian hubs in mainland China, Hong Kong, South Korea and Japan, so the actual volume from Southeast Asia to North America is higher.  The Freightos Air Index shows China-US rates at a 2025 high exceeding $8/kg this week, higher than last year’s $7.30/kg peak, according to a market update from Freightos Tuesday.   The International Air Transport Association expects global air volume growth of 3.1% for 2025 and 2.6% for 2026 despite the impact of the US tariffs on volume flows.  Contact Greg Knowler at  greg.knowler@spglobal.com . 

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Rising US air freight imports from Taiwan, Vietnam offset drop in China trade 

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Electronic Data Interchange (EDI) has long been the backbone of global commerce, quietly facilitating trillions in transactions. Yet, despite its critical role, traditional EDI has remained notoriously complex, labor-intensive, viewed as antique, and costly. Companies have historically grappled with cumbersome mapping processes, intricate partner-specific logic, and extended onboarding timelines. Now, as industries increasingly adopt agile digital frameworks, the limitations of conventional EDI solutions have become glaringly apparent. Enter Mosaic, an innovative solution unveiled by Orderful, which promises to radically streamline and modernize EDI integration through artificial intelligence. Orderful, already recognized for simplifying supply chain data exchanges, has now introduced Mosaic as the first AI-enriched EDI integration product that completely removes traditional mapping processes. At its core, Mosaic represents a fundamental shift from legacy EDI protocols, replacing archaic, code-heavy formats such as X12 and EDIFACT with modern, easy to use JSON inputs oriented around system-of-record concepts. This alone significantly lowers the barrier to integration, allowing teams accustomed to modern SaaS API development to seamlessly adopt EDI workflows. Mosaic's AI-powered engine ingests and interprets trading partner requirements as well as millions of actual transactions to build reliable, reuseable, self-healing integration which translating data into partner-specific formats without manual intervention. Such automated adaptability is unprecedented in the EDI landscape and promises a marked reduction in implementation timelines, from what once took months or even years, down to mere weeks. Erik Kiser, founder and CEO of Orderful, understands firsthand the pain points of traditional EDI. Having built integrations himself early in his career, Kiser founded Orderful specifically to address the persistent challenges that frustrate businesses across the supply chain. "Nobody has been more frustrated by EDI than I have," Kiser notes candidly. "Those experiences are precisely why Orderful and now Mosaic exist." Mosaic further distinguishes itself by embedding real-time validation and debugging, streamlining error resolution from lengthy processes into rapid, straightforward fixes. Developers, traditionally burdened by the complexities of partner-specific requirements and intricate coding standards, now gain an intuitive, self-service environment. This reduction in complexity not only accelerates implementation but also reduces operational overhead, offering critical advantages in today’s fast-paced business environment. Brian Roberts, general partner at Andreessen Horowitz and Orderful board member, underscores Mosaic's industry impact: "Mosaic has taken one of the most entrenched bottlenecks in enterprise technology, EDI mapping, and replaced it with an AI-native product that adapts automatically. It’s exactly the type of innovation the industry has been missing." While Mosaic initially supports the complete Order-to-Cash lifecycle, covering purchase orders, acknowledgments, shipping notices, and invoices, the platform is designed for continuous growth and expansion. Orderful sees Mosaic not merely as a product but as a foundational architecture poised to support a broader range of data flows and integrations, aligning perfectly with the scalable requirements of global businesses. “The underlying unified data model not only lets us act as the universal connector, but also enables us to build product once that applies to all partners. This includes EDI functionality like order splitting and consolidation, but also unlocks powerful analytics and insights for our customers to help them grow their business,” said Will Benish, principal product manager at Orderful. Security and reliability are integral to Mosaic’s infrastructure, evidenced by SOC 2 Type II compliance and OAuth 2.0 integration. Additionally, the platform guarantees robust performance, boasting sub-second transaction speeds and immediate access to an extensive network of over 10,000 trading partners. For businesses already utilizing Orderful, Mosaic offers a seamless upgrade pathway, allowing organizations to embrace the future of EDI without disrupting their current trading partner relationships. New clients will find Mosaic’s approach refreshingly modern, providing immediate gains in speed, ease of integration, and scalability. Mosaic represents more than just an incremental improvement; it's a visionary leap forward in how enterprises manage and leverage supply chain data. As businesses grapple with increasingly complex global supply networks, Orderful’s Mosaic emerges as a timely and essential tool, providing clarity, agility, and unprecedented simplicity. Mosaic elevates EDI, providing businesses with a streamlined and efficient pathway to rapidly integrate, adapt, and scale in today's dynamic market. “Mosaic wouldn’t have been possible to build even three years ago. The work our team has put in has been extraordinary, combining cutting edge AI techniques with our deep experience with EDI and our rich library of trading partner guidelines and requirements,” said Benish. To learn more about how Mosaic can transform your EDI capabilities and streamline your integration processes or request a demonstration at <a href="https://www.orderful.com/product/mosaic" rel="noreferrer" class="joc_admin__link">www.orderful.com/product/mosaic</a>.

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From 1940s Roots to AI-Driven Future: Reinventing EDI for Today's Supply Chains

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<div class="phx-topic abstract-wrapper">The US Department of Transportation estimates there are about 200,000 holders of non-domiciled commercial driver’s licenses, most of whom would lose eligibility under a proposed rule that would bar certain immigrants from operating commercial vehicles.</div>

The US Department of Transportation estimates there are about 200,000 holders of non-domiciled commercial driver’s licenses, most of whom would lose eligibility under a proposed rule that would bar certain immigrants from operating commercial vehicles.

<div class="phx-topic">The trucking industry differs on how much of any impact stricter federal rules on immigrants driving in the US will have, with one side arguing that a crackdown will move the needle on subdued pricing and the other warning that only a demand rebound will end the three-year freight slump. The US Department of Transportation (USDOT) estimates there are about 200,000 holders of non-domiciled commercial driver’s licenses (CDLs), most of whom would lose eligibility under a proposed rule that would bar certain immigrants, including asylum seekers, from operating commercial vehicles. No one has confirmed the number in the Federal Motor Carrier Safety Administration’s (FMCSA’s) emergency interim rule; states issue CDLs, not the federal government. “There is a lack of clarity on where the 200,000 figure comes from in the first place,” Jason Miller, professor of supply chain management for Michigan State University, told the Journal of Commerce. Under the DOT’s proposed rule, only drivers holding H-2A, H-2B or E-2 visas would be permitted to retain non-domiciled CDLs. But the US Court of Appeals for the District of Columbia Circuit has placed the rule on hold indefinitely. Even so, some industry executives argue that enforcement activity — rather than the rule itself — could have a more immediate effect on trucking capacity. Thom Albrecht, chief revenue officer of insurer Reliance Partners, said he believes up to 15% of current US truckload capacity may be tied to illegitimate operations, including cargo theft and carriers operating outside of US rules and regulations. Albrecht emphasized that the figure is an estimate based on publicly available CDL data, not an exact count. “That doesn’t mean we have 15% excess capacity. I would suggest it’s probably 2% to 3%. It would not take a whole lot for the industry to start feeling better,” he said during a webinar last week hosted by Deutsche Bank. “There have been so many bad actors let into this industry over the last few years. That’s the single-biggest deterrent for this industry to get healthy.” Ryan Joyce, CEO of cargo security firm Genlogs, said his company found nearly 1,000 Mexican trucking companies that are legally allowed to cross the border with international freight, but also operating far beyond the permitted zone inside the US. Joyce said those carriers are engaging in cabotage — legally delivering an international load, then illegally hauling a domestic load between two US locations. “The top violator, for example, was observed hundreds of times operating as far north as Minnesota, Wisconsin, and New York,” Joyce said on the Deutsche Bank webinar. He also said the non-domiciled CDL problem is tied to cargo theft, with some unsafe carriers shutting down one day, paying cash to obtain a new motor carrier number, and then reopening the next day, often referred to as “chameleon carriers.” Albrecht and Joyce are among those who expect a swift market response as insurers and USDOT increase scrutiny of illegitimate operations. “I follow certain threads of truck drivers online, and there are discussions that a lot of these non-domiciled CDLs coming up for renewal won’t be renewed,” Albrecht said on the webinar. “A lot of them have said that post-Christmas, that’s it for them. That this is the last hurrah.” Others, however, argue that the non-domiciled CDL and cabotage crackdowns will not produce a sudden spike in trucking rates. <h3>Skepticism abounds </h3>In audits conducted of Minnesota and New York, most of the violations cited by USDOT involved otherwise properly issued non-domiciled CDLs in which the license expiration date extended beyond the driver’s employment authorization, rather than wholesale ineligibility. And even when drivers with a valid non-domiciled CDL fail an English-language proficiency exam, many continue operating once highway patrol leaves the scene. Police cannot immobilize the vehicle because it is the driver, not the truck, who is taken out of service. “The driver will just wait a little bit and once the officer leaves, he’ll just drive off as if nothing happened,” said Cliff Bates, former owner of Capital City Trucking, a trucking company that went out of business within the last two years. “Even when the driver is dropped off at the next exit, the minute the patrol leaves, he’s walking back down the highway to the truck again.” While Bates agrees that reckless driving by some non-domiciled CDL holders is a major problem, he questions how quickly the Trump administration can act. “I think they’re going to cut off the spigot for new CDLs, but I question the assumption that this administration will act swiftly with midterms coming in less than a year,” Bates told the Journal of Commerce. He said rapid enforcement could raise rates and, by extension, consumer prices. Still, broader macroeconomic factors may limit how much enforcement alone can shift the market. Slashing capacity does not address weak US manufacturing data that has softened truckload demand, according to Miller. He noted, for example, that single-family building permits have fallen 10% from last year, as of the last update before the US government shutdown, and that fracking activity isn’t going to rebound with crude oil at current prices. “There are also individuals out there with the requisite background who could re-enter the [trucking] industry rather quickly if conditions significantly improve from a pricing standpoint, which would blunt any loss of non-domiciled capacity,” Miller said. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

The trucking industry differs on how much of any impact stricter federal rules on immigrants driving in the US will have, with one side arguing that a crackdown will move the needle on subdued pricing and the other warning that only a demand rebound will end the three-year freight slump. The US Department of Transportation (USDOT) estimates there are about 200,000 holders of non-domiciled commercial driver’s licenses (CDLs), most of whom would lose eligibility under a proposed rule that would bar certain immigrants, including asylum seekers, from operating commercial vehicles. No one has confirmed the number in the Federal Motor Carrier Safety Administration’s (FMCSA’s) emergency interim rule; states issue CDLs, not the federal government. “There is a lack of clarity on where the 200,000 figure comes from in the first place,” Jason Miller, professor of supply chain management for Michigan State University, told the Journal of Commerce. Under the DOT’s proposed rule, only drivers holding H-2A, H-2B or E-2 visas would be permitted to retain non-domiciled CDLs. But the US Court of Appeals for the District of Columbia Circuit has placed the rule on hold indefinitely. Even so, some industry executives argue that enforcement activity — rather than the rule itself — could have a more immediate effect on trucking capacity. Thom Albrecht, chief revenue officer of insurer Reliance Partners, said he believes up to 15% of current US truckload capacity may be tied to illegitimate operations, including cargo theft and carriers operating outside of US rules and regulations. Albrecht emphasized that the figure is an estimate based on publicly available CDL data, not an exact count. “That doesn’t mean we have 15% excess capacity. I would suggest it’s probably 2% to 3%. It would not take a whole lot for the industry to start feeling better,” he said during a webinar last week hosted by Deutsche Bank. “There have been so many bad actors let into this industry over the last few years. That’s the single-biggest deterrent for this industry to get healthy.” Ryan Joyce, CEO of cargo security firm Genlogs, said his company found nearly 1,000 Mexican trucking companies that are legally allowed to cross the border with international freight, but also operating far beyond the permitted zone inside the US. Joyce said those carriers are engaging in cabotage — legally delivering an international load, then illegally hauling a domestic load between two US locations. “The top violator, for example, was observed hundreds of times operating as far north as Minnesota, Wisconsin, and New York,” Joyce said on the Deutsche Bank webinar. He also said the non-domiciled CDL problem is tied to cargo theft, with some unsafe carriers shutting down one day, paying cash to obtain a new motor carrier number, and then reopening the next day, often referred to as “chameleon carriers.” Albrecht and Joyce are among those who expect a swift market response as insurers and USDOT increase scrutiny of illegitimate operations. “I follow certain threads of truck drivers online, and there are discussions that a lot of these non-domiciled CDLs coming up for renewal won’t be renewed,” Albrecht said on the webinar. “A lot of them have said that post-Christmas, that’s it for them. That this is the last hurrah.” Others, however, argue that the non-domiciled CDL and cabotage crackdowns will not produce a sudden spike in trucking rates. Skepticism abounds In audits conducted of Minnesota and New York, most of the violations cited by USDOT involved otherwise properly issued non-domiciled CDLs in which the license expiration date extended beyond the driver’s employment authorization, rather than wholesale ineligibility. And even when drivers with a valid non-domiciled CDL fail an English-language proficiency exam, many continue operating once highway patrol leaves the scene. Police cannot immobilize the vehicle because it is the driver, not the truck, who is taken out of service. “The driver will just wait a little bit and once the officer leaves, he’ll just drive off as if nothing happened,” said Cliff Bates, former owner of Capital City Trucking, a trucking company that went out of business within the last two years. “Even when the driver is dropped off at the next exit, the minute the patrol leaves, he’s walking back down the highway to the truck again.” While Bates agrees that reckless driving by some non-domiciled CDL holders is a major problem, he questions how quickly the Trump administration can act. “I think they’re going to cut off the spigot for new CDLs, but I question the assumption that this administration will act swiftly with midterms coming in less than a year,” Bates told the Journal of Commerce. He said rapid enforcement could raise rates and, by extension, consumer prices. Still, broader macroeconomic factors may limit how much enforcement alone can shift the market. Slashing capacity does not address weak US manufacturing data that has softened truckload demand, according to Miller. He noted, for example, that single-family building permits have fallen 10% from last year, as of the last update before the US government shutdown, and that fracking activity isn’t going to rebound with crude oil at current prices. “There are also individuals out there with the requisite background who could re-enter the [trucking] industry rather quickly if conditions significantly improve from a pricing standpoint, which would blunt any loss of non-domiciled capacity,” Miller said. Contact Ari Ashe at ari.ashe@spglobal.com .

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Impact of non-domiciled CDL enforcement splits US trucking sector

<div class="phx-topic abstract-wrapper">S&amp;P Global’s outlook for the transportation sector sees US ports facing a volume decline in 2026 with the potential for recovery in 2027. </div>

S&P Global’s outlook for the transportation sector sees US ports facing a volume decline in 2026 with the potential for recovery in 2027.

<div class="phx-topic">US ports face another down year for volumes in 2026 due to ongoing uncertainty over the direction of US trade and tariff policy, according to an S&amp;P Global credit outlook. The forecast drop in container volumes echoes similar outlooks from major US port operators whose fortunes are not expected to turn around until 2027. S&amp;P Global Ratings said Tuesday that while US economic output and employment are expected to remain stable through next year, ports face a down year as the Trump administration’s wide-ranging tariffs against most US trade partners likely make shippers cautious and continue to reshore production. Trade with China might stabilize in 2026 due to <a href="https://www.joc.com/article/trade-deal-could-boost-short-term-china-imports-but-uncertainty-lingers-6106809">the trade deal the US struck with China through next November</a>, S&amp;P Global Ratings said. But tariffs against China and other trading partners remain at record high levels, forcing shippers to be cautious. A US Supreme Court ruling against Trump’s tariffs could reignite cargo shipments, the outlook said. Nevertheless, S&amp;P Global said US port container volumes will decline 2% in 2026. The outlook calls for a rebound in volume of 6% in 2027 on the hopes of a more stable trade policy. The outlook did not include actual volume figures. “US ports face the greatest uncertainty due to the evolving tariff landscape in 2026,” S&amp;P Global Ratings said. “The recently negotiated truce in the US-China trade conflict provides a measure of certainty until that agreement expires. Our estimate of slightly lower container volumes in 2026 is followed by a solid recovery in 2027.” The outlook follows a similar forecast from the National Retail Federation (NRF), which said Monday <a href="https://www.joc.com/article/december-us-imports-on-track-to-be-lowest-since-june-23-retailers-6130632">first-quarter 2026 port volumes could see double-digit declines from the year earlier</a>. Overall, the NRF expects 2025 volumes to come in slightly below 2024. Credit ratings agency Moody’s on Nov. 18 warned that US import volumes in 2026 will be flat to down 2% from this year. Port operators, too, are budgeting for declines or only slow growth in 2026. The Port Authority of New York and New Jersey said in November it’s budgeting for total container volumes of 8.5 million TEUs in 2026, which would be just over a 2% decline from 2024. Since 2016, NY-NJ port container volumes have grown at an annual average of 4.2%. Port Houston Authority also said last month it’s budgeting for container volumes to reach 4.4 million TEUs in 2026, which would represent growth of 4.7%, below the port’s decade-long average volume growth of 7%. S&amp;P Global is the parent company of the Journal of Commerce. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

US ports face another down year for volumes in 2026 due to ongoing uncertainty over the direction of US trade and tariff policy, according to an S&P Global credit outlook. The forecast drop in container volumes echoes similar outlooks from major US port operators whose fortunes are not expected to turn around until 2027. S&P Global Ratings said Tuesday that while US economic output and employment are expected to remain stable through next year, ports face a down year as the Trump administration’s wide-ranging tariffs against most US trade partners likely make shippers cautious and continue to reshore production. Trade with China might stabilize in 2026 due to the trade deal the US struck with China through next November , S&P Global Ratings said. But tariffs against China and other trading partners remain at record high levels, forcing shippers to be cautious. A US Supreme Court ruling against Trump’s tariffs could reignite cargo shipments, the outlook said. Nevertheless, S&P Global said US port container volumes will decline 2% in 2026. The outlook calls for a rebound in volume of 6% in 2027 on the hopes of a more stable trade policy. The outlook did not include actual volume figures. “US ports face the greatest uncertainty due to the evolving tariff landscape in 2026,” S&P Global Ratings said. “The recently negotiated truce in the US-China trade conflict provides a measure of certainty until that agreement expires. Our estimate of slightly lower container volumes in 2026 is followed by a solid recovery in 2027.” The outlook follows a similar forecast from the National Retail Federation (NRF), which said Monday first-quarter 2026 port volumes could see double-digit declines from the year earlier . Overall, the NRF expects 2025 volumes to come in slightly below 2024. Credit ratings agency Moody’s on Nov. 18 warned that US import volumes in 2026 will be flat to down 2% from this year. Port operators, too, are budgeting for declines or only slow growth in 2026. The Port Authority of New York and New Jersey said in November it’s budgeting for total container volumes of 8.5 million TEUs in 2026, which would be just over a 2% decline from 2024. Since 2016, NY-NJ port container volumes have grown at an annual average of 4.2%. Port Houston Authority also said last month it’s budgeting for container volumes to reach 4.4 million TEUs in 2026, which would represent growth of 4.7%, below the port’s decade-long average volume growth of 7%. S&P Global is the parent company of the Journal of Commerce. Contact Michael Angell at michael.angell@spglobal.com .

US container volumes set for weak 2026 amid ongoing trade uncertainty

<div class="phx-topic abstract-wrapper">The ubiquity of WiseTech’s flagship platform in the forwarding market has placed a target on its back — one that grew larger with a significant change last week in how it prices its product.</div>

The ubiquity of WiseTech’s flagship platform in the forwarding market has placed a target on its back — one that grew larger with a significant change last week in how it prices its product.

<div class="phx-topic">The number of complaints from forwarders about <a href="https://www.joc.com/article/wisetech-pricing-change-tests-shippers-willingness-to-absorb-tech-costs-6127788">last week’s pricing model change</a> by software provider WiseTech Global is an indication that the company’s flagship product has reached a level of market penetration that many technology companies can only dream of. There’s a saying in technology circles that software companies want their products to be so successful that everyone grumbles about them. That scenario generally only occurs when a product is so ubiquitous that it’s hard to envision an industry using anything else. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6133280_0.1.jpg"></img></div>CargoWise occupies that place in the world of forwarding. Simply put, most forwarders of any size and scale are using CargoWise for something, whether it be back-office accounting, transportation management, trade compliance or some mix of all three. By some estimates, CargoWise has as much as a 70% share of the forwarding software market, dwarfing the market share that even the largest forwarder, DSV (a current CargoWise customer) has over the logistics industry. Which means that WiseTech Global, with a $16 billion market capitalization, has a more dominant position in its market than its largest customer — with a $60 billion market cap – has in its market. That explains, in part, why something as seemingly banal as a change in the way WiseTech prices its product has created such a furor. Over the past three decades, a small software provider to Australian forwarders has morphed into a global technology powerhouse, a brand everyone loves to hate, because so many people must use its products. WiseTech’s fortress is, in part, built around a string of acquisitions of country-specific customs software vendors it made over the past dozen years. Those acquisitions give WiseTech direct connections to customs authorities that its competitors mostly lack, allowing its customers to remain compliant in a range of export and import markets. The importance of this network of customs capabilities can’t be understated — without it, forwarders struggle to help their customers clear regulatory authorities in key markets. That, along with general ledger and accounting functions upon which many forwarders base their operations, creates a scenario that makes it difficult for forwarders to switch to other solutions. As one forwarder put it to the Journal of Commerce: “It would be like ripping out a person’s circulatory system while the person was still alive.” <h3>No meaningful competition </h3>There is more to WiseTech’s dominance than its own ascent. A number of forwarding software vendors have, over the years, had designs encroaching on WiseTech’s turf. The list is not long, but it includes more than a dozen names, from sizable incumbent rivals such as Descartes, Softlink and Magaya, to upstarts that emerged in the past decade, including GoFreight and NewAge, to even newer entrants such as FreightSuite and Clear.ai. In addition, there are a number of regional providers that tend to focus on forwarders in their geographic market, most notably Riege in Germany. All of those providers collectively have failed to alter WiseTech’s trajectory, even as concerns grew from customers over WiseTech’s annual price increases and its sluggishness in integrating the products from its acquisitions. A new dimension to those concerns arose <a href="https://www.joc.com/article/wisetech-makes-2-billion-gamble-on-overturning-complicated-software-history-6013221">this past May when WiseTech made its biggest ever acquisition</a>, a $2.1 billion deal for E2open, a logistics software vendor that catered primarily to shippers. That enabled WiseTech to offer products directly to the customers of its core CargoWise users. Coupled with the upheaval from the pricing change, and an expectation from most CargoWise customers that the new pricing model would raise technology costs above the normal annual price increases, fully leveraging E2open would seemingly force forwarders to reconsider their use of CargoWise, if that is truly an option. For many, it won’t be. And so, if the anger around the pricing change model eventually passes without a wholesale loss of its customer base, that will be a sign that WiseTech has indeed reached escape velocity, and that the forwarding world is more dependent on the software provider than it had believed. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>.</div>

The number of complaints from forwarders about last week’s pricing model change by software provider WiseTech Global is an indication that the company’s flagship product has reached a level of market penetration that many technology companies can only dream of. There’s a saying in technology circles that software companies want their products to be so successful that everyone grumbles about them. That scenario generally only occurs when a product is so ubiquitous that it’s hard to envision an industry using anything else. CargoWise occupies that place in the world of forwarding. Simply put, most forwarders of any size and scale are using CargoWise for something, whether it be back-office accounting, transportation management, trade compliance or some mix of all three. By some estimates, CargoWise has as much as a 70% share of the forwarding software market, dwarfing the market share that even the largest forwarder, DSV (a current CargoWise customer) has over the logistics industry. Which means that WiseTech Global, with a $16 billion market capitalization, has a more dominant position in its market than its largest customer — with a $60 billion market cap – has in its market. That explains, in part, why something as seemingly banal as a change in the way WiseTech prices its product has created such a furor. Over the past three decades, a small software provider to Australian forwarders has morphed into a global technology powerhouse, a brand everyone loves to hate, because so many people must use its products. WiseTech’s fortress is, in part, built around a string of acquisitions of country-specific customs software vendors it made over the past dozen years. Those acquisitions give WiseTech direct connections to customs authorities that its competitors mostly lack, allowing its customers to remain compliant in a range of export and import markets. The importance of this network of customs capabilities can’t be understated — without it, forwarders struggle to help their customers clear regulatory authorities in key markets. That, along with general ledger and accounting functions upon which many forwarders base their operations, creates a scenario that makes it difficult for forwarders to switch to other solutions. As one forwarder put it to the Journal of Commerce: “It would be like ripping out a person’s circulatory system while the person was still alive.” No meaningful competition There is more to WiseTech’s dominance than its own ascent. A number of forwarding software vendors have, over the years, had designs encroaching on WiseTech’s turf. The list is not long, but it includes more than a dozen names, from sizable incumbent rivals such as Descartes, Softlink and Magaya, to upstarts that emerged in the past decade, including GoFreight and NewAge, to even newer entrants such as FreightSuite and Clear.ai. In addition, there are a number of regional providers that tend to focus on forwarders in their geographic market, most notably Riege in Germany. All of those providers collectively have failed to alter WiseTech’s trajectory, even as concerns grew from customers over WiseTech’s annual price increases and its sluggishness in integrating the products from its acquisitions. A new dimension to those concerns arose this past May when WiseTech made its biggest ever acquisition , a $2.1 billion deal for E2open, a logistics software vendor that catered primarily to shippers. That enabled WiseTech to offer products directly to the customers of its core CargoWise users. Coupled with the upheaval from the pricing change, and an expectation from most CargoWise customers that the new pricing model would raise technology costs above the normal annual price increases, fully leveraging E2open would seemingly force forwarders to reconsider their use of CargoWise, if that is truly an option. For many, it won’t be. And so, if the anger around the pricing change model eventually passes without a wholesale loss of its customer base, that will be a sign that WiseTech has indeed reached escape velocity, and that the forwarding world is more dependent on the software provider than it had believed. Contact Eric Johnson at eric.johnson@spglobal.com .

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