<div class="phx-topic abstract-wrapper">Amid tariffs of up 130%, US laden imports from China for the six months between April and September fell to levels not seen since 2013.</div>

Amid tariffs of up 130%, US laden imports from China for the six months between April and September fell to levels not seen since 2013.

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<div class="phx-topic">President Donald Trump’s tariff onslaught has, arguably, forever shifted US import flows away from China after a six-month rollercoaster of ever-changing amounts and deadlines. But US tariffs – while denting shipments from China – aren’t yet showing signs of hurting overall global container volumes. “The rest of the world trucks along just nicely,” said Lars Jensen, a maritime analyst and Journal of Commerce contributor. “It's a little bit volatile. It's a bit up and down, but basically throughout the year, you’ve seen global growth in container volumes around 6%, which is twice what you expect given global development. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6101629_0.1.jpg"></img></div> “So the rest of the world is doing just fine, more or less unperturbed by the US trade war,” Jensen added. “It’s the US that’s suffering from this, not everybody else.” US laden imports between April, when sweeping tariffs were imposed on all trade partners, and September are virtually flat compared to a year ago, according to PIERS, a sister company of the Journal of Commerce within S&amp;P Global. US laden exports in the five months ending August, the most recent data available, are flat as well. Global container volumes, including empties, rose 4.1% in that same period, according to data from Container Trade Statistics. But the extent to which US tariffs on China imports – currently up to 130% -- have upended the trans-Pacific is clear: Imports from China for April through September were at levels not seen since 2013. US imports from China were down 15% from a year ago, equating to 875,000 fewer TEUs. Looking at it another way, one-third of laden, ocean-going imports that came into the US during the six-month period originated from China. Last year, four out of 10 laden containers entering US seaports came from China. Some of those volumes from China were lost due to Canadian importers diverting goods away from US ports in favor of domestic ports to avoid paying tariffs. Other shipments, as tracked by PIERS, originated from China and were illegally declared differently. <h3>Beneficiaries of China tariffs </h3>Vietnam, facing a US tariff rate of 20%, has been the biggest benefactor from tariffs on China. US laden imports from Vietnam jumped nearly 26% in the six-month period and volumes accounted for 16.8% of all inbound traffic into the United States. India, Thailand, Indonesia, Malaysia and Cambodia all gained from the higher US tariffs on China. And while each still accounted for less than 1% of total US laden imports, Columbia, Ecuador, and Guatemala were leaned on more by US importers. Notably, the US tariffs on imports from the European Union haven’t stopped import growth, with laden volumes expanding 4.9% between April and September. Despite high US tariffs on its exports, China’s factory production hasn’t slowed yet, with activity in September rising at its fastest pace since March, according to the RatingDog China General Manufacturing Purchasing Managers Index, which is compiled by S&amp;P Global. Chinese exporters have found buyers for their wares, contributing to <a href="https://www.joc.com/article/growing-box-backlogs-at-europes-strike-hit-hubs-could-take-weeks-to-clear-6098397">port congestion in Europe</a> and increasingly feeding factories in Mexico. With record profits from the pandemic and a scale-up of ship deliveries, container lines are following the growth, deploying tonnage and investing in marine terminals that strengthen so-called secondary trades. Evergreen Line, for example, in its five-plan released last month, said it would focus on expanding service to Latin America and the Middle East. The carrier plans to increase the number of vessels deployed on the Asia-Latin America trade and deploy 12,000-TEU ships on the Asia-West Coast of South America trades. Evergreen also plans to add capacity between Europe and Mexico, and from Asia to the Caribbean. Still, container lines, importantly, aren’t abandoning the US market, even if it comes at a higher cost than other markets thanks to elevated labor costs and the inability to impose terminal handling charges on cargo owners and consignees. “If you look at the United States, the market is not going anywhere. This is an extremely strategic market for our group, and we will continue to invest here,” Adeline Chouraqui, CEO and president at CMA CGM Americas, said Oct. 16 at the Virgina Maritime Association’s International Trade Forum. CMA CGM in March <a href="https://www.joc.com/article/cma-cgm-to-invest-20-billion-in-us-shipping-ports-and-logistics-5957748">committed to investing $20 billion in the US over the next five years.</a> ”It’s a continuation of what we’ve always done, but changes in flows do bring opportunities for investment,” she said. Contact Mark Szakonyi at <a href="mailto:mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com.</a></div>

President Donald Trump’s tariff onslaught has, arguably, forever shifted US import flows away from China after a six-month rollercoaster of ever-changing amounts and deadlines. But US tariffs – while denting shipments from China – aren’t yet showing signs of hurting overall global container volumes. “The rest of the world trucks along just nicely,” said Lars Jensen, a maritime analyst and Journal of Commerce contributor. “It's a little bit volatile. It's a bit up and down, but basically throughout the year, you’ve seen global growth in container volumes around 6%, which is twice what you expect given global development. “So the rest of the world is doing just fine, more or less unperturbed by the US trade war,” Jensen added. “It’s the US that’s suffering from this, not everybody else.” US laden imports between April, when sweeping tariffs were imposed on all trade partners, and September are virtually flat compared to a year ago, according to PIERS, a sister company of the Journal of Commerce within S&P Global. US laden exports in the five months ending August, the most recent data available, are flat as well. Global container volumes, including empties, rose 4.1% in that same period, according to data from Container Trade Statistics. But the extent to which US tariffs on China imports – currently up to 130% -- have upended the trans-Pacific is clear: Imports from China for April through September were at levels not seen since 2013. US imports from China were down 15% from a year ago, equating to 875,000 fewer TEUs. Looking at it another way, one-third of laden, ocean-going imports that came into the US during the six-month period originated from China. Last year, four out of 10 laden containers entering US seaports came from China. Some of those volumes from China were lost due to Canadian importers diverting goods away from US ports in favor of domestic ports to avoid paying tariffs. Other shipments, as tracked by PIERS, originated from China and were illegally declared differently. Beneficiaries of China tariffs Vietnam, facing a US tariff rate of 20%, has been the biggest benefactor from tariffs on China. US laden imports from Vietnam jumped nearly 26% in the six-month period and volumes accounted for 16.8% of all inbound traffic into the United States. India, Thailand, Indonesia, Malaysia and Cambodia all gained from the higher US tariffs on China. And while each still accounted for less than 1% of total US laden imports, Columbia, Ecuador, and Guatemala were leaned on more by US importers. Notably, the US tariffs on imports from the European Union haven’t stopped import growth, with laden volumes expanding 4.9% between April and September. Despite high US tariffs on its exports, China’s factory production hasn’t slowed yet, with activity in September rising at its fastest pace since March, according to the RatingDog China General Manufacturing Purchasing Managers Index, which is compiled by S&P Global. Chinese exporters have found buyers for their wares, contributing to port congestion in Europe and increasingly feeding factories in Mexico. With record profits from the pandemic and a scale-up of ship deliveries, container lines are following the growth, deploying tonnage and investing in marine terminals that strengthen so-called secondary trades. Evergreen Line, for example, in its five-plan released last month, said it would focus on expanding service to Latin America and the Middle East. The carrier plans to increase the number of vessels deployed on the Asia-Latin America trade and deploy 12,000-TEU ships on the Asia-West Coast of South America trades. Evergreen also plans to add capacity between Europe and Mexico, and from Asia to the Caribbean. Still, container lines, importantly, aren’t abandoning the US market, even if it comes at a higher cost than other markets thanks to elevated labor costs and the inability to impose terminal handling charges on cargo owners and consignees. “If you look at the United States, the market is not going anywhere. This is an extremely strategic market for our group, and we will continue to invest here,” Adeline Chouraqui, CEO and president at CMA CGM Americas, said Oct. 16 at the Virgina Maritime Association’s International Trade Forum. CMA CGM in March committed to investing $20 billion in the US over the next five years. ”It’s a continuation of what we’ve always done, but changes in flows do bring opportunities for investment,” she said. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com.

Trans-Pacific

Maritime

US tariffs dent China import volumes, but not global container growth

<div class="phx-topic abstract-wrapper">Record container volumes resulted in greater port activity amid an increase in calls by vessels, trucks and trains, as well as increased use of cargo-handling equipment.</div>

Record container volumes resulted in greater port activity amid an increase in calls by vessels, trucks and trains, as well as increased use of cargo-handling equipment.

<div class="phx-topic">Emissions from vessel and surface operations at the ports of Los Angeles and Long Beach were up by only small to moderate amounts in 2024 despite the Southern California gateway handling record container volumes that jumped about 20% from the year prior. The new data was included in the annual emissions inventories published separately last week by each port. “Cargo volume shot up from 2023 to 2024, and we did see increases in emissions in that time period,” said Noel Hacegaba, COO at the Port of Long Beach. “However, the reduction figures from the baseline year of 2005 to 2024 show we still have dramatically reduced air pollution in the long run.” Record container volumes resulted in greater port activity amid an increase in calls by vessels, trucks and trains, as well as increased use of cargo-handling equipment, said Jacqueline Moore, vice president of the Pacific Merchant Shipping Association (PMSA), which represents marine terminal operators and shipping lines in legislative matters. Los Angeles in 2024 handled 10.3 million laden and empty TEUs, up 19% from 2023. Long Beach handled 9.6 million TEUs, up 20% from 2023, according to statistics in their emissions reports. Despite the growth in activity, “the increases in emissions were small to moderate,” Moore told the Journal of Commerce Tuesday. Los Angeles and Long Beach each year release details of more than a half-dozen health risk categories of emissions at the ports, including diesel particulate matter (DPM), nitrogen oxide (NOx), sulfur oxides (SOx), carbon monoxide (CO) and carbon dioxide (CO2). In most categories, the increase in emissions for 2024 was in the mid- to upper-single-digit range, Moore said. <h3>Ports account for ‘miniscule” percentage of regional pollution </h3>Port-generated emissions are a “miniscule” percentage of total pollutants in Southern California, Moore said. That includes mobile sources such as automobiles and regional trucking, and stationary sources such as manufacturing and residences. For example, the ports account for 0.5% of all NOx emissions in the South Coast region, 1.3% of DPMs and 5.6% of NOx, she said. The ports’ emission inventories have been measuring gains in emission reductions since 2005. According to an Oct. 16 PMSA release, the port complex has reduced DPMs by 90%, NOx by 70%, SOx by 98%, and greenhouse gas emissions by 10% since that baseline year. The ports will continue to cite these figures before regional, state and federal regulatory agencies to show that they and their stakeholders are doing their part to reduce pollution, Moore said. Last month, the ports reached a “cooperative” agreement with the South Coast Air Quality Management District (AQMD) to seek further emissions reductions. The PMSA said at the time gains should now be realized without resorting to burdensome measures proposed by the AQMD in its <a href="https://www.joc.com/article/proposed-emissions-rule-would-cap-la-lb-port-volumes-5679341">original Indirect Source Rule.</a>The AQMD agreement recognizes the ports’ achievements to date. The easier gains have been made, and squeezing further reductions from vessels, trucks, trains and cargo-handling equipment <a href="https://www.joc.com/article/la-lb-likely-to-work-with-regulator-on-emissions-cutting-plan-for-ports-6084550">will be much more costly to achieve</a>, PMSA President Mike Jacob told the regulatory agency last month. The ports will also work in a similar capacity with the California Air Resources Board and the federal Environmental Protection Agency to further reduce emissions in areas where those agencies’ jurisdictions intersect with port operations, Moore said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Emissions from vessel and surface operations at the ports of Los Angeles and Long Beach were up by only small to moderate amounts in 2024 despite the Southern California gateway handling record container volumes that jumped about 20% from the year prior. The new data was included in the annual emissions inventories published separately last week by each port. “Cargo volume shot up from 2023 to 2024, and we did see increases in emissions in that time period,” said Noel Hacegaba, COO at the Port of Long Beach. “However, the reduction figures from the baseline year of 2005 to 2024 show we still have dramatically reduced air pollution in the long run.” Record container volumes resulted in greater port activity amid an increase in calls by vessels, trucks and trains, as well as increased use of cargo-handling equipment, said Jacqueline Moore, vice president of the Pacific Merchant Shipping Association (PMSA), which represents marine terminal operators and shipping lines in legislative matters. Los Angeles in 2024 handled 10.3 million laden and empty TEUs, up 19% from 2023. Long Beach handled 9.6 million TEUs, up 20% from 2023, according to statistics in their emissions reports. Despite the growth in activity, “the increases in emissions were small to moderate,” Moore told the Journal of Commerce Tuesday. Los Angeles and Long Beach each year release details of more than a half-dozen health risk categories of emissions at the ports, including diesel particulate matter (DPM), nitrogen oxide (NOx), sulfur oxides (SOx), carbon monoxide (CO) and carbon dioxide (CO2). In most categories, the increase in emissions for 2024 was in the mid- to upper-single-digit range, Moore said. Ports account for ‘miniscule” percentage of regional pollution Port-generated emissions are a “miniscule” percentage of total pollutants in Southern California, Moore said. That includes mobile sources such as automobiles and regional trucking, and stationary sources such as manufacturing and residences. For example, the ports account for 0.5% of all NOx emissions in the South Coast region, 1.3% of DPMs and 5.6% of NOx, she said. The ports’ emission inventories have been measuring gains in emission reductions since 2005. According to an Oct. 16 PMSA release, the port complex has reduced DPMs by 90%, NOx by 70%, SOx by 98%, and greenhouse gas emissions by 10% since that baseline year. The ports will continue to cite these figures before regional, state and federal regulatory agencies to show that they and their stakeholders are doing their part to reduce pollution, Moore said. Last month, the ports reached a “cooperative” agreement with the South Coast Air Quality Management District (AQMD) to seek further emissions reductions. The PMSA said at the time gains should now be realized without resorting to burdensome measures proposed by the AQMD in its original Indirect Source Rule. The AQMD agreement recognizes the ports’ achievements to date. The easier gains have been made, and squeezing further reductions from vessels, trucks, trains and cargo-handling equipment will be much more costly to achieve , PMSA President Mike Jacob told the regulatory agency last month. The ports will also work in a similar capacity with the California Air Resources Board and the federal Environmental Protection Agency to further reduce emissions in areas where those agencies’ jurisdictions intersect with port operations, Moore said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Port News

North American ports

Marine terminals

Container Shipping News

LA-LB saw ‘small to moderate’ rise in emissions despite record volumes in 2024

<div class="phx-topic abstract-wrapper">The Owner-Operator Independent Driver’s Association is urging Congress to codify new regulations aimed at tightening oversight of commercial driver licensing and to support more training for new drivers. </div>

The Owner-Operator Independent Driver’s Association is urging Congress to codify new regulations aimed at tightening oversight of commercial driver licensing and to support more training for new drivers.

<div class="phx-topic">A crackdown on unqualified and illegal truck drivers in the US is already said to be tightening capacity in certain markets, but some want the crackdown to go further. The Owner-Operator Independent Driver’s Association (OOIDA) is urging the House of Representatives and Senate to write <a href="https://www.joc.com/article/usdot-cracks-down-on-non-domiciled-cdls-targets-california-6087419">new truck driver licensing rules</a> into law. OOIDA is also calling for enhanced new driver training and more stringent audits of new carriers. The group also opposes efforts to lower the legal age required to drive a commercial truck in interstate commerce from 21 to 18. The Infrastructure Investment and Jobs Act of 2022 established a three-year pilot program for 18- to 20-year-old truck drivers. “Simply put, far too many individuals are entering the trucking industry without the basic skills necessary to safely operate a commercial vehicle,” Todd Spencer, OOIDA’s president, said in a letter to the House and Senate transportation committees. “Additionally, inconsistent and improper licensing processes among states have permitted hundreds of thousands of unqualified drivers to work on our nation’s roads, which has needlessly resulted in numerous fatal crashes,” Spencer wrote. Since June, truck drivers have been the focus of English-language proficiency (ELP) and commercial driver’s license (CDL) enforcement initiatives by the US Department of Transportation (DOT) and its Federal Motor Carrier Safety Administration (FMCSA). The DOT initiatives have focused on enforcing <a href="https://www.joc.com/article/us-dot-presses-states-to-enforce-english-language-trucking-rules-6069884">English-language proficiency</a> requirements and tightening standards for non-domiciled CDLs issued by states. The US also stopped issuing certain work visas for foreign truck drivers. In its letter, the OOIDA urged Congress to take up the Non-Domiciled CDL Integrity Act <a href="https://rouzer.house.gov/news/documentsingle.aspx?DocumentID=2587">introduced in the House</a> on Oct. 8 by Rep. David Rouzer (R-North Carolina). The bill would codify the interim final rule on non-domiciled CDLs published by the FMCSA on Sept. 29. The interim final rule and the House bill attempt to prevent those in the US illegally from receiving non-domiciled licenses that some states issue to drivers living outside their jurisdiction. The rules also tighten state enforcement of licensing requirements. <h3>‘A little tightness’ </h3>The DOT crackdown on ELP requirements and licensing is already having an impact on some truck lanes and on spot market truckload rates, according to motor carriers. The extent of the impact, however, is hard to measure. “We believe recent developments in regulations and enforcement when taken together could have a noticeable impact on available industry capacity,” Nicholas Hobbs, COO at J.B. Hunt Transport Services, said during a third-quarter earnings call Oct. 15. “We’ve seen a little tightness in probably eight to 10 markets,” said Hobbs. He attributed that not just to DOT roadside inspections, but also immigration enforcement. “You can follow the news and see where [US Immigration and Customs Enforcement (ICE)] is active,” he said. The average US national truckload spot rate was $1.70 per mile in the week ending Oct. 18, according to DAT Freight &amp; Analytics, flat with the week prior. The load board operator is seeing evidence that DOT and ICE enforcement are affecting capacity. “We’re seeing drivers who are US citizens saying, ‘We’re going to sit this one out,’” said Dean Croke, principal analyst at DAT. “They’ll go do something else, [such as] maybe run locally.” Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. </div>

A crackdown on unqualified and illegal truck drivers in the US is already said to be tightening capacity in certain markets, but some want the crackdown to go further. The Owner-Operator Independent Driver’s Association (OOIDA) is urging the House of Representatives and Senate to write new truck driver licensing rules into law. OOIDA is also calling for enhanced new driver training and more stringent audits of new carriers. The group also opposes efforts to lower the legal age required to drive a commercial truck in interstate commerce from 21 to 18. The Infrastructure Investment and Jobs Act of 2022 established a three-year pilot program for 18- to 20-year-old truck drivers. “Simply put, far too many individuals are entering the trucking industry without the basic skills necessary to safely operate a commercial vehicle,” Todd Spencer, OOIDA’s president, said in a letter to the House and Senate transportation committees. “Additionally, inconsistent and improper licensing processes among states have permitted hundreds of thousands of unqualified drivers to work on our nation’s roads, which has needlessly resulted in numerous fatal crashes,” Spencer wrote. Since June, truck drivers have been the focus of English-language proficiency (ELP) and commercial driver’s license (CDL) enforcement initiatives by the US Department of Transportation (DOT) and its Federal Motor Carrier Safety Administration (FMCSA). The DOT initiatives have focused on enforcing English-language proficiency requirements and tightening standards for non-domiciled CDLs issued by states. The US also stopped issuing certain work visas for foreign truck drivers. In its letter, the OOIDA urged Congress to take up the Non-Domiciled CDL Integrity Act introduced in the House on Oct. 8 by Rep. David Rouzer (R-North Carolina). The bill would codify the interim final rule on non-domiciled CDLs published by the FMCSA on Sept. 29. The interim final rule and the House bill attempt to prevent those in the US illegally from receiving non-domiciled licenses that some states issue to drivers living outside their jurisdiction. The rules also tighten state enforcement of licensing requirements. ‘A little tightness’ The DOT crackdown on ELP requirements and licensing is already having an impact on some truck lanes and on spot market truckload rates, according to motor carriers. The extent of the impact, however, is hard to measure. “We believe recent developments in regulations and enforcement when taken together could have a noticeable impact on available industry capacity,” Nicholas Hobbs, COO at J.B. Hunt Transport Services, said during a third-quarter earnings call Oct. 15. “We’ve seen a little tightness in probably eight to 10 markets,” said Hobbs. He attributed that not just to DOT roadside inspections, but also immigration enforcement. “You can follow the news and see where [US Immigration and Customs Enforcement (ICE)] is active,” he said. The average US national truckload spot rate was $1.70 per mile in the week ending Oct. 18, according to DAT Freight & Analytics, flat with the week prior. The load board operator is seeing evidence that DOT and ICE enforcement are affecting capacity. “We’re seeing drivers who are US citizens saying, ‘We’re going to sit this one out,’” said Dean Croke, principal analyst at DAT. “They’ll go do something else, [such as] maybe run locally.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Transport, Trade and Regulation News

Surface

Industry group calls for tougher licensing, better training amid trucker crackdown

<div class="phx-topic abstract-wrapper">The absence of a framework on how global shipping can pass on the higher operating costs of using low- or zero-emission fuels to cargo owners will likely stall investment in the sector. </div>

The absence of a framework on how global shipping can pass on the higher operating costs of using low- or zero-emission fuels to cargo owners will likely stall investment in the sector.

<div class="phx-topic">The most optimistic view of global maritime regulators punting on a new net-zero emissions framework is that efforts to derail it completely were avoided. For most in the shipping industry, however, the International Maritime Organization’s (IMO’s) one-year delay is viewed as a major missed opportunity to give the investment community the certainty it needs to fund the transition to net-zero fuels. The Friday motion to delay adoption of the IMO’s net-zero framework was made at a tense and combative session of its Marine Environment Protection Committee (MEPC) in London. The vote to delay was 57 in favor and 49 against, with 21 abstentions. In the interim, member states will continue to work toward consensus on the decarbonization plans, but achieving the emissions-cutting targets agreed under the revised IMO greenhouse gas (GHG) strategy in 2023 will now be under pressure. The IMO’s targets include at least a 20% — striving for 30% — reduction in emissions by 2030 and at least a 70%, striving for 80%, reduction by 2040 compared with 2008 levels. The ultimate goal is to achieve net-zero emissions by 2050. But critics argue that the absence of a framework on how global shipping can pass on to cargo owners the higher operating costs of using low- or zero-emission fuels will likely stall investment in shipbuilding and in scaling up production of alternative fuels to replace conventional, heavy-emission bunkers. They fear that with no global pricing mechanism, there is likely to emerge a host of local carbon pricing initiatives that will be difficult for carriers to navigate. The United States’ willingness to threaten IMO member states voting against White House efforts to water down the regulations brings a challenge that wasn’t present in July 2023 when the IMO’s revised GHG strategy was agreed. The US believes putting a price on carbon emissions from ships will be passed on to its consumers, increasing costs by 10%. It was what triggered the extraordinary threats by the White House that included sanctions, port fees and visa refusals against member states voting to adopt the IMO net-zero framework. President Donald Trump even weighed in on his Truth Social media platform with a post last week saying, “the US will not stand for this Global Green New Scam Tax on Shipping. Stand with the US and vote NO in London...!” <h3>States swayed by US threats </h3>The US was supported in its opposition to the measures by petrostates Saudi Arabia, Russia and Venezuela, with Singapore raising the idea that the regulation be delayed and Saudi Arabia calling for the vote. Pressure from the US saw Liberia, the world’s largest ship registry with 16% of global tonnage, and Bahamas, home to almost 4% of global tonnage, reversing their support for the framework. Not everyone was cowed by the US threats, particularly the tiny Pacific Island states that are most vulnerable to the climate change dismissed as a hoax by Trump. “Don’t pretend that the Pacific was voiceless. We were ignored, bullied, threatened, cornered, sidelined and harassed. But we stood tall,” Marshall Islands Ambassador Albon Ishoda <a href="https://www.linkedin.com/in/albon-ishoda-384472333/recent-activity/all/">wrote in a LinkedIn post</a>. “When you mention those large countries that fought for or against the framework, don’t forget that it was the Pacific Island countries and Seychelles that gave the hardest miles and took the hardest hit,” Ishoda wrote. “A year delay is a year of more devastation and displacement for our communities that have nothing to do with this catastrophe. We don’t have the luxury of time.” There are concerns that the US considers the delay in adopting IMO decarbonization plans as a win and will use the time between now and next October to build further opposition against the net-zero framework, potentially killing the regulation. There are also concerns that the delay is a win for liquefied natural gas (LNG) that will continue to be the fuel of choice across shipping sectors. Reaction to the IMO vote to adjourn the attempted adoption of the net-zero framework for a year has been loud and predominantly negative, particularly concerning the enormous investment required to decarbonize the maritime industry. The Global Maritime Forum has estimated that achieving a 50% reduction in shipping's GHG emissions by 2050 will require investment of $1 trillion to $1.4 trillion between 2030 and 2050. If full decarbonization is the goal, the total could be as high as $1.9 trillion. “From an economic standpoint, introducing carbon pricing is essential to level the playing field with sustainable fuels, which are currently not economically viable,” said Rico Luman, senior economist for transport and logistics at global bank ING. “Regardless of the timing, a pricing mechanism will eventually be necessary to drive progress in reducing greenhouse gas emissions, also as it helps funding green investments,” Luman noted. <h3>Delay puts targets under pressure </h3>It was a sentiment repeated time and again as the reaction rolled in following the Friday afternoon vote. “The industry needs clarity to be able to make the investments needed to decarbonize the maritime sector, in line with the goals set out in the IMO greenhouse gas strategy,” said Thomas Kazakos, secretary-general of the International Chamber of Shipping. Kazakos said the framework would have created the first global carbon pricing mechanism for any industrial sector, with the aim of delivering a clear path for shipping’s transition to net zero. The delay means meeting the IMO’s decarbonization targets has been made more difficult, Luman told the Journal of Commerce. “The current timeline needs to be reassessed, as the projected CO₂ reductions by 2030 already fall short of earlier ambitions,” he said. “As a result, achieving the 2040 and 2050 targets set out in the IMO’s net-zero strategy is becoming increasingly challenging — particularly given the long investment horizons typical in the shipping industry.” Jesse Fahnestock, director of decarbonization at the Global Maritime Forum, agreed, calling Friday’s adjournment “a disappointing setback for shipping” that will make delivery of maritime decarbonization targets even more challenging. Lars Jensen, CEO of Vespucci Maritime and a Journal of Commerce contributor, said the main container carriers were unlikely to stray from their current newbuilding path, at least for now. “But it will make it more difficult to convince ... investors to come in hard on green fuel production with the new uncertainty,” <a href="https://www.linkedin.com/in/larsjensenvespuccimaritime/recent-activity/all/">Jensen wrote in a LinkedIn post</a> Monday. “In such an environment, LNG just got another improvement in its relative competitiveness versus the fully green fuels.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

The most optimistic view of global maritime regulators punting on a new net-zero emissions framework is that efforts to derail it completely were avoided. For most in the shipping industry, however, the International Maritime Organization’s (IMO’s) one-year delay is viewed as a major missed opportunity to give the investment community the certainty it needs to fund the transition to net-zero fuels. The Friday motion to delay adoption of the IMO’s net-zero framework was made at a tense and combative session of its Marine Environment Protection Committee (MEPC) in London. The vote to delay was 57 in favor and 49 against, with 21 abstentions. In the interim, member states will continue to work toward consensus on the decarbonization plans, but achieving the emissions-cutting targets agreed under the revised IMO greenhouse gas (GHG) strategy in 2023 will now be under pressure. The IMO’s targets include at least a 20% — striving for 30% — reduction in emissions by 2030 and at least a 70%, striving for 80%, reduction by 2040 compared with 2008 levels. The ultimate goal is to achieve net-zero emissions by 2050. But critics argue that the absence of a framework on how global shipping can pass on to cargo owners the higher operating costs of using low- or zero-emission fuels will likely stall investment in shipbuilding and in scaling up production of alternative fuels to replace conventional, heavy-emission bunkers. They fear that with no global pricing mechanism, there is likely to emerge a host of local carbon pricing initiatives that will be difficult for carriers to navigate. The United States’ willingness to threaten IMO member states voting against White House efforts to water down the regulations brings a challenge that wasn’t present in July 2023 when the IMO’s revised GHG strategy was agreed. The US believes putting a price on carbon emissions from ships will be passed on to its consumers, increasing costs by 10%. It was what triggered the extraordinary threats by the White House that included sanctions, port fees and visa refusals against member states voting to adopt the IMO net-zero framework. President Donald Trump even weighed in on his Truth Social media platform with a post last week saying, “the US will not stand for this Global Green New Scam Tax on Shipping. Stand with the US and vote NO in London...!” States swayed by US threats The US was supported in its opposition to the measures by petrostates Saudi Arabia, Russia and Venezuela, with Singapore raising the idea that the regulation be delayed and Saudi Arabia calling for the vote. Pressure from the US saw Liberia, the world’s largest ship registry with 16% of global tonnage, and Bahamas, home to almost 4% of global tonnage, reversing their support for the framework. Not everyone was cowed by the US threats, particularly the tiny Pacific Island states that are most vulnerable to the climate change dismissed as a hoax by Trump. “Don’t pretend that the Pacific was voiceless. We were ignored, bullied, threatened, cornered, sidelined and harassed. But we stood tall,” Marshall Islands Ambassador Albon Ishoda wrote in a LinkedIn post . “When you mention those large countries that fought for or against the framework, don’t forget that it was the Pacific Island countries and Seychelles that gave the hardest miles and took the hardest hit,” Ishoda wrote. “A year delay is a year of more devastation and displacement for our communities that have nothing to do with this catastrophe. We don’t have the luxury of time.” There are concerns that the US considers the delay in adopting IMO decarbonization plans as a win and will use the time between now and next October to build further opposition against the net-zero framework, potentially killing the regulation. There are also concerns that the delay is a win for liquefied natural gas (LNG) that will continue to be the fuel of choice across shipping sectors. Reaction to the IMO vote to adjourn the attempted adoption of the net-zero framework for a year has been loud and predominantly negative, particularly concerning the enormous investment required to decarbonize the maritime industry. The Global Maritime Forum has estimated that achieving a 50% reduction in shipping's GHG emissions by 2050 will require investment of $1 trillion to $1.4 trillion between 2030 and 2050. If full decarbonization is the goal, the total could be as high as $1.9 trillion. “From an economic standpoint, introducing carbon pricing is essential to level the playing field with sustainable fuels, which are currently not economically viable,” said Rico Luman, senior economist for transport and logistics at global bank ING. “Regardless of the timing, a pricing mechanism will eventually be necessary to drive progress in reducing greenhouse gas emissions, also as it helps funding green investments,” Luman noted. Delay puts targets under pressure It was a sentiment repeated time and again as the reaction rolled in following the Friday afternoon vote. “The industry needs clarity to be able to make the investments needed to decarbonize the maritime sector, in line with the goals set out in the IMO greenhouse gas strategy,” said Thomas Kazakos, secretary-general of the International Chamber of Shipping. Kazakos said the framework would have created the first global carbon pricing mechanism for any industrial sector, with the aim of delivering a clear path for shipping’s transition to net zero. The delay means meeting the IMO’s decarbonization targets has been made more difficult, Luman told the Journal of Commerce. “The current timeline needs to be reassessed, as the projected CO₂ reductions by 2030 already fall short of earlier ambitions,” he said. “As a result, achieving the 2040 and 2050 targets set out in the IMO’s net-zero strategy is becoming increasingly challenging — particularly given the long investment horizons typical in the shipping industry.” Jesse Fahnestock, director of decarbonization at the Global Maritime Forum, agreed, calling Friday’s adjournment “a disappointing setback for shipping” that will make delivery of maritime decarbonization targets even more challenging. Lars Jensen, CEO of Vespucci Maritime and a Journal of Commerce contributor, said the main container carriers were unlikely to stray from their current newbuilding path, at least for now. “But it will make it more difficult to convince ... investors to come in hard on green fuel production with the new uncertainty,” Jensen wrote in a LinkedIn post Monday. “In such an environment, LNG just got another improvement in its relative competitiveness versus the fully green fuels.” Contact Greg Knowler at greg.knowler@spglobal.com .

Delay in IMO decarbonization plans robs green fuel investors of certainty

<div class="phx-topic abstract-wrapper">The partnership is part of a broader effort to advance the development of the India-Middle East-Europe Economic Corridor via the Adriatic’s main port. </div>

The partnership is part of a broader effort to advance the development of the India-Middle East-Europe Economic Corridor via the Adriatic’s main port.

<div class="phx-topic">CMA CGM and the Slovenian Port of Koper have established an automotive logistic services joint venture, expanding the carrier’s reach into Central Europe and upgrading an existing long-standing partnership. Rodolphe Saadé, CMA CGM’s chairman and CEO, signed the deal Monday during a visit to the port, alongside Slovenian Prime Minister Robert Golob and French President Emmanuel Macron. “In the context of the emerging India-Middle East-Europe Economic Corridor, CMA CGM and the Port of Koper share the ambition to strengthen Slovenia’s role as a sustainable logistics hub at the heart of Europe,” CMA CGM said in a statement. Financial terms of the deal were not disclosed. Koper is the Adriatic’s main port and a strategic gateway for the transport of vehicles to and from Asia by sea and rail, and the logistics JV will build on CMA CGM’s established intermodal network in the region. The JV company will equip, maintain and operate the site for automotive logistic services. CMA CGM and Koper are considering other joint projects to improve the competitive position of the port and further develop regional trade flows, according to the statement. CMA CGM’s services from Koper are operated by LNG or methanol-powered vessels with a capacity of 15,000 TEUs, with rail connections to major Central European markets. The carrier has two weekly maritime services calling Koper: the Phoenician Express connecting Asia to the Mediterranean and the Bora Med service within the Mediterranean basin. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

CMA CGM and the Slovenian Port of Koper have established an automotive logistic services joint venture, expanding the carrier’s reach into Central Europe and upgrading an existing long-standing partnership. Rodolphe Saadé, CMA CGM’s chairman and CEO, signed the deal Monday during a visit to the port, alongside Slovenian Prime Minister Robert Golob and French President Emmanuel Macron. “In the context of the emerging India-Middle East-Europe Economic Corridor, CMA CGM and the Port of Koper share the ambition to strengthen Slovenia’s role as a sustainable logistics hub at the heart of Europe,” CMA CGM said in a statement. Financial terms of the deal were not disclosed. Koper is the Adriatic’s main port and a strategic gateway for the transport of vehicles to and from Asia by sea and rail, and the logistics JV will build on CMA CGM’s established intermodal network in the region. The JV company will equip, maintain and operate the site for automotive logistic services. CMA CGM and Koper are considering other joint projects to improve the competitive position of the port and further develop regional trade flows, according to the statement. CMA CGM’s services from Koper are operated by LNG or methanol-powered vessels with a capacity of 15,000 TEUs, with rail connections to major Central European markets. The carrier has two weekly maritime services calling Koper: the Phoenician Express connecting Asia to the Mediterranean and the Bora Med service within the Mediterranean basin. Contact Greg Knowler at greg.knowler@spglobal.com .

Container lines

Asia-Europe

International ports

CMA CGM inks auto logistics joint venture with Slovenian Port of Koper

<div class="phx-topic abstract-wrapper">The ocean carrier and logistics provider already has big investments in Panama but may lack dedicated berth space for ships if MSC swoops in on two big container terminals there.</div>

The ocean carrier and logistics provider already has big investments in Panama but may lack dedicated berth space for ships if MSC swoops in on two big container terminals there.

<div class="phx-topic">Maersk signaled its interest in helping develop the Panama Canal’s yet-to-be-built container terminals, as the carrier faces the prospect of its former alliance partner Mediterranean Shipping Co. taking control of Panama’s current terminal assets. Speaking at an event Oct. 9 sponsored by Denmark’s embassy in Colombia, Maersk Chief Executive Vincent Clerc said his company may invest in the new terminals the Panama Canal Authority (ACP) hopes to build on both sides of the canal. This summer, <a href="https://www.joc.com/article/panama-canal-mulls-developing-corozal-to-allay-neutrality-fears-over-hutchison-deal-6023330">the ACP said it was looking to develop container terminals</a> on the Pacific side at Corozal and on the Atlantic side near Colon. According to local press reports about the event, the ACP is starting its outreach to ocean carriers and terminal operators about the new terminal concessions, with a formal tender expected in the second half of 2026. The new terminals are part of Panama’s response to US government concerns about Chinese conglomerate CK Hutchison owning terminals on both sides of the canal. President Donald Trump has repeatedly pressured Panama’s government about selling the terminals to a non-Chinese firm, despite <a href="https://www.joc.com/article/panama-canal-transit-data-belies-trumps-claims-of-chinas-control-project44-5948559">no evidence of US-bound ships receiving less preferential treatment for canal transits</a>. ACP President Ricuarte Vasquez Morales has said the canal needs more common carrier terminal capacity. MSC’s Terminal Investment Limited subsidiary and BlackRock’s Global Infrastructure Partners have emerged as the leading bidders for the terminals in Colon and Balboa. The sale, though, faces a lengthy regulatory review, plus the potential inclusion of Cosco Shipping as another partner as <a href="https://www.joc.com/article/beijing-issues-warning-over-hutchisons-proposed-sale-of-panama-ports-company-5962910">a sop to China for approving Hutchison’s sale of the terminals</a>. Hutchison has confirmed that a “major strategic investor from China” was looking to be part of a Hutchison acquisition. An MSC takeover of the two terminals could shut out Maersk from an important transshipment point for its north-south services. Over the past 12 months, Maersk-operated container ships have made 1,345 calls to Panama’s ports, according to data from Sea-web, a sister product of the Journal of Commerce within S&amp;P Global. MSC, as well, is a heavy user of Panama’s terminals, with 1,563 calls over the same time. In April, <a href="https://www.joc.com/article/apm-acquires-first-railroad-asset-with-deal-for-panama-canals-short-line-5975493">Maersk bought the Panama Canal Railway</a>, the short-line railroad that links the ports of Balboa and Colon. Maersk, which is the railway’s largest customer, also operates a logistics park in the country. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Maersk signaled its interest in helping develop the Panama Canal’s yet-to-be-built container terminals, as the carrier faces the prospect of its former alliance partner Mediterranean Shipping Co. taking control of Panama’s current terminal assets. Speaking at an event Oct. 9 sponsored by Denmark’s embassy in Colombia, Maersk Chief Executive Vincent Clerc said his company may invest in the new terminals the Panama Canal Authority (ACP) hopes to build on both sides of the canal. This summer, the ACP said it was looking to develop container terminals on the Pacific side at Corozal and on the Atlantic side near Colon. According to local press reports about the event, the ACP is starting its outreach to ocean carriers and terminal operators about the new terminal concessions, with a formal tender expected in the second half of 2026. The new terminals are part of Panama’s response to US government concerns about Chinese conglomerate CK Hutchison owning terminals on both sides of the canal. President Donald Trump has repeatedly pressured Panama’s government about selling the terminals to a non-Chinese firm, despite no evidence of US-bound ships receiving less preferential treatment for canal transits . ACP President Ricuarte Vasquez Morales has said the canal needs more common carrier terminal capacity. MSC’s Terminal Investment Limited subsidiary and BlackRock’s Global Infrastructure Partners have emerged as the leading bidders for the terminals in Colon and Balboa. The sale, though, faces a lengthy regulatory review, plus the potential inclusion of Cosco Shipping as another partner as a sop to China for approving Hutchison’s sale of the terminals . Hutchison has confirmed that a “major strategic investor from China” was looking to be part of a Hutchison acquisition. An MSC takeover of the two terminals could shut out Maersk from an important transshipment point for its north-south services. Over the past 12 months, Maersk-operated container ships have made 1,345 calls to Panama’s ports, according to data from Sea-web, a sister product of the Journal of Commerce within S&P Global. MSC, as well, is a heavy user of Panama’s terminals, with 1,563 calls over the same time. In April, Maersk bought the Panama Canal Railway , the short-line railroad that links the ports of Balboa and Colon. Maersk, which is the railway’s largest customer, also operates a logistics park in the country. Contact Michael Angell at michael.angell@spglobal.com .

Maersk considering investment in Panama’s new terminals

<div class="phx-topic abstract-wrapper">The LTL world of 2025 does not reward those who guess, but rather those who know — and knowing begins with visibility. </div>

The LTL world of 2025 does not reward those who guess, but rather those who know — and knowing begins with visibility.

<div class="phx-topic">The US less-than-truckload (LTL) sector stands at a critical crossroads. Faced with depressed demand, high operating costs, economic uncertainty and rising customer expectations, LTL carriers, brokers and shippers are under mounting pressure to do more with less. Efficiency, accuracy and transparency have never been more vital. Even as some aspects of LTL have modernized, persistent blind spots still drain time, revenue and customer satisfaction. Accessorial management and location visibility remain at the heart of operational performance and profitability in the LTL sector, and companies must solve these challenges to thrive in this freight environment. Accessorial charges are often treated as the fine print of freight, but their financial impact is anything but small. These additional fees, covering services such as liftgate usage, residential delivery, limited-access sites and inside delivery are frequently not accounted for until after a delivery is completed. At that point, shippers receive unexpected invoices, brokers scramble to reconcile charges, and carriers are left fielding disputes that strain valuable relationships and negatively impact their bottom line. Without an accurate, upfront method of identifying potential accessorials, companies lose control over cost predictability. This unpredictability does more than damage budgets. It undermines long-term rate negotiations and muddies performance metrics such as cost per shipment and gross margin. Billing disputes over accessorials can also slow down cash flow and stretch out time-to-payment cycles. As the logistics sector faces tighter margins and rising customer expectations, these seemingly minor charges can add up to major financial consequences. Location data is another underestimated factor that directly impacts LTL performance. While most transportation management systems (TMSs) offer basic shipment tracking, they often lack granular location insights. This includes data points such as whether a site is residential or commercial, whether there is dock access or a forklift onsite, or if the delivery site has limited hours or requires specialized entry. These details may seem minor, but their absence leads to service mismatches, re-delivery attempts, extended dwell times and more accessorial charges. For example, failing to flag a residential delivery that requires a liftgate can result in a surprise fee and an unhappy customer. A shipment bound for a military base or an airport without the right equipment or credentials can create costly delays and failed deliveries. Inaccurate or incomplete location information does more than increase costs — it erodes operational agility. <h3>Technology can ease challenges </h3>The good news is that technology now exists to solve these challenges at scale. New platforms that leverage AI, machine learning and geospatial data are transforming how logistics professionals manage LTL freight. These tools can identify potential accessorial charges before the freight is tendered, analyze delivery site characteristics in real time and deliver a unified accessorial view across all stakeholders. By automating accessorial identification during order entry and integrating precise location attributes such as limited access, loading dock availability, forklifts on site or gated entry, these platforms allow teams to move from reactive firefighting to proactive planning. With real-time alerts and API integrations that connect directly into a TMS, shippers, brokers and carriers can operate from a shared source of accessorial truth. The impact of smarter accessorial identification and location visibility delivers measurable results. Companies that have adopted these advanced solutions have reported a 75% reduction in unexpected accessorial fees, leading to cleaner invoices and faster dispute resolution. Customers have also seen improved on-time in-full (OTIF) performance, driving higher customer satisfaction and stronger service-level agreement (SLA) compliance. This shift is particularly timely in 2025, as the LTL industry grapples with economic volatility, rising operating costs and major classification changes. Freight volumes are inconsistent, carriers are prioritizing profitability over market share, and the new National Motor Freight Traffic Association density-based classification system is forcing shippers to re-evaluate how they package and price freight. In this environment, hidden costs such as accessorials and inefficiencies tied to poor location visibility can erode already thin margins. With shifting demand, cost inflation and operational headwinds, the ability to forecast costs, identify risks and plan accordingly has become a key competitive advantage. In the past, accessorial management and granular location visibility may have been viewed as optional enhancements. Today, they are essential for any company that relies on LTL shipping as a core part of its logistics strategy. When customer expectations are rising and disruptions are the new norm, having visibility into every shipment detail and every delivery site is table stakes. The LTL world of 2025 does not reward those who guess. It rewards those who know, and knowing begins with visibility. North Winship is president of Shiplify. Contact him at <a href="mailto:northw@shiplify.com">northw@shiplify.com</a>. Bart De Muynck is a strategic advisor for Drewry. Contact him at <a href="mailto:bart@bartdemuynck.com">bart@bartdemuynck.com</a>. </div>

The US less-than-truckload (LTL) sector stands at a critical crossroads. Faced with depressed demand, high operating costs, economic uncertainty and rising customer expectations, LTL carriers, brokers and shippers are under mounting pressure to do more with less. Efficiency, accuracy and transparency have never been more vital. Even as some aspects of LTL have modernized, persistent blind spots still drain time, revenue and customer satisfaction. Accessorial management and location visibility remain at the heart of operational performance and profitability in the LTL sector, and companies must solve these challenges to thrive in this freight environment. Accessorial charges are often treated as the fine print of freight, but their financial impact is anything but small. These additional fees, covering services such as liftgate usage, residential delivery, limited-access sites and inside delivery are frequently not accounted for until after a delivery is completed. At that point, shippers receive unexpected invoices, brokers scramble to reconcile charges, and carriers are left fielding disputes that strain valuable relationships and negatively impact their bottom line. Without an accurate, upfront method of identifying potential accessorials, companies lose control over cost predictability. This unpredictability does more than damage budgets. It undermines long-term rate negotiations and muddies performance metrics such as cost per shipment and gross margin. Billing disputes over accessorials can also slow down cash flow and stretch out time-to-payment cycles. As the logistics sector faces tighter margins and rising customer expectations, these seemingly minor charges can add up to major financial consequences. Location data is another underestimated factor that directly impacts LTL performance. While most transportation management systems (TMSs) offer basic shipment tracking, they often lack granular location insights. This includes data points such as whether a site is residential or commercial, whether there is dock access or a forklift onsite, or if the delivery site has limited hours or requires specialized entry. These details may seem minor, but their absence leads to service mismatches, re-delivery attempts, extended dwell times and more accessorial charges. For example, failing to flag a residential delivery that requires a liftgate can result in a surprise fee and an unhappy customer. A shipment bound for a military base or an airport without the right equipment or credentials can create costly delays and failed deliveries. Inaccurate or incomplete location information does more than increase costs — it erodes operational agility. Technology can ease challenges The good news is that technology now exists to solve these challenges at scale. New platforms that leverage AI, machine learning and geospatial data are transforming how logistics professionals manage LTL freight. These tools can identify potential accessorial charges before the freight is tendered, analyze delivery site characteristics in real time and deliver a unified accessorial view across all stakeholders. By automating accessorial identification during order entry and integrating precise location attributes such as limited access, loading dock availability, forklifts on site or gated entry, these platforms allow teams to move from reactive firefighting to proactive planning. With real-time alerts and API integrations that connect directly into a TMS, shippers, brokers and carriers can operate from a shared source of accessorial truth. The impact of smarter accessorial identification and location visibility delivers measurable results. Companies that have adopted these advanced solutions have reported a 75% reduction in unexpected accessorial fees, leading to cleaner invoices and faster dispute resolution. Customers have also seen improved on-time in-full (OTIF) performance, driving higher customer satisfaction and stronger service-level agreement (SLA) compliance. This shift is particularly timely in 2025, as the LTL industry grapples with economic volatility, rising operating costs and major classification changes. Freight volumes are inconsistent, carriers are prioritizing profitability over market share, and the new National Motor Freight Traffic Association density-based classification system is forcing shippers to re-evaluate how they package and price freight. In this environment, hidden costs such as accessorials and inefficiencies tied to poor location visibility can erode already thin margins. With shifting demand, cost inflation and operational headwinds, the ability to forecast costs, identify risks and plan accordingly has become a key competitive advantage. In the past, accessorial management and granular location visibility may have been viewed as optional enhancements. Today, they are essential for any company that relies on LTL shipping as a core part of its logistics strategy. When customer expectations are rising and disruptions are the new norm, having visibility into every shipment detail and every delivery site is table stakes. The LTL world of 2025 does not reward those who guess. It rewards those who know, and knowing begins with visibility. North Winship is president of Shiplify. Contact him at northw@shiplify.com . Bart De Muynck is a strategic advisor for Drewry. Contact him at bart@bartdemuynck.com .

Visibility transforming accessorial and location insights in LTL shipping

<div class="phx-topic abstract-wrapper">There are measures carriers can take around the edges, but if they really want to take control of supply — and thus price — collectively sidelining some high-caliber tonnage is the standout solution, writes Jeremy Masters. </div>

There are measures carriers can take around the edges, but if they really want to take control of supply — and thus price — collectively sidelining some high-caliber tonnage is the standout solution, writes Jeremy Masters.

<div class="phx-topic">The laws of supply and demand dictate that prices will move in accordance with the relativity of the two. Container carriers can marginally move the dial between what is containerized and what is bulk or breakbulk by offering very attractive (low contribution) rates. An innovative product — for example, Gemini Cooperation’s high reliability network or an express service — might lure some air freight to sea freight. For the most part, however, carriers have very little control over demand. The key price lever that carriers have is slot supply, and current fundamentals point to heavy surplus, even as diversions around southern Africa continue. Are the carriers, then, sprinting to the edge of the cliff with newbuild deliveries, fresh orders, second-hand buying and chartering of what little spare capacity is left, followed by a freefall? Or do they at least have a parachute to slow down their momentum? There are some things they can do to help themselves in trades with overcapacity. <h3>Pushing pause </h3>The most obvious and dramatic way would be to park ships. To be impactful, that would mean collectively taking out multiple strings rather than tinkering with single strings or blank sailings. Understandably, there is a mental block in the big east-west trades when it comes to parking high-capacity, high-value, newer ships. But if the carriers get supply even minimally below demand, the economics are massively in their favor. Let's assume that, in the Asia-to-Europe trade, each consortium (for these purposes, Mediterranean Shipping Co. would be considered a consortium) ties up one string of ultra-large container vessels (ULCVs) that was forecasted to make a minimal contribution to fixed cost because of declining rates. If, because of removing these strings, freight rates were a very conservative $500 per TEU higher on average on the headhaul than they would have been, based on 20,000 TEU per week and 50 weeks, all consortiums would accumulate an additional $500,000 million per annum on all remaining loops. There would be, of course, some incremental lay-up costs, but other costs would remain similar. Parking some $3 billion worth of assets per consortium is easier in theory than in practice, especially for those carriers who need to justify some heavy investments to their boards. If the carriers accept that drastic action is required, however, and there is enough collective action — not orchestrated action, of course, in contravention of competition rules — then the results will be dramatically better, and the ships will be readily available for an upturn. <h3>Beyond parking </h3>Are there less capacity-eating measures that carriers could undertake? The catalyst for a major dive in multi-trade rates would be a return to the Red Sea and Suez Canal for Asia-to-Europe strings, but it's unlikely that we will go overnight from high-risk Red Sea transits to totally safe ones. Given the disruption and risk — for carriers and their clients — of moving all strings back to the Red Sea only to find that further issues arise, it would be entirely justifiable to keep some strings moving around the Cape of Good Hope. Big beneficial cargo owners (BCOs) and forwarders/non-vessel operating common carriers (NVOCCs) have — forcefully — adjusted to the Cape routing. And while there is higher on-the-water inventory cost, the weekly pipeline of arrivals are established. They would naturally lean towards the faster Red Sea routing, but at the same time, would want to strenuously avoid a situation where production lines are stopped or shelves empty because they have put all their eggs in the Red Sea basket that has turned bad again. This may be counterintuitive, given more expensive ship systems around the Cape, but carriers could also implement two-tier pricing to re-enforce this prudence — essentially, a premium for Red Sea risk or a deficit for longer transits, whichever you prefer. Slow-steaming is another area of capacity control where a systematic approach could eat up more capacity. This means not just applying it in over-tonnaged trades, but in all trades. Tonnage can then be moved from trades where there is oversupply to those that are short because of slow-steaming. Finally, there is the scrapping of older vessels. If we look at carriers' desire to hold onto bigger, newer assets and their purchase of relatively old smaller tonnage to run regional and feeder networks, this does not look to be a particularly encouraging area for capacity shedding. There are measures the carriers can take around the edges, but if they really want to take control of supply – and thus price – collectively sidelining some high-caliber tonnage is the standout solution. Contact Jeremy Masters at <a href="mailto:jeremy@shippingmastershk.com">jeremy@shippingmastershk.com</a>. </div>

The laws of supply and demand dictate that prices will move in accordance with the relativity of the two. Container carriers can marginally move the dial between what is containerized and what is bulk or breakbulk by offering very attractive (low contribution) rates. An innovative product — for example, Gemini Cooperation’s high reliability network or an express service — might lure some air freight to sea freight. For the most part, however, carriers have very little control over demand. The key price lever that carriers have is slot supply, and current fundamentals point to heavy surplus, even as diversions around southern Africa continue. Are the carriers, then, sprinting to the edge of the cliff with newbuild deliveries, fresh orders, second-hand buying and chartering of what little spare capacity is left, followed by a freefall? Or do they at least have a parachute to slow down their momentum? There are some things they can do to help themselves in trades with overcapacity. Pushing pause The most obvious and dramatic way would be to park ships. To be impactful, that would mean collectively taking out multiple strings rather than tinkering with single strings or blank sailings. Understandably, there is a mental block in the big east-west trades when it comes to parking high-capacity, high-value, newer ships. But if the carriers get supply even minimally below demand, the economics are massively in their favor. Let's assume that, in the Asia-to-Europe trade, each consortium (for these purposes, Mediterranean Shipping Co. would be considered a consortium) ties up one string of ultra-large container vessels (ULCVs) that was forecasted to make a minimal contribution to fixed cost because of declining rates. If, because of removing these strings, freight rates were a very conservative $500 per TEU higher on average on the headhaul than they would have been, based on 20,000 TEU per week and 50 weeks, all consortiums would accumulate an additional $500,000 million per annum on all remaining loops. There would be, of course, some incremental lay-up costs, but other costs would remain similar. Parking some $3 billion worth of assets per consortium is easier in theory than in practice, especially for those carriers who need to justify some heavy investments to their boards. If the carriers accept that drastic action is required, however, and there is enough collective action — not orchestrated action, of course, in contravention of competition rules — then the results will be dramatically better, and the ships will be readily available for an upturn. Beyond parking Are there less capacity-eating measures that carriers could undertake? The catalyst for a major dive in multi-trade rates would be a return to the Red Sea and Suez Canal for Asia-to-Europe strings, but it's unlikely that we will go overnight from high-risk Red Sea transits to totally safe ones. Given the disruption and risk — for carriers and their clients — of moving all strings back to the Red Sea only to find that further issues arise, it would be entirely justifiable to keep some strings moving around the Cape of Good Hope. Big beneficial cargo owners (BCOs) and forwarders/non-vessel operating common carriers (NVOCCs) have — forcefully — adjusted to the Cape routing. And while there is higher on-the-water inventory cost, the weekly pipeline of arrivals are established. They would naturally lean towards the faster Red Sea routing, but at the same time, would want to strenuously avoid a situation where production lines are stopped or shelves empty because they have put all their eggs in the Red Sea basket that has turned bad again. This may be counterintuitive, given more expensive ship systems around the Cape, but carriers could also implement two-tier pricing to re-enforce this prudence — essentially, a premium for Red Sea risk or a deficit for longer transits, whichever you prefer. Slow-steaming is another area of capacity control where a systematic approach could eat up more capacity. This means not just applying it in over-tonnaged trades, but in all trades. Tonnage can then be moved from trades where there is oversupply to those that are short because of slow-steaming. Finally, there is the scrapping of older vessels. If we look at carriers' desire to hold onto bigger, newer assets and their purchase of relatively old smaller tonnage to run regional and feeder networks, this does not look to be a particularly encouraging area for capacity shedding. There are measures the carriers can take around the edges, but if they really want to take control of supply – and thus price – collectively sidelining some high-caliber tonnage is the standout solution. Contact Jeremy Masters at jeremy@shippingmastershk.com .

Ocean carriers are not helpless when it comes to managing capacity

Asia to North Europe

Asia to Mediterranean

eeSea collects and centralizes liner network data from dozens of public sources including carriers’ vessel tracking portals, long-term schedules, customer advisories, port and terminal operator schedules, and pilot schedules. These disparate datasets are continually inspected, cleaned, and carefully structured. eeSea synthesizes this refined public data with AIS positions from a third-party provider and its datasets spanning schedule reliability, transit times, trade capacity evolution, and 60-day vessel forecasts. Ships are deemed late if they are one calendar day or late than scheduled. [eeSea](https://www.eesea.com)

Asia to North Europe and Mediterranean ocean reliability (eeSea)

On-Time Performance Asia to Northern Europe and Mediterranean (eeSea) Gateway

<div class="phx-topic abstract-wrapper">On the eve of IMO’s London gathering this week, Washington has pledged to retaliate against nations supporting what it says is a “European-led neocolonial export of global climate regulations.” </div>

On the eve of IMO’s London gathering this week, Washington has pledged to retaliate against nations supporting what it says is a “European-led neocolonial export of global climate regulations.”

<div class="phx-topic">US opposition to the International Maritime Organization’s (IMO’s) shipping decarbonization plans has escalated dramatically, with the White House now threatening sanctions on countries who vote in favor of measures to cut shipping’s carbon emissions. Washington’s threats of retaliation against the IMO come as its Marine Environment Protection Committee (MEPC) <a href="https://www.joc.com/article/deep-divisions-linger-as-imo-gathers-for-pivotal-decarbonization-talks-6094699">readies to meet Oct. 14–17 in London</a> to vote on the decarbonization regulations, including the proposed net-zero framework that was agreed in principle by a majority of IMO members in April. A joint statement by Secretary of State Marco Rubio, Secretary of Energy Chris Wright and Transportation Secretary Sean Duffy on Friday called the greenhouse gas-cutting measures a global carbon tax on American consumers that would not be tolerated. “The NZF [net-zero framework] proposal poses significant risks to the global economy and subjects not just Americans, but all IMO member states to an unsanctioned global tax regime that levies punitive and regressive financial penalties, which could be avoided,” the statement said. If the net-zero framework is adopted, all large ships operating globally, including cruise ships, will be required to slash emissions by 17% by 2028, with steadily increasing emission reduction targets after that, or pay a fee. Shipping currently accounts for 3% of global carbon emissions. The US has long opposed measures aimed at placing a price on carbon emissions, and on the eve of the pivotal IMO meeting, its threats of retaliation against member states backing the net-zero framework were spelled out in the statement. “The United States will be moving to levy these remedies against nations that sponsor this European-led neocolonial export of global climate regulations,” the US statement said. “We will fight hard to protect our economic interests by imposing costs on countries if they support the NZF. Our fellow IMO members should be on notice.” The US actions would include sanctions on officials “sponsoring activist-driven climate policies that would burden American consumers,” imposing visa restrictions and revising quotas of maritime crew visas, and imposing additional port fees on ships owned, operated or flagged by countries supporting the net-zero framework. Flag states supporting the IMO measures may have their registered vessels blocked from calling at US ports, with the US also evaluating the imposition of financial penalties on the flag states. <h3>Leveling the global playing field </h3>The targeting of vessel flag states is an indication that the US is targeting Liberia, Panama and the Marshall Islands that are home to almost half of the world’s registered gross tonnage, which could play a crucial role during this week’s MEPC meeting. While much has been made about the need for a two-thirds majority vote in favor of the framework for it to pass, those voting yes will also need to control at least 50% of the world’s gross tonnage. Vessels flagged in Marshall Islands, Liberia and Panama constitute more than 45% of global tonnage. In a brief statement responding to the US threats, the European Commission said it supported the IMO’s “ambitious global measures to decarbonize the shipping sector and ensure a global level playing field.” “The EU views the net-zero framework as a significant milestone and calls for its adoption at the IMO,” the European Commission said. It has taken several years for the IMO to get to this point, but the heavily compromised net-zero framework agreement has polarized the shipping industry. Last week, seven shipowner associations <a href="https://www.joc.com/article/deep-divisions-linger-as-imo-gathers-for-pivotal-decarbonization-talks-6094699">urged member states “to make history” by approving the net-zero framework</a> that includes the world’s first industrywide carbon pricing measure. Besides the US, opposing the adoption of the framework in its current form are Greek shipowners representing mostly the tanker and gas carrier fleet and classification societies the American Bureau of Shipping (ABS) and DNV. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

US opposition to the International Maritime Organization’s (IMO’s) shipping decarbonization plans has escalated dramatically, with the White House now threatening sanctions on countries who vote in favor of measures to cut shipping’s carbon emissions. Washington’s threats of retaliation against the IMO come as its Marine Environment Protection Committee (MEPC) readies to meet Oct. 14–17 in London to vote on the decarbonization regulations, including the proposed net-zero framework that was agreed in principle by a majority of IMO members in April. A joint statement by Secretary of State Marco Rubio, Secretary of Energy Chris Wright and Transportation Secretary Sean Duffy on Friday called the greenhouse gas-cutting measures a global carbon tax on American consumers that would not be tolerated. “The NZF [net-zero framework] proposal poses significant risks to the global economy and subjects not just Americans, but all IMO member states to an unsanctioned global tax regime that levies punitive and regressive financial penalties, which could be avoided,” the statement said. If the net-zero framework is adopted, all large ships operating globally, including cruise ships, will be required to slash emissions by 17% by 2028, with steadily increasing emission reduction targets after that, or pay a fee. Shipping currently accounts for 3% of global carbon emissions. The US has long opposed measures aimed at placing a price on carbon emissions, and on the eve of the pivotal IMO meeting, its threats of retaliation against member states backing the net-zero framework were spelled out in the statement. “The United States will be moving to levy these remedies against nations that sponsor this European-led neocolonial export of global climate regulations,” the US statement said. “We will fight hard to protect our economic interests by imposing costs on countries if they support the NZF. Our fellow IMO members should be on notice.” The US actions would include sanctions on officials “sponsoring activist-driven climate policies that would burden American consumers,” imposing visa restrictions and revising quotas of maritime crew visas, and imposing additional port fees on ships owned, operated or flagged by countries supporting the net-zero framework. Flag states supporting the IMO measures may have their registered vessels blocked from calling at US ports, with the US also evaluating the imposition of financial penalties on the flag states. Leveling the global playing field The targeting of vessel flag states is an indication that the US is targeting Liberia, Panama and the Marshall Islands that are home to almost half of the world’s registered gross tonnage, which could play a crucial role during this week’s MEPC meeting. While much has been made about the need for a two-thirds majority vote in favor of the framework for it to pass, those voting yes will also need to control at least 50% of the world’s gross tonnage. Vessels flagged in Marshall Islands, Liberia and Panama constitute more than 45% of global tonnage. In a brief statement responding to the US threats, the European Commission said it supported the IMO’s “ambitious global measures to decarbonize the shipping sector and ensure a global level playing field.” “The EU views the net-zero framework as a significant milestone and calls for its adoption at the IMO,” the European Commission said. It has taken several years for the IMO to get to this point, but the heavily compromised net-zero framework agreement has polarized the shipping industry. Last week, seven shipowner associations urged member states “to make history” by approving the net-zero framework that includes the world’s first industrywide carbon pricing measure. Besides the US, opposing the adoption of the framework in its current form are Greek shipowners representing mostly the tanker and gas carrier fleet and classification societies the American Bureau of Shipping (ABS) and DNV. Contact Greg Knowler at greg.knowler@spglobal.com .

White House sanctions threat ups ante ahead of pivotal IMO meeting

<div class="phx-topic abstract-wrapper">The move would substantially increase costs and reduce capacity for vehicle and equipment makers such as Ford and Caterpillar who rely on vehicle carriers and ro/ro vessels to export their products, stakeholders say.   </div>

The move would substantially increase costs and reduce capacity for vehicle and equipment makers such as Ford and Caterpillar who rely on vehicle carriers and ro/ro vessels to export their products, stakeholders say.  

<div class="phx-topic">Vehicle carrier operators and trade groups are condemning moves by the US Trade Representative (USTR) to more than triple port call fees for all foreign-built vessels calling at US ports starting Oct. 14. The move would substantially increase costs and reduce capacity for vehicle and equipment makers such as Ford and Caterpillar who rely on vehicle carriers and roll-on/roll-off (ro/ro) vessels to export their products, stakeholders said.   “USTR drops the bomb at the last minute, not realizing how badly this will hurt US exporters,” Andrew Abbott, CEO of Atlantic Container Line, the US affiliate of Italy’s Grimaldi Group, told the Journal of Commerce. In a 32-page docket published Friday, the USTR said the port levy would increase to $46 per net ton compared with the $14 per net ton set in June when the USTR switched its fee assessment to a tonnage tax from a cargo tax. This means an average-sized vehicle carrier or ro/ro vessel will face a bill of about $1.2 million when it makes its first call at a US port. USTR will cap the fee at five calls per year for the same vessel. Justifying the three-fold increase in port fees, USTR general counsel Jennifer Thornton said in Friday’s announcement that “a number of comments made in the consultation period raised concerns that the proposed service fee rate of $14 per net ton is too low.” But most of the 69 submissions listed on the USTR website during the June–July industry comment period either wanted the port fee scrapped or levied only on Chinese-built vehicle carriers and ro/ro vessels. <h3>Customers to take the hit </h3>Vessel operators including Wallenius Wilhelmsen, the world’s largest car carrier operator, and Höegh Autoliners said the fees would likely be passed on to customers where feasible. The revised charges will increase Wilhelmsen’s annual port fee bill to about $1 billion, assuming 300 to 350 voyages to the US per year, while Höegh Autoliners will likely face a $225 million hit. Senior executives from the two Norwegian companies did not immediately respond to requests for comment from the Journal of Commerce. Knut Arild Hareide, CEO of the Norwegian Shipowners’ Association, to which the two companies belong, told the Journal of Commerce the group was “closely monitoring the situation and currently reviewing the latest developments.” Mitsui OSK Lines’ Frontier Ace and Glorious Ace, with calls scheduled for Oct.14 at Brunswick’s Colonel’s Island terminal in Georgia, will be among the first vehicles subject to the port call tax. Abbott warned previously that Grimaldi would likely cut its services and US port calls because even with the original fee of $14 per net ton, the cost would be unsustainable. “These fees will harm US automobile and tractor manufacturers who rely on vehicle carriers for both imports to support their American manufacturing operations, as well as some $20 billion in exports,” Joe Kramek, president and CEO of the Washington, DC-based World Shipping Council (WSC), told the Journal of Commerce Saturday. <h3>‘Collapse’ of US short-sea shipping </h3>Florida-headquartered Accordia Shipping, which operates ro/ro services between the US and the Caribbean, said the new fees could cause the collapse of short-sea services from the US, hurting exports and likely costing jobs. In written comments on the changes submitted to the USTR Friday, Farid Escobar, Accordia Shipping’s legal affairs liaison, said the company’s 3,829 net ton ro/ro Minchah will have to pay $176,134 per US port call under the revised $46 per net ton fee. The increase from the earlier $14-per-net-ton proposal “would render short-sea, export-based ro/ro operations economically untenable, dismantling trade lanes that sustain US manufacturing exports, regional supply-chain resilience, and maritime employment,” Escobar said in the filing. “Our operations consist of over 99% outbound US exports — US-manufactured and US-origin vehicles, construction equipment, and heavy rolling machinery — destined for neighboring Caribbean nations,” he added. Tiffany Smith, vice president for global trade policy at the National Foreign Trade Council, said the inclusion of all non-US-built car carriers “is a massive divergence from the objective of the [Section] 301 investigation.” “Imposing broad-based penalties on all operators, including US allies, would do nothing to constrain China’s dominance of the maritime sector and would have harmful effects on US industries that rely on ro/ro vessels,” Smith said. Other changes in Friday’s announcement include the possibility of levying port fees on vehicle carriers and ro/ro vessels below 10,000 deadweight metric tons. USTR has opened a public consultation on the proposal, which closes Nov. 10. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Vehicle carrier operators and trade groups are condemning moves by the US Trade Representative (USTR) to more than triple port call fees for all foreign-built vessels calling at US ports starting Oct. 14. The move would substantially increase costs and reduce capacity for vehicle and equipment makers such as Ford and Caterpillar who rely on vehicle carriers and roll-on/roll-off (ro/ro) vessels to export their products, stakeholders said.   “USTR drops the bomb at the last minute, not realizing how badly this will hurt US exporters,” Andrew Abbott, CEO of Atlantic Container Line, the US affiliate of Italy’s Grimaldi Group, told the Journal of Commerce. In a 32-page docket published Friday, the USTR said the port levy would increase to $46 per net ton compared with the $14 per net ton set in June when the USTR switched its fee assessment to a tonnage tax from a cargo tax. This means an average-sized vehicle carrier or ro/ro vessel will face a bill of about $1.2 million when it makes its first call at a US port. USTR will cap the fee at five calls per year for the same vessel. Justifying the three-fold increase in port fees, USTR general counsel Jennifer Thornton said in Friday’s announcement that “a number of comments made in the consultation period raised concerns that the proposed service fee rate of $14 per net ton is too low.” But most of the 69 submissions listed on the USTR website during the June–July industry comment period either wanted the port fee scrapped or levied only on Chinese-built vehicle carriers and ro/ro vessels. Customers to take the hit Vessel operators including Wallenius Wilhelmsen, the world’s largest car carrier operator, and Höegh Autoliners said the fees would likely be passed on to customers where feasible. The revised charges will increase Wilhelmsen’s annual port fee bill to about $1 billion, assuming 300 to 350 voyages to the US per year, while Höegh Autoliners will likely face a $225 million hit. Senior executives from the two Norwegian companies did not immediately respond to requests for comment from the Journal of Commerce. Knut Arild Hareide, CEO of the Norwegian Shipowners’ Association, to which the two companies belong, told the Journal of Commerce the group was “closely monitoring the situation and currently reviewing the latest developments.” Mitsui OSK Lines’ Frontier Ace and Glorious Ace, with calls scheduled for Oct.14 at Brunswick’s Colonel’s Island terminal in Georgia, will be among the first vehicles subject to the port call tax. Abbott warned previously that Grimaldi would likely cut its services and US port calls because even with the original fee of $14 per net ton, the cost would be unsustainable. “These fees will harm US automobile and tractor manufacturers who rely on vehicle carriers for both imports to support their American manufacturing operations, as well as some $20 billion in exports,” Joe Kramek, president and CEO of the Washington, DC-based World Shipping Council (WSC), told the Journal of Commerce Saturday. ‘Collapse’ of US short-sea shipping Florida-headquartered Accordia Shipping, which operates ro/ro services between the US and the Caribbean, said the new fees could cause the collapse of short-sea services from the US, hurting exports and likely costing jobs. In written comments on the changes submitted to the USTR Friday, Farid Escobar, Accordia Shipping’s legal affairs liaison, said the company’s 3,829 net ton ro/ro Minchah will have to pay $176,134 per US port call under the revised $46 per net ton fee. The increase from the earlier $14-per-net-ton proposal “would render short-sea, export-based ro/ro operations economically untenable, dismantling trade lanes that sustain US manufacturing exports, regional supply-chain resilience, and maritime employment,” Escobar said in the filing. “Our operations consist of over 99% outbound US exports — US-manufactured and US-origin vehicles, construction equipment, and heavy rolling machinery — destined for neighboring Caribbean nations,” he added. Tiffany Smith, vice president for global trade policy at the National Foreign Trade Council, said the inclusion of all non-US-built car carriers “is a massive divergence from the objective of the [Section] 301 investigation.” “Imposing broad-based penalties on all operators, including US allies, would do nothing to constrain China’s dominance of the maritime sector and would have harmful effects on US industries that rely on ro/ro vessels,” Smith said. Other changes in Friday’s announcement include the possibility of levying port fees on vehicle carriers and ro/ro vessels below 10,000 deadweight metric tons. USTR has opened a public consultation on the proposal, which closes Nov. 10. Contact Keith Wallis at keithwallis@hotmail.com .

Ro/ro cargo

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Car carrier sector slams USTR’s decision for threefold increase in port fees

<div class="phx-topic abstract-wrapper">But it will take several months of sustained peace before liners are confident enough of safe passage to redirect mainline services through the Suez Canal, according to an HSBC report.</div>

But it will take several months of sustained peace before liners are confident enough of safe passage to redirect mainline services through the Suez Canal, according to an HSBC report.

<div class="phx-topic">Two ocean carriers have expanded services in the Red Sea just days after a ceasefire was declared in Gaza between Israel and Hamas, but most liners will not be in a hurry to return to the at-times perilous route, according to one global bank. The expanded services of both CMA CGM and SeaLead pass through the narrow Bab al-Mandab Strait at the southern end of the Red Sea that is controlled by Houthi militants who have been attacking commercial shipping in support of Palestinians in Gaza since late 2023. A new routing structure by SeaLead’s revamped Five Seas Express (5CX) service will be launched on Oct. 27 offering weekly sailings via the Suez Canal connecting China, Egypt, Turkey, Saudi Arabia and Malaysia. The port rotation covers Qingdao, Shanghai, Ningbo, Nansha, Alexandria, Aliaga, Istanbul, Mersin, Jeddah and Port Klang before returning to Qingdao. “With weekly sailings and a time-saving route, the revamped service offers faster, more reliable, and efficient shipping solutions,” Kadir Oruc, regional managing director for Europe and the Mediterranean at SeaLead, said in a statement. CMA CGM told customers in an advisory Tuesday it was upgrading its REX2 service this month to offer expanded direct coverage between China and the Red Sea that would provide weekly sailings and faster transit times. New direct calls will be added at Qingdao and Aqaba in Jordan, with the double calls at Saudi Arabia’s Red Sea hub of Jeddah. The port rotation will be Qingdao, Shanghai, Ningbo, Shekou, Nansha, Singapore, Djibouti, Jeddah, Sokhna, Aqaba, Jeddah and Qingdao. The revamped service does not pass through the Suez. <h3>Carriers to practice caution </h3>The first phase of the Gaza truce took effect Oct. 9, and while a return to the Red Sea was expected at some point, carriers will remain cautious over whether the ceasefire will hold before they redirect mainline services through the Suez, HSBC said in a research report Monday. “In our view, liners will require a period of up to several months to feel confident that safe passage is fully restored before returning to the route,” HSBC said. “We think the ceasefire remains a key risk. A potential breakdown in the truce could lead to a resurgence of Red Sea attacks and further delay the return to the Red Sea.” The threat of attacks by the Houthis has forced carriers to divert around southern Africa since late 2023, adding significant time to journeys and pulling an estimated 7% of global capacity from the market. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Two ocean carriers have expanded services in the Red Sea just days after a ceasefire was declared in Gaza between Israel and Hamas, but most liners will not be in a hurry to return to the at-times perilous route, according to one global bank. The expanded services of both CMA CGM and SeaLead pass through the narrow Bab al-Mandab Strait at the southern end of the Red Sea that is controlled by Houthi militants who have been attacking commercial shipping in support of Palestinians in Gaza since late 2023. A new routing structure by SeaLead’s revamped Five Seas Express (5CX) service will be launched on Oct. 27 offering weekly sailings via the Suez Canal connecting China, Egypt, Turkey, Saudi Arabia and Malaysia. The port rotation covers Qingdao, Shanghai, Ningbo, Nansha, Alexandria, Aliaga, Istanbul, Mersin, Jeddah and Port Klang before returning to Qingdao. “With weekly sailings and a time-saving route, the revamped service offers faster, more reliable, and efficient shipping solutions,” Kadir Oruc, regional managing director for Europe and the Mediterranean at SeaLead, said in a statement. CMA CGM told customers in an advisory Tuesday it was upgrading its REX2 service this month to offer expanded direct coverage between China and the Red Sea that would provide weekly sailings and faster transit times. New direct calls will be added at Qingdao and Aqaba in Jordan, with the double calls at Saudi Arabia’s Red Sea hub of Jeddah. The port rotation will be Qingdao, Shanghai, Ningbo, Shekou, Nansha, Singapore, Djibouti, Jeddah, Sokhna, Aqaba, Jeddah and Qingdao. The revamped service does not pass through the Suez. Carriers to practice caution The first phase of the Gaza truce took effect Oct. 9, and while a return to the Red Sea was expected at some point, carriers will remain cautious over whether the ceasefire will hold before they redirect mainline services through the Suez, HSBC said in a research report Monday. “In our view, liners will require a period of up to several months to feel confident that safe passage is fully restored before returning to the route,” HSBC said. “We think the ceasefire remains a key risk. A potential breakdown in the truce could lead to a resurgence of Red Sea attacks and further delay the return to the Red Sea.” The threat of attacks by the Houthis has forced carriers to divert around southern Africa since late 2023, adding significant time to journeys and pulling an estimated 7% of global capacity from the market. Contact Greg Knowler at greg.knowler@spglobal.com .

CMA CGM, SeaLead revamp Red Sea sailings after Gaza truce

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The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

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Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

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<div class="phx-topic abstract-wrapper">But freighter operators were prepared for the frontloading, and no capacity shortages are being reported on China-US routes, according to Tiaca.</div>

But freighter operators were prepared for the frontloading, and no capacity shortages are being reported on China-US routes, according to Tiaca.

<div class="phx-topic">Air freight demand on the trans-Pacific has risen sharply as shippers advance orders following a threat by President Donald Trump to impose an additional 100% tariff on Chinese goods from Nov. 1. There has been no official announcement on the new tariff levels announced by the White House on Oct. 10 in response to Beijing’s plan to raise export controls on rare earth minerals, a crucial commodity primarily used in high-tech, renewables and defense industries. Still, jittery US importers were taking no chances, and with little time to frontload trans-Pacific ocean freight, they have turned to air cargo. “Many shippers are rushing to get their airfreight shipments into the US prior to Nov. 1 to beat the additional 100% tariffs that were announced recently,” said Sanjay Tejwani, CEO of 365 Logistics. “But I think this is a negotiating tactic to get China to review its recent regulations on the export of rare earth minerals,” he added. Kathy Liu, vice president of global sales and marketing at Dimerco Express Group, said air freight volume booked for this week into the US was “surging” ahead of the potential tariffs from Nov. 1. The Oct. 10 tariff announcement saw an initial 19% increase in rates compared with the previous week to $5.30 per kilogram, but rates have remained mostly flat since then, according to Freightos. Analysts expect to have a better idea of how rising demand is impacting pricing later this week. One factor preventing rates from spiking despite the rising demand is the available air freight capacity on the trans-Pacific. Glyn Hughes, director general of The International Air Cargo Association (Tiaca), said freighter operators were prepared for the frontloading and there were no capacity shortages on China-US routes. “This is the third round of such actions so to some degree it was expected and carriers were able to mobilize capacity on the trans-Pacific trade lane,” he told the Journal of Commerce Monday. In the week after the tariff announcement, available air freight capacity on China-US routes increased 24% compared with the previous week, according to data from air cargo analyst Rotate. Capacity deployed on the routes is currently up 21% year over year. Hughes said maritime supply chains were longer and slower to respond to deferred or implemented tariff decisions, with shippers preferring to take a “wait and see” approach and loading urgent consignments by air as required. “Overall, though, these constant frontloading spikes in capacity demand do not provide for a consistent operational environment conducive to rate stability and regularized network connectivity,” he added. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Air freight demand on the trans-Pacific has risen sharply as shippers advance orders following a threat by President Donald Trump to impose an additional 100% tariff on Chinese goods from Nov. 1. There has been no official announcement on the new tariff levels announced by the White House on Oct. 10 in response to Beijing’s plan to raise export controls on rare earth minerals, a crucial commodity primarily used in high-tech, renewables and defense industries. Still, jittery US importers were taking no chances, and with little time to frontload trans-Pacific ocean freight, they have turned to air cargo. “Many shippers are rushing to get their airfreight shipments into the US prior to Nov. 1 to beat the additional 100% tariffs that were announced recently,” said Sanjay Tejwani, CEO of 365 Logistics. “But I think this is a negotiating tactic to get China to review its recent regulations on the export of rare earth minerals,” he added. Kathy Liu, vice president of global sales and marketing at Dimerco Express Group, said air freight volume booked for this week into the US was “surging” ahead of the potential tariffs from Nov. 1. The Oct. 10 tariff announcement saw an initial 19% increase in rates compared with the previous week to $5.30 per kilogram, but rates have remained mostly flat since then, according to Freightos. Analysts expect to have a better idea of how rising demand is impacting pricing later this week. One factor preventing rates from spiking despite the rising demand is the available air freight capacity on the trans-Pacific. Glyn Hughes, director general of The International Air Cargo Association (Tiaca), said freighter operators were prepared for the frontloading and there were no capacity shortages on China-US routes. “This is the third round of such actions so to some degree it was expected and carriers were able to mobilize capacity on the trans-Pacific trade lane,” he told the Journal of Commerce Monday. In the week after the tariff announcement, available air freight capacity on China-US routes increased 24% compared with the previous week, according to data from air cargo analyst Rotate. Capacity deployed on the routes is currently up 21% year over year. Hughes said maritime supply chains were longer and slower to respond to deferred or implemented tariff decisions, with shippers preferring to take a “wait and see” approach and loading urgent consignments by air as required. “Overall, though, these constant frontloading spikes in capacity demand do not provide for a consistent operational environment conducive to rate stability and regularized network connectivity,” he added. Contact Greg Knowler at greg.knowler@spglobal.com .

Air Cargo

China air freight demand, rates surge on new 100% US tariff

<div class="phx-topic abstract-wrapper">J.B. Hunt lowered its peak season surcharge because of disappointing volume on the West Coast.</div>

J.B. Hunt lowered its peak season surcharge because of disappointing volume on the West Coast.

<div class="phx-topic">J.B. Hunt Transport Services said demand for its intermodal business remained soft in the third quarter, particularly on the West Coast, where transcontinental container loads fell 6% from a year earlier, as total rail shipments declined 1% overall. In describing the overall freight market, the company remarked that “it’s no secret, the market hasn’t returned yet,” which has now surpassed three years. The nation’s largest domestic intermodal provider rolled out an early peak-season surcharge in July of $1,500 per container in Los Angeles, but the company <a href="https://www.joc.com/article/jb-hunt-reduces-peak-season-surcharge-on-southern-california-moves-6066323">later trimmed the fee to $800.</a> “We were disappointed in demand off the West Coast during the quarter and even adjusted our peak program in the middle of the quarter as an example,” said Darren Field, president of J.B. Hunt’s intermodal division. “Demand for our domestic intermodal service wasn’t all that strong.” Despite sluggish volume, executives said the peak season may not be finished because much of the cargo unloaded at West Coast ports this summer remains in local warehouses. “It is important to disconnect the timing of peak season on the water from peak season of the inland supply chain,” said Spencer Frazier, executive vice president of sales and marketing. “Our conversations indicate there is a large amount of freight that was imported early that hasn’t moved through the inland supply chain yet. No one has canceled Christmas.” There were some positive results despite the weaker third quarter in Southern California. Domestic intermodal operating income rose 12% year over year, contributing to an 8% increase in company-wide operating income. The company said aggressive cost controls shaved $20 million in costs during the quarter. <h3>East Coast intermodal doing better </h3>Local East Coast intermodal volume climbed 6% in the quarter, a signal that there is strength on containerized freight staying within the CSX Transportation and Norfolk Southern Railway (NS) networks. The carrier credited improved rail service for helping to shift more truckload freight to rail in the region. The Journal of Commerce Intermodal Service Z-Score, a measurement of how a railroad performs against its own history on three key service metrics, showed CSX and NS operated at or above average through the second-to-last week of the quarter. The final week’s data is unavailable because the US Surface Transportation Board, which publishes the metrics, is affected by the federal government shutdown. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="128e25f2-064e-4956-afe3-0fe7d3c06552"></dynamic-object></div>Norfolk Southern CEO Mark George said Thursday at the Virginia Maritime Association conference that intermodal train speeds are up this year. “We’re delivering consistent service, trending about 90% on-time performance,” George said. “In fact, in September, we had a standout month, hitting 100% in intermodal plan compliance.” He added that international intermodal traffic has risen more than 3% year over year, while domestic volume has flatlined because of trade disruptions. The comments suggest either J.B. Hunt’s East Coast gains may be concentrated on the CSX network, or other NS domestic intermodal partners have struggled to sustain shipments. <h3>Not taking sides on UP-NS deal </h3>J.B. Hunt CEO Shelley Simpson addressed Union Pacific Railroad’s (UP’s) <a href="https://www.joc.com/article/major-rail-union-backs-up-ns-merger-after-job-protection-deal-6084510">proposed acquisition</a> of NS before US regulators, signaling that the company would neither endorse nor oppose the transaction. “Our decades of experience, including navigating seven prior Class I railroad mergers and our thoughtfully developed long-term agreements and strong relationships with NS, CSX, and BNSF should provide the basis for us to accept any changes in the industry,” she said Wednesday. J.B. Hunt’s Field pushed back on speculation that a merger would force J.B. Hunt to shift all East Coast traffic to CSX. The assumption stems from the carrier’s long-standing partnership with BNSF Railway under the “Quantum Agreement,” a revenue-sharing arrangement formed more than 35 years ago that gives J.B. Hunt a pricing edge over competitors. It also launched a <a href="https://www.joc.com/article/j-b-hunt-bnsf-launch-new-intermodal-service-to-grab-time-sensitive-freight-5215574">Quantum service product</a> two years ago with a 95% on-time intermodal performance guarantee supported by J.B. Hunt staff embedded at BNSF’s headquarters in Texas. In recent months, BNSF and CSX have deepened their relationship, launching coast-to-coast intermodal routes linking Southern California <a href="https://www.joc.com/article/bnsf-csx-unveil-new-joint-intermodal-lanes-in-aftermath-of-up-ns-merger-6067789">with Charlotte and Jacksonville</a>. Other coast-to-coast routes to the Northeast <a href="https://www.joc.com/article/csx-restarts-baltimore-tunnel-service-for-double-stack-in-2026-6087384">may be announced next year</a> after CSX begins double-stack intermodal service through Baltimore next spring. This budding partnership has fueled speculation that J.B. Hunt could edge closer to CSX along with BNSF. Many West Coast rail contracts include exclusivity clauses preventing companies such as Hub Group or Schneider National from using BNSF in markets where UP also runs. J.B. Hunt’s BNSF deals carry similar restrictions, making it unlikely the carrier would be permitted to shift volume onto a merged UP-NS network in BNSF-served territories. Even so, J.B. Hunt could continue using a combined UP-NS network for freight to stay east of the Mississippi, where BNSF has no presence. “Any future merger that would be approved for whatever reason has been perceived that J.B. Hunt would have to move our traffic to CSX and that’s not accurate at all,” Field said. “There’s nothing about a future state new railroad that would mean our current Norfolk Southern footprint that we have today would be required to change.” Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. Senior Editor Eric Johnson contributed to this report. </div>

J.B. Hunt Transport Services said demand for its intermodal business remained soft in the third quarter, particularly on the West Coast, where transcontinental container loads fell 6% from a year earlier, as total rail shipments declined 1% overall. In describing the overall freight market, the company remarked that “it’s no secret, the market hasn’t returned yet,” which has now surpassed three years. The nation’s largest domestic intermodal provider rolled out an early peak-season surcharge in July of $1,500 per container in Los Angeles, but the company later trimmed the fee to $800. “We were disappointed in demand off the West Coast during the quarter and even adjusted our peak program in the middle of the quarter as an example,” said Darren Field, president of J.B. Hunt’s intermodal division. “Demand for our domestic intermodal service wasn’t all that strong.” Despite sluggish volume, executives said the peak season may not be finished because much of the cargo unloaded at West Coast ports this summer remains in local warehouses. “It is important to disconnect the timing of peak season on the water from peak season of the inland supply chain,” said Spencer Frazier, executive vice president of sales and marketing. “Our conversations indicate there is a large amount of freight that was imported early that hasn’t moved through the inland supply chain yet. No one has canceled Christmas.” There were some positive results despite the weaker third quarter in Southern California. Domestic intermodal operating income rose 12% year over year, contributing to an 8% increase in company-wide operating income. The company said aggressive cost controls shaved $20 million in costs during the quarter. East Coast intermodal doing better Local East Coast intermodal volume climbed 6% in the quarter, a signal that there is strength on containerized freight staying within the CSX Transportation and Norfolk Southern Railway (NS) networks. The carrier credited improved rail service for helping to shift more truckload freight to rail in the region. The Journal of Commerce Intermodal Service Z-Score, a measurement of how a railroad performs against its own history on three key service metrics, showed CSX and NS operated at or above average through the second-to-last week of the quarter. The final week’s data is unavailable because the US Surface Transportation Board, which publishes the metrics, is affected by the federal government shutdown. Norfolk Southern CEO Mark George said Thursday at the Virginia Maritime Association conference that intermodal train speeds are up this year. “We’re delivering consistent service, trending about 90% on-time performance,” George said. “In fact, in September, we had a standout month, hitting 100% in intermodal plan compliance.” He added that international intermodal traffic has risen more than 3% year over year, while domestic volume has flatlined because of trade disruptions. The comments suggest either J.B. Hunt’s East Coast gains may be concentrated on the CSX network, or other NS domestic intermodal partners have struggled to sustain shipments. Not taking sides on UP-NS deal J.B. Hunt CEO Shelley Simpson addressed Union Pacific Railroad’s (UP’s) proposed acquisition of NS before US regulators, signaling that the company would neither endorse nor oppose the transaction. “Our decades of experience, including navigating seven prior Class I railroad mergers and our thoughtfully developed long-term agreements and strong relationships with NS, CSX, and BNSF should provide the basis for us to accept any changes in the industry,” she said Wednesday. J.B. Hunt’s Field pushed back on speculation that a merger would force J.B. Hunt to shift all East Coast traffic to CSX. The assumption stems from the carrier’s long-standing partnership with BNSF Railway under the “Quantum Agreement,” a revenue-sharing arrangement formed more than 35 years ago that gives J.B. Hunt a pricing edge over competitors. It also launched a Quantum service product two years ago with a 95% on-time intermodal performance guarantee supported by J.B. Hunt staff embedded at BNSF’s headquarters in Texas. In recent months, BNSF and CSX have deepened their relationship, launching coast-to-coast intermodal routes linking Southern California with Charlotte and Jacksonville . Other coast-to-coast routes to the Northeast may be announced next year after CSX begins double-stack intermodal service through Baltimore next spring. This budding partnership has fueled speculation that J.B. Hunt could edge closer to CSX along with BNSF. Many West Coast rail contracts include exclusivity clauses preventing companies such as Hub Group or Schneider National from using BNSF in markets where UP also runs. J.B. Hunt’s BNSF deals carry similar restrictions, making it unlikely the carrier would be permitted to shift volume onto a merged UP-NS network in BNSF-served territories. Even so, J.B. Hunt could continue using a combined UP-NS network for freight to stay east of the Mississippi, where BNSF has no presence. “Any future merger that would be approved for whatever reason has been perceived that J.B. Hunt would have to move our traffic to CSX and that’s not accurate at all,” Field said. “There’s nothing about a future state new railroad that would mean our current Norfolk Southern footprint that we have today would be required to change.” Contact Ari Ashe at ari.ashe@spglobal.com . Senior Editor Eric Johnson contributed to this report.

North-American rail

Intermodal providers

J.B. Hunt: Intermodal volume retracts amid cost-cutting measures

<div class="phx-topic abstract-wrapper">China’s new port fees on non-China-made vessels that are US-flagged or owned or controlled by US companies are forcing the Gemini Cooperation partners to transship via South Korea to avoid the multimillion-dollar hit. </div>

China’s new port fees on non-China-made vessels that are US-flagged or owned or controlled by US companies are forcing the Gemini Cooperation partners to transship via South Korea to avoid the multimillion-dollar hit.

<div class="phx-topic">The Gemini Cooperation diverted two US-flag vessels in a trans-Pacific service away from China due to that country’s retaliatory port fees, with one of the alliance partners warning of a multimillion-dollar hit that carriers face on US-flag ships because of the fees. Maersk and Hapag-Lloyd advised customers on Tuesday that two US-flag ships in their jointly-operated TP7/WC5 service will no longer call Ningbo. This week’s voyage of Hapag-Lloyd’s Potomac Express will discharge westbound cargo for China in Busan, South Korea, and then be transshipped on another ship. The Denmark-flagged Maersk Luz will carry outbound freight from Ningbo to South Korea’s Kwangyang port, which will then be loaded on the Potomac Express. Next week’s voyage of the Maersk Kinloss will also discharge westbound China cargo in South Korea for transshipment on an unidentified ship, with eastbound cargo from Ningbo being shipped on a Gemini shuttle ship. The service switch-up comes as <a href="https://www.joc.com/article/china-returns-fire-with-retaliatory-port-fees-targeting-us-affiliated-ships-6095198">China’s recently unveiled port fees on US-flag ships</a> went into effect on Oct. 14, the same day as similar US port fees took effect on Chinese-built ships and carriers. While China has exempted US-flag ships built in China from the fees, both of Gemini’s affected ships were built in South Korea. China plans to charge US-flag, non-Chinese vessels $56 per net ton, approximately similar to what the US is levying. Based on their net tonnage, each of the Gemini ships would incur a $2.5 million charge. <h3>Hapag-Lloyd looks to adjust </h3>Stuart Sandlin, Hapag-Lloyd’s North American president, said Wednesday at the Virginia Maritime Association trade conference in Norfolk that the carrier’s five US-flagged, South Korean-built ships would face a total of $125 million in Chinese port fees annually. The US-flag international fleet can also carry commercial cargo to and from China, in addition to any government or military cargo for other Asian countries. Sandlin said Hapag-Lloyd is now looking at how to split up that business to avoid the fees. “We have a US-flag group, and we have a non-US-flag group, and that makes it a lot more difficult because of the current geopolitical situation,” he said. “We’re working to see how we actually manage through that.” There are currently 57 ships in the US-flag international fleet, according to Sea-web, a sister company of the Journal of Commerce within S&amp;P Global. Those US-flag ships made 163 calls globally year to date. The US-flag Matson Waikiki, which called Shanghai on Tuesday, faces a $1.7 million fee. Among US-flag carriers, CMA CGM’s APL division runs the only fleet solely built in China. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

The Gemini Cooperation diverted two US-flag vessels in a trans-Pacific service away from China due to that country’s retaliatory port fees, with one of the alliance partners warning of a multimillion-dollar hit that carriers face on US-flag ships because of the fees. Maersk and Hapag-Lloyd advised customers on Tuesday that two US-flag ships in their jointly-operated TP7/WC5 service will no longer call Ningbo. This week’s voyage of Hapag-Lloyd’s Potomac Express will discharge westbound cargo for China in Busan, South Korea, and then be transshipped on another ship. The Denmark-flagged Maersk Luz will carry outbound freight from Ningbo to South Korea’s Kwangyang port, which will then be loaded on the Potomac Express. Next week’s voyage of the Maersk Kinloss will also discharge westbound China cargo in South Korea for transshipment on an unidentified ship, with eastbound cargo from Ningbo being shipped on a Gemini shuttle ship. The service switch-up comes as China’s recently unveiled port fees on US-flag ships went into effect on Oct. 14, the same day as similar US port fees took effect on Chinese-built ships and carriers. While China has exempted US-flag ships built in China from the fees, both of Gemini’s affected ships were built in South Korea. China plans to charge US-flag, non-Chinese vessels $56 per net ton, approximately similar to what the US is levying. Based on their net tonnage, each of the Gemini ships would incur a $2.5 million charge. Hapag-Lloyd looks to adjust Stuart Sandlin, Hapag-Lloyd’s North American president, said Wednesday at the Virginia Maritime Association trade conference in Norfolk that the carrier’s five US-flagged, South Korean-built ships would face a total of $125 million in Chinese port fees annually. The US-flag international fleet can also carry commercial cargo to and from China, in addition to any government or military cargo for other Asian countries. Sandlin said Hapag-Lloyd is now looking at how to split up that business to avoid the fees. “We have a US-flag group, and we have a non-US-flag group, and that makes it a lot more difficult because of the current geopolitical situation,” he said. “We’re working to see how we actually manage through that.” There are currently 57 ships in the US-flag international fleet, according to Sea-web, a sister company of the Journal of Commerce within S&P Global. Those US-flag ships made 163 calls globally year to date. The US-flag Matson Waikiki, which called Shanghai on Tuesday, faces a $1.7 million fee. Among US-flag carriers, CMA CGM’s APL division runs the only fleet solely built in China. Contact Michael Angell at michael.angell@spglobal.com .

China’s port fees forcing Gemini to shift out US-flag ships

<div class="phx-topic abstract-wrapper">The trade dispute has become multi-dimensional with many different elements all impacting shipping and the supply chain, writes maritime and Journal of Commerce analyst Lars Jensen. </div>

The trade dispute has become multi-dimensional with many different elements all impacting shipping and the supply chain, writes maritime and Journal of Commerce analyst Lars Jensen.

<div class="phx-topic">Seen from the container shipping sector, the US trade dispute has become multi-dimensional and global in nature. The complexities are likely to grow further with shipping as a centrally impacted industry. Initially, the trade conflict mainly focused on tariffs — which countries were being hit by which magnitude of tariffs and on which commodities. The so-called “Liberation Day,” where reciprocal tariffs on all countries in the world were announced, was the clear embodiment of this early phase. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6098416_0.1.png"></img></div>Had this been the only element to the trade dispute and had the first round of reciprocal tariffs simply been kept in place, container shipping would have adapted. Tariff wars are not new, and the impact of such actions is somewhat predictable. Sourcing will shift and adapt to the new landscape, and goods will be sourced where it is most advantageous given the new landscape. Ships will follow and trade lanes adapt accordingly. It could potentially result in an overall demand reduction, but swings in demand and supply are something shipping stakeholders have been handling literally for centuries. This is not to imply it would have been without cost for the shipping industry, but simply to point out that the situation would have been within the parameters of what has also previously been handled. But as the months have gone on, the trade dispute has become multi-dimensional, developing many different elements, all of which impact shipping and supply chains. <h3>Tariff changes speeding up </h3>A second front is that the speed of change in tariffs is accelerating. Deadlines for implementation of new tariffs, and details thereof, have become progressively faster, to the point where cargo already loaded on vessels would now be subject to tariffs with the importer having no recourse but to accept the sudden increase in cost for goods already purchased. <a href="https://www.joc.com/article/importers-pump-brakes-as-they-tire-of-ever-changing-us-tariff-policy-analyst-6091571">Neither shippers nor carriers can physically adapt</a> to the supply chain at the speed of recent tariff changes. This creates an environment for shippers where planning a stable long-term supply chain is no longer a risk-mitigating activity but a source of risk. And in an environment for shipping lines where large-scale capacity reduction or capacity increases are necessary at extremely short notice — resulting in poor schedule adherence as well as erratic appearances of vessel capacity shortages (and excesses) — port congestion problems emerge at destination and at origin. <h3>A port fee standoff </h3>We arrive at the third dimension of the trade dispute: port fees based on nationality. At the headline level, this came with ample warning time from the US where Chinese shipping interests are targeted, albeit a range of details are still missing. Shipping lines planned and adapted accordingly by shuffling vessels in the network — a process taking place over a period of months. <a href="https://www.joc.com/article/chinas-port-fees-forcing-gemini-to-shift-out-us-flag-ships-6097952">But then came the Chinese reaction</a> in the form of similar tit-for-tat rules directed against US shipping interests. There was almost no lead time for the shipping lines that are still processing what the precise impact will be and how they will once more reshuffle vessels to mitigate it. Regarding this aspect of the trade dispute, the impact is especially important for Cosco Shipping, OOCL, Hede Shipping, Matson and APL, highlighting the clear US-China conflict. What is unknown is whether the next steps in this aspect will be to escalate or de-escalate. <h3>The coming fronts </h3>The fourth dimension has been brewing for six months and came to the headlines early in October in the form of the <a href="https://www.joc.com/article/white-house-sanctions-threat-ups-ante-ahead-of-pivotal-imo-meeting-6096646">US opposition to the International Maritime Organization’s (IMO’s) Net Zero Framework</a> (NZF). At the time of writing <a href="https://www.joc.com/article/high-stakes-imo-decarbonization-meeting-begins-in-london-6097313">it is not yet known whether the IMO will vote in favor</a>, whether they will reject it or whether there will be a stalling action that will push it six months to the next MEPC meeting. But the US made their position clear: if NZF is adopted, countries voting “yes” will be subject to US penalties. A range of possibilities were listed such as fees on vessels or entry bans to US ports. Should any of the proposed actions be implemented, this will clearly open a fourth front of the trade dispute and directly impact shipping. A fifth front looms on the horizon — the Federal Maritime Commission’s (FMC’s) investigation into unfair practices related to flag state competition, especially from flags of convenience. This is on hold as the FMC staff is sent home due to the government shutdown. Eventually, the study will be completed, and it is highly likely a conclusion will be made that points to examples of what, from a US perspective, would be seen as unfair competitive practices. Looking at the actions the US government took following the USTR investigation on Chinese shipping practices, it is very likely the FMC study will act as well and, just as with the USTR port fees, open yet another front in the trade war involving shipping directly. Finally, a sixth front has opened in US ports where cranes and chassis <a href="https://www.joc.com/article/freeport-pays-crane-tariffs-to-avoid-ustr-fee-risk-6087337">are now subject to 100% duties</a>, and port handling equipment now faces a proposed 150% duty level. All of this has emerged during 2025 alone and has pushed container shipping into the center of the US trade dispute. Contact Lars Jensen at <a href="mailto:lars.jensen@vespucci-maritime.com">lars.jensen@vespucci-maritime.com</a>. </div>

Seen from the container shipping sector, the US trade dispute has become multi-dimensional and global in nature. The complexities are likely to grow further with shipping as a centrally impacted industry. Initially, the trade conflict mainly focused on tariffs — which countries were being hit by which magnitude of tariffs and on which commodities. The so-called “Liberation Day,” where reciprocal tariffs on all countries in the world were announced, was the clear embodiment of this early phase. Had this been the only element to the trade dispute and had the first round of reciprocal tariffs simply been kept in place, container shipping would have adapted. Tariff wars are not new, and the impact of such actions is somewhat predictable. Sourcing will shift and adapt to the new landscape, and goods will be sourced where it is most advantageous given the new landscape. Ships will follow and trade lanes adapt accordingly. It could potentially result in an overall demand reduction, but swings in demand and supply are something shipping stakeholders have been handling literally for centuries. This is not to imply it would have been without cost for the shipping industry, but simply to point out that the situation would have been within the parameters of what has also previously been handled. But as the months have gone on, the trade dispute has become multi-dimensional, developing many different elements, all of which impact shipping and supply chains. Tariff changes speeding up A second front is that the speed of change in tariffs is accelerating. Deadlines for implementation of new tariffs, and details thereof, have become progressively faster, to the point where cargo already loaded on vessels would now be subject to tariffs with the importer having no recourse but to accept the sudden increase in cost for goods already purchased. Neither shippers nor carriers can physically adapt to the supply chain at the speed of recent tariff changes. This creates an environment for shippers where planning a stable long-term supply chain is no longer a risk-mitigating activity but a source of risk. And in an environment for shipping lines where large-scale capacity reduction or capacity increases are necessary at extremely short notice — resulting in poor schedule adherence as well as erratic appearances of vessel capacity shortages (and excesses) — port congestion problems emerge at destination and at origin. A port fee standoff We arrive at the third dimension of the trade dispute: port fees based on nationality. At the headline level, this came with ample warning time from the US where Chinese shipping interests are targeted, albeit a range of details are still missing. Shipping lines planned and adapted accordingly by shuffling vessels in the network — a process taking place over a period of months. But then came the Chinese reaction in the form of similar tit-for-tat rules directed against US shipping interests. There was almost no lead time for the shipping lines that are still processing what the precise impact will be and how they will once more reshuffle vessels to mitigate it. Regarding this aspect of the trade dispute, the impact is especially important for Cosco Shipping, OOCL, Hede Shipping, Matson and APL, highlighting the clear US-China conflict. What is unknown is whether the next steps in this aspect will be to escalate or de-escalate. The coming fronts The fourth dimension has been brewing for six months and came to the headlines early in October in the form of the US opposition to the International Maritime Organization’s (IMO’s) Net Zero Framework (NZF). At the time of writing it is not yet known whether the IMO will vote in favor , whether they will reject it or whether there will be a stalling action that will push it six months to the next MEPC meeting. But the US made their position clear: if NZF is adopted, countries voting “yes” will be subject to US penalties. A range of possibilities were listed such as fees on vessels or entry bans to US ports. Should any of the proposed actions be implemented, this will clearly open a fourth front of the trade dispute and directly impact shipping. A fifth front looms on the horizon — the Federal Maritime Commission’s (FMC’s) investigation into unfair practices related to flag state competition, especially from flags of convenience. This is on hold as the FMC staff is sent home due to the government shutdown. Eventually, the study will be completed, and it is highly likely a conclusion will be made that points to examples of what, from a US perspective, would be seen as unfair competitive practices. Looking at the actions the US government took following the USTR investigation on Chinese shipping practices, it is very likely the FMC study will act as well and, just as with the USTR port fees, open yet another front in the trade war involving shipping directly. Finally, a sixth front has opened in US ports where cranes and chassis are now subject to 100% duties , and port handling equipment now faces a proposed 150% duty level. All of this has emerged during 2025 alone and has pushed container shipping into the center of the US trade dispute. Contact Lars Jensen at lars.jensen@vespucci-maritime.com .

US trade dispute has multiple fronts to disrupt shipping: analyst

<div class="phx-topic abstract-wrapper">But forwarders say the effort by liners to end a four-month decline in rates may lose steam after a week or so given generally weak market fundamentals. </div>

But forwarders say the effort by liners to end a four-month decline in rates may lose steam after a week or so given generally weak market fundamentals.

<div class="phx-topic">Spot rates on the eastbound trans-Pacific have jumped by about $700 to the US West Coast this week with retailers stepping up their purchase orders for the fourth quarter now that factories in Asia have reopened following the Golden Week and Autumn festivals, market sources say. But forwarders say the effort to end a four-month decline in container spot rates may stumble, and carriers have few other options. The gains came via a general rate increase (GRI) carriers implemented Wednesday, with prices rising to about $2,000 per FEU for West Coast business from $1,300 per FEU last week. Multiple forwarders and a carrier source told the Journal of Commerce that carriers are getting the higher rates from customers. “Bookings are stronger than anticipated after the Autumn Festival,” one forwarder said. “In general, the market is showing some resilience.” Business to the US East Coast was pegged at $3,050 to $3,100 per FEU, up from $2,300. Still, carriers and forwarders expect this week’s GRIs, such as the price hike made on Sept. 1, to deteriorate after a week to 10 days, likely to be followed by additional GRI attempts on Nov. 1 and Nov. 15. “This could be deja vu from Sept. 1,” said Chris Sur, vice president/ocean of freight contract logistics at the forwarder Unique Logistics International. Helping to support the trans-Pacific market at the moment is the fact that vessel capacity has been reduced amid multiple blank sailings and some suspended weekly services due to weakened import demand in August and September. Yet another factor influencing retailers’ ordering behavior this fall has been tariff uncertainties amid the Trump administration’s shifting trade policies for individual countries. This will play out for the remainder of the fourth quarter, said Jon Monroe, who serves as an adviser to forwarders. “Nobody knows what to expect from Trump,” he said. “Everyone is rushing now to get their orders out by the end of the year.” <h3>Inventory restocking, spring imports coming next </h3>Retailers, especially the big box stores, are beginning to focus now on re-stocking their inventories and placing their spring orders, said Robert Khachatryan, CEO of the forwarder FreightRight Global Logistics. “We could see increased orders in November and December,” he said. The traditional peak season shipping patterns this year were disrupted by the constantly changing US tariff announcements. July was the peak month for US imports from Asia; normally, imports of holiday merchandise remain strong from August through October. US imports from Asia in July totaled 1.81 million TEUs, dropping to 1.75 million TEUs in August and 1.58 million TEUs in September, according to PIERS, a Journal of Commerce sister product within S&amp;P Global. Carriers have already filed their 30-day notice in advance of proposed GRIs for Nov. 1 and Nov. 15, so further rate hikes, albeit short-lived, can be expected as liners attempt to set a floor under spot rates, a carrier executive told the Journal of Commerce. “Rates had gotten too low. This behavior is nothing new,” the source said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. </div>

Spot rates on the eastbound trans-Pacific have jumped by about $700 to the US West Coast this week with retailers stepping up their purchase orders for the fourth quarter now that factories in Asia have reopened following the Golden Week and Autumn festivals, market sources say. But forwarders say the effort to end a four-month decline in container spot rates may stumble, and carriers have few other options. The gains came via a general rate increase (GRI) carriers implemented Wednesday, with prices rising to about $2,000 per FEU for West Coast business from $1,300 per FEU last week. Multiple forwarders and a carrier source told the Journal of Commerce that carriers are getting the higher rates from customers. “Bookings are stronger than anticipated after the Autumn Festival,” one forwarder said. “In general, the market is showing some resilience.” Business to the US East Coast was pegged at $3,050 to $3,100 per FEU, up from $2,300. Still, carriers and forwarders expect this week’s GRIs, such as the price hike made on Sept. 1, to deteriorate after a week to 10 days, likely to be followed by additional GRI attempts on Nov. 1 and Nov. 15. “This could be deja vu from Sept. 1,” said Chris Sur, vice president/ocean of freight contract logistics at the forwarder Unique Logistics International. Helping to support the trans-Pacific market at the moment is the fact that vessel capacity has been reduced amid multiple blank sailings and some suspended weekly services due to weakened import demand in August and September. Yet another factor influencing retailers’ ordering behavior this fall has been tariff uncertainties amid the Trump administration’s shifting trade policies for individual countries. This will play out for the remainder of the fourth quarter, said Jon Monroe, who serves as an adviser to forwarders. “Nobody knows what to expect from Trump,” he said. “Everyone is rushing now to get their orders out by the end of the year.” Inventory restocking, spring imports coming next Retailers, especially the big box stores, are beginning to focus now on re-stocking their inventories and placing their spring orders, said Robert Khachatryan, CEO of the forwarder FreightRight Global Logistics. “We could see increased orders in November and December,” he said. The traditional peak season shipping patterns this year were disrupted by the constantly changing US tariff announcements. July was the peak month for US imports from Asia; normally, imports of holiday merchandise remain strong from August through October. US imports from Asia in July totaled 1.81 million TEUs, dropping to 1.75 million TEUs in August and 1.58 million TEUs in September, according to PIERS, a Journal of Commerce sister product within S&P Global. Carriers have already filed their 30-day notice in advance of proposed GRIs for Nov. 1 and Nov. 15, so further rate hikes, albeit short-lived, can be expected as liners attempt to set a floor under spot rates, a carrier executive told the Journal of Commerce. “Rates had gotten too low. This behavior is nothing new,” the source said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

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