<div class="phx-topic abstract-wrapper">With on-time performance close to the 90% target, Hapag-Lloyd has begun to remove the additional capacity initially built into the network to ensure 90% reliability, Rolf Habben Jansen told the TPM26 conference. </div>

With on-time performance close to the 90% target, Hapag-Lloyd has begun to remove the additional capacity initially built into the network to ensure 90% reliability, Rolf Habben Jansen told the TPM26 conference.

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<div class="phx-topic">Long Beach, California — Gemini Cooperation’s steadily improving schedule reliability has enabled Hapag-Lloyd to take buffer capacity out of the network while maintaining reliable transit times, CEO Rolf Habben Jansen said Tuesday. The additional capacity was built into schedules when Gemini launched in February 2025 because partners Hapag-Lloyd and Maersk wanted to ensure 90% on-time arrivals “no matter what,” Habben Jansen told the Journal of Commerce’s TPM26 conference. “If you look at the product that we’re now launching in 2026 you will see that we have already taken some buffer capacity out here and there, and we will continue to do that because we want to be reliable, but we also want to have competitive transit times,” he said. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div>“You need to find a competitive transit time, very high predictability and low variability,” Habben Jansen added. “If you do that, it allows our customers to say, ‘okay, if I put the most valuable stuff on that service I can take out a week of inventory ... It may only be a week of inventory, but a week is a lot.” Data from Sea-Intelligence Maritime Analysis for December and January shows that Gemini had a global schedule reliability of 89.5%, despite congestion challenges at European and Asian ports and severe winter weather. Chelsea Morris, vice president of global inbound transportation at Dollar General, said the discount retailer still needed to pressure-test the reliability in its supply chain, but the trends were positive. “We’ve already seen a demonstrable dip in the standard deviation associated with our cargo,” she told the conference. “When we determine how much product we need in the pipeline, that’s lead times. How much safety stock we need is variability. Anytime you can remove that variability, you don’t need that extra inventory.” <h3>Reliability on ‘a massive scale’ </h3>Morris said that although Gemini was the most reliable alliance, on-time performance was improving across the industry. “What’s really special about what is being done is that it is being done on a massive scale,” she added. “Often when working with carrier partners, it’s singular and it’s directional, but what we’re doing here is really making a difference for the entire industry. It means that we’re not flowing wasteful product through the supply chain that can then bottleneck and cause a lot of issues for all our customers.” Rebecca Ziebarth, vice president of global trade management at Ashley Furniture, agreed that more reliability in ocean schedules improved inventory management. “We want to be able to reduce how much we’re carrying and make sure that we can keep those costs in check, and being able to have the option to direct those raw materials to our manufacturing facility is a huge benefit,” she said. With Gemini’s schedule reliability remaining close to its 90% stated target since its launch early last year, Habben Jansen on Tuesday repeated a view he first expressed at TPM25 last year. “Our objective is to create more value for customers, and I’m firmly convinced that if you create value for the customer, then in the end, you will find a way to share it,” he said. “Whether and how that is then reflected, and how that comes about in the relationship, remains to be seen, but for sure, if we are consistent and always on time, for a lot of customers that has real value,” he added. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="4abe02d4-ed18-461a-ac0b-87ef52e3192b"></dynamic-object></div>Still, global ocean reliability has been on a steady decline since last October, according to data from eeSea, falling from 36.6% then to 25.4% in February. Oscar de Bok, CEO of DHL Global Forwarding, agreed that consistent delivery of better services would, over time, translate into better pricing for service providers. “In the end, customers will pay for value that you create,” he told the conference. “If you can benefit by $1,000, then you will probably be willing to pay $100 more in order to get $900 for yourself. Once it has proven itself, then the value is visible and a customer will not want to lose it.” Contact Greg Knowler at <a href="https://www.joc.com/article/greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>.</div>

Long Beach, California — Gemini Cooperation’s steadily improving schedule reliability has enabled Hapag-Lloyd to take buffer capacity out of the network while maintaining reliable transit times, CEO Rolf Habben Jansen said Tuesday. The additional capacity was built into schedules when Gemini launched in February 2025 because partners Hapag-Lloyd and Maersk wanted to ensure 90% on-time arrivals “no matter what,” Habben Jansen told the Journal of Commerce’s TPM26 conference. “If you look at the product that we’re now launching in 2026 you will see that we have already taken some buffer capacity out here and there, and we will continue to do that because we want to be reliable, but we also want to have competitive transit times,” he said. “You need to find a competitive transit time, very high predictability and low variability,” Habben Jansen added. “If you do that, it allows our customers to say, ‘okay, if I put the most valuable stuff on that service I can take out a week of inventory ... It may only be a week of inventory, but a week is a lot.” Data from Sea-Intelligence Maritime Analysis for December and January shows that Gemini had a global schedule reliability of 89.5%, despite congestion challenges at European and Asian ports and severe winter weather. Chelsea Morris, vice president of global inbound transportation at Dollar General, said the discount retailer still needed to pressure-test the reliability in its supply chain, but the trends were positive. “We’ve already seen a demonstrable dip in the standard deviation associated with our cargo,” she told the conference. “When we determine how much product we need in the pipeline, that’s lead times. How much safety stock we need is variability. Anytime you can remove that variability, you don’t need that extra inventory.” Reliability on ‘a massive scale’ Morris said that although Gemini was the most reliable alliance, on-time performance was improving across the industry. “What’s really special about what is being done is that it is being done on a massive scale,” she added. “Often when working with carrier partners, it’s singular and it’s directional, but what we’re doing here is really making a difference for the entire industry. It means that we’re not flowing wasteful product through the supply chain that can then bottleneck and cause a lot of issues for all our customers.” Rebecca Ziebarth, vice president of global trade management at Ashley Furniture, agreed that more reliability in ocean schedules improved inventory management. “We want to be able to reduce how much we’re carrying and make sure that we can keep those costs in check, and being able to have the option to direct those raw materials to our manufacturing facility is a huge benefit,” she said. With Gemini’s schedule reliability remaining close to its 90% stated target since its launch early last year, Habben Jansen on Tuesday repeated a view he first expressed at TPM25 last year. “Our objective is to create more value for customers, and I’m firmly convinced that if you create value for the customer, then in the end, you will find a way to share it,” he said. “Whether and how that is then reflected, and how that comes about in the relationship, remains to be seen, but for sure, if we are consistent and always on time, for a lot of customers that has real value,” he added. Still, global ocean reliability has been on a steady decline since last October, according to data from eeSea, falling from 36.6% then to 25.4% in February. Oscar de Bok, CEO of DHL Global Forwarding, agreed that consistent delivery of better services would, over time, translate into better pricing for service providers. “In the end, customers will pay for value that you create,” he told the conference. “If you can benefit by $1,000, then you will probably be willing to pay $100 more in order to get $900 for yourself. Once it has proven itself, then the value is visible and a customer will not want to lose it.” Contact Greg Knowler at greg.knowler@spglobal.com .

Container lines

Container Shipping News

Maritime

TPM26: Buffer capacity being taken out of Gemini network: Hapag-Lloyd CEO

<div class="phx-topic abstract-wrapper">Ryan Petersen said his company went into “code red” last year in transitioning to AI, with the technology’s first benefits seen in customs compliance and auditing.</div>

Ryan Petersen said his company went into “code red” last year in transitioning to AI, with the technology’s first benefits seen in customs compliance and auditing.

<div class="phx-topic">Long Beach, California — Flexport CEO Ryan Petersen said Tuesday recent advances in artificial intelligence AI can remove more of the friction involved in shipping, potentially shaving 10% off the back-office cost of ocean freight and allowing logistics companies to easily scale without adding employees. Speaking at the Journal of Commerce’s TPM26 conference, Petersen said Flexport went into “code red” and began a more urgent transition to using AI tools in its processes last November due to the better models and new capabilities available in the market. He said the company plans to use AI to “vibe code” half of its internal applications rather than using traditional programming tools. “I think the ability to build AI right now is phenomenal,” Petersen said. “You can just talk to Claude [AI] in English and get an application out in 30 minutes. So, there’s a huge amount of this that’s possible now that wasn’t possible even 90 days ago.” <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div>AI has been especially helpful in Flexport’s customs business, he said, allowing the company to update its internal systems to reflect 53 changes to US Customs code last year to reflect the multiple changes to tariff and trade codes. Petersen said the adoption of AI has reduced the error rate on Flexport’s customs declarations to almost zero. The company also used AI to build its recently released “tariff simulator” to double check customs duties and other fees. And he said the tool has been able to identify some $4 billion in overcharges on customs documents. “We are now able to do customs for some of the biggest companies in the world because our customs technology stack is really differentiated for very large enterprises,” Petersen said. “We can put things on autopilot with a very high degree of compliance accuracy.” <h3>Using AI to optimize ocean freight </h3>In its forwarding business, Flexport used AI to build an application for optimizing ocean freight by assigning shipments based on the lowest contract rate, sailing schedules, and vessel arrival dates. Many other forwarders are applying AI to ocean freight, which Petersen said is a “simple problem.” He said the real benefits of AI come from handling the industry’s complex problems, such as customs updates and optimizing less-than-container load and consolidated shipments. “We want to be more about how do you bring AI to either do better, more compliant customs keeping track of all the tariff changes or freight consolidation, so being able to have an AI algorithm that takes freight and does Tetris inside the container,” Petersen said. AI is solving the problem of how a logistics company can serve more customers and markets without increasing headcount. Citing the example of DSV’s 2024 acquisition of Schenker that doubled its headcount to 150,000, Petersen said an organization that size can introduce more complexity into logistics that AI can eliminate. “I think you’re going to see a really rapid ability to lower costs in logistics,” he said. “Our estimate is that a shipper can save about 10% on the price of shipping a container [compared with] the white-collar transactional labor to coordinate the shipments.” Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

Long Beach, California — Flexport CEO Ryan Petersen said Tuesday recent advances in artificial intelligence AI can remove more of the friction involved in shipping, potentially shaving 10% off the back-office cost of ocean freight and allowing logistics companies to easily scale without adding employees. Speaking at the Journal of Commerce’s TPM26 conference, Petersen said Flexport went into “code red” and began a more urgent transition to using AI tools in its processes last November due to the better models and new capabilities available in the market. He said the company plans to use AI to “vibe code” half of its internal applications rather than using traditional programming tools. “I think the ability to build AI right now is phenomenal,” Petersen said. “You can just talk to Claude [AI] in English and get an application out in 30 minutes. So, there’s a huge amount of this that’s possible now that wasn’t possible even 90 days ago.” AI has been especially helpful in Flexport’s customs business, he said, allowing the company to update its internal systems to reflect 53 changes to US Customs code last year to reflect the multiple changes to tariff and trade codes. Petersen said the adoption of AI has reduced the error rate on Flexport’s customs declarations to almost zero. The company also used AI to build its recently released “tariff simulator” to double check customs duties and other fees. And he said the tool has been able to identify some $4 billion in overcharges on customs documents. “We are now able to do customs for some of the biggest companies in the world because our customs technology stack is really differentiated for very large enterprises,” Petersen said. “We can put things on autopilot with a very high degree of compliance accuracy.” Using AI to optimize ocean freight In its forwarding business, Flexport used AI to build an application for optimizing ocean freight by assigning shipments based on the lowest contract rate, sailing schedules, and vessel arrival dates. Many other forwarders are applying AI to ocean freight, which Petersen said is a “simple problem.” He said the real benefits of AI come from handling the industry’s complex problems, such as customs updates and optimizing less-than-container load and consolidated shipments. “We want to be more about how do you bring AI to either do better, more compliant customs keeping track of all the tariff changes or freight consolidation, so being able to have an AI algorithm that takes freight and does Tetris inside the container,” Petersen said. AI is solving the problem of how a logistics company can serve more customers and markets without increasing headcount. Citing the example of DSV’s 2024 acquisition of Schenker that doubled its headcount to 150,000, Petersen said an organization that size can introduce more complexity into logistics that AI can eliminate. “I think you’re going to see a really rapid ability to lower costs in logistics,” he said. “Our estimate is that a shipper can save about 10% on the price of shipping a container [compared with] the white-collar transactional labor to coordinate the shipments.” Contact Michael Angell at michael.angell@spglobal.com .

Logistics Technology News

Supply chain

TPM26: Flexport CEO sees AI’s impact on logistics accelerating

<div class="phx-topic abstract-wrapper">Amid trade tensions and other geopolitical challenges, ocean freight volumes should remain elevated, according to Jens Drewes.</div>

Amid trade tensions and other geopolitical challenges, ocean freight volumes should remain elevated, according to Jens Drewes.

<div class="phx-topic">Long Beach, California — Global ocean freight volumes are expected to remain elevated despite geopolitical uncertainties that include ongoing trade tensions and now an expanding war in the Middle East. That’s according to Jens Drewes, CEO of forwarder Hellmann Worldwide Logistics, who spoke Tuesday at the Journal of Commerce’s TPM26 conference. “Despite all of these uncertainties, about all of the risks that you see, and the topics that we talk about ... one thing is also very clear: Global trade is still very strong,” Drewes said, citing the potential for growth in nations including India and China. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div>“There’s a lot of consumption demand in the future, so there’s also a lot of opportunity,” he said. “So, I believe globalization, in particular, global trade ... will be strong and fuel the world economy as well.” With regards to the integration of AI at Hellmann, Drewes insisted that the technology will be a supplement and improve the overall customer experience. He believes it can be a tool that makes freight forwarding more efficient, without a substantial reduction in employees at the family-owned company that was founded in 1871. “We want to have that human element,” Drewes said. He added that during the COVID-19 pandemic, many company leaders who were successful learned the granular details of the supply chain and today, that attention to detail must be a part of a leader’s portfolio if the company is to maintain a high degree of success and customer satisfaction. “There will always be people involved,” he said. “Only the companies who are finding the right balance [by] having this human touch and the digital touch and new technologies combined ... they will be in the lead.” Contact Dan Ronan at <a href="mailto:contactdanronan@gmail.com">contactdanronan@gmail.com</a>.</div>

Long Beach, California — Global ocean freight volumes are expected to remain elevated despite geopolitical uncertainties that include ongoing trade tensions and now an expanding war in the Middle East. That’s according to Jens Drewes, CEO of forwarder Hellmann Worldwide Logistics, who spoke Tuesday at the Journal of Commerce’s TPM26 conference. “Despite all of these uncertainties, about all of the risks that you see, and the topics that we talk about ... one thing is also very clear: Global trade is still very strong,” Drewes said, citing the potential for growth in nations including India and China. “There’s a lot of consumption demand in the future, so there’s also a lot of opportunity,” he said. “So, I believe globalization, in particular, global trade ... will be strong and fuel the world economy as well.” With regards to the integration of AI at Hellmann, Drewes insisted that the technology will be a supplement and improve the overall customer experience. He believes it can be a tool that makes freight forwarding more efficient, without a substantial reduction in employees at the family-owned company that was founded in 1871. “We want to have that human element,” Drewes said. He added that during the COVID-19 pandemic, many company leaders who were successful learned the granular details of the supply chain and today, that attention to detail must be a part of a leader’s portfolio if the company is to maintain a high degree of success and customer satisfaction. “There will always be people involved,” he said. “Only the companies who are finding the right balance [by] having this human touch and the digital touch and new technologies combined ... they will be in the lead.” Contact Dan Ronan at contactdanronan@gmail.com .

TPM26: Global trade ‘still strong’ despite uncertainties: Hellmann CEO

<div class="phx-topic abstract-wrapper">Stefan Paul said almost 20% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports are closed or flights have been otherwise canceled. </div>

Stefan Paul said almost 20% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports are closed or flights have been otherwise canceled.

<div class="phx-topic">Air cargo originating in Asia and bound for the US and Europe will begin to stack up at airports in Asia within days because a significant amount of the capacity needed to move the freight has been grounded by the widening Middle East conflict, the CEO of forwarder Kuehne + Nagel said Tuesday. The backlogs are expected to be particularly acute at air freight hubs in China and Southeast Asia, K+N CEO Stefan Paul said during his company’s fourth-quarter online results briefing. “By the end of the week [or] beginning of next week, we’ll see most probably certain backlogs arising in Southeast Asia and in China for the European and US marketplace,” Paul said. He said about 18% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports, including the huge regional hub in Dubai, are closed or flights have been otherwise canceled. He said the forwarder would help exporters as much as it could by chartering additional capacity to fly directly “from the various origins into the destinations.” Paul also said the mismatch in cargo demand and supply was similar to the COVID-19 pandemic, when there was a surge in demand for air freight due to port and other disruptions caused by lockdowns and related restrictions. He expected the Middle East crisis to benefit the air freight market via higher rates more so than the ocean sector due to the urgency in fulfilling demand. Kuehne + Nagel was already seeing a continuing rebound in air freight volumes in January and February that started in the fourth quarter. “I’m quite confident we’ll see the same pattern in terms of air freight growth,” Paul said. <h3>Profits down, job cuts accelerate </h3>The forwarder saw air cargo volumes in the fourth quarter climb 6% year over year to 595,000 tons, while full-year volumes grew 7% to 2.2 million tons. Paul said K+N is seeing strong demand from aerospace, pharma and semiconductor-related industries, including AI-focused hyperscalers such as Amazon AWS and Google Cloud. Demand from the automotive industry has also recovered in the first two months of 2026 after it declined last year, he said. But K+N’s net profit in 2025 fell 26% to $1.1 billion, while turnover was unchanged at $31 billion. The figures included $156 million in one-off costs, of which 90% was due to staff redundancies and related costs. The company said more than 2,000 employees will be laid off by the end of this year, up from the 1,000 to 1,500 staff that were originally targeted when the cost-cutting program was unveiled in the fourth quarter. K+N this year will target small and medium-sized enterprises in China to boost ocean freight volumes that were unchanged in 2025 at 4.3 million TEUs, Paul said. The company is also chasing acquisitions, including “smaller bolt-ons and higher-quality businesses,” CFO Markus Blanka-Graff said. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Air cargo originating in Asia and bound for the US and Europe will begin to stack up at airports in Asia within days because a significant amount of the capacity needed to move the freight has been grounded by the widening Middle East conflict, the CEO of forwarder Kuehne + Nagel said Tuesday. The backlogs are expected to be particularly acute at air freight hubs in China and Southeast Asia, K+N CEO Stefan Paul said during his company’s fourth-quarter online results briefing. “By the end of the week [or] beginning of next week, we’ll see most probably certain backlogs arising in Southeast Asia and in China for the European and US marketplace,” Paul said. He said about 18% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports, including the huge regional hub in Dubai, are closed or flights have been otherwise canceled. He said the forwarder would help exporters as much as it could by chartering additional capacity to fly directly “from the various origins into the destinations.” Paul also said the mismatch in cargo demand and supply was similar to the COVID-19 pandemic, when there was a surge in demand for air freight due to port and other disruptions caused by lockdowns and related restrictions. He expected the Middle East crisis to benefit the air freight market via higher rates more so than the ocean sector due to the urgency in fulfilling demand. Kuehne + Nagel was already seeing a continuing rebound in air freight volumes in January and February that started in the fourth quarter. “I’m quite confident we’ll see the same pattern in terms of air freight growth,” Paul said. Profits down, job cuts accelerate The forwarder saw air cargo volumes in the fourth quarter climb 6% year over year to 595,000 tons, while full-year volumes grew 7% to 2.2 million tons. Paul said K+N is seeing strong demand from aerospace, pharma and semiconductor-related industries, including AI-focused hyperscalers such as Amazon AWS and Google Cloud. Demand from the automotive industry has also recovered in the first two months of 2026 after it declined last year, he said. But K+N’s net profit in 2025 fell 26% to $1.1 billion, while turnover was unchanged at $31 billion. The figures included $156 million in one-off costs, of which 90% was due to staff redundancies and related costs. The company said more than 2,000 employees will be laid off by the end of this year, up from the 1,000 to 1,500 staff that were originally targeted when the cost-cutting program was unveiled in the fourth quarter. K+N this year will target small and medium-sized enterprises in China to boost ocean freight volumes that were unchanged in 2025 at 4.3 million TEUs, Paul said. The company is also chasing acquisitions, including “smaller bolt-ons and higher-quality businesses,” CFO Markus Blanka-Graff said. Contact Keith Wallis at keithwallis@hotmail.com .

Air Cargo Carriers News

Asia-Europe

Trans-Pacific

Air Cargo

Air freight backlog set to gridlock Asia airports amid Middle East conflict: K+N CEO

<div class="phx-topic abstract-wrapper">While reefer trade is at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have put a stop to all Middle East shipments until further notice. </div>

While reefer trade is at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have put a stop to all Middle East shipments until further notice.

<div class="phx-topic">Supply chains between India and the Middle East have come to a standstill following the en masse suspension of services and cargo acceptance by ocean carriers serving the trade corridor amid the military conflict between Iran and the US and Israel. The economic implications of the developing crisis are enormous for India as it is the second-largest trading partner for the United Arab Emirates (UAE). The two sides in 2022 signed a comprehensive trade pact aimed at pushing non-oil bilateral trade to $100 billion by 2030. While reefer trade is seen to be at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have already put a stop to all kinds of Middle East shipments until further notice. “Effective immediately, we are suspending all new bookings between the Indian Subcontinent [India, Pakistan, Bangladesh and Sri Lanka] and the Upper Gulf markets of the UAE, Bahrain, Qatar, Iraq, Kuwait, and Saudi Arabia [Dammam and Jubail only],” Maersk said in an operational update. Mediterranean Shipping Co., Hapag-Lloyd and Ocean Network Express (ONE) have also halted all Middle East bookings. “For cargo currently in transit or planned shipments, we are closely assessing the situation voyage by voyage,” Singapore-based ONE said. Concurrently, lead mainline carriers on the trade lane have announced hefty war risk or emergency surcharges — ranging between $1,500 and $3,000 per standard container. Maersk is the latest operator to have issued that advisory, slapping an “emergency freight increase” levy for the region of $1,800 per TEU, $3,000 per FEU, and $3,800 for reefer boxes. <h3>Exports ‘piling up’ on Indian docks </h3>Meanwhile, the abrupt cargo flow stoppage and service disruptions have left many Indian docks facing a buildup of containers, with the accumulation expected to aggravate as planned export containers continue to gate in. “Cargo booked for Middle East destinations is piling up across Indian ports,” Sunil Vaswani, executive director of the Container Shipping Lines Association (India), told the Journal of Commerce. “If the crisis is not resolved quickly, it’s going to cause congestion troubles.” The disruptive impact on Indian exports goes beyond the Middle East regional trade. India’s seasonal grape shipments to Europe, which were picking up, now face longer or unpredictable transits due to vessel diversions around southern Africa for westbound services that recently resumed, and then halted, Red Sea/Suez Canal transits. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

Supply chains between India and the Middle East have come to a standstill following the en masse suspension of services and cargo acceptance by ocean carriers serving the trade corridor amid the military conflict between Iran and the US and Israel. The economic implications of the developing crisis are enormous for India as it is the second-largest trading partner for the United Arab Emirates (UAE). The two sides in 2022 signed a comprehensive trade pact aimed at pushing non-oil bilateral trade to $100 billion by 2030. While reefer trade is seen to be at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have already put a stop to all kinds of Middle East shipments until further notice. “Effective immediately, we are suspending all new bookings between the Indian Subcontinent [India, Pakistan, Bangladesh and Sri Lanka] and the Upper Gulf markets of the UAE, Bahrain, Qatar, Iraq, Kuwait, and Saudi Arabia [Dammam and Jubail only],” Maersk said in an operational update. Mediterranean Shipping Co., Hapag-Lloyd and Ocean Network Express (ONE) have also halted all Middle East bookings. “For cargo currently in transit or planned shipments, we are closely assessing the situation voyage by voyage,” Singapore-based ONE said. Concurrently, lead mainline carriers on the trade lane have announced hefty war risk or emergency surcharges — ranging between $1,500 and $3,000 per standard container. Maersk is the latest operator to have issued that advisory, slapping an “emergency freight increase” levy for the region of $1,800 per TEU, $3,000 per FEU, and $3,800 for reefer boxes. Exports ‘piling up’ on Indian docks Meanwhile, the abrupt cargo flow stoppage and service disruptions have left many Indian docks facing a buildup of containers, with the accumulation expected to aggravate as planned export containers continue to gate in. “Cargo booked for Middle East destinations is piling up across Indian ports,” Sunil Vaswani, executive director of the Container Shipping Lines Association (India), told the Journal of Commerce. “If the crisis is not resolved quickly, it’s going to cause congestion troubles.” The disruptive impact on Indian exports goes beyond the Middle East regional trade. India’s seasonal grape shipments to Europe, which were picking up, now face longer or unpredictable transits due to vessel diversions around southern Africa for westbound services that recently resumed, and then halted, Red Sea/Suez Canal transits. Contact Bency Mathew at bencyvmathew@gmail.com .

Port News

International ports

Carriers pause India-Middle East cargo bookings amid Persian Gulf port chaos 

<div class="phx-topic abstract-wrapper">An expert on Yemen told TPM26 the leadership of the Tehran-backed militant group appears to be split on how best to respond to the attacks on Iran that began over the weekend. </div>

An expert on Yemen told TPM26 the leadership of the Tehran-backed militant group appears to be split on how best to respond to the attacks on Iran that began over the weekend.

<div class="phx-topic">Long Beach, California — The next 48 to 72 hours are critical as to how Houthi militants operating in Yemen will react to the US/Israeli bombardment of Iran, specifically what the Tehran-backed rebels may do to once again disrupt shipping in the Red Sea and Suez Canal. That’s the assessment of a veteran security analyst speaking to attendees Monday at the Journal of Commerce’s TPM26 conference. Geopolitical expert Hisham Al-Omeisy is a senior Yemen advisor at the European Institute for Peace. He says the leadership of the Houthis appears to be split on how best to respond to the attacks on Iran that began Saturday. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div>“A lot of people were waiting for them to act, and now that the attacks are ongoing in Iran, they’ve stayed relatively on the fence,” al-Omeisy said. He explained that with the huge US military buildup in the Middle East, if the Houthis were to resume their attacks against commercial shipping in the Red Sea, it would be, in his words, “a suicide mission.” “Houthi leadership, I’ve been talking to people there from Yemen for the past couple of days, and there is a bit of an internal fight where the hardliners are basically trigger happy,” al-Omeisy said. “The hardliners are pushing for action.” Cooler heads within the militants believe that taking military action now would prompt a response from the US and Israel that could degrade the Houthis military capability. But al-Omeisy said his sources have told him that to save face, there could be a limited military response from the Houthis. “There are massive protests in Hutu-controlled areas from their base, demanding blood, demanding reaction, especially since part of the Houthi bravado, their rhetoric, you know the slogan, the ‘death to America, death to Israel,’” he said. “People are asking, ‘why aren’t you doing something?’” Al-Omeisy says the longer the conflict goes without action by the Houthis, they risk losing their legitimacy. “We are really holding our breath, waiting for the Houthi reaction,” he said. Major container lines have mostly avoided the Red Sea/Suez route since late 2023 when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing lengthy and costly diversions around southern Africa. Those attacks stopped last October after the ceasefire agreement between Israel and Hamas, prompting some major carriers to resume transits through the volatile area on a small scale. <h3>Paying protection money </h3>Al-Omeisy said the Houthis have made side deals with some shipping companies who essentially pay protection money to get their ships through the waters, something considered a cost of doing business in that part of the world. “I’m not at liberty to say who, where and when, but there have been payments, and I can’t fault them for that,” he said. “People are being pragmatic. They’ve been cutting their own deals, realizing that’s the best way out for certain amounts [of money] that you’ve just secured the safety of your crews, your ships.” That means for the Houthis, it’s a matter of more than just political power; the threat of their attacks has become a profit center. “The Houthis are insistent on those attacks, because it’s an income. They’re making a lot of money from it,” al-Omeisy told TPM26. “And you have to remember, it’s not just a dogma, it’s not just a political incentive. There’s also financial incentive.” Appearing on the same conference panel, Robbert van Trooijen, a veteran shipping consultant and executive director of Inception Holdings, noted the financial windfall of the Houthis’ business. “Piracy, regretfully, is still a very lucrative line of business,” he said. Contact Dan Ronan at <a href="mailto:contactdanronan@gmail.com">contactdanronan@gmail.com</a>. </div>

Long Beach, California — The next 48 to 72 hours are critical as to how Houthi militants operating in Yemen will react to the US/Israeli bombardment of Iran, specifically what the Tehran-backed rebels may do to once again disrupt shipping in the Red Sea and Suez Canal. That’s the assessment of a veteran security analyst speaking to attendees Monday at the Journal of Commerce’s TPM26 conference. Geopolitical expert Hisham Al-Omeisy is a senior Yemen advisor at the European Institute for Peace. He says the leadership of the Houthis appears to be split on how best to respond to the attacks on Iran that began Saturday. “A lot of people were waiting for them to act, and now that the attacks are ongoing in Iran, they’ve stayed relatively on the fence,” al-Omeisy said. He explained that with the huge US military buildup in the Middle East, if the Houthis were to resume their attacks against commercial shipping in the Red Sea, it would be, in his words, “a suicide mission.” “Houthi leadership, I’ve been talking to people there from Yemen for the past couple of days, and there is a bit of an internal fight where the hardliners are basically trigger happy,” al-Omeisy said. “The hardliners are pushing for action.” Cooler heads within the militants believe that taking military action now would prompt a response from the US and Israel that could degrade the Houthis military capability. But al-Omeisy said his sources have told him that to save face, there could be a limited military response from the Houthis. “There are massive protests in Hutu-controlled areas from their base, demanding blood, demanding reaction, especially since part of the Houthi bravado, their rhetoric, you know the slogan, the ‘death to America, death to Israel,’” he said. “People are asking, ‘why aren’t you doing something?’” Al-Omeisy says the longer the conflict goes without action by the Houthis, they risk losing their legitimacy. “We are really holding our breath, waiting for the Houthi reaction,” he said. Major container lines have mostly avoided the Red Sea/Suez route since late 2023 when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing lengthy and costly diversions around southern Africa. Those attacks stopped last October after the ceasefire agreement between Israel and Hamas, prompting some major carriers to resume transits through the volatile area on a small scale. Paying protection money Al-Omeisy said the Houthis have made side deals with some shipping companies who essentially pay protection money to get their ships through the waters, something considered a cost of doing business in that part of the world. “I’m not at liberty to say who, where and when, but there have been payments, and I can’t fault them for that,” he said. “People are being pragmatic. They’ve been cutting their own deals, realizing that’s the best way out for certain amounts [of money] that you’ve just secured the safety of your crews, your ships.” That means for the Houthis, it’s a matter of more than just political power; the threat of their attacks has become a profit center. “The Houthis are insistent on those attacks, because it’s an income. They’re making a lot of money from it,” al-Omeisy told TPM26. “And you have to remember, it’s not just a dogma, it’s not just a political incentive. There’s also financial incentive.” Appearing on the same conference panel, Robbert van Trooijen, a veteran shipping consultant and executive director of Inception Holdings, noted the financial windfall of the Houthis’ business. “Piracy, regretfully, is still a very lucrative line of business,” he said. Contact Dan Ronan at contactdanronan@gmail.com .

TPM26: Shipping waits for Houthi reaction to US/Israeli attacks on Iran

<div class="phx-topic abstract-wrapper">Record fleet expansion, widening scale disparities, and lingering financial reserves have combined to create a rare window in which transformative deals among ocean carriers are both feasible and strategically rational.</div>

Record fleet expansion, widening scale disparities, and lingering financial reserves have combined to create a rare window in which transformative deals among ocean carriers are both feasible and strategically rational.

<div class="phx-topic">Debate over consolidation in the container shipping industry has persisted for decades. Advocates argue that the sector has long been fragmented, and that further consolidation is essential to improve financial resilience, operational efficiency, and long-term sustainability. Critics counter that consolidation concentrates pricing power in the hands of a few large players, potentially leading to higher freight rates and reduced competition. In my personal experience, the industry’s structural cyclicality has changed little over time. Freight rate movements in recent months suggest that competitive pressure remains intense, both within alliances and between independent carriers. Indeed, competition is likely to increase over the next three to five years as new vessel capacity enters the market. However, the competitive landscape itself has shifted dramatically. The global container ship order book currently stands at more than 35% of the existing fleet — an unprecedented level. At the same time, the four largest carriers — Mediterranean Shipping Co., CMA CGM, Maersk and Cosco — have taken decisive steps to widen the gap between themselves and the rest of the industry. Meanwhile, Hapag-Lloyd has strengthened its position as a clear number five, extending its lead over mid-tier competitors such as Ocean Network Express, Evergreen, HMM and PIL. (Industry data sources include Drewry and Clarksons Research.) Shipping is a low-margin, capital-intensive business where scale matters enormously. Larger fleets enable lower unit costs, stronger purchasing power, and more efficient network deployment, yet there are limits to what alliances alone can deliver. Alliances primarily provide network coordination and slot sharing; they do not generate the full cost synergies available through unified ownership structures. True economies of scale typically come from either expanding fleets organically or pursuing mergers and acquisitions. Of the two, M&amp;A offers the additional advantage of organizational synergies — streamlined management, consolidated procurement, integrated IT platforms, and rationalized overhead — that alliances cannot replicate. This raises an important question: Why is consolidation particularly relevant now? In cyclical industries such as container shipping, mergers rarely occur at market peaks. When profits are strong, shareholder expectations rise, valuations expand and forward multiples make transactions difficult to justify. Conversely, consolidation tends to occur during downturns or when markets are transitioning toward weaker conditions. That transition phase appears to be underway today. <h3>COVID-era profits provide ‘window of opportunity’ for carriers </h3>Many carriers still retain significant liquidity accumulated during the extraordinary profitability of the COVID-19 era boom. These financial reserves provide a unique window of opportunity. Companies can invest in strategic partnerships or acquisitions while still maintaining operational stability and customer confidence. They also have the resources needed to execute careful integrations that are critical to preserving service quality and avoiding customer disruption. If carriers wait several years, those reserves may be eroded by weaker freight markets, rising costs, or capital expenditures tied to fleet renewal and decarbonization requirements. The mid-tier segment of the industry presents multiple potential merger candidates. Historically, national interests have complicated cross-border consolidation, as governments often view shipping lines as strategic assets tied to trade security and economic policy. Yet recent developments suggest that such barriers are not insurmountable. Hapag-Lloyd’s proposed acquisition of Zim demonstrates that creative structures can address national security concerns while still enabling industrial consolidation. The ability to design tailored governance or ownership arrangements may unlock additional transactions that once seemed politically impossible. Customers, too, have a stake in consolidation, perhaps more than is commonly recognized. Over time, a more consolidated industry can produce greater stability. Previous downturns, including those in 2001, 2009 and 2016, revealed how financially distressed carriers can disrupt supply chains. When shipping lines suffer sustained losses, they often resort to abrupt service cancellations, capacity withdrawals, and large-scale blank sailings. These measures create uncertainty for shippers, ports, logistics providers, and equipment lessors. Most of us vividly remember the collapse of Hanjin Shipping. Its bankruptcy triggered widespread cargo disruptions, stranded containers, port congestion and financial losses across the logistics ecosystem. Such systemic shocks underscore the broader economic value of financially stronger carriers. Consolidation, if executed in a timely manner, can reduce the likelihood of extreme distress events by improving cost structures and balance sheet resilience. <h3>‘Pivotal moment’ </h3>To reassure the skeptics, we can rest assured that competition authorities will continue to monitor market concentration carefully, and customers will demand tangible service improvements rather than promises of efficiency. Nevertheless, the strategic logic is compelling. The container shipping industry stands at a pivotal moment. Record fleet expansion, widening scale disparities, and lingering financial reserves combine to create a rare window in which transformative deals are both feasible and strategically rational. Delaying action could mean missing that window, as market conditions tighten and financial flexibility declines. For carriers, investors and customers alike, timely consolidation offers the prospect of a more stable and sustainable industry. In a sector long defined by volatility, that outcome should be in everyone’s interest. Robbert van Trooijen, founder and president of Inception Partners and a McKinsey consultant, had a 33-year tenure with The Nedlloyd Group, P&amp;O Nedlloyd and the Maersk Group. Contact him at <a href="mailto:robbert@inceptionpartners.org">robbert@inceptionpartners.org</a>. </div>

Debate over consolidation in the container shipping industry has persisted for decades. Advocates argue that the sector has long been fragmented, and that further consolidation is essential to improve financial resilience, operational efficiency, and long-term sustainability. Critics counter that consolidation concentrates pricing power in the hands of a few large players, potentially leading to higher freight rates and reduced competition. In my personal experience, the industry’s structural cyclicality has changed little over time. Freight rate movements in recent months suggest that competitive pressure remains intense, both within alliances and between independent carriers. Indeed, competition is likely to increase over the next three to five years as new vessel capacity enters the market. However, the competitive landscape itself has shifted dramatically. The global container ship order book currently stands at more than 35% of the existing fleet — an unprecedented level. At the same time, the four largest carriers — Mediterranean Shipping Co., CMA CGM, Maersk and Cosco — have taken decisive steps to widen the gap between themselves and the rest of the industry. Meanwhile, Hapag-Lloyd has strengthened its position as a clear number five, extending its lead over mid-tier competitors such as Ocean Network Express, Evergreen, HMM and PIL. (Industry data sources include Drewry and Clarksons Research.) Shipping is a low-margin, capital-intensive business where scale matters enormously. Larger fleets enable lower unit costs, stronger purchasing power, and more efficient network deployment, yet there are limits to what alliances alone can deliver. Alliances primarily provide network coordination and slot sharing; they do not generate the full cost synergies available through unified ownership structures. True economies of scale typically come from either expanding fleets organically or pursuing mergers and acquisitions. Of the two, M&A offers the additional advantage of organizational synergies — streamlined management, consolidated procurement, integrated IT platforms, and rationalized overhead — that alliances cannot replicate. This raises an important question: Why is consolidation particularly relevant now? In cyclical industries such as container shipping, mergers rarely occur at market peaks. When profits are strong, shareholder expectations rise, valuations expand and forward multiples make transactions difficult to justify. Conversely, consolidation tends to occur during downturns or when markets are transitioning toward weaker conditions. That transition phase appears to be underway today. COVID-era profits provide ‘window of opportunity’ for carriers Many carriers still retain significant liquidity accumulated during the extraordinary profitability of the COVID-19 era boom. These financial reserves provide a unique window of opportunity. Companies can invest in strategic partnerships or acquisitions while still maintaining operational stability and customer confidence. They also have the resources needed to execute careful integrations that are critical to preserving service quality and avoiding customer disruption. If carriers wait several years, those reserves may be eroded by weaker freight markets, rising costs, or capital expenditures tied to fleet renewal and decarbonization requirements. The mid-tier segment of the industry presents multiple potential merger candidates. Historically, national interests have complicated cross-border consolidation, as governments often view shipping lines as strategic assets tied to trade security and economic policy. Yet recent developments suggest that such barriers are not insurmountable. Hapag-Lloyd’s proposed acquisition of Zim demonstrates that creative structures can address national security concerns while still enabling industrial consolidation. The ability to design tailored governance or ownership arrangements may unlock additional transactions that once seemed politically impossible. Customers, too, have a stake in consolidation, perhaps more than is commonly recognized. Over time, a more consolidated industry can produce greater stability. Previous downturns, including those in 2001, 2009 and 2016, revealed how financially distressed carriers can disrupt supply chains. When shipping lines suffer sustained losses, they often resort to abrupt service cancellations, capacity withdrawals, and large-scale blank sailings. These measures create uncertainty for shippers, ports, logistics providers, and equipment lessors. Most of us vividly remember the collapse of Hanjin Shipping. Its bankruptcy triggered widespread cargo disruptions, stranded containers, port congestion and financial losses across the logistics ecosystem. Such systemic shocks underscore the broader economic value of financially stronger carriers. Consolidation, if executed in a timely manner, can reduce the likelihood of extreme distress events by improving cost structures and balance sheet resilience. ‘Pivotal moment’ To reassure the skeptics, we can rest assured that competition authorities will continue to monitor market concentration carefully, and customers will demand tangible service improvements rather than promises of efficiency. Nevertheless, the strategic logic is compelling. The container shipping industry stands at a pivotal moment. Record fleet expansion, widening scale disparities, and lingering financial reserves combine to create a rare window in which transformative deals are both feasible and strategically rational. Delaying action could mean missing that window, as market conditions tighten and financial flexibility declines. For carriers, investors and customers alike, timely consolidation offers the prospect of a more stable and sustainable industry. In a sector long defined by volatility, that outcome should be in everyone’s interest. Robbert van Trooijen, founder and president of Inception Partners and a McKinsey consultant, had a 33-year tenure with The Nedlloyd Group, P&O Nedlloyd and the Maersk Group. Contact him at robbert@inceptionpartners.org .

In wake of Zim deal, the time for industry consolidation is now

<div class="phx-topic abstract-wrapper">That means minimizing drayage without degrading transit, requiring disaggregating volume from larger hubs into smaller ones. </div>

That means minimizing drayage without degrading transit, requiring disaggregating volume from larger hubs into smaller ones.

<div class="phx-topic">With their proposed merger, Union Pacific and Norfolk Southern have channeled President Abraham Lincoln’s vision for a united transcontinental railroad. Under the tag line “The Great Connection,” they have put forth a vision of a single, integrated rail freight network. Recently, one of their executives touted the benefit from an envisioned “non-stop” service between Los Angeles and northern New Jersey that could be accomplished without needing to change trains in Chicago. This is indeed a powerful service vision. His remarks got me thinking about how airline marketing and flights have become somewhat muddled in their application of terms and performance. For example, many people confuse “non-stop” and “direct.” The former is a single flight that goes from origin to destination without any scheduled stops. One takeoff and one landing. The latter may have one flight number from origin to destination, but may include scheduled stops. Also, passengers may stay on board or change planes. Today, most of the intermodal train network is designed as non-stop at its core. Trains between major hubs run intact without pickups or setouts — although the tenets of precision scheduled railroading (PSR) may look to fill out trains enroute to achieve operating economies. While this works for many intermodal point pairs, it is not comprehensive. A connecting trip requires changing aircraft at an intermediate airport. There are separate flight segments with a layover; you usually change gates and, sometimes, terminals. In rare cases, you may actually need to change airports (e.g., a domestic leg at LaGuardia connecting to an overseas flight at JFK). This is the model for most transcontinental intermodal traffic today and what the UP-NS merger seeks to eliminate. A through flight is one where you stay on the same aircraft across one or more intermediate stops, or the airline provides through-checked baggage and a single itinerary even if you change planes. This is how intermodal efficiently expands scope today. For example, a train may run from Chicago to Harrisburg on one “flight” with the traffic for Philadelphia run as another train from Harrisburg. There are also flights marketed by one airline but operated by another; your ticket may show the marketing airline’s flight number while a partner operates the plane. For example, BNSF offers direct service into CSX facilities in Atlanta and Northwest Ohio. <h3>‘Closest to the pin’ </h3>UP and CSX have a hybrid case of non-stop, connecting code shares. Traffic to Springfield, Mass., is loaded on cars in Los Angeles for non-stop service to Chicago. There the cars are delivered intact to CSX Bedford Park, where they are incorporated into another non-stop train. Of course, in cases of operational trauma, the units may be grounded in Chicago and cross-towned like most traffic. All of this is standard for asset-based, network-operating businesses. There are often competing network economies of scale (larger trains) and scope (more destinations to achieve higher volumes). This is the crux of the “hub-and-spoke” network that so many passenger airlines have implemented. They have a centralized structure: a few hubs connect to many peripheral spokes — which generally do not connect directly to each other. Plane density is achieved, lowering per-unit costs with improved asset utilization. This allows better network reach. Service is enabled between many origin-destination pairs with fewer links than full point-to-point connections. A hub with 10 spokes supports 110 lanes with only 10 spokes. In intermodal, these hubs are at the end points of railroad networks. They offer predictable, scheduled flows with regular, repeatable routes along the spokes. It is scalable because it is easy to add nodes without redesigning the whole network. This is the challenge for intermodal. To compete with trucking, the goal is to seamlessly provide service that looks like trucking but offers economics. That means being “closest to the pin” so as to minimize drayage without degrading transit. This requires disaggregating volume from larger hubs into smaller ones. Not Los Angeles to Croxton rail yard in Jersey City, but LA to ramps beyond immediate North Jersey: i.e., Albany, Allentown, Bethlehem and Philadelphia. And, in the other direction, Croxton to LA, West Colton, and Las Vegas. The ideal outcome would be the ability to connect all of those points in a seamless method in both directions; however, that is probably a future undertaking. For now, we will hopefully keep flying to expanded intermodal networks and service scope. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at <a href="mailto:ted@tricitiesintermodal.com">ted@tricitiesintermodal.com</a>. </div>

With their proposed merger, Union Pacific and Norfolk Southern have channeled President Abraham Lincoln’s vision for a united transcontinental railroad. Under the tag line “The Great Connection,” they have put forth a vision of a single, integrated rail freight network. Recently, one of their executives touted the benefit from an envisioned “non-stop” service between Los Angeles and northern New Jersey that could be accomplished without needing to change trains in Chicago. This is indeed a powerful service vision. His remarks got me thinking about how airline marketing and flights have become somewhat muddled in their application of terms and performance. For example, many people confuse “non-stop” and “direct.” The former is a single flight that goes from origin to destination without any scheduled stops. One takeoff and one landing. The latter may have one flight number from origin to destination, but may include scheduled stops. Also, passengers may stay on board or change planes. Today, most of the intermodal train network is designed as non-stop at its core. Trains between major hubs run intact without pickups or setouts — although the tenets of precision scheduled railroading (PSR) may look to fill out trains enroute to achieve operating economies. While this works for many intermodal point pairs, it is not comprehensive. A connecting trip requires changing aircraft at an intermediate airport. There are separate flight segments with a layover; you usually change gates and, sometimes, terminals. In rare cases, you may actually need to change airports (e.g., a domestic leg at LaGuardia connecting to an overseas flight at JFK). This is the model for most transcontinental intermodal traffic today and what the UP-NS merger seeks to eliminate. A through flight is one where you stay on the same aircraft across one or more intermediate stops, or the airline provides through-checked baggage and a single itinerary even if you change planes. This is how intermodal efficiently expands scope today. For example, a train may run from Chicago to Harrisburg on one “flight” with the traffic for Philadelphia run as another train from Harrisburg. There are also flights marketed by one airline but operated by another; your ticket may show the marketing airline’s flight number while a partner operates the plane. For example, BNSF offers direct service into CSX facilities in Atlanta and Northwest Ohio. ‘Closest to the pin’ UP and CSX have a hybrid case of non-stop, connecting code shares. Traffic to Springfield, Mass., is loaded on cars in Los Angeles for non-stop service to Chicago. There the cars are delivered intact to CSX Bedford Park, where they are incorporated into another non-stop train. Of course, in cases of operational trauma, the units may be grounded in Chicago and cross-towned like most traffic. All of this is standard for asset-based, network-operating businesses. There are often competing network economies of scale (larger trains) and scope (more destinations to achieve higher volumes). This is the crux of the “hub-and-spoke” network that so many passenger airlines have implemented. They have a centralized structure: a few hubs connect to many peripheral spokes — which generally do not connect directly to each other. Plane density is achieved, lowering per-unit costs with improved asset utilization. This allows better network reach. Service is enabled between many origin-destination pairs with fewer links than full point-to-point connections. A hub with 10 spokes supports 110 lanes with only 10 spokes. In intermodal, these hubs are at the end points of railroad networks. They offer predictable, scheduled flows with regular, repeatable routes along the spokes. It is scalable because it is easy to add nodes without redesigning the whole network. This is the challenge for intermodal. To compete with trucking, the goal is to seamlessly provide service that looks like trucking but offers economics. That means being “closest to the pin” so as to minimize drayage without degrading transit. This requires disaggregating volume from larger hubs into smaller ones. Not Los Angeles to Croxton rail yard in Jersey City, but LA to ramps beyond immediate North Jersey: i.e., Albany, Allentown, Bethlehem and Philadelphia. And, in the other direction, Croxton to LA, West Colton, and Las Vegas. The ideal outcome would be the ability to connect all of those points in a seamless method in both directions; however, that is probably a future undertaking. For now, we will hopefully keep flying to expanded intermodal networks and service scope. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at ted@tricitiesintermodal.com .

North-American rail

Surface

Intermodal needs ‘closest to the pin’ strategy to compete with trucking

China to US

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 w-o-w change:  {week_over_week.formatNumber("##.#%")} 
 y-o-y change: {year_over_year_percent.formatNumber("##.#%")}

The Freightos Air Index (FAX) is based on all-in spot rates for general cargo in US$ for weight category of 100 to 3,000 kilograms. The rates include the air freight fee, fuel, and security and seasonal surcharges. The per kg rate is calculated based on the standard chargeable weight (the greater of the actual gross weight and 166kgs, multiplied by the volume in cubic meters). [Freightos Air Index](https://www.freightos.com/enterprise/terminal/fax-global-freightos-air-index/?utm_source=terminal_embed&utm_medium=referral&utm_content=fax)

China to US air freight rates (Freightos)

China to US Air Freight Price Index by Weight Break 100–3000 kg (Freightos) Gateway

<div class="phx-topic abstract-wrapper">Hapag could leverage Zim-owned Gold Star Line’s ready-made ro/ro fleet to expand its offering in the breakbulk market, but overcapacity provides potential headwinds. </div>

Hapag could leverage Zim-owned Gold Star Line’s ready-made ro/ro fleet to expand its offering in the breakbulk market, but overcapacity provides potential headwinds.

<div class="phx-topic">Hapag-Lloyd’s <a href="https://www.joc.com/article/hapag-lloyd-bolsters-fleet-with-42-billion-deal-to-acquire-zim-6170540">planned $4.2 billion takeover of Zim Integrated Shipping Services</a> offers an opportunity to develop the car carrier business established by Zim’s Hong Kong-headquartered affiliate Gold Star Line (GSL), shipping executives say. GSL currently operates two roll-on/roll-off (ro/ro) services linking Asia and Latin America and Asia with Africa. The Gold Star Pacific Vehicle Carrier (GPL) service includes calls at Shanghai, Masan (South Korea) and Yokohama, linking with Mazatlan and Lazaro Cardenas in Mexico, Buenaventura (Colombia) and San Antonio (Chile). Current vessel schedules show on-demand inducement calls at California’s Port Hueneme and Manta in Ecuador. Similarly, the VEC service includes calls such as Kobe (Japan), Taicang and Shanghai in China, Mombasa (Kenya) and Dar es Salaam (Tanzania). Vessels listed under the same service are also calling at Paranagua and Vitoria in Brazil in the next few weeks. Gold Star’s car carriers also call at Ashdod in Israel. GSL has developed its car carrier operations through specialized business, “targeting niche trades where we can provide a competitive service,” a senior source close to the company told the Journal of Commerce. “As a global operator, we have an ability to pivot quickly and efficiently towards areas to help our customers and their pain points,” the executive added. A third GSL ro/ro service connecting Asia and Europe has been suspended, although it could be reinstated. <h3>Operating a lean fleet </h3>Esgian, an Oslo, Norway-headquartered maritime consultant, said Gold Star Line has trimmed its ro/ro operations in the last few months. “Our data shows GSL currently operates a ro/ro fleet of 13 vessels,” Mijeong Jang Rolfsen, Esgian’s senior market impact analyst/shipping, told the Journal of Commerce. The vessels vary in size between 4,000 and 6,500 car equivalent units (CEUs) and are mostly chartered from other operators including Gram Car Carriers, Zodiac Maritime and Cido Shipping. “In terms of commercial footprint, Gold Star Line recorded 72 port calls in Q4 2025, which is 12% down from the previous quarter [Q3 2025], spanning Asia with services extending to South America and selected ports in Africa,” Rolfsen said. Captain Igal Dafni, who was Gold Star Line’s managing director in the early 2000s, said GSL’s ro/ro services are potentially a new source of business for Hapag-Lloyd. Dafni agreed Hapag-Lloyd could use the moves into the car carrier sector by rival container lines Mediterranean Shipping Co. and CMA CGM as a blueprint for its own expansion into the market, using GSL’s existing network as the foundation. “But I’m not sure what it will do,” he said. MSC entered the vehicle carrier sector in 2024 after acquiring Gram Car Carriers and has a fleet of approximately 20 pure car and truck carriers. CMA CGM operates ro/ro services in the Mediterranean and North Africa. <h3>Flurry of new vessels pressurizing the sector </h3>While GSL is focused on bespoke services that should be more profitable, the wider car carrier sector is facing increasing headwinds, especially potential overcapacity that could hit freight rates. “There is a huge backlog of new vessels to be delivered between 2026 [and] 2030 which will create significant pressure for tonnage providers and operators,” a senior executive at a European freight forwarder specializing in the vehicle carrier sector told the Journal of Commerce. British shipbroker Clarksons said there are 140 car carriers on order, equivalent to 16% of the existing fleet of 899 ships, although 27% of the fleet is over 20 years old and is a likely candidate for scrapping. “So, I am not so sure the sector will continue to boom and [be] ... a great market to enter, especially if you are not well established,” the forwarding executive said. “It could be Hapag-Lloyd will keep GSL’s existing car carrier services until they feel comfortable and see how things turn out.” Hapag-Lloyd and Gold Star Line executives told the Journal of Commerce it was too early to comment on how the Hamburg-based carrier would develop GSL’s business. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Hapag-Lloyd’s planned $4.2 billion takeover of Zim Integrated Shipping Services offers an opportunity to develop the car carrier business established by Zim’s Hong Kong-headquartered affiliate Gold Star Line (GSL), shipping executives say. GSL currently operates two roll-on/roll-off (ro/ro) services linking Asia and Latin America and Asia with Africa. The Gold Star Pacific Vehicle Carrier (GPL) service includes calls at Shanghai, Masan (South Korea) and Yokohama, linking with Mazatlan and Lazaro Cardenas in Mexico, Buenaventura (Colombia) and San Antonio (Chile). Current vessel schedules show on-demand inducement calls at California’s Port Hueneme and Manta in Ecuador. Similarly, the VEC service includes calls such as Kobe (Japan), Taicang and Shanghai in China, Mombasa (Kenya) and Dar es Salaam (Tanzania). Vessels listed under the same service are also calling at Paranagua and Vitoria in Brazil in the next few weeks. Gold Star’s car carriers also call at Ashdod in Israel. GSL has developed its car carrier operations through specialized business, “targeting niche trades where we can provide a competitive service,” a senior source close to the company told the Journal of Commerce. “As a global operator, we have an ability to pivot quickly and efficiently towards areas to help our customers and their pain points,” the executive added. A third GSL ro/ro service connecting Asia and Europe has been suspended, although it could be reinstated. Operating a lean fleet Esgian, an Oslo, Norway-headquartered maritime consultant, said Gold Star Line has trimmed its ro/ro operations in the last few months. “Our data shows GSL currently operates a ro/ro fleet of 13 vessels,” Mijeong Jang Rolfsen, Esgian’s senior market impact analyst/shipping, told the Journal of Commerce. The vessels vary in size between 4,000 and 6,500 car equivalent units (CEUs) and are mostly chartered from other operators including Gram Car Carriers, Zodiac Maritime and Cido Shipping. “In terms of commercial footprint, Gold Star Line recorded 72 port calls in Q4 2025, which is 12% down from the previous quarter [Q3 2025], spanning Asia with services extending to South America and selected ports in Africa,” Rolfsen said. Captain Igal Dafni, who was Gold Star Line’s managing director in the early 2000s, said GSL’s ro/ro services are potentially a new source of business for Hapag-Lloyd. Dafni agreed Hapag-Lloyd could use the moves into the car carrier sector by rival container lines Mediterranean Shipping Co. and CMA CGM as a blueprint for its own expansion into the market, using GSL’s existing network as the foundation. “But I’m not sure what it will do,” he said. MSC entered the vehicle carrier sector in 2024 after acquiring Gram Car Carriers and has a fleet of approximately 20 pure car and truck carriers. CMA CGM operates ro/ro services in the Mediterranean and North Africa. Flurry of new vessels pressurizing the sector While GSL is focused on bespoke services that should be more profitable, the wider car carrier sector is facing increasing headwinds, especially potential overcapacity that could hit freight rates. “There is a huge backlog of new vessels to be delivered between 2026 [and] 2030 which will create significant pressure for tonnage providers and operators,” a senior executive at a European freight forwarder specializing in the vehicle carrier sector told the Journal of Commerce. British shipbroker Clarksons said there are 140 car carriers on order, equivalent to 16% of the existing fleet of 899 ships, although 27% of the fleet is over 20 years old and is a likely candidate for scrapping. “So, I am not so sure the sector will continue to boom and [be] ... a great market to enter, especially if you are not well established,” the forwarding executive said. “It could be Hapag-Lloyd will keep GSL’s existing car carrier services until they feel comfortable and see how things turn out.” Hapag-Lloyd and Gold Star Line executives told the Journal of Commerce it was too early to comment on how the Hamburg-based carrier would develop GSL’s business. Contact Keith Wallis at keithwallis@hotmail.com .

Ro/ro cargo

Breakbulk News

Zim deal offers Hapag-Lloyd entry into niche car carrier market  

<div class="phx-topic abstract-wrapper">The widely used freight forwarding software vendor said artificial intelligence is enabling it to reduce staff in roles that include programming, product development and customer service.</div>

The widely used freight forwarding software vendor said artificial intelligence is enabling it to reduce staff in roles that include programming, product development and customer service.

<div class="phx-topic">WiseTech Global will lay off approximately 2,000 of its employees — nearly 30% of its current workforce — over the next two years because of the efficiencies artificial intelligence will bring to its ability to develop products and interact with customers, the forwarding software vendor said Wednesday. The announcement overshadowed WiseTech’s earnings release for the first half of its fiscal year and sparked a double-digit spike in the company’s share price. WiseTech CEO Zubin Appoo explained in a pre-recorded video message that the workforce reduction was due to the progression of AI tools, those developed internally and by the largest AI model developers such as Anthropic, OpenAI and Google. Cuts will come from roles that include programming, product development, and customer service. “This decision was not taken lightly, but it was necessary to ensure we stay disciplined, nimble, competitive, and future-ready,” Appoo said in the video. “A transformation of this scale will fundamentally reshape our cost base while allowing for an uplift in productivity.” The move comes months after Australia-based WiseTech shook the market <a href="https://www.joc.com/article/cargowises-pricing-model-change-could-mark-final-milestone-in-market-ascent-6133279">with a pricing model change</a> that affected virtually all of its forwarder, customs brokers and third-party logistics provider customers. It also comes as WiseTech integrates its <a href="https://www.joc.com/article/wisetech-makes-2-billion-gamble-on-overturning-complicated-software-history-6013221">largest-ever acquisition</a>, a $2.1 billion purchase of E2open last May, one that expanded the company’s customer reach from 3PLs to shippers. Taken together, those moves could be seen as WiseTech prepping itself for a future where AI transforms how software is built, sold and used, rather than waiting for those changes to undermine its business. WiseTech’s planned layoffs and its emphasis on AI can also be seen as a warning shot to software providers that either act as agentic layers on top of CargoWise — WiseTech’s flagship product — or focus on automating processes inside of CargoWise. Either way, the news will surely reverberate around the market, with software companies that have a fraction of WiseTech’s revenue and a lower operating margin asking themselves if their headcount is optimal given the impact AI is having. The move to cut a significant portion of its workforce should also be viewed through the lens that WiseTech must juggle public market scrutiny in a way that privately-held logistics technology providers do not. The narrative around AI potentially eroding the value of publicly-traded software vendors and data providers has surely spooked companies into showing that they are indeed ready for what AI will do to their products, customers, market share and profit margin. <h3>Revenue growth </h3>The announcement of layoffs comes as WiseTech reported solid financials for the first half of its fiscal year. The company posted operating profits of $252.1 million for the period between July 1 and Dec. 31 on revenue of $672 million, an operating margin of 38%. Total revenue in the first half increased 76% year over year, but much of that growth was attributable to the addition of E2open revenue. Organic revenue growth in the period was 12% Additionally, the company said it has lessened its reliance on its biggest customers over the past year, with 23% of its revenue coming from its top 20 customers in the first half of its current fiscal year, down from 33% in the same period in 2025. Another development worth noting from WiseTech’s fiscal year first-half earnings is its continued focus around building a one-stop shop for logistics software, one that encompasses international and domestic freight procurement, execution, payment and analytics, alongside trade compliance and accounting. The company is not there yet, as most of its customer base is still tied to international forwarding or customs compliance, but the intent is to move in that direction. WiseTech’s share price rose 11% Wednesday on the Australian stock exchange after the planned layoffs were announced. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

WiseTech Global will lay off approximately 2,000 of its employees — nearly 30% of its current workforce — over the next two years because of the efficiencies artificial intelligence will bring to its ability to develop products and interact with customers, the forwarding software vendor said Wednesday. The announcement overshadowed WiseTech’s earnings release for the first half of its fiscal year and sparked a double-digit spike in the company’s share price. WiseTech CEO Zubin Appoo explained in a pre-recorded video message that the workforce reduction was due to the progression of AI tools, those developed internally and by the largest AI model developers such as Anthropic, OpenAI and Google. Cuts will come from roles that include programming, product development, and customer service. “This decision was not taken lightly, but it was necessary to ensure we stay disciplined, nimble, competitive, and future-ready,” Appoo said in the video. “A transformation of this scale will fundamentally reshape our cost base while allowing for an uplift in productivity.” The move comes months after Australia-based WiseTech shook the market with a pricing model change that affected virtually all of its forwarder, customs brokers and third-party logistics provider customers. It also comes as WiseTech integrates its largest-ever acquisition , a $2.1 billion purchase of E2open last May, one that expanded the company’s customer reach from 3PLs to shippers. Taken together, those moves could be seen as WiseTech prepping itself for a future where AI transforms how software is built, sold and used, rather than waiting for those changes to undermine its business. WiseTech’s planned layoffs and its emphasis on AI can also be seen as a warning shot to software providers that either act as agentic layers on top of CargoWise — WiseTech’s flagship product — or focus on automating processes inside of CargoWise. Either way, the news will surely reverberate around the market, with software companies that have a fraction of WiseTech’s revenue and a lower operating margin asking themselves if their headcount is optimal given the impact AI is having. The move to cut a significant portion of its workforce should also be viewed through the lens that WiseTech must juggle public market scrutiny in a way that privately-held logistics technology providers do not. The narrative around AI potentially eroding the value of publicly-traded software vendors and data providers has surely spooked companies into showing that they are indeed ready for what AI will do to their products, customers, market share and profit margin. Revenue growth The announcement of layoffs comes as WiseTech reported solid financials for the first half of its fiscal year. The company posted operating profits of $252.1 million for the period between July 1 and Dec. 31 on revenue of $672 million, an operating margin of 38%. Total revenue in the first half increased 76% year over year, but much of that growth was attributable to the addition of E2open revenue. Organic revenue growth in the period was 12% Additionally, the company said it has lessened its reliance on its biggest customers over the past year, with 23% of its revenue coming from its top 20 customers in the first half of its current fiscal year, down from 33% in the same period in 2025. Another development worth noting from WiseTech’s fiscal year first-half earnings is its continued focus around building a one-stop shop for logistics software, one that encompasses international and domestic freight procurement, execution, payment and analytics, alongside trade compliance and accounting. The company is not there yet, as most of its customer base is still tied to international forwarding or customs compliance, but the intent is to move in that direction. WiseTech’s share price rose 11% Wednesday on the Australian stock exchange after the planned layoffs were announced. Contact Eric Johnson at eric.johnson@spglobal.com .

WiseTech says to cut nearly 30% of workforce as it preps for AI era

<div class="phx-topic abstract-wrapper">Nixon, one of the most recognized executives in container shipping, led the transformation of legacy Japanese carriers K Line, MOL and NYK into a unified global company based in Singapore. </div>

Nixon, one of the most recognized executives in container shipping, led the transformation of legacy Japanese carriers K Line, MOL and NYK into a unified global company based in Singapore.

<div class="phx-topic">Ocean Network Express CEO Jeremy Nixon will step down on July 1 from the leadership position he has held since ONE’s inception in 2018 and turn over the helm to industry veteran Till Ole Barrelet. The change was part of a “planned leadership transition” and will not have any impact on customers, the carrier said in a statement Wednesday. Nixon is one of the most recognized executives in container shipping and will stay on with ONE as a senior advisor after Barrelet becomes CEO. “Leading ONE from day one has been the defining chapter of my career,” Nixon said in the statement. “Now is the right time for new leadership, and I am very confident in Till’s ability to lead ONE forward.” Barrelet has more than 20 years of maritime and logistics experience, most recently serving as CEO of Emirates Shipping Line. He has expertise in ship owning, financing, container shipping and trade development across Asia, the Middle East, Europe and Africa. In addition to a change at the top, ONE will transition to a new executive management team structure comprising the CEO and seven representatives from across all the carrier’s divisions. The new executive team, together with six regional leaders, will report into the CEO. “As our founding CEO, Jeremy has helped build ONE from the ground up, establishing our corporate culture and market position,” said Jotaro Tamura, representative director and chairman of Ocean Network Express Holdings. Nixon has been a regular presence at the Journal of Commerce’s TPM conference in Long Beach, and will speak at TPM26 next Monday. <h3>Transforming three Japanese carriers </h3>As CEO of ONE, Nixon presided over the transformation of the container segments of legacy Japanese carriers K Line, MOL and NYK into a unified global container shipping company based in Singapore. Prior to taking the top job at ONE, he headed up the container division at NYK and served in senior management positions at P&amp;O Nedlloyd and Maersk. Under his stewardship, ONE’s fleet grew from 1.5 million TEUs to more than 260 vessels with capacity exceeding 2 million TEUs. Another 1.15 million TEUs of capacity are on order. ONE recorded a loss in 2018–19, its first year of operation, but rode the massive profitability wave generated during the pandemic-impacted years that followed. That profitability came to an end in the fiscal third quarter of ONE’s 2025 financial year when <a href="https://www.joc.com/article/frontloading-drags-one-to-a-loss-in-its-fiscal-third-quarter-6161263">the carrier posted an $88 million net loss</a>. “ONE is well-positioned to navigate industry headwinds with an increasingly modern fleet, financial strength, and proven capabilities,” Till said in the statement. Contact Greg Knowler at <a href="https://www.joc.com/article/frontloading-drags-one-to-a-loss-in-its-fiscal-third-quarter-6161263">greg.knowler@spglobal.com</a>. </div>

Ocean Network Express CEO Jeremy Nixon will step down on July 1 from the leadership position he has held since ONE’s inception in 2018 and turn over the helm to industry veteran Till Ole Barrelet. The change was part of a “planned leadership transition” and will not have any impact on customers, the carrier said in a statement Wednesday. Nixon is one of the most recognized executives in container shipping and will stay on with ONE as a senior advisor after Barrelet becomes CEO. “Leading ONE from day one has been the defining chapter of my career,” Nixon said in the statement. “Now is the right time for new leadership, and I am very confident in Till’s ability to lead ONE forward.” Barrelet has more than 20 years of maritime and logistics experience, most recently serving as CEO of Emirates Shipping Line. He has expertise in ship owning, financing, container shipping and trade development across Asia, the Middle East, Europe and Africa. In addition to a change at the top, ONE will transition to a new executive management team structure comprising the CEO and seven representatives from across all the carrier’s divisions. The new executive team, together with six regional leaders, will report into the CEO. “As our founding CEO, Jeremy has helped build ONE from the ground up, establishing our corporate culture and market position,” said Jotaro Tamura, representative director and chairman of Ocean Network Express Holdings. Nixon has been a regular presence at the Journal of Commerce’s TPM conference in Long Beach, and will speak at TPM26 next Monday. Transforming three Japanese carriers As CEO of ONE, Nixon presided over the transformation of the container segments of legacy Japanese carriers K Line, MOL and NYK into a unified global container shipping company based in Singapore. Prior to taking the top job at ONE, he headed up the container division at NYK and served in senior management positions at P&O Nedlloyd and Maersk. Under his stewardship, ONE’s fleet grew from 1.5 million TEUs to more than 260 vessels with capacity exceeding 2 million TEUs. Another 1.15 million TEUs of capacity are on order. ONE recorded a loss in 2018–19, its first year of operation, but rode the massive profitability wave generated during the pandemic-impacted years that followed. That profitability came to an end in the fiscal third quarter of ONE’s 2025 financial year when the carrier posted an $88 million net loss . “ONE is well-positioned to navigate industry headwinds with an increasingly modern fleet, financial strength, and proven capabilities,” Till said in the statement. Contact Greg Knowler at greg.knowler@spglobal.com .

Jeremy Nixon to step down as ONE CEO after eight years at the helm

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<div class="phx-topic abstract-wrapper">The US has established a maritime warning zone, effectively placing the region out of bounds to shipping, while airlines have suspended passenger and freighter flights across the Middle East.</div>

The US has established a maritime warning zone, effectively placing the region out of bounds to shipping, while airlines have suspended passenger and freighter flights across the Middle East.

<div class="phx-topic">Commercial shipping and airlines continued to avoid the Middle East Sunday as the US and Israel launched a second day of massive military strikes on Iran. The bombardment, meanwhile, prompted Tehran-backed Houthi militants in Yemen to threaten retaliation by saying they may resume attacks on commercial shipping in the Red Sea. Airlines have suspended passenger and freighter flights across the Middle East and the US has established a maritime warning zone in the Persian Gulf, Gulf of Oman, North Arabian Sea and the Strait of Hormuz, effectively placing the region out of bounds to shipping. “The establishment of the warning zone is intended to provide notice that dangerous military operations are taking place from within these locations and the US Navy cannot guarantee the safety of neutral or merchant shipping,” Jakob Larsen, chief safety and security officer at BIMCO, said in a statement Saturday. Two Houthi officials speaking on the condition of anonymity on Saturday <a href="https://www.yahoo.com/news/articles/yemens-iranian-backed-houthi-rebels-083643083.html?guccounter=1&amp;guce_referrer=aHR0cHM6Ly93d3cuYmluZy5jb20v&amp;guce_referrer_sig=AQAAAHCSkq524Zuax-7RXYPUHL7WjCXLoDzxDA6oxH9lxQY48Svx1eiq28CB1EPKkJs30ZP9956P-XPnfis5r3FnNU3a4X4GWKphMEAzIxOLvy2kEVrs30VhCmW5QTvk4i_UISC1bNGzJqshxlFkcuwfpiUYmp6_A6xzvpJM1G6XP-8G">told the Associated Press</a> that attacks on commercial shipping in the Bab-el-Madeb Strait could restart as early as “tonight.” Houthi leadership has yet to make an official statement. A fire broke out at the Port of Jebel Ali in Dubai Sunday when debris fell to the ground after a drone launched from Iran was intercepted, according to media reports. No information on damage to the port was immediately available.CMA CGM on Sunday implemented an “emergency conflict surcharge” for the region of $2,000 per TEU, $3,000 per FEU, and $4,000 for refrigerated containers and special equipment. “In continued efforts to ensure the safety of our crew, vessels, and your cargo amid the ongoing developments in Iran and across the Arabian Peninsula, precautionary measures have been taken to safeguard operations in the affected areas,” the carrier said in customer advisory. “We understand these measures may impact your logistics and supply chain operations; however, they are necessary steps that also lead to additional operational costs.” That came a day after CMA CGM ordered 14 vessels inside the Persian Gulf and seven en route to the Gulf to immediately proceed to shelter. The carrier has also suspended all passages through the Red Sea and is rerouting ships around southern Africa. “This decision is dictated by safety considerations and is made in compliance with our Bill of Lading terms and conditions,” CMA CGM said in a statement Saturday. “Customers will be contacted as soon as we have more details of the possible alternative ports where their cargo could be discharged.” Maersk on Sunday said it was rerouting all sailings of its ME11 Middle East-India-Mediterranean service and MECL Middle East-India-US East Coast service back around southern Africa until further notice. That is an escalation <a href="https://www.joc.com/article/maersk-hapag-lloyd-to-reroute-some-march-sailings-away-from-red-seasuez-6177149">from Friday</a>, when the carrier announced select sailings of both services would avoid the Red Sea and Suez through the first half of March. “Once the situation stabilizes and the security situation again permits, we will continue to prioritize the trans-Suez route for ME11 and MECL services as it is the fastest, most sustainable and most efficient way for us to serve our customers,” Maersk said in a statement Sunday. The Houthis have not launched any attacks on shipping since the Gaza ceasefire between Israel and Hamas was announced last October. And while the Houthis’ top leader, Abdul-Malik Badr al-Din al-Houthi, voiced support over the weekend for Iran, he held back on pledging military action, Hisisham al-Omeisy, a geopolitical expert on Yemen, told the Journal of Commerce. Seeing the scale and severity of US and Israel attacks on Iran, the Houthis appear to be calculating their next move, he said. The Houthis understand “going full in at this point will prove to be costly if not suicidal, and may instead resort to measures to save face; the movement has called for public protests in areas under their control in Yemen,” al-Omeisy said. “Nevertheless, Houthis are now under immense pressure to act, and their leadership may still authorize limited strikes on ships or even Tel Aviv." Major container lines have mostly avoided the Red Sea/Suez route since late 2023 when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing lengthy diversions around southern Africa. Peter Sand, chief analyst for rate benchmarking platform Xeneta, said the military action launched by the US and Israel and Iran’s retaliation will “shatter hopes of a large-scale return of container shipping to the Red Sea” this year. “If Houthi militia resume attacks, as now seems likely, carriers will reverse the decision to return services to the Red Sea and prioritize the safety of crew, ship and cargo,” Sand said in a statement Saturday. “Any plans for a phased return of container shipping to the Red Sea in 2026 will be shelved until the security situation becomes clearer.” The Mediterranean Port of Haifa in Israel was open and operational Monday, according to media reports.<h3>Marine insurance to soar </h3>The escalation of hostilities in the region is expected to push maritime risk insurance through the roof, according to Dylan Mortimer from UK-based insurance risk adviser Marsh. “It is very early to tell at this point, but we would estimate that near-term rate increases for marine hull insurance in the Gulf could range from 25% to 50%, barring any direct attack on merchant shipping, which could have major repercussions across war insurance rates,” Mortimer said in a statement. “The primary risks center on the Persian/Arabian Gulf, particularly the threat of vessel boarding and seizure by Iranian forces and the potential closure of the Strait of Hormuz,” he added. Bimco has also warned that insurance rates are expected to increase “manyfold,” and Larsen said ships with business connections to the US or Israel would likely have their insurance withdrawn. While Iran will be able to disrupt commercial shipping in the Persian Gulf, Larsen did not expect that disruption to be long term. “It is assessed that within a few days US air and naval superiority will eventually establish a level of security which will enable commercial shipping to resume transportation in and out of the Persian Gulf and adjacent waters,” he said. Contact Greg Knowler at <a href="https://www.joc.com/article/rotterdam-congestion-limits-benefit-of-second-half-surge-in-imports-6176418">greg.knowler@spglobal.com</a>.</div>

Commercial shipping and airlines continued to avoid the Middle East Sunday as the US and Israel launched a second day of massive military strikes on Iran. The bombardment, meanwhile, prompted Tehran-backed Houthi militants in Yemen to threaten retaliation by saying they may resume attacks on commercial shipping in the Red Sea. Airlines have suspended passenger and freighter flights across the Middle East and the US has established a maritime warning zone in the Persian Gulf, Gulf of Oman, North Arabian Sea and the Strait of Hormuz, effectively placing the region out of bounds to shipping. “The establishment of the warning zone is intended to provide notice that dangerous military operations are taking place from within these locations and the US Navy cannot guarantee the safety of neutral or merchant shipping,” Jakob Larsen, chief safety and security officer at BIMCO, said in a statement Saturday. Two Houthi officials speaking on the condition of anonymity on Saturday told the Associated Press that attacks on commercial shipping in the Bab-el-Madeb Strait could restart as early as “tonight.” Houthi leadership has yet to make an official statement. A fire broke out at the Port of Jebel Ali in Dubai Sunday when debris fell to the ground after a drone launched from Iran was intercepted, according to media reports. No information on damage to the port was immediately available. CMA CGM on Sunday implemented an “emergency conflict surcharge” for the region of $2,000 per TEU, $3,000 per FEU, and $4,000 for refrigerated containers and special equipment. “In continued efforts to ensure the safety of our crew, vessels, and your cargo amid the ongoing developments in Iran and across the Arabian Peninsula, precautionary measures have been taken to safeguard operations in the affected areas,” the carrier said in customer advisory. “We understand these measures may impact your logistics and supply chain operations; however, they are necessary steps that also lead to additional operational costs.” That came a day after CMA CGM ordered 14 vessels inside the Persian Gulf and seven en route to the Gulf to immediately proceed to shelter. The carrier has also suspended all passages through the Red Sea and is rerouting ships around southern Africa. “This decision is dictated by safety considerations and is made in compliance with our Bill of Lading terms and conditions,” CMA CGM said in a statement Saturday. “Customers will be contacted as soon as we have more details of the possible alternative ports where their cargo could be discharged.” Maersk on Sunday said it was rerouting all sailings of its ME11 Middle East-India-Mediterranean service and MECL Middle East-India-US East Coast service back around southern Africa until further notice. That is an escalation from Friday , when the carrier announced select sailings of both services would avoid the Red Sea and Suez through the first half of March. “Once the situation stabilizes and the security situation again permits, we will continue to prioritize the trans-Suez route for ME11 and MECL services as it is the fastest, most sustainable and most efficient way for us to serve our customers,” Maersk said in a statement Sunday. The Houthis have not launched any attacks on shipping since the Gaza ceasefire between Israel and Hamas was announced last October. And while the Houthis’ top leader, Abdul-Malik Badr al-Din al-Houthi, voiced support over the weekend for Iran, he held back on pledging military action, Hisisham al-Omeisy, a geopolitical expert on Yemen, told the Journal of Commerce. Seeing the scale and severity of US and Israel attacks on Iran, the Houthis appear to be calculating their next move, he said. The Houthis understand “going full in at this point will prove to be costly if not suicidal, and may instead resort to measures to save face; the movement has called for public protests in areas under their control in Yemen,” al-Omeisy said. “Nevertheless, Houthis are now under immense pressure to act, and their leadership may still authorize limited strikes on ships or even Tel Aviv." Major container lines have mostly avoided the Red Sea/Suez route since late 2023 when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing lengthy diversions around southern Africa. Peter Sand, chief analyst for rate benchmarking platform Xeneta, said the military action launched by the US and Israel and Iran’s retaliation will “shatter hopes of a large-scale return of container shipping to the Red Sea” this year. “If Houthi militia resume attacks, as now seems likely, carriers will reverse the decision to return services to the Red Sea and prioritize the safety of crew, ship and cargo,” Sand said in a statement Saturday. “Any plans for a phased return of container shipping to the Red Sea in 2026 will be shelved until the security situation becomes clearer.” The Mediterranean Port of Haifa in Israel was open and operational Monday, according to media reports. Marine insurance to soar The escalation of hostilities in the region is expected to push maritime risk insurance through the roof, according to Dylan Mortimer from UK-based insurance risk adviser Marsh. “It is very early to tell at this point, but we would estimate that near-term rate increases for marine hull insurance in the Gulf could range from 25% to 50%, barring any direct attack on merchant shipping, which could have major repercussions across war insurance rates,” Mortimer said in a statement. “The primary risks center on the Persian/Arabian Gulf, particularly the threat of vessel boarding and seizure by Iranian forces and the potential closure of the Strait of Hormuz,” he added. Bimco has also warned that insurance rates are expected to increase “manyfold,” and Larsen said ships with business connections to the US or Israel would likely have their insurance withdrawn. While Iran will be able to disrupt commercial shipping in the Persian Gulf, Larsen did not expect that disruption to be long term. “It is assessed that within a few days US air and naval superiority will eventually establish a level of security which will enable commercial shipping to resume transportation in and out of the Persian Gulf and adjacent waters,” he said. Contact Greg Knowler at greg.knowler@spglobal.com .

Shipping avoids Middle East region after US, Israel begin strikes on Iran

<div class="phx-topic abstract-wrapper">Premier Alliance carriers may not have the most chips in the game, but in a world where all the alliances are competing to provide the best product, they can inject some very useful capacity to enhance particular trade lanes, writes Jeremy Masters.</div>

Premier Alliance carriers may not have the most chips in the game, but in a world where all the alliances are competing to provide the best product, they can inject some very useful capacity to enhance particular trade lanes, writes Jeremy Masters.

<div class="phx-topic">Recent articles on <a href="https://www.joc.com/article/hapag-lloyd-bolsters-fleet-with-42-billion-deal-to-acquire-zim-6170540">Hapag Lloyd’s acquisition of Zim Integrated Shipping Services</a> have naturally focused on the additional critical mass it brings the fifth-largest carrier. It also has some signals for others. If we look at the top 10 carriers, we see the following existing TEU fleet size and capacity on order as of December 2025, (courtesy of Alphaliner): <div class="wrapper-full"><table><colgroup><col width="25%"></col><col width="25%"></col><col width="25%"></col><col width="25%"></col></colgroup><thead><tr><th>Company</th><th class="align-right">Existing Capacity</th><th class="align-right">On Order</th><th class="align-right">Total</th></tr></thead><tbody><tr><td>MSC                </td><td class="align-right">7,080,958</td><td class="align-right">2,102,992</td><td class="align-right">9,183,950</td></tr><tr><td>Maersk            </td><td class="align-right">4,602,633</td><td class="align-right">834,770</td><td class="align-right">5,437,403</td></tr><tr><td>CMA CGM </td><td class="align-right">4,081,155</td><td class="align-right"> 1,909,846</td><td class="align-right"> 5,991,001</td></tr><tr><td>Cosco </td><td class="align-right"> 3,553,514</td><td class="align-right">1,168,612</td><td class="align-right">4,722,126</td></tr><tr><td>Hapag-Lloyd</td><td class="align-right">2,412,728</td><td class="align-right">415,220</td><td class="align-right">2,827,948 </td></tr><tr><td>ONE </td><td class="align-right">2,050,500</td><td class="align-right">611,304</td><td class="align-right"> 2,661,804</td></tr><tr><td>Evergreen       </td><td class="align-right">1,938,786</td><td class="align-right">853,113</td><td class="align-right">2,791,899</td></tr><tr><td>HMM               </td><td class="align-right">1,016,180</td><td class="align-right">190,192</td><td class="align-right">1,206,372</td></tr><tr><td>Yang Ming</td><td class="align-right">717,715</td><td class="align-right">236,660</td><td class="align-right">954,375</td></tr><tr><td>Zim</td><td class="align-right">703,598</td><td class="align-right">163,128</td><td class="align-right">866,726</td></tr></tbody><tfoot><tr><td colspan="4">Source: Alphaliner</td></tr></tfoot></table></div>Switching to consortium carriers, combined existing capacity plus that on order (counting Mediterranean Shipping Co. as a consortium) leaves us with total TEU fleet sizes as follows: <div class="wrapper-full"><table><colgroup><col width="50%"></col><col width="50%"></col></colgroup><thead><tr><th>Company</th><th class="align-right">Fleet Size</th></tr></thead><tbody><tr><td>MSC </td><td class="align-right">9,183,950</td></tr><tr><td>Maersk and HL (including Zim)</td><td class="align-right">9,132,077</td></tr><tr><td>CMA CGM, Cosco and Evergreen</td><td class="align-right">13,505,026</td></tr><tr><td>ONE, HMM and Yang Ming</td><td class="align-right">4,822,551</td></tr></tbody><tfoot><tr><td colspan="2">Alphaliner</td></tr></tfoot></table></div>Of course, relative total fleet capacities do not correlate with relative capacities deployed in the consortium trades, but the above gives a clear guide to overall future strength as it stands. <h3>Significant variation in firepower </h3>MSC continues to surge ahead on both new buildings and second-hand acquisitions, and it would not be a surprise if their ultimate objective is a 30% share of total capacity (they currently sit at 21.5%). The Ocean Alliance of CMA CGM, Cosco (and OOCL), and Evergreen stands out as the biggest consortium by some margin, and the order book reinforces that. The agreement has been extended until 2032, all of the partners are strong, and unless politics gets in the way, this cooperation looks very solid. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6176395_0.1.jpg"></img></div>Whether or not the Zim transaction is completed and however that capacity is operated, Gemini Cooperation has critical mass and, of course, has differentiated itself by its drive for schedule reliability. The current joint vision is clear. The future one may be less so until Maersk’s integrated logistics adventure fully unfolds. Of course, the number that sticks out the most is the capacity of the Premier Alliance carriers of Ocean Network Express, HMM and Yang Ming. After newbuildings, it is 36% of the Ocean Alliance carriers and 53% of MSC and the Gemini carriers, including Zim. Previous articles have visited why capacity is not everything in a consortium and why THE Alliance (now Premier) carriers left behind by Hapag-Lloyd had more options than was originally perceived. Premier moved forward with great dexterity, and multi-trade viability was clutched from the jaws of impending marginalization. Slot exchanges with MSC on the Asia-to-Europe trade, slot purchases from Ocean Alliance to the North American West Coast, and joint services/slotting with Ocean Alliance on the trans-Atlantic were a critical part of that solution. <h3>Options for Premier </h3>Premier may not have the most chips in the game, but in a world where all the alliances are competing to provide the best product, they can inject some very useful capacity to enhance particular trade lanes. They also have enough capacity that any streamlined services they operate have the ability to be market disruptive, so there is an element of “keeping your enemy close,” or to be more exact, under control. On the flip side, we are about to enter a sustained period of structural overcapacity that could have negative effects on Premier as follows: other consortiums taking capacity out and streamlining services, which may reduce their need/desire for using capacity from outside their alliance members; and financial results coming under pressure, with those carriers with less economies of scale feeling the pinch first. Still, we are nowhere near a crisis point in the industry, and the carriers still have some potential to stabilize things. Given Premier’s strategic position, however, they may need to revisit their options calmly before any storm hits. Some potential areas: 1) ONE buying HMM or Yang Ming to consolidate their strength and reduce the vulnerability of Premier. 2) ONE, HMM or Yang Ming ramping up capacity by buying one or more carriers outside the top 10, or otherwise acquiring additional capacity (although in the current situation, any net addition of capacity would further exacerbate overcapacity). 3) Inviting one of the bigger carriers outside the top 10 such as Wan Hai or PIL to join Premier. 4) Recalibrating consortium trade focus. There is no rule that says the main consortiums need to be focused exclusively on east-west trades. If problems do hit, Premier also has the option to rationalize its east-west network and pick its spots where it can build competitive products. In that situation, it will certainly want to positively differentiate its physical or customer service product as Gemini has done with schedule reliability. The Premier Alliance carriers have proven they can be agile and inventive, and they will need to be again. Jeremy Masters is managing director of Shipping Masters. Contact him at <a href="mailto:jeremy@shippingmastershk.com">jeremy@shippingmastershk.com</a>. </div>

Recent articles on Hapag Lloyd’s acquisition of Zim Integrated Shipping Services have naturally focused on the additional critical mass it brings the fifth-largest carrier. It also has some signals for others. If we look at the top 10 carriers, we see the following existing TEU fleet size and capacity on order as of December 2025, (courtesy of Alphaliner): Company Existing Capacity On Order Total MSC                 7,080,958 2,102,992 9,183,950 Maersk            4,602,633 834,770 5,437,403 CMA CGM 4,081,155 1,909,846 5,991,001 Cosco 3,553,514 1,168,612 4,722,126 Hapag-Lloyd 2,412,728 415,220 2,827,948 ONE 2,050,500 611,304 2,661,804 Evergreen       1,938,786 853,113 2,791,899 HMM               1,016,180 190,192 1,206,372 Yang Ming 717,715 236,660 954,375 Zim 703,598 163,128 866,726 Source: Alphaliner Switching to consortium carriers, combined existing capacity plus that on order (counting Mediterranean Shipping Co. as a consortium) leaves us with total TEU fleet sizes as follows: Company Fleet Size MSC 9,183,950 Maersk and HL (including Zim) 9,132,077 CMA CGM, Cosco and Evergreen 13,505,026 ONE, HMM and Yang Ming 4,822,551 Alphaliner Of course, relative total fleet capacities do not correlate with relative capacities deployed in the consortium trades, but the above gives a clear guide to overall future strength as it stands. Significant variation in firepower MSC continues to surge ahead on both new buildings and second-hand acquisitions, and it would not be a surprise if their ultimate objective is a 30% share of total capacity (they currently sit at 21.5%). The Ocean Alliance of CMA CGM, Cosco (and OOCL), and Evergreen stands out as the biggest consortium by some margin, and the order book reinforces that. The agreement has been extended until 2032, all of the partners are strong, and unless politics gets in the way, this cooperation looks very solid. Whether or not the Zim transaction is completed and however that capacity is operated, Gemini Cooperation has critical mass and, of course, has differentiated itself by its drive for schedule reliability. The current joint vision is clear. The future one may be less so until Maersk’s integrated logistics adventure fully unfolds. Of course, the number that sticks out the most is the capacity of the Premier Alliance carriers of Ocean Network Express, HMM and Yang Ming. After newbuildings, it is 36% of the Ocean Alliance carriers and 53% of MSC and the Gemini carriers, including Zim. Previous articles have visited why capacity is not everything in a consortium and why THE Alliance (now Premier) carriers left behind by Hapag-Lloyd had more options than was originally perceived. Premier moved forward with great dexterity, and multi-trade viability was clutched from the jaws of impending marginalization. Slot exchanges with MSC on the Asia-to-Europe trade, slot purchases from Ocean Alliance to the North American West Coast, and joint services/slotting with Ocean Alliance on the trans-Atlantic were a critical part of that solution. Options for Premier Premier may not have the most chips in the game, but in a world where all the alliances are competing to provide the best product, they can inject some very useful capacity to enhance particular trade lanes. They also have enough capacity that any streamlined services they operate have the ability to be market disruptive, so there is an element of “keeping your enemy close,” or to be more exact, under control. On the flip side, we are about to enter a sustained period of structural overcapacity that could have negative effects on Premier as follows: other consortiums taking capacity out and streamlining services, which may reduce their need/desire for using capacity from outside their alliance members; and financial results coming under pressure, with those carriers with less economies of scale feeling the pinch first. Still, we are nowhere near a crisis point in the industry, and the carriers still have some potential to stabilize things. Given Premier’s strategic position, however, they may need to revisit their options calmly before any storm hits. Some potential areas: 1) ONE buying HMM or Yang Ming to consolidate their strength and reduce the vulnerability of Premier. 2) ONE, HMM or Yang Ming ramping up capacity by buying one or more carriers outside the top 10, or otherwise acquiring additional capacity (although in the current situation, any net addition of capacity would further exacerbate overcapacity). 3) Inviting one of the bigger carriers outside the top 10 such as Wan Hai or PIL to join Premier. 4) Recalibrating consortium trade focus. There is no rule that says the main consortiums need to be focused exclusively on east-west trades. If problems do hit, Premier also has the option to rationalize its east-west network and pick its spots where it can build competitive products. In that situation, it will certainly want to positively differentiate its physical or customer service product as Gemini has done with schedule reliability. The Premier Alliance carriers have proven they can be agile and inventive, and they will need to be again. Jeremy Masters is managing director of Shipping Masters. Contact him at jeremy@shippingmastershk.com .

After Hapag-Zim deal, Premier Alliance may be next in the spotlight

<div class="phx-topic abstract-wrapper">Retailers are holding back on signing their 2026–27 service contracts because they anticipate spot rates may sink further in the next few weeks, while carriers hold out hope market fundamentals will emerge to reverse the softening trend. </div>

Retailers are holding back on signing their 2026–27 service contracts because they anticipate spot rates may sink further in the next few weeks, while carriers hold out hope market fundamentals will emerge to reverse the softening trend.

<div class="phx-topic">Neither ocean carriers nor US importers are in a rush to sign contracts for the 2026–27 service year in a trans-Pacific market where spot rates to the West Coast have fallen more than 20% since early January and, many believe, have room to slide further. Multiple sources who spoke to the Journal of Commerce this week said carriers are in no hurry to ink deals with their customers, holding out hope market fundamentals will emerge to reverse the softening trend on the trans-Pacific. And shippers are biding their time, happy to watch rates continue to fall before they’ll put pen to paper on service contracts, most of which begin May 1. The levels and direction of spot rates impact service contracting, as it’s a barometer of the degree to which carriers can effectively match supply to demand. Long-term contract rates generally allow shippers to lock in lower prices than they could find in the spot market, leading shippers to watch the latter closely ahead of and during service contract negotiations. The Journal of Commerce spoke with three ocean carriers, three retailers, three forwarders, two consultants, and an industry analyst for this story. “No one will sign now,” one carrier executive said. “Most shippers will wait until [TPM26] to see if rates have dropped further.” In past years leading up to the Journal of Commerce’s Trans-Pacific Maritime Conference in Long Beach in the first week of March, at least one or two of the half-dozen largest retailers had already signed their service contracts. Those initial contracts then set the floor for contract rates, with the remaining large, midsize and smaller importers signing for somewhat higher rates in March and through April. TPM26 will be held March 1–4. “No major big-box retailers have signed as of yet,” a source with a top 20 US retailer said. “We’re running two to three weeks late.” A second carrier executive said while a couple of carriers could be “close” to signing a big-box account, most customers are holding out to see how much further the market falls. <h3>Shippers’ market </h3>The signals, at least now, favor the importers. In addition to <a href="https://www.joc.com/article/soft-demand-in-eastbound-trans-pacific-overwhelms-carriers-gri-attempt-6109240">softer demand</a> and <a href="https://www.joc.com/article/pre-lunar-new-year-demand-to-give-trans-pac-market-first-test-of-2026-6149869">falling spot rates</a>, no significant surge in imports is projected in March, when the factories in Asia that closed for the Lunar New Year holiday that began Feb. 17 return to full production. Indeed, retailers and direct importers are holding back on signing their 2026–27 service contracts because they anticipate spot rates may sink further in the next few weeks, forcing carriers to reduce their contract tenders, said Bob Fredman, principal at the consulting firm SF Global Logistics who formerly negotiated service contracts for big-box retailers. “That’s what smart shippers should do,” Fredman said. “It doesn’t make much sense to get too far in front of the [big retailers].” <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="56cdc0fc-22a5-4ef9-9e3e-11f96f369c70"></dynamic-object></div>A national furniture importer said he circulated his “boilerplate” tender to his core carrier partners but is not pressuring them to finalize a contract because he anticipates rates will move lower in March. “As a mid-size importer, why not wait? I want to get more clarity as to where the market is,” the source said. As of Feb. 19, the market from Asia to the West Coast was at $1,600 per FEU, down 23% since early January and 42% lower year over year, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. The East Coast spot rate of $2,400 was down 21% so far this year and 39% lower year over year. According to online rate benchmarking platform Xeneta, Asia-West Coast rates were at $1.356 per FEU as of Feb. 19, down from $2,289 per FEU on Jan. 4 and almost 60% lower year over year. A second top 20 retailer said carriers and their customers are holding back from signing service contracts to see what the negotiating environment looks like after TPM26 in terms of spot rates and forecasts for demand in the second quarter. “We are pretty much completed with our tenders. I suspect we will be completed within the next couple of weeks,” the source said. “Demand right now leading up to Q2 is soft. Carriers are holding back to see if demand picks up after Chinese New Year.” <h3>Carriers ‘failed’ to balance supply and demand </h3>But the slower-than-usual finalizing of contracts by the largest big-box retailers does not mean that medium to smaller retailers will sign later than usual, said Jason Cook, CEO of forwarder Ardent Global Logistics. “After TPM there will be a rapid succession of completions for the big-box retailers,” Cook said. “Then the midsize and smaller importers will get serious in round two...” Unlike in past years when importers were anxious to lock in volume allotments, known as minimum quantity commitments (MQCs), because vessel space was tight, capacity is readily available this year, and it is the carriers who are edgy. The second top 20 retailer source said her preliminary discussions with carriers have been “colorful.” <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e5c8a2a0-9aa5-4787-bbed-bf4b7a9f9677"></dynamic-object></div>A major reason why there was no capacity shortage in the trans-Pacific leading into the Lunar New Year was that carriers did not respond quickly enough to the market conditions by managing vessel space, said Destine Ozuygur, senior analyst for liner network performance at Xeneta. According to data from Xeneta’s eeSea, carriers had 1.19 million TEUs of actual capacity on the Asia-West Coast trade lane in January, with that expected to rise to 1.26 million TEUs in February and 1.4 million TEUs in March. “Given the current slump in rates on the trans-Pacific and the absence of a strong Lunar New Year surge, it appears the carriers failed to balance supply against demand,” Ozuygur said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. </div>

Neither ocean carriers nor US importers are in a rush to sign contracts for the 2026–27 service year in a trans-Pacific market where spot rates to the West Coast have fallen more than 20% since early January and, many believe, have room to slide further. Multiple sources who spoke to the Journal of Commerce this week said carriers are in no hurry to ink deals with their customers, holding out hope market fundamentals will emerge to reverse the softening trend on the trans-Pacific. And shippers are biding their time, happy to watch rates continue to fall before they’ll put pen to paper on service contracts, most of which begin May 1. The levels and direction of spot rates impact service contracting, as it’s a barometer of the degree to which carriers can effectively match supply to demand. Long-term contract rates generally allow shippers to lock in lower prices than they could find in the spot market, leading shippers to watch the latter closely ahead of and during service contract negotiations. The Journal of Commerce spoke with three ocean carriers, three retailers, three forwarders, two consultants, and an industry analyst for this story. “No one will sign now,” one carrier executive said. “Most shippers will wait until [TPM26] to see if rates have dropped further.” In past years leading up to the Journal of Commerce’s Trans-Pacific Maritime Conference in Long Beach in the first week of March, at least one or two of the half-dozen largest retailers had already signed their service contracts. Those initial contracts then set the floor for contract rates, with the remaining large, midsize and smaller importers signing for somewhat higher rates in March and through April. TPM26 will be held March 1–4. “No major big-box retailers have signed as of yet,” a source with a top 20 US retailer said. “We’re running two to three weeks late.” A second carrier executive said while a couple of carriers could be “close” to signing a big-box account, most customers are holding out to see how much further the market falls. Shippers’ market The signals, at least now, favor the importers. In addition to softer demand and falling spot rates , no significant surge in imports is projected in March, when the factories in Asia that closed for the Lunar New Year holiday that began Feb. 17 return to full production. Indeed, retailers and direct importers are holding back on signing their 2026–27 service contracts because they anticipate spot rates may sink further in the next few weeks, forcing carriers to reduce their contract tenders, said Bob Fredman, principal at the consulting firm SF Global Logistics who formerly negotiated service contracts for big-box retailers. “That’s what smart shippers should do,” Fredman said. “It doesn’t make much sense to get too far in front of the [big retailers].” A national furniture importer said he circulated his “boilerplate” tender to his core carrier partners but is not pressuring them to finalize a contract because he anticipates rates will move lower in March. “As a mid-size importer, why not wait? I want to get more clarity as to where the market is,” the source said. As of Feb. 19, the market from Asia to the West Coast was at $1,600 per FEU, down 23% since early January and 42% lower year over year, according to Platts, a sister company of the Journal of Commerce within S&P Global. The East Coast spot rate of $2,400 was down 21% so far this year and 39% lower year over year. According to online rate benchmarking platform Xeneta, Asia-West Coast rates were at $1.356 per FEU as of Feb. 19, down from $2,289 per FEU on Jan. 4 and almost 60% lower year over year. A second top 20 retailer said carriers and their customers are holding back from signing service contracts to see what the negotiating environment looks like after TPM26 in terms of spot rates and forecasts for demand in the second quarter. “We are pretty much completed with our tenders. I suspect we will be completed within the next couple of weeks,” the source said. “Demand right now leading up to Q2 is soft. Carriers are holding back to see if demand picks up after Chinese New Year.” Carriers ‘failed’ to balance supply and demand But the slower-than-usual finalizing of contracts by the largest big-box retailers does not mean that medium to smaller retailers will sign later than usual, said Jason Cook, CEO of forwarder Ardent Global Logistics. “After TPM there will be a rapid succession of completions for the big-box retailers,” Cook said. “Then the midsize and smaller importers will get serious in round two...” Unlike in past years when importers were anxious to lock in volume allotments, known as minimum quantity commitments (MQCs), because vessel space was tight, capacity is readily available this year, and it is the carriers who are edgy. The second top 20 retailer source said her preliminary discussions with carriers have been “colorful.” A major reason why there was no capacity shortage in the trans-Pacific leading into the Lunar New Year was that carriers did not respond quickly enough to the market conditions by managing vessel space, said Destine Ozuygur, senior analyst for liner network performance at Xeneta. According to data from Xeneta’s eeSea, carriers had 1.19 million TEUs of actual capacity on the Asia-West Coast trade lane in January, with that expected to rise to 1.26 million TEUs in February and 1.4 million TEUs in March. “Given the current slump in rates on the trans-Pacific and the absence of a strong Lunar New Year surge, it appears the carriers failed to balance supply against demand,” Ozuygur said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Trans-Pacific carriers, importers slow-walking service contract negotiations

<div class="phx-topic abstract-wrapper">The carrier has finalized plans to inject significant incremental westbound capacity into the market on its “MECL” service, multiple industry sources told the Journal of Commerce. </div>

The carrier has finalized plans to inject significant incremental westbound capacity into the market on its “MECL” service, multiple industry sources told the Journal of Commerce.

<div class="phx-topic">More container capacity is poised to enter the India-US trade lane as carrier executives spot measurable green shoots of volume after the <a href="https://www.joc.com/article/us-agrees-to-slash-tariffs-on-imports-from-india-after-reaching-trade-deal-6162939">recent reset of US tariffs on Indian-made goods</a>. Maersk has finalized plans to inject significant incremental westbound capacity into the market through vessel upsizing on its West India-US East Coast (USEC) “MECL” service, multiple industry sources told the Journal of Commerce. That comes as the US has lowered its tariff on Indian goods from 50% to 25%, with a further cut to 18% expected soon. Sources also confirmed that Maersk’s loading space for the Indian region will climb sequentially by up to 3,000 TEUs per week through the year, beginning with an extra 750 TEUS to 800 TEUs of capacity joining the MECL service in the second quarter that typically aligns with the onset of new service contract shipments. The weekly MECL service currently deploys ships with capacities ranging between 6,000 TEUS and 8,000 TEUs, available data shows. A Maersk executive declined to confirm specifics of the carrier’s planned capacity boost on the India-US trade but acknowledged cargo flows would increase on the lane soon. “Based on our read of the market, we expect meaningful new cargo flows to begin materializing from April onwards, as buyers and sellers lock in commitments and production cycles align,” Bhavik Mota, Maersk’s director of regional ocean management for India/Middle East/Africa (IMEA), told the Journal of Commerce. “We will then recalibrate our capacity for India-US trade based on customer requirements.” Bhavik also said while exporters across the sectors remain bullish about the demand outlook ahead, tariff realignments and new procurement cycles take time to filter through before containers begin moving. “This [tariff] reduction meaningfully improves the economics of doing business across this [India-US] lane, and that sentiment is clearly reflected in the conversations we are having with shippers,” he added. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="ae1df54b-4003-46b5-a8c3-e0d35707e941"></dynamic-object></div>There were some positive signs even before the trade deal between Washington and New Delhi was announced in early February. Exports from India to the US East Coast climbed 20% to 76,550 TEUs in January from December, the first month-over-month increase since last August, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. <h3>Spot rates on steady decline </h3>With the late-January <a href="https://www.joc.com/article/maersk-set-to-resume-regular-suez-transits-on-india-usec-mecl-loop-sources-6152441">reinstatement of regular Red Sea/Suez Canal transits westbound</a>, the MECL now boasts a 25-day transit from Nhava Sheva to Newark, NJ, currently the fastest connection on offer for Indian loads to the US East Coast. Maersk wants to reclaim India-USEC market share lost to rivals over the past decade, so capacity expansions now at play build on service upgrades it implemented last year, including the addition of Mundra as a third Indian port of call to enhance export allocations and the removal of Algeciras in Spain to shorten the roundtrip duration. Spot rate indicators and capacity utilization data, however, suggest carriers are struggling thus far to tilt the market back to their side. Booking rates from India to the USEC have almost halved since the 50% tariff blow, down to $1,173 per FEU as of Feb. 18 from $2,200 on Aug. 29, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="893ffa5c-0a69-45c7-a555-425e44318711"></dynamic-object></div>Additionally, according to rate benchmarking platform Xeneta, monthly average proforma capacity across seven services on the India-US trade lane between August 2025 and January 2026 was approximately 160,000 TEUs, whereas the nominal monthly average of capacity actually deployed by carriers over the period stood at 127,000 TEUs, blanking approximately 21% of scheduled space. And sources warn any large capacity influx could also weigh on carrier contract rate negotiations if there is no matching acceleration in demand. Meanwhile, Maersk on Wednesday announced a hefty peak season surcharge of $3,000 per container for loads from the Indian subcontinent/Middle East to the US East/Gulf coasts from March 20. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

More container capacity is poised to enter the India-US trade lane as carrier executives spot measurable green shoots of volume after the recent reset of US tariffs on Indian-made goods . Maersk has finalized plans to inject significant incremental westbound capacity into the market through vessel upsizing on its West India-US East Coast (USEC) “MECL” service, multiple industry sources told the Journal of Commerce. That comes as the US has lowered its tariff on Indian goods from 50% to 25%, with a further cut to 18% expected soon. Sources also confirmed that Maersk’s loading space for the Indian region will climb sequentially by up to 3,000 TEUs per week through the year, beginning with an extra 750 TEUS to 800 TEUs of capacity joining the MECL service in the second quarter that typically aligns with the onset of new service contract shipments. The weekly MECL service currently deploys ships with capacities ranging between 6,000 TEUS and 8,000 TEUs, available data shows. A Maersk executive declined to confirm specifics of the carrier’s planned capacity boost on the India-US trade but acknowledged cargo flows would increase on the lane soon. “Based on our read of the market, we expect meaningful new cargo flows to begin materializing from April onwards, as buyers and sellers lock in commitments and production cycles align,” Bhavik Mota, Maersk’s director of regional ocean management for India/Middle East/Africa (IMEA), told the Journal of Commerce. “We will then recalibrate our capacity for India-US trade based on customer requirements.” Bhavik also said while exporters across the sectors remain bullish about the demand outlook ahead, tariff realignments and new procurement cycles take time to filter through before containers begin moving. “This [tariff] reduction meaningfully improves the economics of doing business across this [India-US] lane, and that sentiment is clearly reflected in the conversations we are having with shippers,” he added. There were some positive signs even before the trade deal between Washington and New Delhi was announced in early February. Exports from India to the US East Coast climbed 20% to 76,550 TEUs in January from December, the first month-over-month increase since last August, according to PIERS, a sister product of the Journal of Commerce within S&P Global. Spot rates on steady decline With the late-January reinstatement of regular Red Sea/Suez Canal transits westbound , the MECL now boasts a 25-day transit from Nhava Sheva to Newark, NJ, currently the fastest connection on offer for Indian loads to the US East Coast. Maersk wants to reclaim India-USEC market share lost to rivals over the past decade, so capacity expansions now at play build on service upgrades it implemented last year, including the addition of Mundra as a third Indian port of call to enhance export allocations and the removal of Algeciras in Spain to shorten the roundtrip duration. Spot rate indicators and capacity utilization data, however, suggest carriers are struggling thus far to tilt the market back to their side. Booking rates from India to the USEC have almost halved since the 50% tariff blow, down to $1,173 per FEU as of Feb. 18 from $2,200 on Aug. 29, according to Platts, a sister company of the Journal of Commerce within S&P Global. Additionally, according to rate benchmarking platform Xeneta, monthly average proforma capacity across seven services on the India-US trade lane between August 2025 and January 2026 was approximately 160,000 TEUs, whereas the nominal monthly average of capacity actually deployed by carriers over the period stood at 127,000 TEUs, blanking approximately 21% of scheduled space. And sources warn any large capacity influx could also weigh on carrier contract rate negotiations if there is no matching acceleration in demand. Meanwhile, Maersk on Wednesday announced a hefty peak season surcharge of $3,000 per container for loads from the Indian subcontinent/Middle East to the US East/Gulf coasts from March 20. Contact Bency Mathew at bencyvmathew@gmail.com .

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