<div class="phx-topic abstract-wrapper">The decision means CMA CGM, Hapag-Lloyd, Maersk and Zim will be forced to wait until early April before implementing surcharges designed to recoup higher operating costs associated with the war in the Middle East. </div>

The decision means CMA CGM, Hapag-Lloyd, Maersk and Zim will be forced to wait until early April before implementing surcharges designed to recoup higher operating costs associated with the war in the Middle East.

Feature image

<div class="phx-topic">The US Federal Maritime Commission (FMC) on Monday unanimously rejected separate requests from four ocean carriers to waive a 30-day notice period to implement surcharges tied to the war in the Middle East, forcing the four to wait until early April to charge their shipper customers. CMA CGM, Hapag-Lloyd, Maersk and Zim Integrated Shipping Services, as required by US shipping law, filed 30-day notices with the FMC in early March informing the agency of their intent to implement special surcharges on customers in order to <a href="https://www.joc.com/article/war-reignites-tussle-between-ocean-carriers-cargo-owners-over-fuel-surcharges-6188632">recoup the higher operating costs</a> tied to spiking fuel prices and the disruption to ships and equipment after the US and Israel launched attacks against Iran on Feb. 28. Along with the notices came requests by the carriers to waive the 30-day waiting period, which would have allowed the liners to implement the new charges immediately. Zim’s surcharge applies to all US trades, while the charges for the other three carriers apply only to their US-Middle East trade. “In my view, when a carrier seeks special permission to reduce the 30 days’ notice period for a surcharge, the carrier should demonstrate how its increased costs are: linked to the dollar amount of the proposed surcharge,” FMC Chairman Laura DiBella said in a statement. “An assertion that there are increased costs, without any data on what those costs are, how long they may last, and what steps the carrier is taking to mitigate them, is insufficient in demonstrating good cause.” DiBella recommended that carriers provide data behind the decision to levy the surcharge and specify a duration, so the fee is “reasonably related to the increased costs.” <h3>Seeking to recoup higher costs </h3>The surcharge notices filed with the FMC are just one of the ways container lines are trying to recoup the higher costs. Cargo contracted on a long-term basis rather than via freight-all-kinds rates (FAK) are subject to bunker adjustment factors reset quarterly and floating fuel surcharges that can be reset as frequently as monthly. Ocean carriers began assessing war-related surcharges for any shipments to and from the Persian Gulf states on March 2. The FMC must grant special permission for any such charges to be implemented on US trades prior to the end of a 30-day review period. The surcharges filed with the FMC by Hapag-Lloyd and Maersk pertain only to shipments between the US and Saudi Arabia, Bahrain, Iraq, Kuwait, Oman, Qatar, and the United Arab Emirates. Maersk’s surcharge specifically noted eastern Saudi Arabia. Maersk plans to charge $1,800 per TEU; $3,000 per FEU and 45-foot unit; and $3,800 for refrigerated and special containers. Hapag-Lloyd plans to levy $1,500 per dry TEU and $3,500 for reefer containers. CMA CGM said it would implement an emergency conflict surcharge on exports and imports from the Middle East and Africa at $2,000 per TEU; $3,000 per FEU; and $4,000 for reefer and special containers. Zim plans to seek a war risk surcharge of $25 per TEU and $50 per FEU on all US shipments. Zim said the war has increased the cost of running its network and operations at its headquarters in Haifa, Israel. “These increased costs include higher war-risk insurance premiums and tighter P&amp;I coverage terms; the need to delay, speed up, and/or re-route vessels and cargo; increased equipment positioning/repositioning costs resulting from changes in vessel schedules; and a loss of productivity as the result of employees having to take refuge in bomb shelters throughout the day and night, among others,” Wayne Rohde, an attorney at Cozen O’Conner representing three of the carriers, wrote to the FMC. While the carriers filed their surcharge notices separately, Maersk, Hapag-Lloyd and Zim are represented by Cozen O’Conner. The carriers each told the FMC that unless the 30-day notice period for the surcharges was waived, they would be unable to begin recovering the increased costs they are experiencing for almost a full month. <h3>Waiver requests filed in early March </h3>The various requests were filed by the carriers between March 2-5, following the beginning of the war on Feb. 28. The four requests are the only ones that have been processed by the agency so far, an FMC spokesperson told the Journal of Commerce on Monday. The FMC in mid-March told shippers to check their ocean freight bills for any surcharges related to the war in the Middle East that have not been formally reviewed by the agency. In a March 11 statement, the agency said it was “closely monitoring the impact the current conflict in the Middle East is having on shipping conditions through the Strait of Hormuz” and any rate adjustments ocean carriers are making in response. The FMC in early 2024 came under fire from shippers, including the Agriculture Transport Coalition, after waiving for one ocean carrier the 30-day notice period for surcharges tied to vessel diversions away from the Suez Canal due to attacks by Houthi militants on commercial shipping in the Red Sea. A subsequent economic analysis questioned whether the surcharge was warranted, given the carrier was also avoiding Suez Canal tolls by diverting around the Cape of Good Hope. Contact Mark Szakonyi at <a href="mailto:mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a></div>

The US Federal Maritime Commission (FMC) on Monday unanimously rejected separate requests from four ocean carriers to waive a 30-day notice period to implement surcharges tied to the war in the Middle East, forcing the four to wait until early April to charge their shipper customers. CMA CGM, Hapag-Lloyd, Maersk and Zim Integrated Shipping Services, as required by US shipping law, filed 30-day notices with the FMC in early March informing the agency of their intent to implement special surcharges on customers in order to recoup the higher operating costs tied to spiking fuel prices and the disruption to ships and equipment after the US and Israel launched attacks against Iran on Feb. 28. Along with the notices came requests by the carriers to waive the 30-day waiting period, which would have allowed the liners to implement the new charges immediately. Zim’s surcharge applies to all US trades, while the charges for the other three carriers apply only to their US-Middle East trade. “In my view, when a carrier seeks special permission to reduce the 30 days’ notice period for a surcharge, the carrier should demonstrate how its increased costs are: linked to the dollar amount of the proposed surcharge,” FMC Chairman Laura DiBella said in a statement. “An assertion that there are increased costs, without any data on what those costs are, how long they may last, and what steps the carrier is taking to mitigate them, is insufficient in demonstrating good cause.” DiBella recommended that carriers provide data behind the decision to levy the surcharge and specify a duration, so the fee is “reasonably related to the increased costs.” Seeking to recoup higher costs The surcharge notices filed with the FMC are just one of the ways container lines are trying to recoup the higher costs. Cargo contracted on a long-term basis rather than via freight-all-kinds rates (FAK) are subject to bunker adjustment factors reset quarterly and floating fuel surcharges that can be reset as frequently as monthly. Ocean carriers began assessing war-related surcharges for any shipments to and from the Persian Gulf states on March 2. The FMC must grant special permission for any such charges to be implemented on US trades prior to the end of a 30-day review period. The surcharges filed with the FMC by Hapag-Lloyd and Maersk pertain only to shipments between the US and Saudi Arabia, Bahrain, Iraq, Kuwait, Oman, Qatar, and the United Arab Emirates. Maersk’s surcharge specifically noted eastern Saudi Arabia. Maersk plans to charge $1,800 per TEU; $3,000 per FEU and 45-foot unit; and $3,800 for refrigerated and special containers. Hapag-Lloyd plans to levy $1,500 per dry TEU and $3,500 for reefer containers. CMA CGM said it would implement an emergency conflict surcharge on exports and imports from the Middle East and Africa at $2,000 per TEU; $3,000 per FEU; and $4,000 for reefer and special containers. Zim plans to seek a war risk surcharge of $25 per TEU and $50 per FEU on all US shipments. Zim said the war has increased the cost of running its network and operations at its headquarters in Haifa, Israel. “These increased costs include higher war-risk insurance premiums and tighter P&I coverage terms; the need to delay, speed up, and/or re-route vessels and cargo; increased equipment positioning/repositioning costs resulting from changes in vessel schedules; and a loss of productivity as the result of employees having to take refuge in bomb shelters throughout the day and night, among others,” Wayne Rohde, an attorney at Cozen O’Conner representing three of the carriers, wrote to the FMC. While the carriers filed their surcharge notices separately, Maersk, Hapag-Lloyd and Zim are represented by Cozen O’Conner. The carriers each told the FMC that unless the 30-day notice period for the surcharges was waived, they would be unable to begin recovering the increased costs they are experiencing for almost a full month. Waiver requests filed in early March The various requests were filed by the carriers between March 2-5, following the beginning of the war on Feb. 28. The four requests are the only ones that have been processed by the agency so far, an FMC spokesperson told the Journal of Commerce on Monday. The FMC in mid-March told shippers to check their ocean freight bills for any surcharges related to the war in the Middle East that have not been formally reviewed by the agency. In a March 11 statement, the agency said it was “closely monitoring the impact the current conflict in the Middle East is having on shipping conditions through the Strait of Hormuz” and any rate adjustments ocean carriers are making in response. The FMC in early 2024 came under fire from shippers, including the Agriculture Transport Coalition, after waiving for one ocean carrier the 30-day notice period for surcharges tied to vessel diversions away from the Suez Canal due to attacks by Houthi militants on commercial shipping in the Red Sea. A subsequent economic analysis questioned whether the surcharge was warranted, given the carrier was also avoiding Suez Canal tolls by diverting around the Cape of Good Hope. Contact Mark Szakonyi at  mark.szakonyi@spglobal.com

Transport, Trade and Regulation News

Container lines

Supply chain

Container Shipping News

Maritime

FMC rejects requests by carriers to waive waiting period for Middle East surcharges

<div class="phx-topic abstract-wrapper"> Reefer shipments into the port, while still small, have been growing faster than overall cargo, forcing port officials to deal with more long-dwelling containers. </div>

 Reefer shipments into the port, while still small, have been growing faster than overall cargo, forcing port officials to deal with more long-dwelling containers. 

<div class="phx-topic">The Port of Houston is reducing the free time given to refrigerated container imports at its marine terminals because shippers continue to leave reefer cargo past the port’s allotted grace period. The Board of Commissioners for the Port Houston Authority approved Monday a change to the terminal tariffs that will reduce the free time for a refrigerated container to four days from the current seven-day period in place for all containers. The policy change comes as reefer imports, while still a small part of the port’s business, grow faster than Houston’s dry cargo imports. The tariff change will take effect May 1. Reefer shippers will still have an additional three days of free time available if a container requires an inspection by US Customs and Border Protection or the Department of Agriculture (USDA). In asking for the tariff change, Chief Port Operations Officer Ryan Mariacher said the move would align Houston’s policies with how other ports handle refrigerated containers. “This supports the shippers that need to expedite the handling of these commodity types,” Mariacher said. “We want to be a transit facility, not a storage facility.” Mariacher did not say how long refrigerated containers are dwelling at the port. But in June 2025, <a href="https://www.joc.com/article/port-houston-implementing-reefer-dwell-fees-to-encourage-container-flow-6030417">when the port approved a higher rate of demurrage on refrigerated boxes</a>, he said some shippers had been leaving their reefer shipments at the port for a week or more. <h3>Reefer imports growing </h3>Refrigerated imports into Houston appear to have been accelerating since 2024 after <a href="https://www.joc.com/article/houston-gets-usda-approval-to-handle-cold-treated-produce-cargoes-5703146">the port secured approval from the USDA to bring in cold-treated cargo without inspection</a>. Houston last year handled 83,354 TEUs in reefer containers, up 9.7% from 2024, according to PIERS, a sister company of the Journal of Commerce within S&amp;P Global. Overall imports of 1.93 million TEUs grew 1.5% year over year. Most of Houston’s growth in refrigerated imports comes from its north-south services. Imports from Guatemala, which is the port’s second-largest origin for reefer shipments behind China, saw a 9% gain in 2025 to 10,913 TEUs, led largely by bananas, according to PIERS. High US prices for beef have also led to a strong uptick in the port’s inbound reefer business. Refrigerated imports from Brazil rose 71% to 8,185 TEUs during 2025, led by meat and animal proteins. Colombia saw its refrigerated meat exports to Houston grow 56% in 2025 to 6,249 TEUs, PIERS data shows. Contact Michael Angell at <a href="mailto: michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

The Port of Houston is reducing the free time given to refrigerated container imports at its marine terminals because shippers continue to leave reefer cargo past the port’s allotted grace period. The Board of Commissioners for the Port Houston Authority approved Monday a change to the terminal tariffs that will reduce the free time for a refrigerated container to four days from the current seven-day period in place for all containers. The policy change comes as reefer imports, while still a small part of the port’s business, grow faster than Houston’s dry cargo imports. The tariff change will take effect May 1. Reefer shippers will still have an additional three days of free time available if a container requires an inspection by US Customs and Border Protection or the Department of Agriculture (USDA). In asking for the tariff change, Chief Port Operations Officer Ryan Mariacher said the move would align Houston’s policies with how other ports handle refrigerated containers. “This supports the shippers that need to expedite the handling of these commodity types,” Mariacher said. “We want to be a transit facility, not a storage facility.” Mariacher did not say how long refrigerated containers are dwelling at the port. But in June 2025, when the port approved a higher rate of demurrage on refrigerated boxes , he said some shippers had been leaving their reefer shipments at the port for a week or more. Reefer imports growing Refrigerated imports into Houston appear to have been accelerating since 2024 after the port secured approval from the USDA to bring in cold-treated cargo without inspection . Houston last year handled 83,354 TEUs in reefer containers, up 9.7% from 2024, according to PIERS, a sister company of the Journal of Commerce within S&P Global. Overall imports of 1.93 million TEUs grew 1.5% year over year. Most of Houston’s growth in refrigerated imports comes from its north-south services. Imports from Guatemala, which is the port’s second-largest origin for reefer shipments behind China, saw a 9% gain in 2025 to 10,913 TEUs, led largely by bananas, according to PIERS. High US prices for beef have also led to a strong uptick in the port’s inbound reefer business. Refrigerated imports from Brazil rose 71% to 8,185 TEUs during 2025, led by meat and animal proteins. Colombia saw its refrigerated meat exports to Houston grow 56% in 2025 to 6,249 TEUs, PIERS data shows. Contact Michael Angell at michael.angell@spglobal.com .

Cool Cargo News

North American ports

Houston cuts free time on reefer importers amid ongoing high dwells

<div class="phx-topic abstract-wrapper">The closure of the Strait of Hormuz is the latest disruption to global shipping, highlighting once again that the market would rather ride out the problem than pay for the resilience that could bring relief, analyst Lars Jensen writes.</div>

The closure of the Strait of Hormuz is the latest disruption to global shipping, highlighting once again that the market would rather ride out the problem than pay for the resilience that could bring relief, analyst Lars Jensen writes.

<div class="phx-topic">The turmoil caused by the closure of the Strait of Hormuz has brought the notion of resilience in shipping back to the forefront. In part by people asking, seemingly rhetorical, why the industry did not prepare to be more resilient, and in part why the governments in the region did not prepare for more resilience. Add to this the somewhat fanciful, and quite impractical, notion of digging a canal from the Arabian Sea straight through UAE and Oman into the Persian Gulf itself. On the surface, the matter of resilience appears to be a reasonable question, but upon closer inspection, it turns out to be anything but. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6191694_0.1.jpg"></img></div>When it comes to resilience in the supply chain, this is not a new discussion at all. I wrote about this very topic <a href="https://www.joc.com/article/global-supply-chain-must-weigh-balance-between-efficiency-resilience-5250599">in the Journal of Commerce in March 2021</a>. At the time, the context was the disruptions stemming from the pandemic, which had given rise to calls for more resilience in the supply chain. At the time, I pointed out that supply chains had evolved this way because efficiency is the core driver behind everything — efficiency in terms of lower costs, leaner inventories, higher utilization of assets such as vessels, terminals, trucks etc. Still, within these confines, the supply chain was typically quite resilient on a day-to-day basis, with the main vulnerability being more systemic risks. As I pointed out at the time, there are plenty of known systemic risks for which there is no willingness to pay for added resilience. To underscore this point, I listed a range of examples of such systemic risks where there is no willingness to pay for added resilience, including: a major earthquake devastating key port and inland infrastructure in a major port location, the outbreak of war closing critical transit corridors for shipping, a pandemic, tensions between the US and China in the South China Sea, and a cyber-attack. In the five years since that was written, we saw the grounding of the Ever Given in 2021, the Red Sea vessel attacks that began impacting Suez Canal transits in late 2023, drought restrictions along the Panama Canal in 2023–24, and now the closure of the Strait of Hormuz. The risks still stand. And it appears that not a lot is being done to bolster the industry’s resilience against these. <h3>The cost hesitancy of resilience </h3>During the height of the pandemic freight rate spikes, I came across plenty of shippers willing to focus more on long-term resilience and tone down short-term cost savings. As the market then normalized during 2023, I also experienced most of this willingness to disappear entirely. It briefly reawakened in the early part of the Red Sea crisis in 2024, but as supply chains normalized on the longer route around southern Africa, this once more abated. In such an environment, there is no business case for offering more resilient supply chains. Container lines were ridiculed in late 2023 for having, once again, created significant overcapacity. No one wanted to pay for this as resilience, and carriers became loss-making — only to see this overcapacity be sorely needed due to the Red Sea crisis. If we look at Hormuz as an example, how should we have made the supply chains more resilient? Sure, pipelines could be built for oil products, but how about the container shipping sector? This would require massive overland capacity to be built in terms of trucks and rail, a solution that under normal circumstances would be much too expensive compared with the shipping option, and hence would remain idle. I see critics focus on the governments in the Gulf states for not creating such resilience. And sure, in theory, they could have built and paid for this additional infrastructure to stand idle just in case. But if that is the argument, we can also ask why the US government does not build a large new container terminal to stand empty just in case we get an earthquake that incapacitates the Los Angeles-Long Beach port complex. Of course, that is a rhetorical question. No one will be building a second Los Angeles/Long Beach port complex to stand empty just in case. And that is why the resilience many ask for in a time of crisis will often not be available. Lars Jensen is CEO and partner at Vespucci Maritime. Contact him at <a href="mailto:lars.jensen@vespucci-maritime.com">lars.jensen@vespucci-maritime.com</a>.</div>

The turmoil caused by the closure of the Strait of Hormuz has brought the notion of resilience in shipping back to the forefront. In part by people asking, seemingly rhetorical, why the industry did not prepare to be more resilient, and in part why the governments in the region did not prepare for more resilience. Add to this the somewhat fanciful, and quite impractical, notion of digging a canal from the Arabian Sea straight through UAE and Oman into the Persian Gulf itself. On the surface, the matter of resilience appears to be a reasonable question, but upon closer inspection, it turns out to be anything but. When it comes to resilience in the supply chain, this is not a new discussion at all. I wrote about this very topic in the Journal of Commerce in March 2021 . At the time, the context was the disruptions stemming from the pandemic, which had given rise to calls for more resilience in the supply chain. At the time, I pointed out that supply chains had evolved this way because efficiency is the core driver behind everything — efficiency in terms of lower costs, leaner inventories, higher utilization of assets such as vessels, terminals, trucks etc. Still, within these confines, the supply chain was typically quite resilient on a day-to-day basis, with the main vulnerability being more systemic risks. As I pointed out at the time, there are plenty of known systemic risks for which there is no willingness to pay for added resilience. To underscore this point, I listed a range of examples of such systemic risks where there is no willingness to pay for added resilience, including: a major earthquake devastating key port and inland infrastructure in a major port location, the outbreak of war closing critical transit corridors for shipping, a pandemic, tensions between the US and China in the South China Sea, and a cyber-attack. In the five years since that was written, we saw the grounding of the Ever Given in 2021, the Red Sea vessel attacks that began impacting Suez Canal transits in late 2023, drought restrictions along the Panama Canal in 2023–24, and now the closure of the Strait of Hormuz. The risks still stand. And it appears that not a lot is being done to bolster the industry’s resilience against these. The cost hesitancy of resilience During the height of the pandemic freight rate spikes, I came across plenty of shippers willing to focus more on long-term resilience and tone down short-term cost savings. As the market then normalized during 2023, I also experienced most of this willingness to disappear entirely. It briefly reawakened in the early part of the Red Sea crisis in 2024, but as supply chains normalized on the longer route around southern Africa, this once more abated. In such an environment, there is no business case for offering more resilient supply chains. Container lines were ridiculed in late 2023 for having, once again, created significant overcapacity. No one wanted to pay for this as resilience, and carriers became loss-making — only to see this overcapacity be sorely needed due to the Red Sea crisis. If we look at Hormuz as an example, how should we have made the supply chains more resilient? Sure, pipelines could be built for oil products, but how about the container shipping sector? This would require massive overland capacity to be built in terms of trucks and rail, a solution that under normal circumstances would be much too expensive compared with the shipping option, and hence would remain idle. I see critics focus on the governments in the Gulf states for not creating such resilience. And sure, in theory, they could have built and paid for this additional infrastructure to stand idle just in case. But if that is the argument, we can also ask why the US government does not build a large new container terminal to stand empty just in case we get an earthquake that incapacitates the Los Angeles-Long Beach port complex. Of course, that is a rhetorical question. No one will be building a second Los Angeles/Long Beach port complex to stand empty just in case. And that is why the resilience many ask for in a time of crisis will often not be available. Lars Jensen is CEO and partner at Vespucci Maritime. Contact him at lars.jensen@vespucci-maritime.com .

New shipping crisis brings ‘resilience’ question to the fore again

<div class="phx-topic abstract-wrapper">The closure of the Strait of Hormuz has cut off a major source of global resin supply, teeing up US production to fill in some of the gap.</div>

The closure of the Strait of Hormuz has cut off a major source of global resin supply, teeing up US production to fill in some of the gap.

<div class="phx-topic">US resin exports have ticked higher as the war in the Middle East shuts off the largest source of global plastics supply. The sustainability of the export demand, though, hinges largely on the war’s duration and the capacity of North American producers to make more resin.Export container bookings for resins hit 6,191 on March 16, according to maritime visibility provider Vizion. That compares with the nearly 3,500 to 4,500 daily bookings typically made throughout all of 2026. The first week of March saw the highest number of export resin bookings, 22,653, since the last week of January. Most bookings occur during weekdays.The bookings come as Iran’s attacks on commercial shipping through the Strait of Hormuz have cut off the Middle East’s resin producers from world markets. The Middle East accounts for 15% of global polyethylene supply, the most widely traded type of resin, according to S&amp;P Global Market Intelligence. The disruption in the Gulf has already sent US polyethylene prices higher. Platts, a sister company of the Journal of Commerce within S&amp;P Global, said Thursday that US prices have tripled since Feb. 25, now hovering between $1,268 and $1,290 per metric ton, depending on the grade. “The sharp price increases reflected a fundamental shift in global supply dynamics, as the US emerged as the primary supplier of polyethylene ... following the closure of the Strait of Hormuz,” Platts said. Asia and Europe are the most affected by the disruption in Middle East resin exports, Shruthi Vangipuram, an analyst with Wood Mackenzie, told the Journal of Commerce. While both regions have their own resin production, they depend on crude oil feedstocks that have also become more expensive. “Southeast Asia, Japan, South Korea and Taiwan have been impacted the most,” she said. “Producers in the region are struggling to secure feedstock and operating rates in these countries have been severely curtailed.” Vangipuram estimates that resin plants in Asia and Europe are running at only about 70% of their production capacity due to higher prices for feedstock crude oil. In contrast, US producers are running at about 90% utilization. She said US producers can delay maintenance to keep production levels high through the second quarter, but that would still not fill the gap in global demand. “We can flex to 95%, 98% utilization, but it depends on which markets it makes sense to sell to,” Vangipuram said. <h3>Pricing arbitrage favors trans-Atlantic</h3>Export capacity from the US to Asia is ample, according to an executive of a third-party logistics provider, who estimated that backhaul utilization for most ocean carriers hovers near 50%. Spot rates for dry freight to Asia from the US Gulf, which dominates resin exports, are currently running between $500 and $700 for a standard-sized container, while shipping a 20-foot container used primarily for resins runs about 80% of that rate. Trans-Atlantic rates have also been stable, hovering near $1,100 for a 20-foot container from the US Gulf to Northern Europe, according to Xeneta. The rate for shipping a 20-foot container out of the Southeast Atlantic ports has moved higher since the start of the year, going from just over $700 to $757 this week, Xeneta said. <a href="https://www.joc.com/article/ocean-alliance-one-rework-trans-atlantic-services-remove-ships-6169751">Carriers are removing ships and port calls from trans-Atlantic services</a>, tightening up some of the capacity in that market. Outbound US cargo does not face any significant delays with bookings available about two weeks out. The real risk for shippers will be in fuel surcharges that are being applied on global trades due to the Middle East war, as well as a potential general rate increase in April. Outside of freight rates and vessel space, Vangipuram said the real driver for US exports will be the direction of local pricing. Asian prices will still need to move higher to attract more US imports. With a four- to six-week lead time for imports, Asian buyers will need to see the conflict drag out before buying from the US. Europe, which is the second-biggest market for US resins after South America, has seen its benchmark polyethylene prices rise by one-third since the end of February. Vangipuram said Europe would likely be the first market to see additional US imports thanks to the much shorter voyage time and the sharper price move. “The arbitrage works out better in the Atlantic than to Asia because of freight rates and shorter shipping times,” Vangipuram said. “We may not see the volume from the US make it into those markets that would appear to need it most.” Contact Michael Angell at <a href="mailto: michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

US resin exports have ticked higher as the war in the Middle East shuts off the largest source of global plastics supply. The sustainability of the export demand, though, hinges largely on the war’s duration and the capacity of North American producers to make more resin. Export container bookings for resins hit 6,191 on March 16, according to maritime visibility provider Vizion. That compares with the nearly 3,500 to 4,500 daily bookings typically made throughout all of 2026. The first week of March saw the highest number of export resin bookings, 22,653, since the last week of January. Most bookings occur during weekdays. The bookings come as Iran’s attacks on commercial shipping through the Strait of Hormuz have cut off the Middle East’s resin producers from world markets. The Middle East accounts for 15% of global polyethylene supply, the most widely traded type of resin, according to S&P Global Market Intelligence. The disruption in the Gulf has already sent US polyethylene prices higher. Platts, a sister company of the Journal of Commerce within S&P Global, said Thursday that US prices have tripled since Feb. 25, now hovering between $1,268 and $1,290 per metric ton, depending on the grade. “The sharp price increases reflected a fundamental shift in global supply dynamics, as the US emerged as the primary supplier of polyethylene ... following the closure of the Strait of Hormuz,” Platts said. Asia and Europe are the most affected by the disruption in Middle East resin exports, Shruthi Vangipuram, an analyst with Wood Mackenzie, told the Journal of Commerce. While both regions have their own resin production, they depend on crude oil feedstocks that have also become more expensive. “Southeast Asia, Japan, South Korea and Taiwan have been impacted the most,” she said. “Producers in the region are struggling to secure feedstock and operating rates in these countries have been severely curtailed.” Vangipuram estimates that resin plants in Asia and Europe are running at only about 70% of their production capacity due to higher prices for feedstock crude oil. In contrast, US producers are running at about 90% utilization. She said US producers can delay maintenance to keep production levels high through the second quarter, but that would still not fill the gap in global demand. “We can flex to 95%, 98% utilization, but it depends on which markets it makes sense to sell to,” Vangipuram said. Pricing arbitrage favors trans-Atlantic Export capacity from the US to Asia is ample, according to an executive of a third-party logistics provider, who estimated that backhaul utilization for most ocean carriers hovers near 50%. Spot rates for dry freight to Asia from the US Gulf, which dominates resin exports, are currently running between $500 and $700 for a standard-sized container, while shipping a 20-foot container used primarily for resins runs about 80% of that rate. Trans-Atlantic rates have also been stable, hovering near $1,100 for a 20-foot container from the US Gulf to Northern Europe, according to Xeneta. The rate for shipping a 20-foot container out of the Southeast Atlantic ports has moved higher since the start of the year, going from just over $700 to $757 this week, Xeneta said. Carriers are removing ships and port calls from trans-Atlantic services , tightening up some of the capacity in that market. Outbound US cargo does not face any significant delays with bookings available about two weeks out. The real risk for shippers will be in fuel surcharges that are being applied on global trades due to the Middle East war, as well as a potential general rate increase in April. Outside of freight rates and vessel space, Vangipuram said the real driver for US exports will be the direction of local pricing. Asian prices will still need to move higher to attract more US imports. With a four- to six-week lead time for imports, Asian buyers will need to see the conflict drag out before buying from the US. Europe, which is the second-biggest market for US resins after South America, has seen its benchmark polyethylene prices rise by one-third since the end of February. Vangipuram said Europe would likely be the first market to see additional US imports thanks to the much shorter voyage time and the sharper price move. “The arbitrage works out better in the Atlantic than to Asia because of freight rates and shorter shipping times,” Vangipuram said. “We may not see the volume from the US make it into those markets that would appear to need it most.” Contact Michael Angell at michael.angell@spglobal.com .

Trans-Atlantic

US resin shippers look to tap new customers amid Iran war

<div class="phx-topic abstract-wrapper">The latest quarterly results show that FedEx’s less-than-truckload division is struggling with lackluster industrial demand, but a change in strategy after a planned June spinoff could provide different results.</div>

The latest quarterly results show that FedEx’s less-than-truckload division is struggling with lackluster industrial demand, but a change in strategy after a planned June spinoff could provide different results.

<div class="phx-topic">Revenue and shipments in FedEx’s less-than-truckload (LTL) division fell during its fiscal third quarter amid the ongoing sluggish US industrial economy as the parent company prepares for a planned spinoff in June of the LTL business. Revenue for FedEx Freight dropped 5% year over year to $1.99 billion between December and February, the company’s fiscal third quarter, while shipments were down 6%. Revenue per shipment, however, increased 1% year over year. “It’s a broader LTL market that we’re in, and there’s nothing necessarily unique about our volumes,” Marshall Witt, CFO of FedEx Freight, said on an earnings call late Thursday. “We need to continue to improve our yield growth ... we will expect to continue to improve our customer experience ... we expect to continue to be disciplined in our pricing contract renewals.” Fourth-quarter and full fiscal-year revenue for LTL will likely be down by low-single-digit percentages year over year, according to the company. More attention on the call, however, was paid to the FedEx Freight spinoff and an investor day on April 8, during which the company will outline a new strategy for LTL focused on yield over volume. As a standalone company, FedEx Freight might reject low-margin or unprofitable freight from shippers who previously used LTL as part of a larger commercial relationship with FedEx’s parcel, logistics, and airfreight divisions. The freight division has hired its sales and operation teams, created new computer systems and secured a $3.7 billion debt offering in January. “We look at those as good cost incurrences primarily because they’re related to building our IT infrastructure,” Witt said. “Also building out our talent, and that represents both folks that are coming on board externally and folks that are transitioning over from FedEx Corporation. Having those folks and platforms being built now and being ready to address the spin off and the standalone of FedEx Freight is a positive outcome for us.” FedEx also pointed to the possibility that the growth in data centers will generate freight volumes. “We know that as data centers expand, that yes, there will be some LTL business for my friends over at [FedEx] Freight, but in addition, there is going to be some parcel business,” Brie Carere, FedEx’s chief commercial officer, said on Thursday’s call. <h3>Small encouraging signs </h3>There are some small encouraging signs for the LTL industry overall. The Institute for Supply Chain Management reports that the Purchasing Managers’ Index for manufacturing was in expansion territory in February, at 52.4, for a second consecutive month after spending most of 2025 in contraction territory. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="ccfbe9dd-30e0-4ab0-b6bd-a4eed3591ca5"></dynamic-object></div>In an intra-quarter update, ArcBest, parent of LTL provider ABF Freight System, reported that revenue per day was up 1% and shipments were up 2% year over year in January and February combined. XPO reported shipments per day grew 3% year over year in February, although it did not disclose revenue. But Old Dominion Freight Line reported revenue per day declined 3.3% and shipments fell 7% in February. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Revenue and shipments in FedEx’s less-than-truckload (LTL) division fell during its fiscal third quarter amid the ongoing sluggish US industrial economy as the parent company prepares for a planned spinoff in June of the LTL business. Revenue for FedEx Freight dropped 5% year over year to $1.99 billion between December and February, the company’s fiscal third quarter, while shipments were down 6%. Revenue per shipment, however, increased 1% year over year. “It’s a broader LTL market that we’re in, and there’s nothing necessarily unique about our volumes,” Marshall Witt, CFO of FedEx Freight, said on an earnings call late Thursday. “We need to continue to improve our yield growth ... we will expect to continue to improve our customer experience ... we expect to continue to be disciplined in our pricing contract renewals.” Fourth-quarter and full fiscal-year revenue for LTL will likely be down by low-single-digit percentages year over year, according to the company. More attention on the call, however, was paid to the FedEx Freight spinoff and an investor day on April 8, during which the company will outline a new strategy for LTL focused on yield over volume. As a standalone company, FedEx Freight might reject low-margin or unprofitable freight from shippers who previously used LTL as part of a larger commercial relationship with FedEx’s parcel, logistics, and airfreight divisions. The freight division has hired its sales and operation teams, created new computer systems and secured a $3.7 billion debt offering in January. “We look at those as good cost incurrences primarily because they’re related to building our IT infrastructure,” Witt said. “Also building out our talent, and that represents both folks that are coming on board externally and folks that are transitioning over from FedEx Corporation. Having those folks and platforms being built now and being ready to address the spin off and the standalone of FedEx Freight is a positive outcome for us.” FedEx also pointed to the possibility that the growth in data centers will generate freight volumes. “We know that as data centers expand, that yes, there will be some LTL business for my friends over at [FedEx] Freight, but in addition, there is going to be some parcel business,” Brie Carere, FedEx’s chief commercial officer, said on Thursday’s call. Small encouraging signs There are some small encouraging signs for the LTL industry overall. The Institute for Supply Chain Management reports that the Purchasing Managers’ Index for manufacturing was in expansion territory in February, at 52.4, for a second consecutive month after spending most of 2025 in contraction territory. In an intra-quarter update, ArcBest, parent of LTL provider ABF Freight System, reported that revenue per day was up 1% and shipments were up 2% year over year in January and February combined. XPO reported shipments per day grew 3% year over year in February, although it did not disclose revenue. But Old Dominion Freight Line reported revenue per day declined 3.3% and shipments fell 7% in February. Contact Ari Ashe at ari.ashe@spglobal.com .

Trucking News

Surface

FedEx Freight battles weak US industrial sector ahead of spinoff

<div class="phx-topic abstract-wrapper">The move comes just days after a joint venture between the two companies was selected as the preferred bidder to develop a $1.8 billion container terminal in Da Nang.</div>

The move comes just days after a joint venture between the two companies was selected as the preferred bidder to develop a $1.8 billion container terminal in Da Nang.

<div class="phx-topic">APM Terminals has taken a 49% stake in Hateco Haiphong International Container Terminal (HHIT) in northern Vietnam, Maersk’s port affiliate said Friday, cementing its partnership with Vietnam’s Hateco Group after helping to develop the $450 million facility. Financial terms were not disclosed. The move comes <a href="https://www.joc.com/article/apm-terminals-to-build-18-billion-terminal-in-da-nang-6187751">days after a joint venture between the two companies was selected</a> as the preferred bidder to develop a $1.8 billion container terminal in Da Nang, about 350 miles south of Haiphong, and 13 months after the 2.2 million-TEU capacity HHIT became operational. HHIT said the two-berth facility, covering berths 5 and 6 at Haiphong’s Lach Huyen port, has already exceeded initial throughput targets after handling 808,000 TEUs in the 11 months after it became operational last year. APM Terminals said its involvement in developing HHIT included shared best practices on safety, port automation, the use of artificial intelligence and process optimization, and decarbonization. That has helped the terminal achieve an average of 30 container moves per hour and cut truck turnaround times to 16 minutes compared with a market average of 35 minutes, HHIT said. “Since we started operating, we can already see that we are delivering on the highest berth productivities in the Port of Haiphong and have set new records for the automated gate operations as well,” Hateco Group Chairman Tran Van Ky said in a statement announcing APM Terminals’ minority stake. “We are looking forward to working closely with APM Terminals in the years to come to further optimize the terminal operations to the benefit of our customers.” Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

APM Terminals has taken a 49% stake in Hateco Haiphong International Container Terminal (HHIT) in northern Vietnam, Maersk’s port affiliate said Friday, cementing its partnership with Vietnam’s Hateco Group after helping to develop the $450 million facility. Financial terms were not disclosed. The move comes days after a joint venture between the two companies was selected as the preferred bidder to develop a $1.8 billion container terminal in Da Nang, about 350 miles south of Haiphong, and 13 months after the 2.2 million-TEU capacity HHIT became operational. HHIT said the two-berth facility, covering berths 5 and 6 at Haiphong’s Lach Huyen port, has already exceeded initial throughput targets after handling 808,000 TEUs in the 11 months after it became operational last year. APM Terminals said its involvement in developing HHIT included shared best practices on safety, port automation, the use of artificial intelligence and process optimization, and decarbonization. That has helped the terminal achieve an average of 30 container moves per hour and cut truck turnaround times to 16 minutes compared with a market average of 35 minutes, HHIT said. “Since we started operating, we can already see that we are delivering on the highest berth productivities in the Port of Haiphong and have set new records for the automated gate operations as well,” Hateco Group Chairman Tran Van Ky said in a statement announcing APM Terminals’ minority stake. “We are looking forward to working closely with APM Terminals in the years to come to further optimize the terminal operations to the benefit of our customers.” Contact Keith Wallis at keithwallis@hotmail.com .

Port News

International ports

APMT takes 49% stake in Haiphong’s HHIT terminal in northern Vietnam

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

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

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

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

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

<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

Dry Van

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Flatbed

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Refrigerated

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US dry-van, flatbed and refrigerated truckload spot rates (DAT)

US Truckload spot rates weekly (DAT) Gateway

<div class="phx-topic abstract-wrapper">Containers that were inbound when the war started have been plugged into reefer slots in terminals outside the Gulf, accruing mounting storage charges as cargo owners either wait for the Strait of Hormuz to reopen or start looking for new markets</div>

Containers that were inbound when the war started have been plugged into reefer slots in terminals outside the Gulf, accruing mounting storage charges as cargo owners either wait for the Strait of Hormuz to reopen or start looking for new markets

<div class="phx-topic">Düsseldorf — Cold chain shippers with containers destined for the Middle East are in a state of suspended animation with reefer boxes offloaded early at other ports in the region and no timeline on when their voyages will be able to resume through the war zone. Ocean carriers have suspended the acceptance of reefer, dangerous goods and special cargo in and out of the UAE, Oman, Iraq, Kuwait, Qatar, Bahrain and Saudi Arabia until further notice. Reefer containers that were inbound when the war started on Feb. 28 have been dropped off and plugged into reefer slots in terminals outside the Persian Gulf, accruing mounting storage charges and leaving cargo owners waiting until shipping can again pass through the Strait of Hormuz. Alternatively, cargo owners will need to start looking for new markets. One such shipper with reefers out of position is Tyson Foods. The Middle East is a major market for the global protein producer that brings in halal chicken from Brazil, but Gulf-bound reefer containers were offloaded before reaching their destination, according to Juliana Violato, Tyson’s senior manager of procurement in Europe. “In Brazil we have slowed down production because all containers that were on the water are now sitting in ports near the Gulf or in India or Singapore,” Violato told the Journal of Commerce at the Global Cold Chain Association (GCCA) Europe conference in Dusseldorf this week. “They will be there until they find a new trade lane that could be through Oman or Saudi Arabia, but we don’t know how or when because of the war,” she added. “What we do know is that the market is still there.” Thomas Eskesen, founder of cold chain industry consultants Eskesen Advisory, said the fate of frozen food shipments and perishables with a limited shelf life has been the number one issue for the global cold chain since the Middle East war began. “This has a massive cascading effect with equipment tied up and booking stops affecting carriers individually,” Eskesen told the Journal of Commerce. “Lots of cargo is being diverted via the Jeddah back door [in Saudi Arabia], but it is more difficult if dumped in India and Sri Lanka.” <h3>Land-based options under pressure </h3>The land options via Khor Fakkan and Fujairah in the UAE, Sohar in Oman and Jeddah that are being offered by ocean carriers and forwarders <a href="https://www.joc.com/article/rising-road-volume-puts-middle-east-land-based-options-under-pressure-6187755">are creaking under the heavy demand</a>. Port delays are growing fast, as are trucking bottlenecks, with one forwarder reporting a 20-mile line of trucks waiting to get into Dubai’s Jebel Ali container port. Violato said the clock was ticking as reefers could not wait forever and new markets will need to be found if Hormuz remains unpassable “in the coming weeks,” a move that would bring its own set of problems. “There will be a decision to bring back the containers [to origin] or to sell the products in different markets,” she said. “If it’s chicken breast it can be sold in Europe, and if it’s dark meat it can be sold in Africa, but if the war continues, they will need to find another destination.” Kevin Marchetti, co-founder of Lineage Logistics, said although he had no customers with reefers stuck in the region, those shippers are in a difficult position as there will need to be a different solution depending on the customer, the product and the destination. “Some of the products are pre-approved for certain markets where some traders have licenses and some don’t, so it is a really complicated issue,” Marchetti said on the sidelines of the GCCA conference. “The bigger question is that you produce goods thinking you have the end markets open and the goods will just flow, but now reefers are backing up,” he added. “There is also a limited amount of equipment and although we don’t have shortages yet, people have started to talk about it.” <h3>Holding back shipments from Europe </h3>Andrew Mates, managing director of Europe for temperature-controlled warehousing and food logistics specialist Americold, said shipments from Europe to the Middle East have been held back because of the war. “Our Dubai joint venture has reported the UAE government is being very active in redirecting cargo coming in from ports in Oman and Saudi Arabia and arranging land-based routes to keep the supply chain moving,” Mates said. “But there are trucking constraints where all of a sudden containers need to go thousands of kilometers,” he added. “The UAE government realizes that if the situation stays as it is for a few more weeks, they will simply have to get products in somehow.” While exceptions are being made for critical foodstuffs, pharma and other essential goods, <a href="https://www.joc.com/article/maersk-forced-to-ship-fuel-from-us-europe-as-asia-bunkers-start-to-run-dry-6184651">in a recent interview with the Journal of Commerce</a>, Maersk CCO Karsten Kildahl said that at some point “all cargo becomes urgent,” including aluminum, petrochemicals and polyethylene that are all raw materials for plastics production. Persian Gulf states import more than 90% of their goods, and while the closure of the Strait of Hormuz has long been factored into their scenario planning, a long-term closure will start to hit the shelves. Another fast-developing problem is outward-bound cargo, particularly fertilizer from the Middle East that comprises about 30% of the global market and is crucial for food production, according to Violato. “If the war takes longer, we will not have fertilizer for planting and grain production will drop,” she said. “When we impact grain, we impact animal feed and protein becomes more expensive and inflation is impossible to avoid. But again, everything depends on how long the war goes on for.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Düsseldorf — Cold chain shippers with containers destined for the Middle East are in a state of suspended animation with reefer boxes offloaded early at other ports in the region and no timeline on when their voyages will be able to resume through the war zone. Ocean carriers have suspended the acceptance of reefer, dangerous goods and special cargo in and out of the UAE, Oman, Iraq, Kuwait, Qatar, Bahrain and Saudi Arabia until further notice. Reefer containers that were inbound when the war started on Feb. 28 have been dropped off and plugged into reefer slots in terminals outside the Persian Gulf, accruing mounting storage charges and leaving cargo owners waiting until shipping can again pass through the Strait of Hormuz. Alternatively, cargo owners will need to start looking for new markets. One such shipper with reefers out of position is Tyson Foods. The Middle East is a major market for the global protein producer that brings in halal chicken from Brazil, but Gulf-bound reefer containers were offloaded before reaching their destination, according to Juliana Violato, Tyson’s senior manager of procurement in Europe. “In Brazil we have slowed down production because all containers that were on the water are now sitting in ports near the Gulf or in India or Singapore,” Violato told the Journal of Commerce at the Global Cold Chain Association (GCCA) Europe conference in Dusseldorf this week. “They will be there until they find a new trade lane that could be through Oman or Saudi Arabia, but we don’t know how or when because of the war,” she added. “What we do know is that the market is still there.” Thomas Eskesen, founder of cold chain industry consultants Eskesen Advisory, said the fate of frozen food shipments and perishables with a limited shelf life has been the number one issue for the global cold chain since the Middle East war began. “This has a massive cascading effect with equipment tied up and booking stops affecting carriers individually,” Eskesen told the Journal of Commerce. “Lots of cargo is being diverted via the Jeddah back door [in Saudi Arabia], but it is more difficult if dumped in India and Sri Lanka.” Land-based options under pressure The land options via Khor Fakkan and Fujairah in the UAE, Sohar in Oman and Jeddah that are being offered by ocean carriers and forwarders are creaking under the heavy demand . Port delays are growing fast, as are trucking bottlenecks, with one forwarder reporting a 20-mile line of trucks waiting to get into Dubai’s Jebel Ali container port. Violato said the clock was ticking as reefers could not wait forever and new markets will need to be found if Hormuz remains unpassable “in the coming weeks,” a move that would bring its own set of problems. “There will be a decision to bring back the containers [to origin] or to sell the products in different markets,” she said. “If it’s chicken breast it can be sold in Europe, and if it’s dark meat it can be sold in Africa, but if the war continues, they will need to find another destination.” Kevin Marchetti, co-founder of Lineage Logistics, said although he had no customers with reefers stuck in the region, those shippers are in a difficult position as there will need to be a different solution depending on the customer, the product and the destination. “Some of the products are pre-approved for certain markets where some traders have licenses and some don’t, so it is a really complicated issue,” Marchetti said on the sidelines of the GCCA conference. “The bigger question is that you produce goods thinking you have the end markets open and the goods will just flow, but now reefers are backing up,” he added. “There is also a limited amount of equipment and although we don’t have shortages yet, people have started to talk about it.” Holding back shipments from Europe Andrew Mates, managing director of Europe for temperature-controlled warehousing and food logistics specialist Americold, said shipments from Europe to the Middle East have been held back because of the war. “Our Dubai joint venture has reported the UAE government is being very active in redirecting cargo coming in from ports in Oman and Saudi Arabia and arranging land-based routes to keep the supply chain moving,” Mates said. “But there are trucking constraints where all of a sudden containers need to go thousands of kilometers,” he added. “The UAE government realizes that if the situation stays as it is for a few more weeks, they will simply have to get products in somehow.” While exceptions are being made for critical foodstuffs, pharma and other essential goods, in a recent interview with the Journal of Commerce, Maersk CCO Karsten Kildahl said that at some point “all cargo becomes urgent,” including aluminum, petrochemicals and polyethylene that are all raw materials for plastics production. Persian Gulf states import more than 90% of their goods, and while the closure of the Strait of Hormuz has long been factored into their scenario planning, a long-term closure will start to hit the shelves. Another fast-developing problem is outward-bound cargo, particularly fertilizer from the Middle East that comprises about 30% of the global market and is crucial for food production, according to Violato. “If the war takes longer, we will not have fertilizer for planting and grain production will drop,” she said. “When we impact grain, we impact animal feed and protein becomes more expensive and inflation is impossible to avoid. But again, everything depends on how long the war goes on for.” Contact Greg Knowler at  greg.knowler@spglobal.com . 

Forwarding

Reefer shippers play waiting game with boxes stuck outside Persian Gulf

<div class="phx-topic abstract-wrapper">Changing market dynamics offer an opportunity for motor carriers to raise rates, but also for intermodal providers to win business from cost-conscious shippers looking to shift modes.</div>

Changing market dynamics offer an opportunity for motor carriers to raise rates, but also for intermodal providers to win business from cost-conscious shippers looking to shift modes.

<div class="phx-topic">The tightening of truckload capacity and a sharp rise in diesel prices are beginning to reset surface transportation rates in the US, giving carriers renewed leverage while opening a potential growth opportunity for intermodal rail. Crackdowns on <a href="https://www.joc.com/article/impact-of-non-domiciled-cdl-enforcement-splits-us-trucking-sector-6135184">non-domiciled commercial drivers</a> and stricter English-language enforcement are constraining truckload capacity after a four-year freight recession. Meanwhile, diesel prices have surged to their highest level since late 2022 amid the war with Iran, lifting transportation costs for all and forcing shippers to reassess their budgets. It has started a cascading effect across domestic US transportation. Brokers and asset-based truckload carriers are rejecting freight and insisting on renegotiating contract rates, while shippers facing blown transportation budgets consider cheaper options such as intermodal rail. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="f7dc31b8-1e1c-4a59-907f-2391c69d4e9f"></dynamic-object></div>Early signs of that repricing are already evident. Spot truckload rates are up between 15% and 20% from a year ago, according to DAT Freight &amp; Analytics, even as freight demand remains muted amid elevated interest rates, a lackluster housing market, and mixed signals from the US industrial sector. “Not only are you seeing elevated rates across other modalities such as flatbed, but in the overall dry-van market, you’re seeing 14%, 15% tender rejections coming out of the slowest freight month of the year,” said Jared Weisfeld, chief strategy officer for RXO, a non-asset broker, speaking at the J.P. Morgan Industrials Conference on Tuesday. As recently as last year, tender rejections were at or less than 5%, according to Weisfeld. <h3>Regulatory tightening reinforces supply constraint </h3>The supply side could tighten further as new federal regulations take hold. The Federal Motor Carrier Safety Administration (FCMSA) enacted a rule earlier this week restricting non-domiciled commercial driver’s licenses (CDLs), a move the agency estimates could remove up to 194,000 drivers over five years. On Wednesday, the US House of Representatives advanced “Delilah’s Law,” which would accelerate enforcement over non-domiciled CDLs by retroactively invalidating certain licenses, rather than waiting for a non-domiciled CDL holder to interact with state licensing agencies. Despite higher rates, fleets have been cautious about adding capacity, even though stricter emissions regulations in 2027 will increase the purchase price of a new truck. “Our customers are more middle- to smaller-sized [carriers], and I think there’s still a lot of hesitation on that side to make the decisions,” said Cristina Gallo-Aquino, CFO of Ryder Systems, speaking at the J.P. Morgan event. “We are pointing it all out to them to show them how much of a price increase could be coming ... but we haven’t really seen the shift to make a decision and preorder.” <h3>Fuel surge amplifies pricing pressure </h3>Diesel prices averaged $5.07 per gallon last week, according to the US Energy Information Administration, the highest since November 2022 and adding another layer of cost pressure across the truckload market. On the spot market, where rates are often negotiated on an all-in basis, the increase is squeezing owner-operators and smaller carriers that cannot pass through fuel costs. That dynamic may cause more capacity to exit the truckload sector. In the contract market, larger asset-based carriers pass through higher fuel costs via surcharges. Since March 1, the average surcharge has risen nearly 20 cents per mile, although methodologies vary. For shippers, the result is sticker shock on invoices and a renewed focus on lower-cost alternatives such as rail. “For the intermodal space, it starts to put pressure on truck rates, which is a pretty good thing for us,” Mark George, CEO of Norfolk Southern, said at the J.P. Morgan event. “We’ve been pretty depressed [price-wise] for a while. We’d love to see some evacuation of capacity in trucking.” Intermodal providers are already prepared for that shift. Darren Field, president of intermodal at J.B. Hunt Transport Services, said the company is actively engaging with shippers looking to manage rising transportation costs. “How can we convert business from the highway back to intermodal, or to intermodal for the first time to hopefully save you a little money and prepare your budget for a year where truckload capacity and prices could get difficult for you,” Field said at the J.P. Morgan conference. “How can you hedge against the potential for a cost increase coming at your budget as a shipper by utilizing more intermodal?” But capturing that opportunity will depend on execution. Railroads must maintain service reliability even as volumes rise, a lesson of the pandemic when congestion and labor shortages left intermodal with a lingering stigma among some shippers. Service metrics suggest the industry has made progress. In a Journal of Commerce survey conducted late last year, 91.3% of respondents said they were satisfied with domestic intermodal service, up from 45.3% in the spring of 2023. Whether that improvement holds under renewed demand may determine how much freight ultimately shifts modes. Shippers, having experienced pandemic-era disruptions, are unlikely to tolerate a repeat. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

The tightening of truckload capacity and a sharp rise in diesel prices are beginning to reset surface transportation rates in the US, giving carriers renewed leverage while opening a potential growth opportunity for intermodal rail. Crackdowns on non-domiciled commercial drivers and stricter English-language enforcement are constraining truckload capacity after a four-year freight recession. Meanwhile, diesel prices have surged to their highest level since late 2022 amid the war with Iran, lifting transportation costs for all and forcing shippers to reassess their budgets. It has started a cascading effect across domestic US transportation. Brokers and asset-based truckload carriers are rejecting freight and insisting on renegotiating contract rates, while shippers facing blown transportation budgets consider cheaper options such as intermodal rail. Early signs of that repricing are already evident. Spot truckload rates are up between 15% and 20% from a year ago, according to DAT Freight & Analytics, even as freight demand remains muted amid elevated interest rates, a lackluster housing market, and mixed signals from the US industrial sector. “Not only are you seeing elevated rates across other modalities such as flatbed, but in the overall dry-van market, you’re seeing 14%, 15% tender rejections coming out of the slowest freight month of the year,” said Jared Weisfeld, chief strategy officer for RXO, a non-asset broker, speaking at the J.P. Morgan Industrials Conference on Tuesday. As recently as last year, tender rejections were at or less than 5%, according to Weisfeld. Regulatory tightening reinforces supply constraint The supply side could tighten further as new federal regulations take hold. The Federal Motor Carrier Safety Administration (FCMSA) enacted a rule earlier this week restricting non-domiciled commercial driver’s licenses (CDLs), a move the agency estimates could remove up to 194,000 drivers over five years. On Wednesday, the US House of Representatives advanced “Delilah’s Law,” which would accelerate enforcement over non-domiciled CDLs by retroactively invalidating certain licenses, rather than waiting for a non-domiciled CDL holder to interact with state licensing agencies. Despite higher rates, fleets have been cautious about adding capacity, even though stricter emissions regulations in 2027 will increase the purchase price of a new truck. “Our customers are more middle- to smaller-sized [carriers], and I think there’s still a lot of hesitation on that side to make the decisions,” said Cristina Gallo-Aquino, CFO of Ryder Systems, speaking at the J.P. Morgan event. “We are pointing it all out to them to show them how much of a price increase could be coming ... but we haven’t really seen the shift to make a decision and preorder.” Fuel surge amplifies pricing pressure Diesel prices averaged $5.07 per gallon last week, according to the US Energy Information Administration, the highest since November 2022 and adding another layer of cost pressure across the truckload market. On the spot market, where rates are often negotiated on an all-in basis, the increase is squeezing owner-operators and smaller carriers that cannot pass through fuel costs. That dynamic may cause more capacity to exit the truckload sector. In the contract market, larger asset-based carriers pass through higher fuel costs via surcharges. Since March 1, the average surcharge has risen nearly 20 cents per mile, although methodologies vary. For shippers, the result is sticker shock on invoices and a renewed focus on lower-cost alternatives such as rail. “For the intermodal space, it starts to put pressure on truck rates, which is a pretty good thing for us,” Mark George, CEO of Norfolk Southern, said at the J.P. Morgan event. “We’ve been pretty depressed [price-wise] for a while. We’d love to see some evacuation of capacity in trucking.” Intermodal providers are already prepared for that shift. Darren Field, president of intermodal at J.B. Hunt Transport Services, said the company is actively engaging with shippers looking to manage rising transportation costs. “How can we convert business from the highway back to intermodal, or to intermodal for the first time to hopefully save you a little money and prepare your budget for a year where truckload capacity and prices could get difficult for you,” Field said at the J.P. Morgan conference. “How can you hedge against the potential for a cost increase coming at your budget as a shipper by utilizing more intermodal?” But capturing that opportunity will depend on execution. Railroads must maintain service reliability even as volumes rise, a lesson of the pandemic when congestion and labor shortages left intermodal with a lingering stigma among some shippers. Service metrics suggest the industry has made progress. In a Journal of Commerce survey conducted late last year, 91.3% of respondents said they were satisfied with domestic intermodal service, up from 45.3% in the spring of 2023. Whether that improvement holds under renewed demand may determine how much freight ultimately shifts modes. Shippers, having experienced pandemic-era disruptions, are unlikely to tolerate a repeat. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

Truckload

Capacity cuts, fuel shocks provide openings for trucking and rail

<div class="phx-topic abstract-wrapper">The most disruptive energy shock in modern history has reawakened the debate over whether emergency fuel surcharges are a fair way for ocean carriers to recoup unexpected costs or blatant “double-dipping” that angers shippers.</div>

The most disruptive energy shock in modern history has reawakened the debate over whether emergency fuel surcharges are a fair way for ocean carriers to recoup unexpected costs or blatant “double-dipping” that angers shippers.

<div class="phx-topic">The speed and severity of the jump in global oil prices amid the war in the Middle East have reignited long-standing suspicions by cargo owners that fuel surcharges levied by ocean carriers are used as a revenue stream rather than a cost recovery mechanism. Container lines defend the fees, ranging from $30 to $300 per TEU depending on the trade lane, arguing that what is widely seen as the most significant energy shock in history has forced them to recoup costs with fees beyond the lagging quarterly bunker adjustment factor (BAF). Bunker fuel prices contribute approximately 15% to 30% of operating costs, depending on the year, according to various container line financial reports.And while the traditional linkage between fuel costs and BAFs has fractured due to the rapid escalation of the war and the effective closure of the Strait of Hormuz, according to a Vizion analysis, shippers nonetheless are retaining a cynical view of the emergency fuel surcharges. “Shipping lines always seem to manage to turn a crisis into a cash-grab,” was the blunt message from James Hookham, director of the Global Shippers Forum. “This apparent ‘double-dipping’ brings the whole sordid practice of surcharging into further disrepute.” Emergency bunker adjustment factors (EBAFs) on top of quarterly fuel price adjustments to recover costs in what is a core operational expense were acceptable for the current contract period ending March 26, said Antonios Rigalos, managing partner of shipper network ShiftX. But going forward, increased bunker costs should be recovered by the quarterly BAF review, he noted.“The BAF reviews executed for Q3 will reflect the higher bunker costs for the previous quarter [March/April/May], and an EBAF plus BAF review would create a double charging of customers,” Rigalos said. “While we understand the situation of carriers and that increased bunker costs have a big impact that somehow needs to be recovered, it needs to be carried out in a fair way and not by double charging BCOs [beneficial cargo owners] and clients.” Several carriers have announced emergency bunker fuel surcharges on top of quarterly fuel price adjustments to recover costs in what is a core operational expense, but the moves have sparked growing concern from shippers. An Asia-Europe shipper based in Hong Kong said he negotiated contracts based on the Shanghai Containerized Freight Index (SCFI) that covers both BAF and EBAF surcharges. “We adjust the bunker fuel surcharge bi-monthly and as far as we are concerned, we will fight any additional emergency fuel surcharge from the carriers,” the source said. <h3>Long hauls hit with surcharges </h3>CMA CGM this week announced an upward review of its “emergency fuel surcharge” imposed on March 16 that will increase from $150 per TEU to $265/TEU on all long-haul trade lanes. OOCL said it will impose a temporary emergency bunker surcharge (EBS) from March 23 to manage global challenges to fuel availability because the increased costs are “beyond the scope of existing fuel cost recovery and low sulfur adjustment mechanisms.” Cosco Shipping has also announced emergency bunker surcharges on various trades between Europe, South America and Africa, while Mediterranean Shipping Co. introduced a temporary emergency bunker surcharge on March 16 that varies from $30/TEU to $300/TEU depending on the trade lane. Maersk on March 10 announced it would implement an emergency bunker surcharge of $200/TEU on all long hauls “to safeguard cargo integrity and maintain the stability of our network.” “This surcharge covers the impact of fuel availability, cost and mix outside of what is covered in our fossil fuel fee [FFF],” the carrier said in a statement. “This means we are better positioned to have the necessary access to fuel and the ability to move it to necessary locations.” Maersk CCO Karsten Kildahl said the carrier was being forced to take the unprecedented step of <a href="https://www.joc.com/article/maersk-forced-to-ship-fuel-from-us-europe-as-asia-bunkers-start-to-run-dry-6184651">filling ships with fuel in the US and Europe and transferring the bunkers to vessels in Asia as supplies at bunkering hubs dried up</a>. Most of the emergency fuel surcharges will be reviewed by carriers every two weeks, but with the Strait of Hormuz — through which about 20% of global oil and liquefied natural gas supplies move each day — out of bounds to commercial shipping, there is little chance the EBAF will be dropped anytime soon. The speed with which the fuel surcharges were imposed by carriers made it “nigh on impossible” for shippers to recover costs from their own customers or suppliers, Hookham told the Journal of Commerce. “For smaller businesses, that cash flow hit can be fatal when payments are likely to be late due to late or non-delivery of cargo,” he said, noting that the number of surcharges being introduced made it difficult for shippers to track which ones applied to their shipments. “The US got it right when the [Federal Maritime Commission] <a href="https://www.joc.com/article/fmc-says-closely-monitoring-carrier-rate-moves-tied-to-middle-east-war-6184781">required 30-day notice periods</a> before surcharges could take effect on US services,” Hookham said. “The current surcharging behavior will only hasten demands for similar notice periods to become mandatory worldwide.” <h3>Fractured fuel links </h3>While carriers roll out their fuel surcharges to try to recover rising costs, freight tracking platform Vizion believes the traditional linkage between fuel costs and BAFs has fractured due to the rapid escalation of the war and the effective closure of the Strait of Hormuz. In a recent review of bunker surcharges, Vizion noted that average very low sulfur fuel oil (VLSFO) prices of $535 per metric ton in 2025 were down 14.4% year over year, the lowest since 2020, with BAF contributing just 10% to 20% to total freight costs. The launch of US and Israeli strikes on Iran on Feb. 28 triggered a 73% fuel price spike to $939/metric ton in under two weeks, and carriers within days responded with emergency surcharges of $60/TEU to $190/TEU, far faster than standard quarterly BAF adjustments. That shows the traditional BAF fuel-price correlation has weakened as carriers shift to emergency mechanisms to manage extreme volatility, according to Vizion. But Vizion said a deeper trend was emerging with a market fracture in progress as carriers divided into two camps: immediate risk transfer versus contract stability. Carriers such as Maersk initially absorbed the volatility to protect long-term contract relationships, although the carrier has subsequently announced an emergency fuel surcharge. A more aggressive strategy was taken by MSC and CMA CGM, with both adopting a rapid pass-through of fuel spikes to protect their margins immediately. Shippers with locked-in rates will enjoy a short-term cost advantage, but it will be a temporary relief before fuel adjustments hit. Vizion warned that over the next three to six months, shippers can expect aggressive second-quarter BAF corrections to capture the remaining fuel cost delta. Chantal McRoberts, director and head of advisory at Drewry Supply Chain Advisors, said shippers understand they will pay an increased fuel cost in the third quarter as that is part of the BAF policy that enables carriers to recover fuel costs over time. “The concern around the introduction of EBAF is the potential for double recovery,” McRoberts told the Journal of Commerce. “In practice, a shipper may pay an EBAF during Q2 to reflect higher fuel prices and then see its underlying BAF increase in Q3 as the formula catches up with those same Q2 fuel costs. At that point, the EBAF risks becoming revenue‑generating rather than purely cost‑recovering. “This is the dilemma currently facing shippers,” she added. “As a result, those operating under transparent, formula‑based BAF mechanisms are, in many cases, pushing back on EBAF charges.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

The speed and severity of the jump in global oil prices amid the war in the Middle East have reignited long-standing suspicions by cargo owners that fuel surcharges levied by ocean carriers are used as a revenue stream rather than a cost recovery mechanism. Container lines defend the fees, ranging from $30 to $300 per TEU depending on the trade lane, arguing that what is widely seen as the most significant energy shock in history has forced them to recoup costs with fees beyond the lagging quarterly bunker adjustment factor (BAF). Bunker fuel prices contribute approximately 15% to 30% of operating costs, depending on the year, according to various container line financial reports. And while the traditional linkage between fuel costs and BAFs has fractured due to the rapid escalation of the war and the effective closure of the Strait of Hormuz, according to a Vizion analysis, shippers nonetheless are retaining a cynical view of the emergency fuel surcharges. “Shipping lines always seem to manage to turn a crisis into a cash-grab,” was the blunt message from James Hookham, director of the Global Shippers Forum. “This apparent ‘double-dipping’ brings the whole sordid practice of surcharging into further disrepute.” Emergency bunker adjustment factors (EBAFs) on top of quarterly fuel price adjustments to recover costs in what is a core operational expense were acceptable for the current contract period ending March 26, said Antonios Rigalos, managing partner of shipper network ShiftX. But going forward, increased bunker costs should be recovered by the quarterly BAF review, he noted. “The BAF reviews executed for Q3 will reflect the higher bunker costs for the previous quarter [March/April/May], and an EBAF plus BAF review would create a double charging of customers,” Rigalos said. “While we understand the situation of carriers and that increased bunker costs have a big impact that somehow needs to be recovered, it needs to be carried out in a fair way and not by double charging BCOs [beneficial cargo owners] and clients.” Several carriers have announced emergency bunker fuel surcharges on top of quarterly fuel price adjustments to recover costs in what is a core operational expense, but the moves have sparked growing concern from shippers. An Asia-Europe shipper based in Hong Kong said he negotiated contracts based on the Shanghai Containerized Freight Index (SCFI) that covers both BAF and EBAF surcharges. “We adjust the bunker fuel surcharge bi-monthly and as far as we are concerned, we will fight any additional emergency fuel surcharge from the carriers,” the source said. Long hauls hit with surcharges CMA CGM this week announced an upward review of its “emergency fuel surcharge” imposed on March 16 that will increase from $150 per TEU to $265/TEU on all long-haul trade lanes. OOCL said it will impose a temporary emergency bunker surcharge (EBS) from March 23 to manage global challenges to fuel availability because the increased costs are “beyond the scope of existing fuel cost recovery and low sulfur adjustment mechanisms.” Cosco Shipping has also announced emergency bunker surcharges on various trades between Europe, South America and Africa, while Mediterranean Shipping Co. introduced a temporary emergency bunker surcharge on March 16 that varies from $30/TEU to $300/TEU depending on the trade lane. Maersk on March 10 announced it would implement an emergency bunker surcharge of $200/TEU on all long hauls “to safeguard cargo integrity and maintain the stability of our network.” “This surcharge covers the impact of fuel availability, cost and mix outside of what is covered in our fossil fuel fee [FFF],” the carrier said in a statement. “This means we are better positioned to have the necessary access to fuel and the ability to move it to necessary locations.” Maersk CCO Karsten Kildahl said the carrier was being forced to take the unprecedented step of filling ships with fuel in the US and Europe and transferring the bunkers to vessels in Asia as supplies at bunkering hubs dried up . Most of the emergency fuel surcharges will be reviewed by carriers every two weeks, but with the Strait of Hormuz — through which about 20% of global oil and liquefied natural gas supplies move each day — out of bounds to commercial shipping, there is little chance the EBAF will be dropped anytime soon. The speed with which the fuel surcharges were imposed by carriers made it “nigh on impossible” for shippers to recover costs from their own customers or suppliers, Hookham told the Journal of Commerce. “For smaller businesses, that cash flow hit can be fatal when payments are likely to be late due to late or non-delivery of cargo,” he said, noting that the number of surcharges being introduced made it difficult for shippers to track which ones applied to their shipments. “The US got it right when the [Federal Maritime Commission] required 30-day notice periods before surcharges could take effect on US services,” Hookham said. “The current surcharging behavior will only hasten demands for similar notice periods to become mandatory worldwide.” Fractured fuel links While carriers roll out their fuel surcharges to try to recover rising costs, freight tracking platform Vizion believes the traditional linkage between fuel costs and BAFs has fractured due to the rapid escalation of the war and the effective closure of the Strait of Hormuz. In a recent review of bunker surcharges, Vizion noted that average very low sulfur fuel oil (VLSFO) prices of $535 per metric ton in 2025 were down 14.4% year over year, the lowest since 2020, with BAF contributing just 10% to 20% to total freight costs. The launch of US and Israeli strikes on Iran on Feb. 28 triggered a 73% fuel price spike to $939/metric ton in under two weeks, and carriers within days responded with emergency surcharges of $60/TEU to $190/TEU, far faster than standard quarterly BAF adjustments. That shows the traditional BAF fuel-price correlation has weakened as carriers shift to emergency mechanisms to manage extreme volatility, according to Vizion. But Vizion said a deeper trend was emerging with a market fracture in progress as carriers divided into two camps: immediate risk transfer versus contract stability. Carriers such as Maersk initially absorbed the volatility to protect long-term contract relationships, although the carrier has subsequently announced an emergency fuel surcharge. A more aggressive strategy was taken by MSC and CMA CGM, with both adopting a rapid pass-through of fuel spikes to protect their margins immediately. Shippers with locked-in rates will enjoy a short-term cost advantage, but it will be a temporary relief before fuel adjustments hit. Vizion warned that over the next three to six months, shippers can expect aggressive second-quarter BAF corrections to capture the remaining fuel cost delta. Chantal McRoberts, director and head of advisory at Drewry Supply Chain Advisors, said shippers understand they will pay an increased fuel cost in the third quarter as that is part of the BAF policy that enables carriers to recover fuel costs over time. “The concern around the introduction of EBAF is the potential for double recovery,” McRoberts told the Journal of Commerce. “In practice, a shipper may pay an EBAF during Q2 to reflect higher fuel prices and then see its underlying BAF increase in Q3 as the formula catches up with those same Q2 fuel costs. At that point, the EBAF risks becoming revenue‑generating rather than purely cost‑recovering. “This is the dilemma currently facing shippers,” she added. “As a result, those operating under transparent, formula‑based BAF mechanisms are, in many cases, pushing back on EBAF charges.” Contact Greg Knowler at greg.knowler@spglobal.com .

War reignites tussle between ocean carriers, cargo owners over fuel surcharges

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<div class="phx-topic abstract-wrapper">After a pause in trans-Pacific service contract negotiations caused by the war in the Middle East, talks are expected to move forward now that the largest US retailer has concluded some of its agreements.</div>

After a pause in trans-Pacific service contract negotiations caused by the war in the Middle East, talks are expected to move forward now that the largest US retailer has concluded some of its agreements.

<div class="phx-topic">Container lines that paused trans-Pacific service contract talks to assess the impact of the war in the Middle East are back at the table, and expectations are that major retailers will sign in the coming week now that Walmart has finalized its 2026–27 contracts with a half-dozen carriers. Walmart’s move opens the door for other major retailers and, in turn, smaller importers and then non-vessel operating common carriers to ink their own service contracts, which typically go into effect May 1. Despite the <a href="https://www.joc.com/article/china-india-warn-carriers-on-higher-pricing-tied-to-middle-east-conflict-6183986">unknowns in terms of length and scope of the now two-week-long Middle East war</a>, carriers say big-box retailers want to lock in vessel capacity. Walmart, <a href="">the largest US importer</a>, has wrapped up its contract discussions with its core carriers, two sources familiar with the matter told the Journal of Commerce.  Carriers, and some forwarders, are urging customers to move expeditiously in their contract negotiations, rather than allowing uncertainties in global trade to deter them. “We now have seen an unpredictable shock to the global ocean market in like four of the last six years,” a carrier executive who asked not to be named told the Journal of Commerce. “Some BCOs [beneficial cargo owners] recognized that and wanted to take risk off the table; they signed early and at higher rates than many were predicting.” The executive added that analyst forecasts of supply and demand have rarely matched reality in recent years due to that outsized volatility. Geopolitical events including diversions away from the Red Sea, unpredictable US tariff policy and even more weather events, impacting ocean reliability, have begun to shift some shippers’ thinking, he said. “Some shippers have come to realize that pushing carriers well below breakeven to save a few cents on their cost of goods is not worth the risk of a major unpredictable event happening,” the executive said. <h3>Recouping higher fuel costs </h3>While securing space remains paramount for cargo owners, rising bunker fuel prices, driven by the closure of the Strait of Hormuz, <a href="https://www.joc.com/article/fmc-says-closely-monitoring-carrier-rate-moves-tied-to-middle-east-war-6184781">is also driving contract discussions regarding bunker fuel adjustment factors</a>. Shippers are reluctant to compensate carriers for the rising operating costs tied to the Middle East on a trade lane that is not directly impacted. “The uncertainty and waiting around for clarity or resolution is not helpful to anyone,” said Kevin Parkerson, a consultant and former logistics manager at retailers. “Yes, it may impact overall capacity. Yes, it may impact fuel prices. But at this point, that shouldn’t delay the process of contracting. Everybody seems to be proceeding cautiously.” At the moment, securing capacity in the Asia-US West Coast trade is not a significant issue that would slow negotiations. “Asia to the West Coast will be fine,” a second carrier executive told the Journal of Commerce, noting that if the war in the Middle East drags on for some weeks, East Coast routings from the Indian sub-continent could be impacted by the <a href="https://www.joc.com/article/waves-of-diverted-containers-swamping-middle-east-ports-6183989">congestion that is already building at some ports in the region</a>. In the interim, most importers would be wise to secure the minimum quantity commitments in their contracts as soon as they have a handle on what their space requirements will be, a third carrier executive said. “Those BCOs who are slow-walking their negotiations to wait for better prices — it may backfire,” the executive said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Container lines that paused trans-Pacific service contract talks to assess the impact of the war in the Middle East are back at the table, and expectations are that major retailers will sign in the coming week now that Walmart has finalized its 2026–27 contracts with a half-dozen carriers. Walmart’s move opens the door for other major retailers and, in turn, smaller importers and then non-vessel operating common carriers to ink their own service contracts, which typically go into effect May 1. Despite the unknowns in terms of length and scope of the now two-week-long Middle East war , carriers say big-box retailers want to lock in vessel capacity. Walmart,  the largest US importer , has wrapped up its contract discussions with its core carriers, two sources familiar with the matter told the Journal of Commerce.   Carriers, and some forwarders, are urging customers to move expeditiously in their contract negotiations, rather than allowing uncertainties in global trade to deter them. “We now have seen an unpredictable shock to the global ocean market in like four of the last six years,” a carrier executive who asked not to be named told the Journal of Commerce. “Some BCOs [beneficial cargo owners] recognized that and wanted to take risk off the table; they signed early and at higher rates than many were predicting.” The executive added that analyst forecasts of supply and demand have rarely matched reality in recent years due to that outsized volatility. Geopolitical events including diversions away from the Red Sea, unpredictable US tariff policy and even more weather events, impacting ocean reliability, have begun to shift some shippers’ thinking, he said. “Some shippers have come to realize that pushing carriers well below breakeven to save a few cents on their cost of goods is not worth the risk of a major unpredictable event happening,” the executive said. Recouping higher fuel costs While securing space remains paramount for cargo owners, rising bunker fuel prices, driven by the closure of the Strait of Hormuz, is also driving contract discussions regarding bunker fuel adjustment factors . Shippers are reluctant to compensate carriers for the rising operating costs tied to the Middle East on a trade lane that is not directly impacted. “The uncertainty and waiting around for clarity or resolution is not helpful to anyone,” said Kevin Parkerson, a consultant and former logistics manager at retailers. “Yes, it may impact overall capacity. Yes, it may impact fuel prices. But at this point, that shouldn’t delay the process of contracting. Everybody seems to be proceeding cautiously.”  At the moment, securing capacity in the Asia-US West Coast trade is not a significant issue that would slow negotiations. “Asia to the West Coast will be fine,” a second carrier executive told the Journal of Commerce, noting that if the war in the Middle East drags on for some weeks, East Coast routings from the Indian sub-continent could be impacted by the congestion that is already building at some ports in the region . In the interim, most importers would be wise to secure the minimum quantity commitments in their contracts as soon as they have a handle on what their space requirements will be, a third carrier executive said. “Those BCOs who are slow-walking their negotiations to wait for better prices — it may backfire,” the executive said. Contact Bill Mongelluzzo at  bill.mongelluzzo@spglobal.com .

Trans-Pacific

Trans-Pacific contract talks accelerating after Walmart signs

<div class="phx-topic abstract-wrapper">China’s largest shipping company commented on current geopolitical events as it released its 2025 financial results, which saw net profits plummet 38%.</div>

China’s largest shipping company commented on current geopolitical events as it released its 2025 financial results, which saw net profits plummet 38%.

<div class="phx-topic">Geopolitical tensions, heightened by war in the Middle East, will accelerate the pace of regionalization in global trade and nearshoring this year while “amplifying the volatility of global supply chains,” Cosco Shipping said Thursday. Momentum for global economic growth is weak, and the external environment for the container shipping industry remains severe, the liner shipping and terminals group said in its 2025 results statement filed with the Shanghai stock exchange. “Looking ahead to 2026, the complexity and uncertainty of the container shipping market will further intensify,” Cosco said. More favorably for global trade, Cosco said emerging economies are showing strong growth potential, cooperation among developing countries is warming and tariff uncertainties have temporarily eased. Cosco specifically highlighted Southeast Asia and Latin America, where demand is strengthening, buoyed by the widening implementation of free trade agreements such as the Regional Comprehensive Economic Partnership in Asia. China’s biggest shipping company said the imbalance between cargo demand and fleet growth will also ease this year, with cargo volumes rising by a “low to moderate 2.5%” compared with 3.8% fleet growth, “the lowest in the past three years.” While this increase in capacity is likely to put downward pressure on freight rates, the impact could be mitigated by port congestion caused by the realignment of carrier alliance networks and the war in the Middle East, the carrier said. <h3>Net profit down 38% in 2025 </h3>Cosco saw mixed results last year, largely reflected by volatile US tariff policy, the deteriorating global economy and the crash in freight rates in the fourth quarter. Overall, net profit fell 38% to $4.3 billion last year while operating revenues slipped 6% to $30.7 billion. Cosco said net profit in the fourth quarter was the lowest of all four quarters, falling 60% to $532 million. The carrier said the worst-performing trades last year were the Asia-Europe and Mediterranean services, which saw an 18% decline in total revenues to $5.3 billion. Revenue from trans-Pacific services fell 17% to $7.7 billion, while revenue from intra-Asia routes was unchanged at $7.6 billion. Cosco saw a better performance from its terminals business, with revenue climbing 11% to $1.7 billion last year, supported by a 6% increase in total throughput to 153 million TEUs. Cosco said it would focus the development of its terminal business on emerging markets and trade lanes to reflect the growing trade between Southeast Asia and Latin America and the increasing importance of ports in areas such as North Africa and India. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Geopolitical tensions, heightened by war in the Middle East, will accelerate the pace of regionalization in global trade and nearshoring this year while “amplifying the volatility of global supply chains,” Cosco Shipping said Thursday. Momentum for global economic growth is weak, and the external environment for the container shipping industry remains severe, the liner shipping and terminals group said in its 2025 results statement filed with the Shanghai stock exchange. “Looking ahead to 2026, the complexity and uncertainty of the container shipping market will further intensify,” Cosco said. More favorably for global trade, Cosco said emerging economies are showing strong growth potential, cooperation among developing countries is warming and tariff uncertainties have temporarily eased. Cosco specifically highlighted Southeast Asia and Latin America, where demand is strengthening, buoyed by the widening implementation of free trade agreements such as the Regional Comprehensive Economic Partnership in Asia. China’s biggest shipping company said the imbalance between cargo demand and fleet growth will also ease this year, with cargo volumes rising by a “low to moderate 2.5%” compared with 3.8% fleet growth, “the lowest in the past three years.” While this increase in capacity is likely to put downward pressure on freight rates, the impact could be mitigated by port congestion caused by the realignment of carrier alliance networks and the war in the Middle East, the carrier said. Net profit down 38% in 2025 Cosco saw mixed results last year, largely reflected by volatile US tariff policy, the deteriorating global economy and the crash in freight rates in the fourth quarter. Overall, net profit fell 38% to $4.3 billion last year while operating revenues slipped 6% to $30.7 billion. Cosco said net profit in the fourth quarter was the lowest of all four quarters, falling 60% to $532 million. The carrier said the worst-performing trades last year were the Asia-Europe and Mediterranean services, which saw an 18% decline in total revenues to $5.3 billion. Revenue from trans-Pacific services fell 17% to $7.7 billion, while revenue from intra-Asia routes was unchanged at $7.6 billion. Cosco saw a better performance from its terminals business, with revenue climbing 11% to $1.7 billion last year, supported by a 6% increase in total throughput to 153 million TEUs. Cosco said it would focus the development of its terminal business on emerging markets and trade lanes to reflect the growing trade between Southeast Asia and Latin America and the increasing importance of ports in areas such as North Africa and India. Contact Keith Wallis at keithwallis@hotmail.com .

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