<div class="phx-topic abstract-wrapper">The now-bankrupt retailer alleges the ocean carrier failed to provide the full vessel space it contracted for, then charged much-higher premiums to ensure its cargo wasn’t rolled.</div>

The now-bankrupt retailer alleges the ocean carrier failed to provide the full vessel space it contracted for, then charged much-higher premiums to ensure its cargo wasn’t rolled.

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<div>This article has been updated to include comment from OOCL.Bed Bath &amp; Beyond is seeking nearly $32 million from OOCL, accusing the container line of price gouging during the height of pandemic-related supply chain disruption. Days after filing for Chapter 11 bankruptcy protection, BBB said in a complaint filed last Thursday with the US Federal Maritime Commission (FMC) that OOCL failed to fulfill its service agreements and then “gouged” the retailer, “coercing” BBB to pay premium prices and peak surcharges that weren’t included in the agreements between 2020 and 2022. The shipper wants those funds, some $31.7 million, reimbursed. BBB...

This article has been updated to include comment from OOCL. Bed Bath & Beyond is seeking nearly $32 million from OOCL, accusing the container line of price gouging during the height of pandemic-related supply chain disruption. Days after filing for Chapter 11 bankruptcy protection, BBB said in a complaint filed last Thursday with the US Federal Maritime Commission (FMC) that OOCL failed to fulfill its service agreements and then “gouged” the retailer, “coercing” BBB to pay premium prices and peak surcharges that weren’t included in the agreements between 2020 and 2022. The shipper wants those funds, some $31.7 million, reimbursed. BBB inked a pair of year-long service contracts with Orient Overseas Container Line Limited and OOCL Limited — collectively OOCL — with one deal starting in July 2020 and another in May 2021. The retailer said the deals specified certain minimum quantity commitments of cargo to be shipped and locked in the required vessel space. But between July 2020 and April 2022, OOCL fell short of its agreement by 1,987 FEUs, forcing BBB to pay above-contracted prices to secure space or risk forgoing its shipments, the shipper alleged in the complaint. BBB maintains OOCL’s actions were “deliberate” and “not due to an absence of available cargo space.” The shipper also made a link between what it called the “exploited price inflation” it was forced to pay with the record profit of $7.7 billion OOCL booked in 2021. “Respondent’s failure to provide contracted space to complainant was part of a practice by respondent of preferring higher-priced freight and demanding extracontractual financial concessions before performing under its service contracts,” BBB said in its filing with the FMC. During the period in question, BBB says it suffered $11.5 million in damages by paying open market prices, $13.7 in damages for peak season surcharges and other related fees, and $6.3 million in improperly assessed detention and demurrage charges. “Respondent’s practice of holding complainant’s [vessel] space hostage was clearly designed to, and did, coerce complainant to agree to pay the surcharges respondent demanded in order to obtain much-needed space under respondent’s service commitment,” BBB said. OOCL said in a statement to the Journal of Commerce it "has a long history of maintaining the highest standards of regulatory compliance in the US and elsewhere." “We will continue to work with our customers and all relevant authorities to resolve any disputes in a professional, efficient, and amicable manner,” the carrier said. BBB listed FedEx, Blue Yonder as creditors In the filing, BBB referenced an email it received from an OOCL employee that read, “We are not looking to gouge, but stating the reality of the current market environment for any extra space.” OOCL offered a rate of $5,800 per FEU on top of BBB's primary contract pricing rate, which meant the shipper would be paying approximately $7,000 per FEU. BBB noted “even [OOCL’s] employees themselves could not avoid explicitly referring to ‘gouging’ when describing [its] pricing practices.” BBB’s complaint was filed with the FMC four days after its April 23 announcement that it would file for bankruptcy. The company, which started closing its 360 BBB retail locations in the US and 120 of its Buy Buy Baby stores that same week, expects all stores to close by June 30. Citing congested US ports, BBB told investors in April 2022 that it would lose $175 million in sales for its fiscal fourth quarter of 2022, which ended Feb. 28, 2022. That was a $75 million increase from the additional supply chain costs the company accumulated in the prior quarter, according to a CNBC report. The retailer said in its bankruptcy filing it has between 25,001 to 50,000 creditors, including owing about $3.9 million to FedEx and $2.5 million to supply chain management company Blue Yonder. The latest FMC case isn't the first allegation that a carrier failed to fulfill contracted space requirements. Last June, food manufacturer and importer MSRF filed a complaint against HMM and Yang Ming, alleging both carriers failed to honor capacity commitments set out in annual service contracts beginning May 1, 2021. The case is ongoing. Yang Ming settled a similar case with Achim Importing Co. in September. Contact Teri Errico Griffis at teri.griffis@spglobal.com . JOC analyst Cathy Morrow Roberson contributed to this report.

Transport, Trade and Regulation News

Container lines

Trans-Pacific

Container Shipping News

Bed Bath & Beyond looks to recoup millions from OOCL in FMC complaint

<div class="phx-topic abstract-wrapper">Limited air freight options for specialized cargoes are not expected to ease in the short term. </div>

Limited air freight options for specialized cargoes are not expected to ease in the short term.

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<div class="phx-topic">A combination of strong heavy-lift and outsized cargo demand, tight air cargo capacity and surging air freight rates has led to a modal shift in shipments from air to multipurpose vessels (MPVs), carriers and brokers say.Over the past two years, charter rates for aircraft specializing in heavy-lift and outsized cargo have surged more than 50% on strong demand and capacity shortages, Andriy Blagovisniy, global director of air chartering at LP Aero, part of Logistics Plus, told the Journal of Commerce.This has pushed charter rates for the heavy-lift air industry workhorse Antonov An-124 to over $2 million for a flight from Asia to the US. Heavy-lift and project cargo customers charter the entire airplane on an aircraft, crew, maintenance and insurance (ACMI) basis, unlike general air freight which is charged per kilogram. Actual rates are dependent on the type of cargo, flight duration and route.“Charter rates are high, but at the same time it cannot be said that they are not affordable,” Blagovisniy said. “When customers make the decision to use air transport their choice is always based on whether to gain time or save money given the significant financial losses that can arise from delays in delivery of project cargo.”However, he said that strong demand has led to longer lead times for specialized air freight. “To transport project cargo by air it is now necessary to book an aircraft approximately six to seven weeks in advance,” Blagovisniy said. That’s at least double the time needed two years ago. Time also needs to be factored in for the bespoke preparations necessary for the carriage of project cargoes, including the design and manufacture of frames to hold the cargo and the provision of lashing and lifting points to ensure safe weight distribution in the aircraft.The supply squeeze has meant that the waiting time for aircraft availability is now comparable with the time taken to deliver cargo by sea – though sea transportation is considerably cheaper, Blagovisniy said.“Consequently, customers who previously traditionally considered air delivery as the fastest and most convenient option are now, from the very beginning, planning and building their logistics needs on the delivery of project cargo by ship,” Blagovisniy added.<h3>MPV carrier welcomes modal shift</h3>Blagovisniy’s comments were echoed by Marc Willim, general manager and head of chartering at MPV operator AAL Shipping. “We have heard about such cases of heavy-lift air freight shipments moving to ocean freight from our forwarder clients,” Willim told the Journal of Commerce. “It is, however, difficult for us to quantify how many times or which cargoes specifically have shifted.“Due to the typically urgent nature of these shipments, we have a policy of earliest possibly engagement and forward planning with our project customers…and we can plan and lock in sailings early to satisfy individual project or customer needs,” he added.There are few aircraft capable of transporting heavy-lift or outsized project cargo loads. These include the AN-124, the world’s largest commercial cargo aircraft operated by Ukraine’s Antonov Airlines, Boeing 747-400s and Ilyushin IL-76s, all with a 50-ton payload. The Airbus Beluga ST, based on an Airbus A300, can carry up to 40 mt.Due to the Russia-Ukraine war, only six AN-124 Ukraine-registered aircraft remain active in the global heavy-lift transportation market, but “two of these are dedicated to transporting arms and supplies to Ukraine,” a broker said.Ongoing aircraft maintenance means that only two to four AN-124s currently operate on the global commercial market, said the broker, who did not want to be identified.Volga-Dnepr Airlines, which claims to have a fleet of 10 AN-124s, only operates two aircraft because the rest are grounded due to Western sanctions imposed on Russia following its invasion of Ukraine. The two aircraft only operate between Russia and “friendly” countries including China, India and Kazakhstan. There are just two Ilyushin IL-76s available on the market today.“Boeing 747s are more widely available, operated by cargo airlines including Cargolux and Kalitta Air, and have the flexibility to load project cargo through their nose door. But technically, they are more limited due to cargo door dimensions and maximum permissible floor loads,” the broker added.<h3>Shippers hold for Beluga capacity</h3>Tight specialized air freight capacity is expected to continue into next year. Benoît Lemonnier, Airbus Beluga Transport’s managing director, anticipates the situation will improve next year when the airline, specially created by European aircraft maker Airbus, starts to more actively promote its five Beluga Super Transporter (ST) aircraft.The priorities for 2025 are Airbus-related cargoes including satellites and helicopters “and the upcoming transport of new payloads for external strategic customers,” Lemonnier told the Journal of Commerce. “Aeronautics, defense and space are the most active with Beluga at the moment.”Airbus Beluga Transport, which received its air operator’s certificate in November 2023, has focused on developing its operations, flying around 700 hours in the first nine months of this year mainly on European and a few long-range flights, he said.The Beluga ST has a 40 mt payload and the world’s largest interior cross-section of any transport aircraft, accommodating outsized cargo of up to 23 feet wide and 22 feet high.Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

A combination of strong heavy-lift and outsized cargo demand, tight air cargo capacity and surging air freight rates has led to a modal shift in shipments from air to multipurpose vessels (MPVs), carriers and brokers say. Over the past two years, charter rates for aircraft specializing in heavy-lift and outsized cargo have surged more than 50% on strong demand and capacity shortages, Andriy Blagovisniy, global director of air chartering at LP Aero, part of Logistics Plus, told the Journal of Commerce. This has pushed charter rates for the heavy-lift air industry workhorse Antonov An-124 to over $2 million for a flight from Asia to the US. Heavy-lift and project cargo customers charter the entire airplane on an aircraft, crew, maintenance and insurance (ACMI) basis, unlike general air freight which is charged per kilogram. Actual rates are dependent on the type of cargo, flight duration and route. “Charter rates are high, but at the same time it cannot be said that they are not affordable,” Blagovisniy said. “When customers make the decision to use air transport their choice is always based on whether to gain time or save money given the significant financial losses that can arise from delays in delivery of project cargo.” However, he said that strong demand has led to longer lead times for specialized air freight. “To transport project cargo by air it is now necessary to book an aircraft approximately six to seven weeks in advance,” Blagovisniy said. That’s at least double the time needed two years ago. Time also needs to be factored in for the bespoke preparations necessary for the carriage of project cargoes, including the design and manufacture of frames to hold the cargo and the provision of lashing and lifting points to ensure safe weight distribution in the aircraft. The supply squeeze has meant that the waiting time for aircraft availability is now comparable with the time taken to deliver cargo by sea – though sea transportation is considerably cheaper, Blagovisniy said. “Consequently, customers who previously traditionally considered air delivery as the fastest and most convenient option are now, from the very beginning, planning and building their logistics needs on the delivery of project cargo by ship,” Blagovisniy added. MPV carrier welcomes modal shift Blagovisniy’s comments were echoed by Marc Willim, general manager and head of chartering at MPV operator AAL Shipping. “We have heard about such cases of heavy-lift air freight shipments moving to ocean freight from our forwarder clients,” Willim told the Journal of Commerce. “It is, however, difficult for us to quantify how many times or which cargoes specifically have shifted. “Due to the typically urgent nature of these shipments, we have a policy of earliest possibly engagement and forward planning with our project customers…and we can plan and lock in sailings early to satisfy individual project or customer needs,” he added. There are few aircraft capable of transporting heavy-lift or outsized project cargo loads. These include the AN-124, the world’s largest commercial cargo aircraft operated by Ukraine’s Antonov Airlines, Boeing 747-400s and Ilyushin IL-76s, all with a 50-ton payload. The Airbus Beluga ST, based on an Airbus A300, can carry up to 40 mt. Due to the Russia-Ukraine war, only six AN-124 Ukraine-registered aircraft remain active in the global heavy-lift transportation market, but “two of these are dedicated to transporting arms and supplies to Ukraine,” a broker said. Ongoing aircraft maintenance means that only two to four AN-124s currently operate on the global commercial market, said the broker, who did not want to be identified. Volga-Dnepr Airlines, which claims to have a fleet of 10 AN-124s, only operates two aircraft because the rest are grounded due to Western sanctions imposed on Russia following its invasion of Ukraine. The two aircraft only operate between Russia and “friendly” countries including China, India and Kazakhstan. There are just two Ilyushin IL-76s available on the market today. “Boeing 747s are more widely available, operated by cargo airlines including Cargolux and Kalitta Air, and have the flexibility to load project cargo through their nose door. But technically, they are more limited due to cargo door dimensions and maximum permissible floor loads,” the broker added. Shippers hold for Beluga capacity Tight specialized air freight capacity is expected to continue into next year. Benoît Lemonnier, Airbus Beluga Transport’s managing director, anticipates the situation will improve next year when the airline, specially created by European aircraft maker Airbus, starts to more actively promote its five Beluga Super Transporter (ST) aircraft. The priorities for 2025 are Airbus-related cargoes including satellites and helicopters “and the upcoming transport of new payloads for external strategic customers,” Lemonnier told the Journal of Commerce. “Aeronautics, defense and space are the most active with Beluga at the moment.” Airbus Beluga Transport, which received its air operator’s certificate in November 2023, has focused on developing its operations, flying around 700 hours in the first nine months of this year mainly on European and a few long-range flights, he said. The Beluga ST has a 40 mt payload and the world’s largest interior cross-section of any transport aircraft, accommodating outsized cargo of up to 23 feet wide and 22 feet high. Contact Keith Wallis at keithwallis@hotmail.com .

Heavy-haul transport

Project cargo

Breakbulk News

Lack of heavy-lift air freight capacity forces shift to ocean transport

<div class="phx-topic abstract-wrapper">Steady-but-uninspiring demand for MPVs has kept freight rates at a sustainable level.</div>

Steady-but-uninspiring demand for MPVs has kept freight rates at a sustainable level.

<div class="phx-topic">Momentum for the multipurpose vessel (MPV) fleet has eased as renewables projects move slower than anticipated, leaving forward-booked tonnage free to re-enter the charter market and keeping freight rates in check.Michael Mørland, project cargo director/Atlantic at G2 Ocean, told the Journal of Commerce that the renewable segment has not really delivered the volume that was expected in 2024. “And the outlook for the remaining pipeline of projects is the same -- things are going slower than anticipated as the financing climate has been harder, and there are less volumes than anticipated,” Mørland said.This has led to an easing in freight rates because tonnage that had been allocated for the pipeline isn’t being utilized. “That ruins some of the momentum for the multipurpose fleets,” he said.One notable trend is US manufacturers switching supply to near-field production where possible, including from Mexico. “The more they get that bit right, the less they have to ship deepsea,” Mørland said. Toepfer Transport said in its Dec. 6 Multipurpose Shipping Report that the Atlantic trades have shown “gradual and modest positive development,” but are still below the level considered normal.“On both sides of the Atlantic, economic growth is slow, and there are some uncertainties about the impact of the next US presidency on global trade,” Toepfer said.Nevertheless, robust demand for tonnage in Asia still provides for stable vessel utilization, Toepfer added. The broker said it anticipates that the current sideways movement will “persist for a few more months,” although an improvement in rates is expected from the second quarter of 2025 onwards, subject to developments in the US. Toepfer projects a 2.57% increase in its Toepfer Multipurpose Index (TMI) by November 2025, year over year.Drewry Shipping Consultants’ indices echoed the steady, but uninspiring market. Published Dec. 6, its new Project Cargo Transport Index reached 175 points in November, up 0.6% from October, while its new General Cargo Index rose 1.4% to 145 points. The base point for both indices is 100 as of January 2019, and they have been calculated forward from that point.<div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="67c43007-3a39-487a-b219-50013baafc2a"></dynamic-object></div><h3>US cargo demand expected to pivot towards oil </h3>Looking to 2025, Mørland expects a shift in the cargo base for MPVs in the US.“It's quite clear that Donald Trump’s new government is not very pro-renewables,” he said. “They're more into the hydrocarbons and fossil fuels, and I do expect that will trickle down to the MPV fleet with more oil and gas and LNG-related projects in the future.”Fleet changes will also play into the sector’s capacity balance in the coming year. “When you look at the fleet balance, there will be a fair amount of tonnage exiting the fleet in the coming years,” Mørland said. “From G2 Ocean’s perspective in the next few years, there are quite a few ships that will be leaving because they're aging and, as publicized, we will be commencing a newbuild program to futureproof our fleet.”He said G2 Ocean is not the only carrier in that situation, and while there are newbuild programs in place, there is expected to be more MPV capacity exiting than being built. This will lead to tighter capacity. “So even if the market compresses, the market will flatten rather than reduce,” Mørland said.Toepfer’s TMI is based on expected average rates for six- to 12-month time charters for 12,500 dwt “F-Type” vessels with safe working load of 240 to 360 mt, as reported to Toepfer by owners and operators. Drewry’s new general cargo index is based on time charter rates collected from a range of stakeholders for general cargo, dry bulk, car and container carriers and on container freight rates. Drewry weights the various vessel types using estimates, based on its vessel supply/demand model, of how much non-containerized general cargo each sector is carrying and vessel utilization levels in those sectors. Drewry’s project cargo index incorporates time charter rates for various project carrier size categories along with direct competing sectors included in the general cargo index. Vessel types are again weighted according to proportion of project cargo estimated to be carried as per the supply/demand model.Contact Carly Fields at <a href="mailto:carly.fields@spglobal.com">carly.fields@spglobal.com</a>.</div>

Momentum for the multipurpose vessel (MPV) fleet has eased as renewables projects move slower than anticipated, leaving forward-booked tonnage free to re-enter the charter market and keeping freight rates in check. Michael Mørland, project cargo director/Atlantic at G2 Ocean, told the Journal of Commerce that the renewable segment has not really delivered the volume that was expected in 2024. “And the outlook for the remaining pipeline of projects is the same -- things are going slower than anticipated as the financing climate has been harder, and there are less volumes than anticipated,” Mørland said. This has led to an easing in freight rates because tonnage that had been allocated for the pipeline isn’t being utilized. “That ruins some of the momentum for the multipurpose fleets,” he said. One notable trend is US manufacturers switching supply to near-field production where possible, including from Mexico. “The more they get that bit right, the less they have to ship deepsea,” Mørland said. Toepfer Transport said in its Dec. 6 Multipurpose Shipping Report that the Atlantic trades have shown “gradual and modest positive development,” but are still below the level considered normal. “On both sides of the Atlantic, economic growth is slow, and there are some uncertainties about the impact of the next US presidency on global trade,” Toepfer said. Nevertheless, robust demand for tonnage in Asia still provides for stable vessel utilization, Toepfer added. The broker said it anticipates that the current sideways movement will “persist for a few more months,” although an improvement in rates is expected from the second quarter of 2025 onwards, subject to developments in the US. Toepfer projects a 2.57% increase in its Toepfer Multipurpose Index (TMI) by November 2025, year over year. Drewry Shipping Consultants’ indices echoed the steady, but uninspiring market. Published Dec. 6, its new Project Cargo Transport Index reached 175 points in November, up 0.6% from October, while its new General Cargo Index rose 1.4% to 145 points. The base point for both indices is 100 as of January 2019, and they have been calculated forward from that point. US cargo demand expected to pivot towards oil Looking to 2025, Mørland expects a shift in the cargo base for MPVs in the US. “It's quite clear that Donald Trump’s new government is not very pro-renewables,” he said. “They're more into the hydrocarbons and fossil fuels, and I do expect that will trickle down to the MPV fleet with more oil and gas and LNG-related projects in the future.” Fleet changes will also play into the sector’s capacity balance in the coming year. “When you look at the fleet balance, there will be a fair amount of tonnage exiting the fleet in the coming years,” Mørland said. “From G2 Ocean’s perspective in the next few years, there are quite a few ships that will be leaving because they're aging and, as publicized, we will be commencing a newbuild program to futureproof our fleet.” He said G2 Ocean is not the only carrier in that situation, and while there are newbuild programs in place, there is expected to be more MPV capacity exiting than being built. This will lead to tighter capacity. “So even if the market compresses, the market will flatten rather than reduce,” Mørland said. Toepfer’s TMI is based on expected average rates for six- to 12-month time charters for 12,500 dwt “F-Type” vessels with safe working load of 240 to 360 mt, as reported to Toepfer by owners and operators. Drewry’s new general cargo index is based on time charter rates collected from a range of stakeholders for general cargo, dry bulk, car and container carriers and on container freight rates. Drewry weights the various vessel types using estimates, based on its vessel supply/demand model, of how much non-containerized general cargo each sector is carrying and vessel utilization levels in those sectors. Drewry’s project cargo index incorporates time charter rates for various project carrier size categories along with direct competing sectors included in the general cargo index. Vessel types are again weighted according to proportion of project cargo estimated to be carried as per the supply/demand model. Contact Carly Fields at carly.fields@spglobal.com .

Breakbulk carriers

Energy projects

Slow-moving renewable projects curtail MPV enthusiasm

<div class="phx-topic abstract-wrapper">The Global Port Tracker upgraded its forecast for imports over the next several months despite the threat of labor unrest and new tariffs by the incoming Trump administration. </div>

The Global Port Tracker upgraded its forecast for imports over the next several months despite the threat of labor unrest and new tariffs by the incoming Trump administration.

<div class="phx-topic">US retailers said Monday they expect a “continued surge” in imports through the spring due to cargo frontloading amid the specter of labor strife and new tariffs, though held out hope both threats can be avoided. “Either a strike or new tariffs would be a blow to the economy and retailers are doing what they can to avoid the impact of either for as long as they can,” Jonathan Gold, vice president for supply chain and customs policy at the National Retail Federation (NRF), said in a statement. “We hope that both can be avoided, but bringing in cargo early is a prudent step to mitigate the impact on our industry, consumers and the nation’s economy.” Gold’s comments came as the NRF and Hackett Associates released their monthly Global Port Tracker, which significantly upgraded its import forecast from the November GPT. December imports are now projected at 2.14 million TEUs, up 14.3% year over year. Last month, retailers said December’s year-on-year gain would be 6.1%. The NRF now expects January imports to jump 12% compared to January 2024, up from the 2.5% gain forecast last month. February’s imports are expected to fall 4.1% year on year, though that’s an upgrade from the 9.3% decline originally forecast. March volumes are expected to jump 12.7% and April by 6.6% compared to the same months in 2024, according to the GPT. Total US imports for 2024 are now projected at 25.6 million TEUs, up 14.8% from 2023, the NFR said. Shippers are working <a href="https://www.joc.com/article/trans-pac-settles-into-sedate-december-before-new-years-uncertainties-5877172">to move goods</a> ahead of a potential Jan. 15 strike by the International Longshoremen’s Association (ILA), the threat of new tariffs by the incoming Trump administration, and an early Lunar New Year holiday on Jan. 29. The most recent data available from PIERS, a sister product of the Journal of Commerce within S&amp;P Global, showed October imports climbing 10% on the year, maintaining a months-long pattern of double-digit on-year increases. October marked the 18th consecutive month of US imports above 2 million TEUs. If NRF forecasts come to fruition as projected, November and December imports will break the pandemic-era record of 19 straight months. Still, October did mark the first month since May where on-month imports didn’t increase, instead sliding by about 3% to 2.44 million TEUs – the softest month since June. Contact Laura Robb at <a href="mailto:Laura.Robb@spglobal.com">Laura.Robb@spglobal.com</a>.  </div>

US retailers said Monday they expect a “continued surge” in imports through the spring due to cargo frontloading amid the specter of labor strife and new tariffs, though held out hope both threats can be avoided. “Either a strike or new tariffs would be a blow to the economy and retailers are doing what they can to avoid the impact of either for as long as they can,” Jonathan Gold, vice president for supply chain and customs policy at the National Retail Federation (NRF), said in a statement. “We hope that both can be avoided, but bringing in cargo early is a prudent step to mitigate the impact on our industry, consumers and the nation’s economy.” Gold’s comments came as the NRF and Hackett Associates released their monthly Global Port Tracker, which significantly upgraded its import forecast from the November GPT. December imports are now projected at 2.14 million TEUs, up 14.3% year over year. Last month, retailers said December’s year-on-year gain would be 6.1%. The NRF now expects January imports to jump 12% compared to January 2024, up from the 2.5% gain forecast last month. February’s imports are expected to fall 4.1% year on year, though that’s an upgrade from the 9.3% decline originally forecast. March volumes are expected to jump 12.7% and April by 6.6% compared to the same months in 2024, according to the GPT. Total US imports for 2024 are now projected at 25.6 million TEUs, up 14.8% from 2023, the NFR said. Shippers are working to move goods ahead of a potential Jan. 15 strike by the International Longshoremen’s Association (ILA), the threat of new tariffs by the incoming Trump administration, and an early Lunar New Year holiday on Jan. 29. The most recent data available from PIERS, a sister product of the Journal of Commerce within S&P Global, showed October imports climbing 10% on the year, maintaining a months-long pattern of double-digit on-year increases. October marked the 18th consecutive month of US imports above 2 million TEUs. If NRF forecasts come to fruition as projected, November and December imports will break the pandemic-era record of 19 straight months. Still, October did mark the first month since May where on-month imports didn’t increase, instead sliding by about 3% to 2.44 million TEUs – the softest month since June. Contact Laura Robb at Laura.Robb@spglobal.com . 

Supply chain

Maritime

US import ‘surge’ to persist into spring amid continued frontloading: retailers

<div class="phx-topic abstract-wrapper">For-hire trucking companies are adding workers again, but not enough to handle any big surge in freight volumes, as prospective employees look for more local jobs.</div>

For-hire trucking companies are adding workers again, but not enough to handle any big surge in freight volumes, as prospective employees look for more local jobs.

<div class="phx-topic">US trucking companies increased hiring in November, adding 2,100 jobs to non-seasonally adjusted payrolls after two months of declining employment. But there are still fewer workers on loading docks and behind the wheel than a year ago, data released Friday by the US Bureau of Labor Statistics (BLS) shows. At 1.56 million, the number of US for-hire trucking employees reported by the BLS in November was 2,000 below the actual, unadjusted payroll number for November 2023. That’s more emblematic of a continuing freight shortage than a market recovery. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="2a48a771-5aa3-4b1c-8561-b26cbf3f1502"></dynamic-object></div>The data indicates the trucking industry — while hiring — is not rushing to add jobs ahead of any projected increase in freight demand in 2025. That market turning point may still be several quarters away, logistics and trucking executives say. “I know of [truck] fleets that are still downsizing,” said Dean Croke, principal analyst for DAT Freight &amp; Analytics. “Fleets still haven’t found equilibrium, and that’s alarming in a peak shipping season. They’re still on the back foot, trying to find the bottom.” The data shows that for-hire trucking employment hasn’t fully recovered from the sudden loss of 30,000 jobs in August 2023 following the collapse of Yellow, then the third-largest less-than-truckload (LTL) carrier in the US. Trucking employment dropped to a three-year low in early 2024 before rising last month to a level just 3,100 jobs higher than immediately after Yellow’s failure. Shippers with freight still have an upper hand in contract talks, but the cautious pace of hiring could become an issue for shippers seeking to ensure predictable truck capacity. Driver availability affects not only pricing but key shipper performance criteria such as on-time, in-full (OTIF) delivery rates. Fewer drivers mean less flexibility for carriers and shippers trying to hit OTIF targets for large retailers and retail wholesalers. <h3>Narrowing payroll gap </h3>The US trucking industry — especially the truckload sector — has been in contraction since the spring of 2022, with rates tumbling as demand for freight shipping dropped. The BLS measure of trucking employment has dropped 2.6% since its August 2022 peak. The Journal of Commerce For-Hire Trucking Employment Index, based on BLS data, was 102.5 in November, up from a revised reading of 102.4 in October, indicating that trucking employment levels are about 2.5% higher than the pre-pandemic peak in 2018. Data for sub-sectors of truck transportation support claims of an ongoing shift from long-distance employers such as for-hire truckload and LTL carriers to local freight haulers and express companies, including package delivery firms. General freight local trucking employment rose by 1,100 workers in October, the latest month for which sub-sector data is available. Employment in the general freight long-distance trucking sub-sector fell by 1,500 workers in the same period, BLS data showed. Long-haul truckload and LTL employment dropped by 900 and 600 workers, respectively, in October, according to the BLS data. Employment at couriers and express delivery services increased by 14,700 workers. <h3>Last-mile competition </h3>Long-distance trucking companies are increasingly competing with local and final-mile delivery companies, including retailers. Retailers such as Walmart have expanded private truck fleets and others are adding home-delivery services. “We are currently partnering with a third-party to offer delivery through our app from approximately 75 stores,” Todd Vasos, CEO of Dollar General, said during a Dec. 5 earnings call. The discount retailer also has a partnership with DoorDash. Although hiring is slow, more truck drivers may be looking for new jobs. A fall 2024 survey of nearly 20,000 truck drivers by Interactive Conversion Agency and PDA found 40.7% of respondents are job hunting, compared with 33.3% a year ago. The top reason by far, cited by 81.9% of respondents, was predictable pay, followed by 65.7% seeking better home time and 49.1% wanting more consistent miles per week. As most drivers are paid by the mile, consistent mileage is a major factor in predictable pay. The survey is a warning sign for large truckload carriers positioning themselves for an end to a 30-month freight downturn that is expected at some point in 2025. Those carriers will have to work harder to keep existing truck drivers as freight conditions improve. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

US trucking companies increased hiring in November, adding 2,100 jobs to non-seasonally adjusted payrolls after two months of declining employment. But there are still fewer workers on loading docks and behind the wheel than a year ago, data released Friday by the US Bureau of Labor Statistics (BLS) shows. At 1.56 million, the number of US for-hire trucking employees reported by the BLS in November was 2,000 below the actual, unadjusted payroll number for November 2023. That’s more emblematic of a continuing freight shortage than a market recovery. The data indicates the trucking industry — while hiring — is not rushing to add jobs ahead of any projected increase in freight demand in 2025. That market turning point may still be several quarters away, logistics and trucking executives say. “I know of [truck] fleets that are still downsizing,” said Dean Croke, principal analyst for DAT Freight & Analytics. “Fleets still haven’t found equilibrium, and that’s alarming in a peak shipping season. They’re still on the back foot, trying to find the bottom.” The data shows that for-hire trucking employment hasn’t fully recovered from the sudden loss of 30,000 jobs in August 2023 following the collapse of Yellow, then the third-largest less-than-truckload (LTL) carrier in the US. Trucking employment dropped to a three-year low in early 2024 before rising last month to a level just 3,100 jobs higher than immediately after Yellow’s failure. Shippers with freight still have an upper hand in contract talks, but the cautious pace of hiring could become an issue for shippers seeking to ensure predictable truck capacity. Driver availability affects not only pricing but key shipper performance criteria such as on-time, in-full (OTIF) delivery rates. Fewer drivers mean less flexibility for carriers and shippers trying to hit OTIF targets for large retailers and retail wholesalers. Narrowing payroll gap The US trucking industry — especially the truckload sector — has been in contraction since the spring of 2022, with rates tumbling as demand for freight shipping dropped. The BLS measure of trucking employment has dropped 2.6% since its August 2022 peak. The Journal of Commerce For-Hire Trucking Employment Index, based on BLS data, was 102.5 in November, up from a revised reading of 102.4 in October, indicating that trucking employment levels are about 2.5% higher than the pre-pandemic peak in 2018. Data for sub-sectors of truck transportation support claims of an ongoing shift from long-distance employers such as for-hire truckload and LTL carriers to local freight haulers and express companies, including package delivery firms. General freight local trucking employment rose by 1,100 workers in October, the latest month for which sub-sector data is available. Employment in the general freight long-distance trucking sub-sector fell by 1,500 workers in the same period, BLS data showed. Long-haul truckload and LTL employment dropped by 900 and 600 workers, respectively, in October, according to the BLS data. Employment at couriers and express delivery services increased by 14,700 workers. Last-mile competition Long-distance trucking companies are increasingly competing with local and final-mile delivery companies, including retailers. Retailers such as Walmart have expanded private truck fleets and others are adding home-delivery services. “We are currently partnering with a third-party to offer delivery through our app from approximately 75 stores,” Todd Vasos, CEO of Dollar General, said during a Dec. 5 earnings call. The discount retailer also has a partnership with DoorDash. Although hiring is slow, more truck drivers may be looking for new jobs. A fall 2024 survey of nearly 20,000 truck drivers by Interactive Conversion Agency and PDA found 40.7% of respondents are job hunting, compared with 33.3% a year ago. The top reason by far, cited by 81.9% of respondents, was predictable pay, followed by 65.7% seeking better home time and 49.1% wanting more consistent miles per week. As most drivers are paid by the mile, consistent mileage is a major factor in predictable pay. The survey is a warning sign for large truckload carriers positioning themselves for an end to a 30-month freight downturn that is expected at some point in 2025. Those carriers will have to work harder to keep existing truck drivers as freight conditions improve. Contact William B. Cassidy at bill.cassidy@spglobal.com .

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US trucking employment rising, but lags 2023 amid soft demand

<div class="phx-topic abstract-wrapper">The February launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming.</div>

The February launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming.

<div class="phx-topic">Wan Hai Lines is planning to expand its trans-Pacific network after agreeing to a slot exchange deal with Ocean Network Express (ONE) on the latter’s Pacific South 6 service linking China with Long Beach and Oakland, the Taiwanese carrier said. The slot exchange will begin in February. The launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming Marine Transport to replace THE Alliance following the departure of Hapag-Lloyd to join Maersk in the Gemini Cooperation. While the launch of the Premier Alliance is now in abeyance after the <a href="https://www.joc.com/article/fmc-halts-premier-alliance-start-for-more-information-5877293">US Federal Maritime Commission’s (FMC’s) announcement Friday</a> that it will stop the partnership from going ahead while it seeks further information to assess the competitive impact, the three carriers can continue their THE Alliance group. The FMC’s agreement with THE Alliance does not expire until April 1, 2030, FMC documents show. The port rotation given by Wan Hai reflects ONE’s existing PS6 service with calls at Shanghai-Ningbo-Long Beach-Oakland-Shanghai-Ningbo. Wan Hai said the PS6 service will “provide a direct connection from Asia to the US West Coast,” with an express 16- to 18-day transit from Shanghai to Southern California. It will augment Wan Hai’s two existing services — its trans-Pacific West Coast AP1 service and its around-the-world US East Coast-Asia-America 7 service. Due to the new PS6 loop, Wan Hai said it will amend the rotation of its AP1 service by dropping Shanghai and Ningbo beginning in February to improve transit times for customers in Vietnam, Taiwan and southern China. The new rotation will be Haiphong-Cai Mep (Vietnam)-Shekou-Xiamen-Taipei-Los Angeles-Oakland-Shekou-Haiphong. Both the PS6 slot exchange and AP1 service changes are part of Wan Hai’s 2025 trans-Pacific service improvements. The carrier has been deriving an increasing share of revenue from its US services. Revenues from Wan Hai’s US trade more than doubled to $560 million in the first half of this year from the year-ago period. The US market contributed 28% of the carrier’s $2 billion in overall first-half revenues against 16% of the $1.5 billion in revenue generated in the prior-year period. US volumes showed only modest growth to 11% of total liftings in the first half, from 10% in the first six months of last year. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Wan Hai Lines is planning to expand its trans-Pacific network after agreeing to a slot exchange deal with Ocean Network Express (ONE) on the latter’s Pacific South 6 service linking China with Long Beach and Oakland, the Taiwanese carrier said. The slot exchange will begin in February. The launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming Marine Transport to replace THE Alliance following the departure of Hapag-Lloyd to join Maersk in the Gemini Cooperation. While the launch of the Premier Alliance is now in abeyance after the US Federal Maritime Commission’s (FMC’s) announcement Friday that it will stop the partnership from going ahead while it seeks further information to assess the competitive impact, the three carriers can continue their THE Alliance group. The FMC’s agreement with THE Alliance does not expire until April 1, 2030, FMC documents show. The port rotation given by Wan Hai reflects ONE’s existing PS6 service with calls at Shanghai-Ningbo-Long Beach-Oakland-Shanghai-Ningbo. Wan Hai said the PS6 service will “provide a direct connection from Asia to the US West Coast,” with an express 16- to 18-day transit from Shanghai to Southern California. It will augment Wan Hai’s two existing services — its trans-Pacific West Coast AP1 service and its around-the-world US East Coast-Asia-America 7 service. Due to the new PS6 loop, Wan Hai said it will amend the rotation of its AP1 service by dropping Shanghai and Ningbo beginning in February to improve transit times for customers in Vietnam, Taiwan and southern China. The new rotation will be Haiphong-Cai Mep (Vietnam)-Shekou-Xiamen-Taipei-Los Angeles-Oakland-Shekou-Haiphong. Both the PS6 slot exchange and AP1 service changes are part of Wan Hai’s 2025 trans-Pacific service improvements. The carrier has been deriving an increasing share of revenue from its US services. Revenues from Wan Hai’s US trade more than doubled to $560 million in the first half of this year from the year-ago period. The US market contributed 28% of the carrier’s $2 billion in overall first-half revenues against 16% of the $1.5 billion in revenue generated in the prior-year period. US volumes showed only modest growth to 11% of total liftings in the first half, from 10% in the first six months of last year. Contact Keith Wallis at keithwallis@hotmail.com .

Wan Hai to expand US trans-Pacific services with ONE slot charter deal

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

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Shippers save money, time with automated transportation bidding tools

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

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Filling the Supply Chain Education Gap with LTL Education Courses

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