<div class="phx-topic abstract-wrapper">The soonest the Panama Canal Authority says it could see significant relief is 2028, raising the possibility of persistent drought restrictions and reduced container capacity and transits until then, writes Journal of Commerce Executive Editor Mark Szakonyi. </div>

The soonest the Panama Canal Authority says it could see significant relief is 2028, raising the possibility of persistent drought restrictions and reduced container capacity and transits until then, writes Journal of Commerce Executive Editor Mark Szakonyi.

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<div>Persistent drought-driven restrictions on container ships traversing the Panama Canal are in the cards for at least the next several years, barring a dramatic upswing in rainfall. Those restrictions, which effectively reduce the maximum stowage capacity of larger vessels and limit the overall number of transits, will likely force carriers to alter networks as they try to push higher costs onto shippers.&nbsp;The canal first began restricting daily transits in July and said it will ease them when water levels rise. Panama’s rainy season is historically in April and May.<div><img></div>But the soonest the Panama Canal Authority says it could see significant...

Persistent drought-driven restrictions on container ships traversing the Panama Canal are in the cards for at least the next several years, barring a dramatic upswing in rainfall. Those restrictions, which effectively reduce the maximum stowage capacity of larger vessels and limit the overall number of transits, will likely force carriers to alter networks as they try to push higher costs onto shippers.  The canal first began restricting daily transits in July and said it will ease them when water levels rise. Panama’s rainy season is historically in April and May. But the soonest the Panama Canal Authority says it could see significant relief is 2028 , and that’s if the government of Panama course-corrects after years of underinvestment and supports $2 billion in investment to build a new reservoir and more pipelines.  Container lines, including Ocean Network Express (ONE), are urging the government to act. Current and past canal administrators, in consultation with the US Army Corps of Engineers, have stressed the need for investment to protect the water basin to avoid underutilization of the waterway.  “We greatly appreciate the current weather conditions are a factor,” ONE CEO Jeremy Nixon wrote in a letter to Panamanian President Laurentino Cortizo Cohen on Oct. 30. “However, we also understand that no significant projects have gone ahead in Panama to increase the fresh water supply to the locks from other catchments areas.”   ONE’s neo-Panamax ships — those with capacities ranging from 10,000 to 15,000 TEUs that can transit the canal thanks to the new set of locks that opened in 2016 — have experienced delays and restricted stowage, Nixon told Cohen in the letter, a copy of which was obtained by the Journal of Commerce.  Draft limits are reducing the capacity of container ships transiting the canal by approximately 20% across all size classes, said Michael Kristiansen, president of Panama-based consultancy CK Americas. Larger vessels lose approximately 350 TEUs of capacity for each foot of draft lost; with draft now limited to 44 feet, down from the designed 50 feet, larger ships must forgo about 2,100 TEUs of otherwise usable space.  Some carriers have been forced to offload cargo at terminals at either end of the canal, and then rail those boxes across the isthmus. Container lines have been generally spared from long transit delays, however, thanks to pre-scheduled transit appointments.  Rethinking routing  Concerns over the restrictions — and shipper complaints over a lack of service reliability — have reached such a level that ONE is considering other routings via the Suez Canal, Nixon said in his letter. To avoid the draft limits and get US imports from Asia to the Midwest, Zim Integrated Shipping Services this month added a call at the Port of Lázaro Cardenas in Mexico , while CMA CGM has been making more ad-hoc calls to the Pacific Coast port.  With Panama Canal transit windows pre-booked, containers lines aren’t diverting services, nor are they shelling out millions of dollars to skip the line, similar to what  some operators of liquefied natural gas (LNG) carriers have done, according to Bloomberg. The lack of scheduled service, however, is squeezing seasonal refrigerated (reefer) operators that charter vessels on an ad-hoc basis and must wait in line similar to the bulk carriers and tankers.  Nixon also raised concern about the reduction in daily transit slots for neo-Panamax vessels, with the number falling to five starting Jan. 1 compared with the 10 available just three months ago. Kristiansen said the canal handles an average of 4.5 neo-Panamax transits daily, raising concerns that some services will be squeezed unless enough neo-Panamax LNG and bulk carriers divert away from the waterway.  ONE, similar to other container lines, invested heavily in larger vessels that were able to move through the larger set of locks, which was completed in 2016 at a cost of $5.25 billion. Ports along the US East and Gulf coasts similarly invested billions of dollars to be able to handle the larger ships, which has helped fuel a two-decade shift of trans-Pacific imports away from the West Coast.  Political solutions  But Panamanian politicians seem more focused on copper than water, amid the largest protests in three decades over mining concessions. Rising political instability and social unrest frame the upcoming national election in May.  Ultimately, the government must either expand the canal authority’s geographic remit so it can push through water management projects or limit current restrictions that prevent it from building new reservoirs. Canal officials hope construction contracts currently in the offing can be awarded by the end of 2024, with work completed in 2028.  Depending on the severity of this drought, and potentially others to come, carriers may do as ONE warned: shift service away from the canal. Deploying smaller vessels is another option.  Carriers could also adjust services to send more cargo from South Asia through the Suez Canal, though it would add distance for some origins, Kristiansen said. The US East Coast is approximately 2,200 nautical miles farther from Shanghai via  the Suez Canal than via a Panama Canal routing.  Yet another option would be for carriers to change some Asia–North America services to so-called around-the-world strings, transiting the Suez on the backhaul from North America to Asia, Kristiansen said. That would require an additional deployment of ships in the string to maintain weekly service frequency. Although less than ideal, it would slightly mitigate industry-wide overcapacity.  Whether carriers can pass on the costs in a depressed trans-Pacific market , as CMA CGM is attempting to do, is another matter. Citing transit limits for neo-Panamax ships and higher tolls, CMA CGM said in a Nov. 21 advisory it will begin applying a $150-per-TEU surcharge for shipments moving through the Panama Canal.  Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Maritime

Trans-Pacific

Container Shipping News

Container lines

Carriers weigh options as Panama Canal restrictions become a fact of life

<div class="phx-topic abstract-wrapper">Houston and New Orleans are coming off a year of growth for project cargo volumes, albeit with a drop in steel imports, and both ports anticipate a continuation of those trends.</div>

Houston and New Orleans are coming off a year of growth for project cargo volumes, albeit with a drop in steel imports, and both ports anticipate a continuation of those trends.

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<div class="phx-topic">Major industrial and energy projects on the Gulf Coast are dialing up cargo activity at two of the largest US ports for breakbulk and project cargo, even as conflict in the Middle East introduces global shipping disruptions and tariff-induced market volatilities linger. The Port of New Orleans and Port Houston are coming off a year of growth for project cargo volumes, albeit with a drop in steel imports, and both ports anticipate a continuation of those trends. For New Orleans, the latest development expected to drive project cargo activity is the $3.4 billion expansion of Shintech’s chemical manufacturing complex in southeastern Louisiana, a project announced March 4. Construction is set to take place in phases, with the first phase slated for completion in 2030. Shintech is the world’s largest manufacturer of polyvinyl chloride (PVC). “With them announcing a new expansion, there’s a lot of optimism from the petrochemical sector, especially in light of the challenges in the Middle East that affect the products they’re producing on a competitive scale,” Janine Mansour, director of trade development for the Port of New Orleans, told the Journal of Commerce. Project cargo volumes at the Port of New Orleans increased 31% to 64,806 tons in 2025, with shipments originating from multiple global locations including Italy, China, India, Thailand, and South Korea, according to data from the Port. That growth comes after a 46% increase in project cargo volumes in 2024. Major projects producing project cargo include Venture Global’s massive CP2 liquefied natural gas (LNG) export facility in southwest Louisiana, UBE Corporation’s Louisiana EV battery plant outside of New Orleans that will produce key chemicals used in EV battery manufacturing, and Meta’s 4-million-square-foot data center in northeast Louisiana. Hyundai Steel also plans to build a $5.8 billion low-carbon steel mill in southeast Louisiana. Overall breakbulk volumes at the Port of New Orleans fell 22% to 958,152 tons in 2025, according to port data, because of tariff-related market uncertainty and because some steel and non-ferrous cargoes have shifted to containers, Mansour said. Breakbulk steel volumes declined 29% to 524,749 short tons in 2025, with most cargo coming from Japan, followed by South Korea and China, according to data from the port. “Steel imports have been severely hit by tariff increases to foster domestic production,” Mansour said, adding that the port last year measured an 80% year-over-year increase, to 129,705 tons, of bulk imports of ferro alloys and silico-alloys, both of which are used in steel manufacturing. With the declines in breakbulk cargoes, the total number of multipurpose/heavy-lift vessel (MPV/HL) calls at New Orleans fell to 163 in 2025 from 189 the previous year. The ongoing conflict in the Middle East could potentially squeeze vessel capacity for breakbulk and project cargoes worldwide, as port closures and route changes have already been tying up vessels on the container side, Mansour said. That could indirectly affect vessel movements at the Port of New Orleans. “For the carriers that are calling New Orleans, if they do have routes in the Middle East, they may have disruptions where it affects their capacity from a global fleet perspective,” she said. “But we’re not anticipating significant impacts on the breakbulk and project cargo side, and we haven’t really seen any direct impacts yet.” Mansour acknowledged that the Middle East is not a major shipping lane for breakbulk and project cargoes for the port. <h3>Cargo mix offsets steel slump for Houston </h3>With tariffs chipping away at steel imports, Port Houston is looking to cargo diversification and Gulf Coast project developments to expand cargo shipments for the nation’s largest breakbulk and project cargo gateway. Volumes of general cargo — which the port defines to include project cargo, breakbulk, and other non-containerized goods — reached 564,346 tons in January, a 27% year-over-year increase, according to Port Houston data. That growth trend is expected to continue, driven in part by a mix of projects under development in the region, port spokesperson Lisa Ashley-Daniels told the Journal of Commerce. “There are several major industrial and energy projects along the Gulf Coast that are expected to move forward between 2026 and 2028, with the potential to generate considerable breakbulk and heavy-lift cargo through Port Houston,” she said. Breakbulk steel imports at Port Houston declined 35% year over year to 213,653 tons in January, according to port data, mirroring larger trends tied to lower drilling activity, Ashley-Daniels said. For all of 2025, breakbulk steel volumes fell 8% to just under 4.2 million tons. “The decline in steel imports that Houston experienced in January is not unique to the port, but reflects broad shifts in energy markets, supply and demand drivers, regulatory environments, and trade policies, among other contributing factors,” she said. Significant activity from cargo types other than steel is driving an overall rise in general cargo volumes at the port, Ashley-Daniels said, citing quadruple-digit growth in machinery, triple-digit increases in grain, and double-digit gains in pet coke volumes and roll-on/roll-off cargo in February. “The growing diversification of breakbulk cargo beyond steel is helping to stabilize overall activity,” Ashley-Daniels said, adding that cargo activity for these commodities is expected to increase further. Contact Autumn Cafiero Giusti at <a href="mailto:autumn@autumngiusti.com">autumn@autumngiusti.com.</a></div>

Major industrial and energy projects on the Gulf Coast are dialing up cargo activity at two of the largest US ports for breakbulk and project cargo, even as conflict in the Middle East introduces global shipping disruptions and tariff-induced market volatilities linger. The Port of New Orleans and Port Houston are coming off a year of growth for project cargo volumes, albeit with a drop in steel imports, and both ports anticipate a continuation of those trends. For New Orleans, the latest development expected to drive project cargo activity is the $3.4 billion expansion of Shintech’s chemical manufacturing complex in southeastern Louisiana, a project announced March 4. Construction is set to take place in phases, with the first phase slated for completion in 2030. Shintech is the world’s largest manufacturer of polyvinyl chloride (PVC). “With them announcing a new expansion, there’s a lot of optimism from the petrochemical sector, especially in light of the challenges in the Middle East that affect the products they’re producing on a competitive scale,” Janine Mansour, director of trade development for the Port of New Orleans, told the Journal of Commerce. Project cargo volumes at the Port of New Orleans increased 31% to 64,806 tons in 2025, with shipments originating from multiple global locations including Italy, China, India, Thailand, and South Korea, according to data from the Port. That growth comes after a 46% increase in project cargo volumes in 2024. Major projects producing project cargo include Venture Global’s massive CP2 liquefied natural gas (LNG) export facility in southwest Louisiana, UBE Corporation’s Louisiana EV battery plant outside of New Orleans that will produce key chemicals used in EV battery manufacturing, and Meta’s 4-million-square-foot data center in northeast Louisiana. Hyundai Steel also plans to build a $5.8 billion low-carbon steel mill in southeast Louisiana. Overall breakbulk volumes at the Port of New Orleans fell 22% to 958,152 tons in 2025, according to port data, because of tariff-related market uncertainty and because some steel and non-ferrous cargoes have shifted to containers, Mansour said. Breakbulk steel volumes declined 29% to 524,749 short tons in 2025, with most cargo coming from Japan, followed by South Korea and China, according to data from the port. “Steel imports have been severely hit by tariff increases to foster domestic production,” Mansour said, adding that the port last year measured an 80% year-over-year increase, to 129,705 tons, of bulk imports of ferro alloys and silico-alloys, both of which are used in steel manufacturing. With the declines in breakbulk cargoes, the total number of multipurpose/heavy-lift vessel (MPV/HL) calls at New Orleans fell to 163 in 2025 from 189 the previous year. The ongoing conflict in the Middle East could potentially squeeze vessel capacity for breakbulk and project cargoes worldwide, as port closures and route changes have already been tying up vessels on the container side, Mansour said. That could indirectly affect vessel movements at the Port of New Orleans. “For the carriers that are calling New Orleans, if they do have routes in the Middle East, they may have disruptions where it affects their capacity from a global fleet perspective,” she said. “But we’re not anticipating significant impacts on the breakbulk and project cargo side, and we haven’t really seen any direct impacts yet.” Mansour acknowledged that the Middle East is not a major shipping lane for breakbulk and project cargoes for the port. Cargo mix offsets steel slump for Houston With tariffs chipping away at steel imports, Port Houston is looking to cargo diversification and Gulf Coast project developments to expand cargo shipments for the nation’s largest breakbulk and project cargo gateway. Volumes of general cargo — which the port defines to include project cargo, breakbulk, and other non-containerized goods — reached 564,346 tons in January, a 27% year-over-year increase, according to Port Houston data. That growth trend is expected to continue, driven in part by a mix of projects under development in the region, port spokesperson Lisa Ashley-Daniels told the Journal of Commerce. “There are several major industrial and energy projects along the Gulf Coast that are expected to move forward between 2026 and 2028, with the potential to generate considerable breakbulk and heavy-lift cargo through Port Houston,” she said. Breakbulk steel imports at Port Houston declined 35% year over year to 213,653 tons in January, according to port data, mirroring larger trends tied to lower drilling activity, Ashley-Daniels said. For all of 2025, breakbulk steel volumes fell 8% to just under 4.2 million tons. “The decline in steel imports that Houston experienced in January is not unique to the port, but reflects broad shifts in energy markets, supply and demand drivers, regulatory environments, and trade policies, among other contributing factors,” she said. Significant activity from cargo types other than steel is driving an overall rise in general cargo volumes at the port, Ashley-Daniels said, citing quadruple-digit growth in machinery, triple-digit increases in grain, and double-digit gains in pet coke volumes and roll-on/roll-off cargo in February. “The growing diversification of breakbulk cargo beyond steel is helping to stabilize overall activity,” Ashley-Daniels said, adding that cargo activity for these commodities is expected to increase further. Contact Autumn Cafiero Giusti at autumn@autumngiusti.com.

Port News

Energy projects

Project cargo

Breakbulk ports

North American ports

Breakbulk News

US Gulf breakbulk ports lean into project boom

<div class="phx-topic abstract-wrapper">The carrier alliance will shake up its Asia-Europe network in April with Busan becoming the focus of its North Asia trade and direct calls ending to ports in Japan and Taiwan.</div>

The carrier alliance will shake up its Asia-Europe network in April with Busan becoming the focus of its North Asia trade and direct calls ending to ports in Japan and Taiwan.

<div class="phx-topic">Ocean Network Express (ONE) has expanded its Asia container terminal network by acquiring a stake in Dongwon Global Terminal Busan (DGT) from South Korean conglomerate and terminal owner Dongwon Group, ONE said Tuesday. The carrier gave no details about how much it paid for what it referred to in a statement as an “indirect but meaningful share” or the size of the shareholding in the fully automated DGT. The terminal, which opened in April 2024, will have a capacity of more than 4.5 million TEUs with five mainline berths totaling 5,740 feet and one berth of 1,263 feet for feeder ships when completed around 2030. ONE previously took minority stakes in China’s Dalian Container Terminal last December and Jakarta’s New Priok Container Terminal One (NPCT1) in Indonesia in November 2024. More broadly, ONE’s move comes as container lines, supported by record profits from several years of supply chain disruption, are investing more in marine terminals to gain better control of landside operations and mitigate port congestion. ONE CEO Jeremey Nixon, speaking at the Journal of Commerce’s TPM26 conference earlier this month, said carriers are "increasingly having to come into the terminal space and taking over involvement in major gateway ports, or major hub ports, and that trend will continue to accelerate, I think, over the next 10 to 15 years.” ”But the problem there is the number of terminals or ports that are available to be acquired is not that significant,” Nixon said. <h3>Premier Alliance Asia-Europe network shift </h3>ONE’s terminal move in Busan also comes ahead of a shakeup in the Premier Alliance’s Asia-Europe network in April that will see Busan become the focus of its North Asia trade, while ending direct calls at ports in Japan and Taiwan. Instead, the group, comprising ONE, HMM and Yang Ming Marine Transport, will launch four shuttle services connecting Busan with Tokyo, Nagoya and Kobe in Japan and with Kaohsiung and Taichung in Taiwan, plus Xiamen in eastern China. While CMA CGM is launching its own <a href="https://www.joc.com/article/cma-cgm-to-launch-standalone-japan-europe-express-service-in-april-6177297">direct Asia-Japan service in April</a>, it will use smaller vessels – 14 ships ranging in size from 7,000 to 10,000 TEU – compared with 20 9,500-13,000-TEU ships previously deployed by the Premier Alliance. It is also one service while the Premier Alliance operated two direct Asia-Europe services from Japan which have now ended with the new 2026 network. The shift in focus to Busan is expected to drive a further increase in transshipment traffic through the port, which has seen transshipment make up an increasing proportion of total container volumes over the last five years, from almost 53% in 2021 to 56% last year. Transshipment volumes are also growing at a faster clip than origin and destination cargo. Busan port authority figures show transshipment cargoes increased 4.4% to 14.1 million TEUs last year out of total throughput of 24.9 million TEUs. That followed an 8.8% surge to 13.5 million TEUs in transshipment volumes in 2024. By comparison, origin and destination cargoes at Busan nudged lower last year to 10.8 million TEUs from 10.9 million TEUs in 2024. Busan has also been consistently higher on the UN Conference on Trade and Development port liner shipping connectivity index than its Japanese rival ports since at least 2008. Results for the fourth quarter of 2025 show Busan with an index ranking of 1,648 compared with Tokyo at 585 and Kobe at 555. According to UNCTAD’s methodology, the higher the ranking number, the better the connectivity. <h3>Improving transshipment cargo handling </h3>The growth in transshipment volumes comes as the Busan Port Authority is introducing a comprehensive digital port community system this year that will improve cargo handling efficiencies for transshipment cargo moving between the port’s nine terminals. Results from pilot tests last year have already shown significant productivity gains with a 90% reduction in container rehandling, up to a 50% reduction in truck waiting times and a threefold increase in load factors, Lee Eung-hyuk, the port authority’s director of international logistics, told the Journal of Commerce. Final quantitative outcomes are expected to be confirmed around 2027, he added. The digital port community system is part of a wider initiative to solidify Busan’s position as the main transshipment hub for north Asia. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com.</a></div>

Ocean Network Express (ONE) has expanded its Asia container terminal network by acquiring a stake in Dongwon Global Terminal Busan (DGT) from South Korean conglomerate and terminal owner Dongwon Group, ONE said Tuesday. The carrier gave no details about how much it paid for what it referred to in a statement as an “indirect but meaningful share” or the size of the shareholding in the fully automated DGT. The terminal, which opened in April 2024, will have a capacity of more than 4.5 million TEUs with five mainline berths totaling 5,740 feet and one berth of 1,263 feet for feeder ships when completed around 2030. ONE previously took minority stakes in China’s Dalian Container Terminal last December and Jakarta’s New Priok Container Terminal One (NPCT1) in Indonesia in November 2024. More broadly, ONE’s move comes as container lines, supported by record profits from several years of supply chain disruption, are investing more in marine terminals to gain better control of landside operations and mitigate port congestion. ONE CEO Jeremey Nixon, speaking at the Journal of Commerce’s TPM26 conference earlier this month, said carriers are "increasingly having to come into the terminal space and taking over involvement in major gateway ports, or major hub ports, and that trend will continue to accelerate, I think, over the next 10 to 15 years.” ”But the problem there is the number of terminals or ports that are available to be acquired is not that significant,” Nixon said. Premier Alliance Asia-Europe network shift ONE’s terminal move in Busan also comes ahead of a shakeup in the Premier Alliance’s Asia-Europe network in April that will see Busan become the focus of its North Asia trade, while ending direct calls at ports in Japan and Taiwan. Instead, the group, comprising ONE, HMM and Yang Ming Marine Transport, will launch four shuttle services connecting Busan with Tokyo, Nagoya and Kobe in Japan and with Kaohsiung and Taichung in Taiwan, plus Xiamen in eastern China. While CMA CGM is launching its own direct Asia-Japan service in April , it will use smaller vessels – 14 ships ranging in size from 7,000 to 10,000 TEU – compared with 20 9,500-13,000-TEU ships previously deployed by the Premier Alliance. It is also one service while the Premier Alliance operated two direct Asia-Europe services from Japan which have now ended with the new 2026 network. The shift in focus to Busan is expected to drive a further increase in transshipment traffic through the port, which has seen transshipment make up an increasing proportion of total container volumes over the last five years, from almost 53% in 2021 to 56% last year. Transshipment volumes are also growing at a faster clip than origin and destination cargo. Busan port authority figures show transshipment cargoes increased 4.4% to 14.1 million TEUs last year out of total throughput of 24.9 million TEUs. That followed an 8.8% surge to 13.5 million TEUs in transshipment volumes in 2024. By comparison, origin and destination cargoes at Busan nudged lower last year to 10.8 million TEUs from 10.9 million TEUs in 2024. Busan has also been consistently higher on the UN Conference on Trade and Development port liner shipping connectivity index than its Japanese rival ports since at least 2008. Results for the fourth quarter of 2025 show Busan with an index ranking of 1,648 compared with Tokyo at 585 and Kobe at 555. According to UNCTAD’s methodology, the higher the ranking number, the better the connectivity. Improving transshipment cargo handling The growth in transshipment volumes comes as the Busan Port Authority is introducing a comprehensive digital port community system this year that will improve cargo handling efficiencies for transshipment cargo moving between the port’s nine terminals. Results from pilot tests last year have already shown significant productivity gains with a 90% reduction in container rehandling, up to a 50% reduction in truck waiting times and a threefold increase in load factors, Lee Eung-hyuk, the port authority’s director of international logistics, told the Journal of Commerce. Final quantitative outcomes are expected to be confirmed around 2027, he added. The digital port community system is part of a wider initiative to solidify Busan’s position as the main transshipment hub for north Asia. Contact Keith Wallis at keithwallis@hotmail.com.

Marine terminals

International ports

ONE takes stake in Busan’s Dongwon terminal ahead of Premier network shift

<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.

<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 Transportation 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. AgTC Executive Director Peter Friedmann praised the FMC for rejecting the carriers’ requests to waive the 30-day waiting period and criticized the lack of explanation from the liners on how the surcharges were calculated. He noted in a statement Monday that none of the requests from the carriers specified the actual costs they were accruing from the Middle East disruption. While recognizing that container lines have made efforts to understand and support US agriculture exporters, Friedmann nonetheless said AgTC was “shocked by the manner in which these requests were drafted, the disrespect shown to carriers’ customers and even to the (FMC).” 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 Transportation 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. AgTC Executive Director Peter Friedmann praised the FMC for rejecting the carriers’ requests to waive the 30-day waiting period and criticized the lack of explanation from the liners on how the surcharges were calculated. He noted in a statement Monday that none of the requests from the carriers specified the actual costs they were accruing from the Middle East disruption. While recognizing that container lines have made efforts to understand and support US agriculture exporters, Friedmann nonetheless said AgTC was “shocked by the manner in which these requests were drafted, the disrespect shown to carriers’ customers and even to the (FMC).” Contact Mark Szakonyi at  mark.szakonyi@spglobal.com

Transport, Trade and Regulation News

Supply chain

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

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

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