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<div class="phx-topic abstract-wrapper">WASHINGTON -- The U.S. Coast Guard on Wednesday announced it would begin levying $10,000 fines again</div>

WASHINGTON -- The U.S. Coast Guard on Wednesday announced it would begin levying $10,000 fines again

<div>WASHINGTON -- The U.S. Coast Guard on Wednesday announced it would begin levying $10,000 fines against port facilities and vessels that had not filed security plans under the terms of the Maritime Transportation Security Act.The Coast Guard began issuing notices of violation this week, but said declared the list of violators to be security-sensitive information, and is withholding it from the public.Spokeswoman Jolie Shifflet said the notices are akin to tickets that let the recipient know that he is in violation of federal statute or regulation and must pay the civil penalty. Shifflet said that the Coast Guard has reduced...

WASHINGTON -- The U.S. Coast Guard on Wednesday announced it would begin levying $10,000 fines against port facilities and vessels that had not filed security plans under the terms of the Maritime Transportation Security Act. The Coast Guard began issuing notices of violation this week, but said declared the list of violators to be security-sensitive information, and is withholding it from the public. Spokeswoman Jolie Shifflet said the notices are akin to tickets that let the recipient know that he is in violation of federal statute or regulation and must pay the civil penalty. Shifflet said that the Coast Guard has reduced the number of ships and port facilities that were required to submit plans. To date, between 600 and 700 of 8,500 vessels, and 200 to 300 of 3,200 shore facilities have not filed plans. The deadline was Dec. 31, 2003. If the violator refuses the notice of violation, Shifflet said the Coast Guard may begin formal civil proceedings. -- R.G. Edmonson

Coast Guard fines security plan non-filers

<div class="phx-topic abstract-wrapper">The railroads say they plan to file an updated merger application on April 30, addressing many of the complaints that caused regulators to deem their original application “incomplete.”</div>

The railroads say they plan to file an updated merger application on April 30, addressing many of the complaints that caused regulators to deem their original application “incomplete.”

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<div class="phx-topic">Newport, Rhode Island — Union Pacific Railroad (UP) and Norfolk Southern Railway (NS) say an updated merger application they plan to file with US regulators on April 30 will include revised forecasts on truck-to-rail conversions, clearer explanations of key proposals, and specific changes aimed at addressing critics of the deal. Executives from the two railroads, speaking Thursday at the North East Association of Rail Shippers (NEARS) Conference, said they’ve received traffic data from competitors BNSF Railway, Canadian National, Canadian Pacific Kansas City and CSX Transportation through a reciprocal discovery process. The data was not included in the original merger application that was <a href="https://www.joc.com/article/stb-rejects-up-ns-merger-application-as-incomplete-6154074">deemed “incomplete” by the US Surface Transportation Board (STB) in mid-January</a>. UP and NS believe the revised filing will convince regulators that combining the rail networks to create the US’ first transcontinental railroad would enhance competition and pull traffic off US highways. “We’ve now gone back, we’ve redone that work with 100% of the carload [volume] files from all the railroads,” Todd Rynaski, UP’s senior vice president of strategy, said at the NEARS event. “All of that work landed us about at the same spot, although [with a] little bit of shift between intermodal and carload [forecasts]. We feel very confident in the initial thesis.” In the original application, UP and NS forecast 2 million overall conversions to rail, including 1.17 million truckload conversions to intermodal. <h3>‘Committed Gateway Pricing’ </h3>Mike McClellan, chief strategy officer for NS, said the updated filing will better explain what the railroads call “Committed Gateway Pricing.” The program would give CSX Transportation and BNSF preset rates for traffic moving over a combined UP-NS network, allowing those railroads to quote a single end-to-end price more quickly to shippers. It would apply only to manifest carload freight, not intermodal. The railroads say the aim is to generate instant rate quotes and make rail more competitive with trucking. “We're going to spend a lot more time, really one-on-one, with the participating railroads and the shippers, especially, to make sure that they fully understand what it is, how it works, and the benefits,” McClellan said at the conference. “That was probably the most misunderstood part of the [original] application.” <h3>Addressing St. Louis </h3>UP and NS also said the revised application will clarify their plans for the Terminal Railroad Association (TRRA) of St. Louis, the switching railroad jointly owned by five of the six North American Class I railroads that helps move freight through the city. Instead of each railroad managing its own traffic in St. Louis, the TRRA receives railcars and then organizes trains to cross the Mississippi River and handoff to other Class I railroads. The arrangement is intended to keep traffic flowing safely and in an orderly fashion through a major interchange location. Under the proposed transaction, Union Pacific would inherit Norfolk Southern’s stake and gain a majority of seats on the TRRA board of directors. CSX has argued that Union Pacific could use that position to influence access and pricing across the river. The STB agreed that the issue raised significant enough competitive concerns to classify the TRRA stake proposal as a “major transaction” and that the original application understated the competitive risks in St. Louis. “We do not intend to ever control the TRRA, and we’ve got that outlined explicitly in the revised application,” Rynaski said. <h3>Meridian Speedway solution requires cash </h3>Although the STB declined to <a href="https://www.joc.com/article/stb-declines-to-intervene-on-meridian-speedway-dispute-6187000">intercede in a dispute over the Meridian Speedway</a>, there is a growing understanding that the issue must be resolved for the merger transaction to yield the rewards detailed in the application. The dispute centers around a 300-mile stretch of track between Shreveport, Louisiana, and Meridian, Mississippi, that is critical for UP and NS to connect Southern California to the US Southeast. Canadian Pacific Kansas City (CPKC), which operates the Meridian joint venture with Norfolk Southern, has enforced an 8,500-foot train length limit based on siding capacity, rejecting efforts by UP and NS to run 11,000-foot trains. CPKC owns a majority stake in the joint venture, so it dictates the rules. UP has complained that containers take too long to cross the Meridian Speedway because of the restrictions. The original application, however, envisioned 11,000-foot trains moving between the West Coast and Atlanta, Charlotte and Jacksonville despite CPKC’s current restriction. McClellan described Norfolk Southern’s relationship with CPKC as “wobbly,” but said he expects UP, NS, and CPKC to reach a solution on Meridian, likely by extending several sidings along the route to handle longer trains. “Over time, I’m sure, we’ll have a very constructive conversation with [CPKC] to put money in the ground to make these issues go away,” he said. Contact Ari Ashe at <a href="ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Newport, Rhode Island — Union Pacific Railroad (UP) and Norfolk Southern Railway (NS) say an updated merger application they plan to file with US regulators on April 30 will include revised forecasts on truck-to-rail conversions, clearer explanations of key proposals, and specific changes aimed at addressing critics of the deal. Executives from the two railroads, speaking Thursday at the North East Association of Rail Shippers (NEARS) Conference, said they’ve received traffic data from competitors BNSF Railway, Canadian National, Canadian Pacific Kansas City and CSX Transportation through a reciprocal discovery process. The data was not included in the original merger application that was deemed “incomplete” by the US Surface Transportation Board (STB) in mid-January . UP and NS believe the revised filing will convince regulators that combining the rail networks to create the US’ first transcontinental railroad would enhance competition and pull traffic off US highways. “We’ve now gone back, we’ve redone that work with 100% of the carload [volume] files from all the railroads,” Todd Rynaski, UP’s senior vice president of strategy, said at the NEARS event. “All of that work landed us about at the same spot, although [with a] little bit of shift between intermodal and carload [forecasts]. We feel very confident in the initial thesis.” In the original application, UP and NS forecast 2 million overall conversions to rail, including 1.17 million truckload conversions to intermodal. ‘Committed Gateway Pricing’ Mike McClellan, chief strategy officer for NS, said the updated filing will better explain what the railroads call “Committed Gateway Pricing.” The program would give CSX Transportation and BNSF preset rates for traffic moving over a combined UP-NS network, allowing those railroads to quote a single end-to-end price more quickly to shippers. It would apply only to manifest carload freight, not intermodal. The railroads say the aim is to generate instant rate quotes and make rail more competitive with trucking. “We're going to spend a lot more time, really one-on-one, with the participating railroads and the shippers, especially, to make sure that they fully understand what it is, how it works, and the benefits,” McClellan said at the conference. “That was probably the most misunderstood part of the [original] application.” Addressing St. Louis UP and NS also said the revised application will clarify their plans for the Terminal Railroad Association (TRRA) of St. Louis, the switching railroad jointly owned by five of the six North American Class I railroads that helps move freight through the city. Instead of each railroad managing its own traffic in St. Louis, the TRRA receives railcars and then organizes trains to cross the Mississippi River and handoff to other Class I railroads. The arrangement is intended to keep traffic flowing safely and in an orderly fashion through a major interchange location. Under the proposed transaction, Union Pacific would inherit Norfolk Southern’s stake and gain a majority of seats on the TRRA board of directors. CSX has argued that Union Pacific could use that position to influence access and pricing across the river. The STB agreed that the issue raised significant enough competitive concerns to classify the TRRA stake proposal as a “major transaction” and that the original application understated the competitive risks in St. Louis. “We do not intend to ever control the TRRA, and we’ve got that outlined explicitly in the revised application,” Rynaski said. Meridian Speedway solution requires cash Although the STB declined to intercede in a dispute over the Meridian Speedway , there is a growing understanding that the issue must be resolved for the merger transaction to yield the rewards detailed in the application. The dispute centers around a 300-mile stretch of track between Shreveport, Louisiana, and Meridian, Mississippi, that is critical for UP and NS to connect Southern California to the US Southeast. Canadian Pacific Kansas City (CPKC), which operates the Meridian joint venture with Norfolk Southern, has enforced an 8,500-foot train length limit based on siding capacity, rejecting efforts by UP and NS to run 11,000-foot trains. CPKC owns a majority stake in the joint venture, so it dictates the rules. UP has complained that containers take too long to cross the Meridian Speedway because of the restrictions. The original application, however, envisioned 11,000-foot trains moving between the West Coast and Atlanta, Charlotte and Jacksonville despite CPKC’s current restriction. McClellan described Norfolk Southern’s relationship with CPKC as “wobbly,” but said he expects UP, NS, and CPKC to reach a solution on Meridian, likely by extending several sidings along the route to handle longer trains. “Over time, I’m sure, we’ll have a very constructive conversation with [CPKC] to put money in the ground to make these issues go away,” he said. Contact Ari Ashe at ari.ashe@spglobal.com .

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Revised UP-NS merger application will address deficiencies, critics concerns

<div class="phx-topic abstract-wrapper">As if the Strait of Hormuz and Red Sea haven’t caused enough concern for commercial shipping, Lars Jensen warns of the potential for weather-related disruptions once again at the canal by year-end. </div>

As if the Strait of Hormuz and Red Sea haven’t caused enough concern for commercial shipping, Lars Jensen warns of the potential for weather-related disruptions once again at the canal by year-end.

<div class="phx-topic">The entire shipping industry, and most certainly shippers needing to get cargo moved, is yearning for some semblance of stability and predictability to return. If this is the message you are seeking, you should not read further. While all eyes are on the Strait of Hormuz as well as the Red Sea crisis and their inevitable domino effects, it is prudent to look deeper into another potential issue: the Panama Canal. No, not from the geopolitical perspective where Panama is presently squeezed between US and Chinese interests. That is an uncertainty unto itself. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6202588_0.1.jpg"></img></div>The US National Oceanic and Atmospheric Administration (NOAA) issues a monthly outlook for the El Niño/La Niña weather phenomenon. These are shifting weather patterns occurring in the Pacific, and among the many effects driven by the weather pattern is an impact on rainfall in Panama. When we have the El Niño pattern, this can lead to reduced rainfall in Panama, which in turn impacts the water level in Lake Gatun in central Panama. This is the water basin used to operate the locks in the Panama Canal. If the water level drops too far, it leads to restrictions on vessels being able to transit the Panama Canal. The water level in Lake Gatun generally varies between 85 and 88 feet. The latest El Niño was in 2023–24, and it was categorized as “strong.” This led to Lake Gatun water levels dropping to 79.2 feet, which was the third-lowest recorded since 1965, when measurements began. As many might remember from two years ago, this resulted in significant capacity restrictions on shipping through the Panama Canal. We saw a “weak” El Niño in 2018–20. (Note that “weak,” “strong,” etc. are the official designations placed on each El Niño by NOAA depending on intensity). Here we also saw Lake Gatun drop below 80 feet, although for a considerably shorter period than in 2023–24. The one before that was a “very strong” El Niño in 2015–16 that had water levels drop almost to 78 feet, the lowest level ever recorded. There were five “weak” or “moderate” El Niño periods from 1999 to 2015, all with limited impact on the canal water level. Prior to that, 1997–98 was a “very strong” El Niño, leading to water levels dropping to 78.5 feet, the second-lowest ever recorded. The historical data is quite clear. A “strong” or “very strong” El Niño tends to result in a significant decline in Lake Gatun water levels. A weaker El Niño might at times do that, but usually not. <h3>Shippers should begin planning </h3>On Thursday, the outlook from NOAA noted a 61% chance of El Niño emerging this May–July and persisting at least until the end of 2026. NOAA also predicted a 51% chance by year-end that it will be either “strong” or “very strong,” with equal risk between the two. This means that based on the current weather models, there is essentially a 50/50 risk that by the end of the year we will have an El Niño pattern of a magnitude that historically has a high likelihood of significantly reducing the water levels in Lake Gatun. And with this comes the risk of renewed, albeit temporary, capacity restrictions through the canal. Weather and climate forecasts are, by nature, probabilistic, and no one can give a certain prediction. Instead, shippers depending on cargo flows through the Panama Canal might at this time contemplate whether this 50/50 risk should be ignored, be used as a reason for planning contingency measures or be used to look at possible changes to the current supply chain setup. 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 entire shipping industry, and most certainly shippers needing to get cargo moved, is yearning for some semblance of stability and predictability to return. If this is the message you are seeking, you should not read further. While all eyes are on the Strait of Hormuz as well as the Red Sea crisis and their inevitable domino effects, it is prudent to look deeper into another potential issue: the Panama Canal. No, not from the geopolitical perspective where Panama is presently squeezed between US and Chinese interests. That is an uncertainty unto itself. The US National Oceanic and Atmospheric Administration (NOAA) issues a monthly outlook for the El Niño/La Niña weather phenomenon. These are shifting weather patterns occurring in the Pacific, and among the many effects driven by the weather pattern is an impact on rainfall in Panama. When we have the El Niño pattern, this can lead to reduced rainfall in Panama, which in turn impacts the water level in Lake Gatun in central Panama. This is the water basin used to operate the locks in the Panama Canal. If the water level drops too far, it leads to restrictions on vessels being able to transit the Panama Canal. The water level in Lake Gatun generally varies between 85 and 88 feet. The latest El Niño was in 2023–24, and it was categorized as “strong.” This led to Lake Gatun water levels dropping to 79.2 feet, which was the third-lowest recorded since 1965, when measurements began. As many might remember from two years ago, this resulted in significant capacity restrictions on shipping through the Panama Canal. We saw a “weak” El Niño in 2018–20. (Note that “weak,” “strong,” etc. are the official designations placed on each El Niño by NOAA depending on intensity). Here we also saw Lake Gatun drop below 80 feet, although for a considerably shorter period than in 2023–24. The one before that was a “very strong” El Niño in 2015–16 that had water levels drop almost to 78 feet, the lowest level ever recorded. There were five “weak” or “moderate” El Niño periods from 1999 to 2015, all with limited impact on the canal water level. Prior to that, 1997–98 was a “very strong” El Niño, leading to water levels dropping to 78.5 feet, the second-lowest ever recorded. The historical data is quite clear. A “strong” or “very strong” El Niño tends to result in a significant decline in Lake Gatun water levels. A weaker El Niño might at times do that, but usually not. Shippers should begin planning On Thursday, the outlook from NOAA noted a 61% chance of El Niño emerging this May–July and persisting at least until the end of 2026. NOAA also predicted a 51% chance by year-end that it will be either “strong” or “very strong,” with equal risk between the two. This means that based on the current weather models, there is essentially a 50/50 risk that by the end of the year we will have an El Niño pattern of a magnitude that historically has a high likelihood of significantly reducing the water levels in Lake Gatun. And with this comes the risk of renewed, albeit temporary, capacity restrictions through the canal. Weather and climate forecasts are, by nature, probabilistic, and no one can give a certain prediction. Instead, shippers depending on cargo flows through the Panama Canal might at this time contemplate whether this 50/50 risk should be ignored, be used as a reason for planning contingency measures or be used to look at possible changes to the current supply chain setup. Lars Jensen is CEO and partner at Vespucci Maritime. Contact him at lars.jensen@vespucci-maritime.com .

El Niño forecast suggests risk of low water levels along Panama Canal

<div class="phx-topic abstract-wrapper">The start to the year was largely unaffected by the Middle East conflict, but the lagging effect of high bunker fuel prices will be felt from the second quarter onward. </div>

The start to the year was largely unaffected by the Middle East conflict, but the lagging effect of high bunker fuel prices will be felt from the second quarter onward.

<div class="phx-topic">OOCL recorded a 7.6% year-over-year drop in first-quarter revenue amid lower demand on most trades and softening rates. The Cosco subsidiary booked revenue of $2.13 billion in the first three months, with topline sales down across all four main trade lanes as capacity increased 4.3%. The carrier’s total volume rose 1.7% to just under 2 million TEUs, while the overall load factor was 2.1% lower than during the same period in 2025. Trans-Pacific liner revenue at OOCL fell 17% year over year to $744 million, Asia-Europe revenue was down 4.5% at $482 million, trans-Atlantic revenue fell 4.3% to $163 million, and intra-Asia/Australasia revenue slipped 0.7% to $748 million. The slight increase in first-quarter volume was thanks to the Asia-Europe corridor, the only trade lane to record growth in the quarter. The carrier handled 384,893 TEUs on Asia-Europe, up 12% year over year. Trans-Pacific volume fell 6% to 523,385 TEUs, trans-Atlantic volume was down 1.3% at 133,910 TEUs, and intra-Asia/Australasia volume declined 3% to 954,464 TEUs. <h3>Lagging impact of high bunker fuel price </h3>While the oversupplied container shipping business appears to be heading for a weak first quarter largely unaffected by disruption from the Middle East war, the industry bill for a sharp increase in bunker prices will be due from the second quarter onward, according to investment bank J.P. Morgan. “The Persian Gulf disruption remains a highly fluid situation and given the time lag in loaded rates, bunker adjustment factors for contracts, and Maersk’s two-month bunker fuel inventory, we see the impact skewed to Q2 2026 onwards,” the bank wrote in a note to Maersk investors Friday. J.P. Morgan is expecting Maersk’s first-quarter earnings out May 7 will also reflect a muted first quarter, given the decline in freight rates through the end of February and the effects of Persian Gulf disruption not really impacting the first quarter. But the investment bank highlighted the impact of high bunker fuel prices that carriers are trying to recover through bunker adjustment factors (BAFs) and emergency fuel surcharges. “We have factored into our 2026 estimates [for Maersk] our assumption that these disruptions will last at least six months, with bunker fuel cost increases post Q2 the biggest drag on earnings that will need to be recovered through firmer spot rates and BAF compliance,” J.P. Morgan said. The bank expects the 2026 bunker fuel bill for Maersk to increase by $1.2 billion to a full-year cost of $7.3 billion on the back of an average price of $693 per ton versus $539 in 2025. “Maersk reportedly has two months of bunker fuel inventory, which shields it from the current volatility,” the bank said. “The bunker fuel adjustment factor for contracts will be recovered in Q3, and therefore there is a lagged fuel cost recovery.” Reflecting this dynamic, J.P. Morgan has forecast that Maersk will report an earnings before interest and taxes loss of $2.6 billion for the year, up from a previous expectation of a $2.8 billion loss. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

OOCL recorded a 7.6% year-over-year drop in first-quarter revenue amid lower demand on most trades and softening rates. The Cosco subsidiary booked revenue of $2.13 billion in the first three months, with topline sales down across all four main trade lanes as capacity increased 4.3%. The carrier’s total volume rose 1.7% to just under 2 million TEUs, while the overall load factor was 2.1% lower than during the same period in 2025. Trans-Pacific liner revenue at OOCL fell 17% year over year to $744 million, Asia-Europe revenue was down 4.5% at $482 million, trans-Atlantic revenue fell 4.3% to $163 million, and intra-Asia/Australasia revenue slipped 0.7% to $748 million. The slight increase in first-quarter volume was thanks to the Asia-Europe corridor, the only trade lane to record growth in the quarter. The carrier handled 384,893 TEUs on Asia-Europe, up 12% year over year. Trans-Pacific volume fell 6% to 523,385 TEUs, trans-Atlantic volume was down 1.3% at 133,910 TEUs, and intra-Asia/Australasia volume declined 3% to 954,464 TEUs. Lagging impact of high bunker fuel price While the oversupplied container shipping business appears to be heading for a weak first quarter largely unaffected by disruption from the Middle East war, the industry bill for a sharp increase in bunker prices will be due from the second quarter onward, according to investment bank J.P. Morgan. “The Persian Gulf disruption remains a highly fluid situation and given the time lag in loaded rates, bunker adjustment factors for contracts, and Maersk’s two-month bunker fuel inventory, we see the impact skewed to Q2 2026 onwards,” the bank wrote in a note to Maersk investors Friday. J.P. Morgan is expecting Maersk’s first-quarter earnings out May 7 will also reflect a muted first quarter, given the decline in freight rates through the end of February and the effects of Persian Gulf disruption not really impacting the first quarter. But the investment bank highlighted the impact of high bunker fuel prices that carriers are trying to recover through bunker adjustment factors (BAFs) and emergency fuel surcharges. “We have factored into our 2026 estimates [for Maersk] our assumption that these disruptions will last at least six months, with bunker fuel cost increases post Q2 the biggest drag on earnings that will need to be recovered through firmer spot rates and BAF compliance,” J.P. Morgan said. The bank expects the 2026 bunker fuel bill for Maersk to increase by $1.2 billion to a full-year cost of $7.3 billion on the back of an average price of $693 per ton versus $539 in 2025. “Maersk reportedly has two months of bunker fuel inventory, which shields it from the current volatility,” the bank said. “The bunker fuel adjustment factor for contracts will be recovered in Q3, and therefore there is a lagged fuel cost recovery.” Reflecting this dynamic, J.P. Morgan has forecast that Maersk will report an earnings before interest and taxes loss of $2.6 billion for the year, up from a previous expectation of a $2.8 billion loss. Contact Greg Knowler at greg.knowler@spglobal.com .

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OOCL posts revenue decline in muted first quarter

<div class="phx-topic abstract-wrapper">An increasing number of lawmakers at the federal, state, and municipal levels are taking steps to freeze data center development, which serves as an important cargo source. </div>

An increasing number of lawmakers at the federal, state, and municipal levels are taking steps to freeze data center development, which serves as an important cargo source.

<div class="phx-topic">Growing calls to place moratoriums on data center construction across the US present a concern for project cargo specialists who are counting on power generation shipments and other key cargoes required to meet the enormous demands of the mega projects. An increasing number of lawmakers at the federal, state and municipal levels are taking steps to freeze data center development, which serves as an important cargo source. Opponents say the centers drain power supplies, raise energy costs, and can harm the environment. Beyond the physical construction of data centers — the largest of which exceed 4 million square feet in the US and can consume as much energy and water as a small town — the development of these facilities is driving large volumes of cargo for infrastructure projects to support their massive utility needs. Data center construction is already facing setbacks related to tariffs and equipment scarcity. According to an April 1 report by Bloomberg, nearly half of data centers planned for this year in the US are expected to experience delays or cancellations because of a shortage of electrical equipment including transformers, switchgear and batteries to build out the power infrastructure for the centers. The parts primarily come from China, subjecting them to heavy tariffs and taking 24 to 30 months to arrive — up to a year later than data center developers say they need the equipment. For project logistics providers, delays from moratoriums can create significant setbacks for cargo shipments. “Long-lead equipment may already be manufactured or in transit, requiring additional storage, rerouting or resequencing of deliveries,” John Lu, global sector head for semiconductor and cloud construction with DHL Global Forwarding Industrial Projects, told the Journal of Commerce. For large artificial intelligence and data center developments, planning around power, water and sustainability often starts well before projects are publicly announced, Lu said. “Projects of this scale are complex and typically involve multiple layers of local, state and federal approvals,” he said. <h3>Maine set to impose first statewide ban </h3>Legislative efforts to rein in data centers are playing out on all levels of government — some with more support than others. In March, Sen. Bernie Sanders (I-Vermont) and Rep. Alexandria Ocasio-Cortez (D-New York) introduced legislation in the Senate and House, respectively, that they said would enact a “reasonable pause” on the development of new AI data centers in the US “to ensure the safety of humanity.” If the bill becomes law, it would institute “an immediate federal moratorium on AI data centers until strong national safeguards are put in place” to ensure AI is safe and effective, does not increase electricity or utility prices, or harm communities or damage the environment. Although the legislation is unlikely to advance, its introduction follows efforts by more than a dozen states and several cities and counties pushing forward with moratorium proposals. Maine is set to become the first US state to temporarily outlaw the development of most new data centers after a proposed ban received state House approval April 6. The bill advances to the state Senate, which is expected to pass the legislation. The moratorium would freeze construction of any data center consuming at least 20 megawatts of electricity until Nov. 1, 2027. Lawmakers have proposed data center bans or restrictions in 12 other states: Georgia, Maryland, Michigan, Minnesota, New Hampshire, New York, Oklahoma, Pennsylvania, South Carolina, Vermont, and Virginia. On the municipal level, the city of New Orleans in January passed a one-year moratorium on the construction of data centers, and city council members — who unanimously approved the measure — say the ban will likely become permanent. Cities in North Carolina and Wisconsin also approved temporary bans earlier this year, while Dallas and Denver are considering their own restrictions. Global spending on data centers is projected to reach $7 trillion by 2030, according to consultant McKinsey. Of the 4,088 data centers now in the US, Virginia and Texas are the top two states for data center construction, with 579 and 411 facilities, respectively, according to industry website Data Center Map. DHL is in the process of expanding its North American infrastructure to support data center logistics, adding 10 warehouse sites with over 7 million square feet of capacity. The facilities are set go live sometime in 2026, according to DHL. Contact Autumn Cafiero Giusti at <a href="mailto:autumn@autumngiusti.com">autumn@autumngiusti.com</a>. </div>

Growing calls to place moratoriums on data center construction across the US present a concern for project cargo specialists who are counting on power generation shipments and other key cargoes required to meet the enormous demands of the mega projects. An increasing number of lawmakers at the federal, state and municipal levels are taking steps to freeze data center development, which serves as an important cargo source. Opponents say the centers drain power supplies, raise energy costs, and can harm the environment. Beyond the physical construction of data centers — the largest of which exceed 4 million square feet in the US and can consume as much energy and water as a small town — the development of these facilities is driving large volumes of cargo for infrastructure projects to support their massive utility needs. Data center construction is already facing setbacks related to tariffs and equipment scarcity. According to an April 1 report by Bloomberg, nearly half of data centers planned for this year in the US are expected to experience delays or cancellations because of a shortage of electrical equipment including transformers, switchgear and batteries to build out the power infrastructure for the centers. The parts primarily come from China, subjecting them to heavy tariffs and taking 24 to 30 months to arrive — up to a year later than data center developers say they need the equipment. For project logistics providers, delays from moratoriums can create significant setbacks for cargo shipments. “Long-lead equipment may already be manufactured or in transit, requiring additional storage, rerouting or resequencing of deliveries,” John Lu, global sector head for semiconductor and cloud construction with DHL Global Forwarding Industrial Projects, told the Journal of Commerce. For large artificial intelligence and data center developments, planning around power, water and sustainability often starts well before projects are publicly announced, Lu said. “Projects of this scale are complex and typically involve multiple layers of local, state and federal approvals,” he said. Maine set to impose first statewide ban Legislative efforts to rein in data centers are playing out on all levels of government — some with more support than others. In March, Sen. Bernie Sanders (I-Vermont) and Rep. Alexandria Ocasio-Cortez (D-New York) introduced legislation in the Senate and House, respectively, that they said would enact a “reasonable pause” on the development of new AI data centers in the US “to ensure the safety of humanity.” If the bill becomes law, it would institute “an immediate federal moratorium on AI data centers until strong national safeguards are put in place” to ensure AI is safe and effective, does not increase electricity or utility prices, or harm communities or damage the environment. Although the legislation is unlikely to advance, its introduction follows efforts by more than a dozen states and several cities and counties pushing forward with moratorium proposals. Maine is set to become the first US state to temporarily outlaw the development of most new data centers after a proposed ban received state House approval April 6. The bill advances to the state Senate, which is expected to pass the legislation. The moratorium would freeze construction of any data center consuming at least 20 megawatts of electricity until Nov. 1, 2027. Lawmakers have proposed data center bans or restrictions in 12 other states: Georgia, Maryland, Michigan, Minnesota, New Hampshire, New York, Oklahoma, Pennsylvania, South Carolina, Vermont, and Virginia. On the municipal level, the city of New Orleans in January passed a one-year moratorium on the construction of data centers, and city council members — who unanimously approved the measure — say the ban will likely become permanent. Cities in North Carolina and Wisconsin also approved temporary bans earlier this year, while Dallas and Denver are considering their own restrictions. Global spending on data centers is projected to reach $7 trillion by 2030, according to consultant McKinsey. Of the 4,088 data centers now in the US, Virginia and Texas are the top two states for data center construction, with 579 and 411 facilities, respectively, according to industry website Data Center Map. DHL is in the process of expanding its North American infrastructure to support data center logistics, adding 10 warehouse sites with over 7 million square feet of capacity. The facilities are set go live sometime in 2026, according to DHL. Contact Autumn Cafiero Giusti at autumn@autumngiusti.com .

Push for data center bans in US threatens project cargo surge

<div class="phx-topic abstract-wrapper">Most of the increases represent a significant premium on current pricing levels, but it remains to be seen how sticky the aspirational rates will be with cargo markets also under pressure from high energy prices. </div>

Most of the increases represent a significant premium on current pricing levels, but it remains to be seen how sticky the aspirational rates will be with cargo markets also under pressure from high energy prices.

<div class="phx-topic">Ocean carriers have unveiled a raft of rate increases and emergency fuel surcharges on multiple trade lanes as high bunker prices push up operating costs across shipping networks. Most of the increases represent a significant premium on current pricing levels, but it remains to be seen how sticky the aspirational rates will be with cargo markets also under pressure from high energy prices. Carriers have been pushing general rate increases (GRIs) on Asia-US trade lanes to lift prices on the trans-Pacific. As of April 9, Asia-US East Coast rates of $3,525/FEU were up 20% compared with levels before the April 1 GRIs, with Asia-West Coast up 24% at $2,525/FEU, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. Mediterranean Shipping Co. will increase its Asia-North America emergency fuel surcharge (EFS) on May 1, with the Asia-North America West Coast EFS rising 70% to $467/FEU and the East Coast levy up 50% at $644/FEU. On Asia-North Europe, rates eased this week despite Maersk announcing freight-all-kinds (FAK) prices that set higher rate levels ranging from $3,500 to $3,900/FEU depending on destination ports. Data from rate benchmarking platform Xeneta shows Asia-North Europe rates unchanged this week near $2,854/FEU. Other upcoming increases announced this week include CMA CGM planning an April 16 FAK rate of $4,300/FEU from Northwest India and Pakistan to North Europe, the Mediterranean and North Africa, more than 70% higher than the current rate, while Hapag-Lloyd will be adding $1,000/FEU on the Indian Subcontinent, Pakistan and Middle East to the US and Canada. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="d915cdd3-263b-4835-b993-5efb9468dc03"></dynamic-object></div>Hapag-Lloyd’s EFS of $160/TEU, in effect since mid-March on routes not regulated by the US Federal Maritime Commission (FMC), was implemented on US trades this week. The FMC requires <a href="https://www.joc.com/article/fmc-rejects-requests-by-carriers-to-waive-waiting-period-for-middle-east-surcharges-6191881">a 30-day notice period from carriers</a> before they can implement rate increases and surcharges on US routes. Ocean Network Express on April 2 implemented an inland fuel surcharge for carrier haulage in Latin America and across all non-FMC regulated trade routes and services and will extend that to FMC-regulated routes on May 2. “The evolving security situation in the Middle East continues to pose significant challenges, affecting logistics operations and customer supply chains,” ONE said in its surcharge announcement this week. “Many refineries are also operating at reduced capacity, limiting export volumes and causing substantial disruptions in global fuel supply chains,” the carrier added. <h3>Shipping reluctant to pass through Hormuz </h3>The Strait of Hormuz that links the Persian Gulf with the Gulf of Oman is a key energy transport route with about 20% of the world’s oil and gas supplies passing through the waterway. It has been effectively closed since the war started on Feb. 28, and despite <a href="https://www.joc.com/article/ocean-carriers-wait-for-clarity-on-safe-hormuz-passage-after-us-iran-ceasefire-6201132">the two-week US-Iran ceasefire agreed to earlier this week</a>, shipping remains reluctant to pass through the strait until safety can be guaranteed. Jan Christensen, senior director of fuel purchasing at Hapag-Lloyd, highlighted the impact high prices and supply disruptions from the Hormuz blockade were having on bunkering operations. “Higher crude oil prices directly translate into higher bunker prices, which are the fuel costs for our vessels,” Christensen said in a recent interview. “Fuel is one of the largest cost components in container shipping, so these developments have a significant financial impact for all carriers. When oil prices move sharply upward, bunker costs follow very quickly, which increases operational expenses across the entire fleet.” <a href="https://www.joc.com/article/singapore-bunker-supply-continues-to-run-down-as-middle-east-war-drags-on-6198359">Fuel availability continues to tighten</a>, particularly in the Asian bunkering hubs in Singapore and South Korea. “Some suppliers are already signaling that they cannot fully guarantee contracted volumes, and it’s becoming increasingly difficult to secure bunker contracts for April and May,” Christensen said. <h3>Lingering Europe port congestion </h3>On top of the rising fuel costs, carriers are also facing delays when calling at gateway ports in North Europe and the Mediterranean. Yard density is high, with the lingering effects of severe storms in early March continuing to be felt. Kuehne + Nagel’s visibility tool SeaExplorer noted “heavily disrupted operations” at Antwerp, Hamburg and Felixstowe, with seven-day average vessel wait times of more than two days. “It’s been reported that yard density has reached over 75% at ports like Antwerp, Hamburg, and Rotterdam in the past few weeks and much of that was due to the berthing delays from storms in February and early March and their lingering impacts,” said Destine Ozuygur, senior market analyst at Xeneta. Another challenge for shippers on the Asia-North Europe trade lane is on-time performance. While schedule reliability in March of 32% into Northern Europe was a significant improvement on the 18% in February and 22% in January, Ozuygur noted it was barely above the average 29% on-time performance through 2025. “Any gains we’ve seen on this trade have been short-lived over the past 12 months,” she said, adding that only in March and May of last year did schedule reliability ever pass 40%. From a deployed capacity perspective, the Asia-Mediterranean trade lane has seen an 8% increase from April to May, with carriers adding 69,000 TEUs to the corridor to serve rerouted Persian Gulf cargo, Xeneta data shows. Planned capacity on Asia-Mediterranean routes of 844,862 TEUs in April is an increase of 25% compared with March and will jump to 913,285 TEUs in May. “The Far East-Med is being used to route Gulf Cooperation Council-bound cargo through Jeddah, King Abdullah and Mersin,” Ozuygur said. “The challenges that could potentially bring to other Mediterranean ports if this becomes a long-term routing option that gains favor over Khor Fakkan, Mundra, Nhava Sheva, etc. is one worth noting.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Ocean carriers have unveiled a raft of rate increases and emergency fuel surcharges on multiple trade lanes as high bunker prices push up operating costs across shipping networks. Most of the increases represent a significant premium on current pricing levels, but it remains to be seen how sticky the aspirational rates will be with cargo markets also under pressure from high energy prices. Carriers have been pushing general rate increases (GRIs) on Asia-US trade lanes to lift prices on the trans-Pacific. As of April 9, Asia-US East Coast rates of $3,525/FEU were up 20% compared with levels before the April 1 GRIs, with Asia-West Coast up 24% at $2,525/FEU, according to Platts, a sister company of the Journal of Commerce within S&P Global. Mediterranean Shipping Co. will increase its Asia-North America emergency fuel surcharge (EFS) on May 1, with the Asia-North America West Coast EFS rising 70% to $467/FEU and the East Coast levy up 50% at $644/FEU. On Asia-North Europe, rates eased this week despite Maersk announcing freight-all-kinds (FAK) prices that set higher rate levels ranging from $3,500 to $3,900/FEU depending on destination ports. Data from rate benchmarking platform Xeneta shows Asia-North Europe rates unchanged this week near $2,854/FEU. Other upcoming increases announced this week include CMA CGM planning an April 16 FAK rate of $4,300/FEU from Northwest India and Pakistan to North Europe, the Mediterranean and North Africa, more than 70% higher than the current rate, while Hapag-Lloyd will be adding $1,000/FEU on the Indian Subcontinent, Pakistan and Middle East to the US and Canada. Hapag-Lloyd’s EFS of $160/TEU, in effect since mid-March on routes not regulated by the US Federal Maritime Commission (FMC), was implemented on US trades this week. The FMC requires a 30-day notice period from carriers before they can implement rate increases and surcharges on US routes. Ocean Network Express on April 2 implemented an inland fuel surcharge for carrier haulage in Latin America and across all non-FMC regulated trade routes and services and will extend that to FMC-regulated routes on May 2. “The evolving security situation in the Middle East continues to pose significant challenges, affecting logistics operations and customer supply chains,” ONE said in its surcharge announcement this week. “Many refineries are also operating at reduced capacity, limiting export volumes and causing substantial disruptions in global fuel supply chains,” the carrier added. Shipping reluctant to pass through Hormuz The Strait of Hormuz that links the Persian Gulf with the Gulf of Oman is a key energy transport route with about 20% of the world’s oil and gas supplies passing through the waterway. It has been effectively closed since the war started on Feb. 28, and despite the two-week US-Iran ceasefire agreed to earlier this week , shipping remains reluctant to pass through the strait until safety can be guaranteed. Jan Christensen, senior director of fuel purchasing at Hapag-Lloyd, highlighted the impact high prices and supply disruptions from the Hormuz blockade were having on bunkering operations. “Higher crude oil prices directly translate into higher bunker prices, which are the fuel costs for our vessels,” Christensen said in a recent interview. “Fuel is one of the largest cost components in container shipping, so these developments have a significant financial impact for all carriers. When oil prices move sharply upward, bunker costs follow very quickly, which increases operational expenses across the entire fleet.” Fuel availability continues to tighten , particularly in the Asian bunkering hubs in Singapore and South Korea. “Some suppliers are already signaling that they cannot fully guarantee contracted volumes, and it’s becoming increasingly difficult to secure bunker contracts for April and May,” Christensen said. Lingering Europe port congestion On top of the rising fuel costs, carriers are also facing delays when calling at gateway ports in North Europe and the Mediterranean. Yard density is high, with the lingering effects of severe storms in early March continuing to be felt. Kuehne + Nagel’s visibility tool SeaExplorer noted “heavily disrupted operations” at Antwerp, Hamburg and Felixstowe, with seven-day average vessel wait times of more than two days. “It’s been reported that yard density has reached over 75% at ports like Antwerp, Hamburg, and Rotterdam in the past few weeks and much of that was due to the berthing delays from storms in February and early March and their lingering impacts,” said Destine Ozuygur, senior market analyst at Xeneta. Another challenge for shippers on the Asia-North Europe trade lane is on-time performance. While schedule reliability in March of 32% into Northern Europe was a significant improvement on the 18% in February and 22% in January, Ozuygur noted it was barely above the average 29% on-time performance through 2025. “Any gains we’ve seen on this trade have been short-lived over the past 12 months,” she said, adding that only in March and May of last year did schedule reliability ever pass 40%. From a deployed capacity perspective, the Asia-Mediterranean trade lane has seen an 8% increase from April to May, with carriers adding 69,000 TEUs to the corridor to serve rerouted Persian Gulf cargo, Xeneta data shows. Planned capacity on Asia-Mediterranean routes of 844,862 TEUs in April is an increase of 25% compared with March and will jump to 913,285 TEUs in May. “The Far East-Med is being used to route Gulf Cooperation Council-bound cargo through Jeddah, King Abdullah and Mersin,” Ozuygur said. “The challenges that could potentially bring to other Mediterranean ports if this becomes a long-term routing option that gains favor over Khor Fakkan, Mundra, Nhava Sheva, etc. is one worth noting.” Contact Greg Knowler at greg.knowler@spglobal.com .

Cost-hit ocean carriers roll out series of rate increases, fuel surcharges

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