<div class="phx-topic abstract-wrapper">Damage from last fall’s Hurricane Helene continues to affect CSX’s operations in the Southeast, while the fast-tracking of construction work at Baltimore’s Howard Street Tunnel provides another challenge.</div>

Damage from last fall’s Hurricane Helene continues to affect CSX’s operations in the Southeast, while the fast-tracking of construction work at Baltimore’s Howard Street Tunnel provides another challenge.

Feature image

<div>Performance metrics for intermodal service on CSX Transportation fell to multi-year lows in the first quarter as the railroad dealt with effects of hurricane damage along a key route through the Carolinas and disruption caused by the fast-tracking of construction work at the Howard Street Tunnel project in Baltimore. CSX’s train speeds dropped to an average of 30 miles per hour in the first quarter, its lowest winter performance since 2018, according to data from the US Surface Transportation Board (STB). A year ago, the average was 31.7 miles per hour. The railroad also experienced a rise in the number...

Performance metrics for intermodal service on CSX Transportation fell to multi-year lows in the first quarter as the railroad dealt with effects of hurricane damage along a key route through the Carolinas and disruption caused by the fast-tracking of construction work at the Howard Street Tunnel project in Baltimore. CSX’s train speeds dropped to an average of 30 miles per hour in the first quarter, its lowest winter performance since 2018, according to data from the US Surface Transportation Board (STB). A year ago, the average was 31.7 miles per hour. The railroad also experienced a rise in the number of loaded intermodal railcars sitting idle. In the first quarter, CSX averaged 47.3 railcars per day that sat idle for at least 48 hours, its highest such figure for a first quarter since 2022, according to STB data. In the final week of March alone, the CSX average jumped to 68.3 idle loaded railcars per day. The performance declines come after CSX consistently outpaced Norfolk Southern Railway in service in 2023 and 2024, according to the Journal of Commerce Intermodal Service Scorecard. CSX said there were two reasons for the service declines. First was lingering damage caused by Hurricane Helene last September to an important rail stretch along the Tennessee-North Carolina border. Second, CSX chose to fast-track construction of Baltimore’s Howard Street Tunnel, requiring truck trips to haul containers around the project. The decision on Howard Street comes with short-term pain but a long-term payoff for volumes traveling between Baltimore and the Midwest and along the I-95 corridor between the Northeast and Southeast. “CSX is dedicated to running a reliable and efficient network and delivering on our customer service commitments — all while having a relentless focus on continuing to improve service metrics,” a CSX spokesperson said in a statement to the Journal of Commerce. “The Howard Street project was initially planned to take three years. However, with the switch to the full outage and construction beginning on Feb. 1, 2025, we’ve been able to accelerate the timeline to just 10 months with completion by the end of 2025.” Containers traveling south from New Jersey are now offloaded at the Seagirt Marine Terminal in Baltimore, trucked across the city to the Curtis Bay Terminal, and then reloaded onto a second train bound for the Southeast. Northbound shipments follow the reverse pattern. Trains are affected between Kearny, New Jersey; Atlanta; and Jacksonville, Lakeland and Miami in Florida. Once complete, the new Howard Street Tunnel will allow double-stack CSX trains to operate on high-volume routes such as between Atlanta and New Jersey, where Norfolk Southern has traditionally held an edge. “Once complete, the modernized tunnel is expected to enhance operational efficiency, bolster the competitiveness of CSX-served markets, and deliver significant benefits to our customers,” CSX said in a statement. Hurricane damaged track in the Carolinas Meanwhile, damage from Hurricane Helene last fall continues to affect CSX’s operations in the Southeast. The railroad’s Blue Ridge Subdivision, a 60-mile stretch of track in the mountains along the Tennessee-North Carolina border, sustained extensive flood damage . In Poplar, North Carolina, the track was completely washed away, while in Erwin, Tennessee, erosion from soil and rock completely covered the tracks. The Blue Ridge recovery efforts have been hampered by a series of winter storms. CSX hopes to reopen the stretch before the end of the year, with four individual parts of the track currently undergoing repairs. While the most direct impact from the hurricane damage has been to routes serving Rocky Mount and Charlotte, North Carolina, the disruption has had broader consequences. CSX has rerouted some traffic through Nashville, already a busy corridor for freight between Chicago and Atlanta, as well as across upstate New York via Buffalo, adding mileage and extending transit times. Contact Ari Ashe at ari.ashe@spglobal.com .

Intermodal providers

North-American rail

CSX Q1 service metrics take hit amid storm recovery, tunnel project

<div class="phx-topic abstract-wrapper">The recent increase in intermodal share in the face of declining West Coast share is intriguing, and it might be signaling a more significant change in the situation, writes Larry Gross. </div>

The recent increase in intermodal share in the face of declining West Coast share is intriguing, and it might be signaling a more significant change in the situation, writes Larry Gross.

<div class="phx-topic">The share of imports arriving in the US and Western Canada that travel inland via rail has been in a long-term decline. Changes in shipping patterns are a big reason why, with major implications as to where things are heading and the railroads’ ability to affect the result. The chart below tracks two measures over the past 16 years. The first is the share of US plus Western Canadian import TEUs arriving on the West Coast. As has been well documented, this share has been in a long-term decline as importers have moved away from West Coast-centric strategies towards four- and five-corner strategies that provide greater diversification and lower costs. Twelve-month moving average West Coast share declined by over 10 points from 59% in 2010 to under 49% in 2025. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="651db556-cc65-494c-abea-84774e97a373"></dynamic-object></div>The second statistic is the percentage of import TEUs arriving that travel inland from the coast via intermodal. This includes both inland point intermodal (IPI) loads and South California transloads. Intermodal share has also seen a long-term decline similar to that of West Coast share. The linear trends over this period for both statistics are almost parallel. The correlation was very strong between 2014 through mid-2022. We know that intermodal share is higher off the West Coast than elsewhere, due primarily to length-of-haul effects. The longer runs from the West Coast to the consumption centers inland are much more intermodal-friendly than the short, dispersed hauls out of other port regions. It is interesting, however, to note that since mid-2022, this tight correlation has loosened significantly. Viewed on a 12-month moving average basis, intermodal share began to recover at that point from the post-pandemic surge congestion, a full year before West Coast share turned upward. In 2023, intermodal share resumed declining, while West Coast share continued to rise. Then, in 2025, West Coast share began to decline once again, but intermodal share began to move up. <h3>Inversely correlated? </h3>Does this de-coupling indicate that the basic bond has been broken between these two measures? I don’t think so. But it does indicate that other factors (congestion, surges, and so forth) have taken control for the time being. It may also say that these inter-dependent but separate systems have reacted to the recent volatility differently and each with their own timing. On the other hand, the recent increase in intermodal share in the face of declining West Coast share is intriguing. It might be signaling a more significant change in the situation and certainly bears watching. If the inter-dependence remains intact, what does that indicate for the future? At the start of the year, West Coast share could have reasonably been expected to continue the decline that resumed in 2025. The Gaza situation had stabilized, and the Red Sea/Suez routing was slowly opening back up. The East Coast option was looking better all the time. But of course, the Iran hostilities have now thrown that all out the window. The trans-Pacific trade is, at least for the moment, more isolated from the disruption. West Coast share can be expected to stabilize or even improve. This will be an intermodal tailwind for the time being. This analysis also tells us that most of what happens here is completely out of the railroads’ control. They will continue to be subject to the routing decisions of the ocean carriers and the importers. It is on the domestic side of the intermodal house where the railroads have more ability to control their destiny and their share. Larry Gross is president and founder of Gross Transportation Consulting. Contact him at <a href="mailto:lawrencejgross@gmail.com">lawrencejgross@gmail.com</a>. </div>

The share of imports arriving in the US and Western Canada that travel inland via rail has been in a long-term decline. Changes in shipping patterns are a big reason why, with major implications as to where things are heading and the railroads’ ability to affect the result. The chart below tracks two measures over the past 16 years. The first is the share of US plus Western Canadian import TEUs arriving on the West Coast. As has been well documented, this share has been in a long-term decline as importers have moved away from West Coast-centric strategies towards four- and five-corner strategies that provide greater diversification and lower costs. Twelve-month moving average West Coast share declined by over 10 points from 59% in 2010 to under 49% in 2025. The second statistic is the percentage of import TEUs arriving that travel inland from the coast via intermodal. This includes both inland point intermodal (IPI) loads and South California transloads. Intermodal share has also seen a long-term decline similar to that of West Coast share. The linear trends over this period for both statistics are almost parallel. The correlation was very strong between 2014 through mid-2022. We know that intermodal share is higher off the West Coast than elsewhere, due primarily to length-of-haul effects. The longer runs from the West Coast to the consumption centers inland are much more intermodal-friendly than the short, dispersed hauls out of other port regions. It is interesting, however, to note that since mid-2022, this tight correlation has loosened significantly. Viewed on a 12-month moving average basis, intermodal share began to recover at that point from the post-pandemic surge congestion, a full year before West Coast share turned upward. In 2023, intermodal share resumed declining, while West Coast share continued to rise. Then, in 2025, West Coast share began to decline once again, but intermodal share began to move up. Inversely correlated? Does this de-coupling indicate that the basic bond has been broken between these two measures? I don’t think so. But it does indicate that other factors (congestion, surges, and so forth) have taken control for the time being. It may also say that these inter-dependent but separate systems have reacted to the recent volatility differently and each with their own timing. On the other hand, the recent increase in intermodal share in the face of declining West Coast share is intriguing. It might be signaling a more significant change in the situation and certainly bears watching. If the inter-dependence remains intact, what does that indicate for the future? At the start of the year, West Coast share could have reasonably been expected to continue the decline that resumed in 2025. The Gaza situation had stabilized, and the Red Sea/Suez routing was slowly opening back up. The East Coast option was looking better all the time. But of course, the Iran hostilities have now thrown that all out the window. The trans-Pacific trade is, at least for the moment, more isolated from the disruption. West Coast share can be expected to stabilize or even improve. This will be an intermodal tailwind for the time being. This analysis also tells us that most of what happens here is completely out of the railroads’ control. They will continue to be subject to the routing decisions of the ocean carriers and the importers. It is on the domestic side of the intermodal house where the railroads have more ability to control their destiny and their share. Larry Gross is president and founder of Gross Transportation Consulting. Contact him at lawrencejgross@gmail.com .

Surface

Trans-Pacific

North American ports

Maritime

Ocean shipping patterns erode intermodal share from West Coast: analyst

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

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

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

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

Container Shipping News

Trans-Pacific contract talks accelerating after Walmart signs

<div class="phx-topic abstract-wrapper">The Meridian Speedway dispute is important because it’s one of the primary routes where a combined Union Pacific-Norfolk Southern railroad would look to take market share from truckload. </div>

The Meridian Speedway dispute is important because it’s one of the primary routes where a combined Union Pacific-Norfolk Southern railroad would look to take market share from truckload.

<div class="phx-topic">The US Surface Transportation Board (STB) will not intervene in a dispute over the Meridian Speedway, a critical intermodal route connecting the West Coast to the US Southeast where three railroads must team up to execute service. The unanimous ruling, issued Friday, culminates more than six months of arguing between Union Pacific Railroad, Norfolk Southern Railway, and Canadian Pacific Kansas City. The dispute boiled over last summer when FedEx and UPS trucked cargo around the stretch of track to bypass the disruptions. The two parcel giants lean on the railroads to move parcels across the US and impose stringent requirements for on-time performance in their service agreements. The Meridian Speedway, a nearly 300-mile stretch between Louisiana and Mississippi, is a joint venture in which CPKC controls 70% and Norfolk Southern controls the remaining 30%. CPKC oversees dispatching and operations. The Meridian Speedway slashes more than three days between Los Angeles and Atlanta compared with going through Memphis. The dispute centers around CPKC’s decision to restrict train lengths to 8,500 feet, while UP and NS prefer trains that are 11,000 feet long. UP argues the restriction forces them to break up the containers into two different blocks, and CPKC provides substandard service on the second train. CPKC counters that most of the sidings — akin to the shoulder of a highway — are not long enough to handle an 11,000-foot train. When there is a conflict between two trains, the CPKC train is often the one stopped for hours at a time to let the 11,000-foot UP train pass. In an unanimous decision, though, the STB decided not to intervene. “As CPKC notes, the increased dwell of UP’s ‘second train’ could also be attributable to an agreement between CPKC and [Norfolk Southern] that the second train would be scheduled to depart four hours and forty minutes after the first,” STB wrote in the ruling. “Given these facts, there are not sufficient indicia that the conditions the Board imposed in the CP/KCS merger approval are implicated by the increased dwell at UP’s Hollywood Yard.” NS filed a complaint last October but eventually reached an agreement with CPKC and dropped the cast. Last month, however, UP filed a new complaint, citing increased dwell times for the containers going on the second train. UP asked the board to launch an investigation. The Meridian Speedway is a lynchpin to the pending UP-NS transaction before regulators, a route identified as critical to converting more than 1.17 million truckloads to intermodal over three years. However, UP’s application also called for running 11,000-foot trains, the very length that is at the heart of the dispute. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

The US Surface Transportation Board (STB) will not intervene in a dispute over the Meridian Speedway, a critical intermodal route connecting the West Coast to the US Southeast where three railroads must team up to execute service. The unanimous ruling, issued Friday, culminates more than six months of arguing between Union Pacific Railroad, Norfolk Southern Railway, and Canadian Pacific Kansas City. The dispute boiled over last summer when FedEx and UPS trucked cargo around the stretch of track to bypass the disruptions. The two parcel giants lean on the railroads to move parcels across the US and impose stringent requirements for on-time performance in their service agreements. The Meridian Speedway, a nearly 300-mile stretch between Louisiana and Mississippi, is a joint venture in which CPKC controls 70% and Norfolk Southern controls the remaining 30%. CPKC oversees dispatching and operations. The Meridian Speedway slashes more than three days between Los Angeles and Atlanta compared with going through Memphis. The dispute centers around CPKC’s decision to restrict train lengths to 8,500 feet, while UP and NS prefer trains that are 11,000 feet long. UP argues the restriction forces them to break up the containers into two different blocks, and CPKC provides substandard service on the second train. CPKC counters that most of the sidings — akin to the shoulder of a highway — are not long enough to handle an 11,000-foot train. When there is a conflict between two trains, the CPKC train is often the one stopped for hours at a time to let the 11,000-foot UP train pass. In an unanimous decision, though, the STB decided not to intervene. “As CPKC notes, the increased dwell of UP’s ‘second train’ could also be attributable to an agreement between CPKC and [Norfolk Southern] that the second train would be scheduled to depart four hours and forty minutes after the first,” STB wrote in the ruling. “Given these facts, there are not sufficient indicia that the conditions the Board imposed in the CP/KCS merger approval are implicated by the increased dwell at UP’s Hollywood Yard.” NS filed a complaint last October but eventually reached an agreement with CPKC and dropped the cast. Last month, however, UP filed a new complaint, citing increased dwell times for the containers going on the second train. UP asked the board to launch an investigation. The Meridian Speedway is a lynchpin to the pending UP-NS transaction before regulators, a route identified as critical to converting more than 1.17 million truckloads to intermodal over three years. However, UP’s application also called for running 11,000-foot trains, the very length that is at the heart of the dispute. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

Transport, Trade and Regulation News

STB declines to intervene on Meridian Speedway dispute

<div class="phx-topic abstract-wrapper">The UP-NS merger and ONE’s Seaspan stake look like separate deals in separate industries, but they are the same move, writes Paul Tonsager. </div>

The UP-NS merger and ONE’s Seaspan stake look like separate deals in separate industries, but they are the same move, writes Paul Tonsager.

<div class="phx-topic">Two consequential infrastructure transactions are moving simultaneously through their respective regulatory processes, in separate industries, with a single and critical purpose: Secure assets and expand infrastructure. In rail, Union Pacific (UP) and Norfolk Southern (NS) are advancing a proposed $85 billion merger that would unite UP’s western network with NS’ eastern footprint into a single system spanning 43 states. The Surface Transportation Board (STB) rejected the initial application in January as incomplete; the carriers have committed to refiling by April 30, 2026. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6186769_0.1.jpg"></img></div>In ocean, Ocean Network Express <a href="https://www.joc.com/article/one-boosts-ownership-stake-in-seaspan-parent-poseidon-6184045">has agreed to increase its ownership stake in Poseidon Corp.</a> — parent company of Seaspan Corporation, the world’s largest independent containership lessor — to 48.9%. ONE is a Singapore-based joint venture of three Japanese shipping conglomerates; Poseidon is incorporated in the Marshall Islands and tax-resident in the United Kingdom. The regulatory approvals cited in the announcement almost certainly refer to Japan’s competition authority and possibly the EU — not the United States, which has no STB equivalent for ocean shipping. That gap is part of the story. Also in ocean: Hapag-Lloyd, Germany’s largest carrier, <a href="https://www.joc.com/article/hapag-lloyd-bolsters-fleet-with-42-billion-deal-to-acquire-zim-6170540">has agreed to acquire ZIM Integrated Shipping Services in a deal valued at approximately $4.2 billion</a>, a transaction that would create a combined fleet exceeding 4.8 million TEUs. Hapag-Lloyd is one of Seaspan’s charter customers, along with MSC, Maersk, CMA CGM, Cosco, Evergreen and ONE. The world’s seven largest container lines all rent tonnage from the platform that ONE is moving to control. That fact has not appeared in any headline covering this transaction. The surface details differ. The underlying logic is identical: the dominant players in each mode are moving to consolidate control of the infrastructure layer that competitors depend on. The difference is that one transaction faces a rigorous, public, multi-year regulatory process. The other faces comparatively limited scrutiny from any authority with real enforcement power over the US freight market. <h3>The network versus the tonnage platform </h3>In rail, the infrastructure being consolidated is the network itself. A UP-NS combination would create a single operator controlling track, terminals and dispatch authority across the full breadth of the country. For shippers benefiting from UP-NS interchange competition on transcontinental lanes, the merger eliminates a competitive option that cannot be recreated once it closes. In ocean, the infrastructure being consolidated is the tonnage platform. Seaspan owns 241 vessels with more than 2.5 million TEUs of capacity and charters them to virtually every major container line. ONE, approaching half-ownership of Seaspan’s parent, is not acquiring a competitor’s ships. It is acquiring a structural position in the platform that determines which carrier gets what vessel, at what charter rate, on what timeline. The rail analog is TTX Company, the carrier-owned flatcar cooperative whose shareholders — BNSF, UP, NS among them — own the equipment pool that their competitors must also rent. ONE’s Seaspan stake is the TTX play, extended to the vessel market. <h3>The 48.9% question </h3>ONE’s ownership threshold is a deliberate structural choice. Crossing 50% would likely require consolidation of Poseidon’s debt-heavy balance sheet onto ONE’s financial statements and would reframe the transaction — from a minority investment to a control acquisition of the dominant vessel-leasing platform — in ways that invite harder antitrust scrutiny in Japan and the EU. At 48.9%, ONE secures board influence and fleet planning access without pulling those triggers. The equity is entirely private — Atlas Corp., Seaspan’s parent company, was delisted in 2023. The primary seller was Fairfax Financial Holdings, run by Prem Watsa, which sold a 23.2% stake but retains approximately 22.1% of Poseidon. Watsa is choosing his partner, not his exit. Any future move toward majority control runs through him and the remaining insiders — on their timeline, at their price. <h3>What shippers are actually facing </h3>Considered individually, neither the UP-NS combination nor the ONE-Seaspan stake is disqualifying. Considered together — alongside Hapag-Lloyd’s pending acquisition of ZIM — they describe a synchronized compression of freight infrastructure across two modes simultaneously. Shippers with rail exposure on transcontinental lanes face a market in which UP and NS no longer compete at interchange. Shippers dependent on ocean capacity face a market in which the largest vessel lessor is approaching control by one of its own customers. For manufacturers, retailers and agricultural exporters moving product across both modes — which describes most significant US freight — the implications compound. The STB’s <a href="https://www.joc.com/article/industry-stakeholders-dont-see-regulators-rubber-stamping-up-ns-deal-6181218">rejection of the UP-NS application</a> signals that rigorous competitive impact analysis is required before major rail transactions proceed. No equivalent process exists for the ONE-Seaspan transaction in the United States. The Federal Maritime Commission has limited authority over foreign vessel ownership structures. The transaction will be decided in Tokyo, Brussels and Hamilton — not Washington. Two modes. Two mechanisms. One direction. The infrastructure consolidation story of 2026 is not being told as a single story. It should be. Paul Tonsager has held executive roles at Maersk, CN Rail, CN Worldwide, Coyote (RXO) and Patriot Rail. He is the founder of Integrated Multimodal Solutions LLC and author of the Substack newsletter Signals &amp; Switches. Contact him at <a href="mailto:paul.tonsager@multimodalsolutions.io">paul.tonsager@multimodalsolutions.io</a>. </div>

Two consequential infrastructure transactions are moving simultaneously through their respective regulatory processes, in separate industries, with a single and critical purpose: Secure assets and expand infrastructure. In rail, Union Pacific (UP) and Norfolk Southern (NS) are advancing a proposed $85 billion merger that would unite UP’s western network with NS’ eastern footprint into a single system spanning 43 states. The Surface Transportation Board (STB) rejected the initial application in January as incomplete; the carriers have committed to refiling by April 30, 2026. In ocean, Ocean Network Express has agreed to increase its ownership stake in Poseidon Corp. — parent company of Seaspan Corporation, the world’s largest independent containership lessor — to 48.9%. ONE is a Singapore-based joint venture of three Japanese shipping conglomerates; Poseidon is incorporated in the Marshall Islands and tax-resident in the United Kingdom. The regulatory approvals cited in the announcement almost certainly refer to Japan’s competition authority and possibly the EU — not the United States, which has no STB equivalent for ocean shipping. That gap is part of the story. Also in ocean: Hapag-Lloyd, Germany’s largest carrier, has agreed to acquire ZIM Integrated Shipping Services in a deal valued at approximately $4.2 billion , a transaction that would create a combined fleet exceeding 4.8 million TEUs. Hapag-Lloyd is one of Seaspan’s charter customers, along with MSC, Maersk, CMA CGM, Cosco, Evergreen and ONE. The world’s seven largest container lines all rent tonnage from the platform that ONE is moving to control. That fact has not appeared in any headline covering this transaction. The surface details differ. The underlying logic is identical: the dominant players in each mode are moving to consolidate control of the infrastructure layer that competitors depend on. The difference is that one transaction faces a rigorous, public, multi-year regulatory process. The other faces comparatively limited scrutiny from any authority with real enforcement power over the US freight market. The network versus the tonnage platform In rail, the infrastructure being consolidated is the network itself. A UP-NS combination would create a single operator controlling track, terminals and dispatch authority across the full breadth of the country. For shippers benefiting from UP-NS interchange competition on transcontinental lanes, the merger eliminates a competitive option that cannot be recreated once it closes. In ocean, the infrastructure being consolidated is the tonnage platform. Seaspan owns 241 vessels with more than 2.5 million TEUs of capacity and charters them to virtually every major container line. ONE, approaching half-ownership of Seaspan’s parent, is not acquiring a competitor’s ships. It is acquiring a structural position in the platform that determines which carrier gets what vessel, at what charter rate, on what timeline. The rail analog is TTX Company, the carrier-owned flatcar cooperative whose shareholders — BNSF, UP, NS among them — own the equipment pool that their competitors must also rent. ONE’s Seaspan stake is the TTX play, extended to the vessel market. The 48.9% question ONE’s ownership threshold is a deliberate structural choice. Crossing 50% would likely require consolidation of Poseidon’s debt-heavy balance sheet onto ONE’s financial statements and would reframe the transaction — from a minority investment to a control acquisition of the dominant vessel-leasing platform — in ways that invite harder antitrust scrutiny in Japan and the EU. At 48.9%, ONE secures board influence and fleet planning access without pulling those triggers. The equity is entirely private — Atlas Corp., Seaspan’s parent company, was delisted in 2023. The primary seller was Fairfax Financial Holdings, run by Prem Watsa, which sold a 23.2% stake but retains approximately 22.1% of Poseidon. Watsa is choosing his partner, not his exit. Any future move toward majority control runs through him and the remaining insiders — on their timeline, at their price. What shippers are actually facing Considered individually, neither the UP-NS combination nor the ONE-Seaspan stake is disqualifying. Considered together — alongside Hapag-Lloyd’s pending acquisition of ZIM — they describe a synchronized compression of freight infrastructure across two modes simultaneously. Shippers with rail exposure on transcontinental lanes face a market in which UP and NS no longer compete at interchange. Shippers dependent on ocean capacity face a market in which the largest vessel lessor is approaching control by one of its own customers. For manufacturers, retailers and agricultural exporters moving product across both modes — which describes most significant US freight — the implications compound. The STB’s rejection of the UP-NS application signals that rigorous competitive impact analysis is required before major rail transactions proceed. No equivalent process exists for the ONE-Seaspan transaction in the United States. The Federal Maritime Commission has limited authority over foreign vessel ownership structures. The transaction will be decided in Tokyo, Brussels and Hamilton — not Washington. Two modes. Two mechanisms. One direction. The infrastructure consolidation story of 2026 is not being told as a single story. It should be. Paul Tonsager has held executive roles at Maersk, CN Rail, CN Worldwide, Coyote (RXO) and Patriot Rail. He is the founder of Integrated Multimodal Solutions LLC and author of the Substack newsletter Signals & Switches. Contact him at paul.tonsager@multimodalsolutions.io .

Container lines

Rail and ocean carriers consolidating shipping infrastructure: analyst

<div class="phx-topic abstract-wrapper">An estimated 30% of Asia-Europe air cargo capacity is routed via the Middle East, and with options through the region severely constrained by the US-Iran war, a rush for Asia-Europe air cargo capacity is pushing up prices. </div>

An estimated 30% of Asia-Europe air cargo capacity is routed via the Middle East, and with options through the region severely constrained by the US-Iran war, a rush for Asia-Europe air cargo capacity is pushing up prices.

<div class="phx-topic">Shippers of Asia-Europe air cargo are being hit with a double whammy of rapidly rising freight rates and soaring fuel surcharges as Middle East cargo gets rerouted, China picks up production after Lunar New Year and jet fuel prices double. An estimated 30% of Asia-Europe air cargo is routed via the Middle East, and with options through the region severely constrained by the ongoing US-Iran war, a rush for Asia-Europe air cargo capacity is pushing up rates with hefty fuel surcharges rolled out on top. Niall van de Wouw, air freight officer at rate benchmarking platform Xeneta, said dynamic load factors on the Asia-Europe trade lane rose to 86% last week, up from 80% in the week prior. “That makes it overall a very tight market that will require some creativity to find spare capacity,” he said, but he warned that solutions will come at a price. Ray Zedov, an analyst at Rotate, said some forwarders were employing the creative and costly option of moving cargo from Asia to Europe in the bellies of passenger planes via North America, which was a clear indication there was not enough direct Asia-Europe capacity available. “This routing via North America will be quite expensive given that trans-Pacific carriers were already full on the eastbound routes prior to the war,” he said. While data from Freightos shows spot rates on China-Europe are up about 13% compared with last week, the rates from South Asia to Europe have increased 82% since before the war started. The Baltic Air Index had Singapore outbound rates up 47.6% last week compared with the previous week as Middle East airspace closures drove diversions from Gulf hubs to Asian gateways, tightening capacity. Judah Levine, head of research at Freightos, said rates climbed sharply following the outbreak of war and the airspace closures, but in the last few days prices have leveled off on many lanes. “That may reflect some capacity recovery by Emirates, as well as Etihad, or the addition of direct Asia-Europe capacity by European airlines and carriers from the Far East,” he said. Several freighter operators and integrators have repositioned capacity to serve growing demand on Asia-Europe markets, but a protracted regional conflict could see rates climb even higher. “If this continues, we will see increases of 100% to 200% on the short-term market,” Van de Wouw noted. “In fact, I am picking up anecdotal evidence that this is already happening in selected markets.” <h3>Limited flight availability via Middle East </h3>The war is entering its third week and flights from international carriers remain suspended to the region’s busiest airports of Abu Dhabi, Amman, Bahrain, Doha, Dubai and Tel Aviv. UAE carriers Emirates and Etihad are operating limited flights to the regional hubs of Dubai and Abu Dhabi, and Qatar Cargo, the region’s largest air freight carrier, is not flying in or out of its home base of Doha where Qatari airspace remains closed. Qatar Cargo is the largest air freight operator in the Gulf with a 5.9% share of global capacity, Emirates Skycargo second with 4.9% and Etihad holding a 1.5% share of global capacity, data from air cargo analyst Rotate shows. Total capacity to and from the Middle Eastern airports affected by the US-Iran war is down 90% compared with normal pre-war levels. South Asian origins in particular are heavily dependent on capacity via the Gulf, said Frederic Horst, managing director for Australia-based Trade and Transport Group. He told the Journal of Commerce that 35% of all Indian freight traffic and 46% of cargo traffic from Pakistan and Bangladesh were routed via the Persian Gulf. Kathy Liu, vice president of global sales and marketing at Dimerco Express Group, said with limited opportunity to ship via the main Gulf airports, the market was looking for direct flights from Asia into Europe or services that fly via Asian hubs. “As factories re-open after Chinese New Year, we will see cargo using Middle East carriers in the past moving to Asian hubs including Hong Kong, Taiwan, Singapore, South Korea and Japan,” she told the Journal of Commerce. “That will impact on the first leg of capacity from origins into those hubs and that will squeeze capacity for intra-Asia and trans-Pacific eastbound,” she added. <h3>Fuel surcharges on the rise </h3>Airlines are reviewing their fuel surcharges weekly instead of every month as the war-driven spike in prices piles additional cost on top of what is already a significant portion of a carrier’s expenses. Cathay Pacific’s cargo fuel surcharge will increase from HK$3.20 ($0.41)/kg on March 19 to HK$12.9 ($1.65)/kg from March 20. Lufthansa Cargo raised its air freight surcharge from €0.85 ($0.97)/kg to €1.20 ($1.27)/kg, effective March 16, while IAG Cargo has hedged more than 60% of its fuel for 2026 and has not announced any new fuel surcharge. Jet fuel typically accounts for 20% to 30% of an airline’s total cost base, and with international carriers forced to fly longer distances to avoid Middle East conflict zones with reduced payloads, those costs are mounting fast. “Airspace restrictions or routing adjustments may require airlines to operate longer flight paths between global hubs, increasing fuel demand at a time when supply conditions are already tight,” global forwarder Logfret said in a market update. “This combination of supply constraints and operational adjustments has intensified cost pressures across both passenger and cargo aviation sectors.” Maersk told customers in an advisory Friday that its fuel surcharges will be reviewed on a weekly basis and adjusted in line with developments in aviation fuel prices, based on established market indexes. For contract renewals where no fuel surcharge mechanism is in place, Maersk has proposed that 15% of the rate is allocated to fuel. “At the same time, the evolving situation is placing pressure on global air freight capacity and routing options,” Maersk noted. “As a result, Maersk Air Freight will apply a transit disruption surcharge in respect of the additional costs associated with securing capacity, rerouting shipments and maintaining service continuity on affected operations.” <a href="https://www.joc.com/article/as-war-rages-multimodal-demand-surges-on-asia-europe-landbridge-6185162">Demand is also growing for multimodal alternatives</a>, with road freight being used to move cargo from Asia to Europe and between transport hubs in the Middle East as an alternative to air. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Shippers of Asia-Europe air cargo are being hit with a double whammy of rapidly rising freight rates and soaring fuel surcharges as Middle East cargo gets rerouted, China picks up production after Lunar New Year and jet fuel prices double. An estimated 30% of Asia-Europe air cargo is routed via the Middle East, and with options through the region severely constrained by the ongoing US-Iran war, a rush for Asia-Europe air cargo capacity is pushing up rates with hefty fuel surcharges rolled out on top. Niall van de Wouw, air freight officer at rate benchmarking platform Xeneta, said dynamic load factors on the Asia-Europe trade lane rose to 86% last week, up from 80% in the week prior. “That makes it overall a very tight market that will require some creativity to find spare capacity,” he said, but he warned that solutions will come at a price. Ray Zedov, an analyst at Rotate, said some forwarders were employing the creative and costly option of moving cargo from Asia to Europe in the bellies of passenger planes via North America, which was a clear indication there was not enough direct Asia-Europe capacity available. “This routing via North America will be quite expensive given that trans-Pacific carriers were already full on the eastbound routes prior to the war,” he said. While data from Freightos shows spot rates on China-Europe are up about 13% compared with last week, the rates from South Asia to Europe have increased 82% since before the war started. The Baltic Air Index had Singapore outbound rates up 47.6% last week compared with the previous week as Middle East airspace closures drove diversions from Gulf hubs to Asian gateways, tightening capacity. Judah Levine, head of research at Freightos, said rates climbed sharply following the outbreak of war and the airspace closures, but in the last few days prices have leveled off on many lanes. “That may reflect some capacity recovery by Emirates, as well as Etihad, or the addition of direct Asia-Europe capacity by European airlines and carriers from the Far East,” he said. Several freighter operators and integrators have repositioned capacity to serve growing demand on Asia-Europe markets, but a protracted regional conflict could see rates climb even higher. “If this continues, we will see increases of 100% to 200% on the short-term market,” Van de Wouw noted. “In fact, I am picking up anecdotal evidence that this is already happening in selected markets.” Limited flight availability via Middle East The war is entering its third week and flights from international carriers remain suspended to the region’s busiest airports of Abu Dhabi, Amman, Bahrain, Doha, Dubai and Tel Aviv. UAE carriers Emirates and Etihad are operating limited flights to the regional hubs of Dubai and Abu Dhabi, and Qatar Cargo, the region’s largest air freight carrier, is not flying in or out of its home base of Doha where Qatari airspace remains closed. Qatar Cargo is the largest air freight operator in the Gulf with a 5.9% share of global capacity, Emirates Skycargo second with 4.9% and Etihad holding a 1.5% share of global capacity, data from air cargo analyst Rotate shows. Total capacity to and from the Middle Eastern airports affected by the US-Iran war is down 90% compared with normal pre-war levels. South Asian origins in particular are heavily dependent on capacity via the Gulf, said Frederic Horst, managing director for Australia-based Trade and Transport Group. He told the Journal of Commerce that 35% of all Indian freight traffic and 46% of cargo traffic from Pakistan and Bangladesh were routed via the Persian Gulf. Kathy Liu, vice president of global sales and marketing at Dimerco Express Group, said with limited opportunity to ship via the main Gulf airports, the market was looking for direct flights from Asia into Europe or services that fly via Asian hubs. “As factories re-open after Chinese New Year, we will see cargo using Middle East carriers in the past moving to Asian hubs including Hong Kong, Taiwan, Singapore, South Korea and Japan,” she told the Journal of Commerce. “That will impact on the first leg of capacity from origins into those hubs and that will squeeze capacity for intra-Asia and trans-Pacific eastbound,” she added. Fuel surcharges on the rise Airlines are reviewing their fuel surcharges weekly instead of every month as the war-driven spike in prices piles additional cost on top of what is already a significant portion of a carrier’s expenses. Cathay Pacific’s cargo fuel surcharge will increase from HK$3.20 ($0.41)/kg on March 19 to HK$12.9 ($1.65)/kg from March 20. Lufthansa Cargo raised its air freight surcharge from €0.85 ($0.97)/kg to €1.20 ($1.27)/kg, effective March 16, while IAG Cargo has hedged more than 60% of its fuel for 2026 and has not announced any new fuel surcharge. Jet fuel typically accounts for 20% to 30% of an airline’s total cost base, and with international carriers forced to fly longer distances to avoid Middle East conflict zones with reduced payloads, those costs are mounting fast. “Airspace restrictions or routing adjustments may require airlines to operate longer flight paths between global hubs, increasing fuel demand at a time when supply conditions are already tight,” global forwarder Logfret said in a market update. “This combination of supply constraints and operational adjustments has intensified cost pressures across both passenger and cargo aviation sectors.” Maersk told customers in an advisory Friday that its fuel surcharges will be reviewed on a weekly basis and adjusted in line with developments in aviation fuel prices, based on established market indexes. For contract renewals where no fuel surcharge mechanism is in place, Maersk has proposed that 15% of the rate is allocated to fuel. “At the same time, the evolving situation is placing pressure on global air freight capacity and routing options,” Maersk noted. “As a result, Maersk Air Freight will apply a transit disruption surcharge in respect of the additional costs associated with securing capacity, rerouting shipments and maintaining service continuity on affected operations.” Demand is also growing for multimodal alternatives , with road freight being used to move cargo from Asia to Europe and between transport hubs in the Middle East as an alternative to air. Contact Greg Knowler at greg.knowler@spglobal.com .

Air Cargo Carriers News

Asia-Europe

Air Cargo

Asia-Europe air cargo space tightens as rates, fuel surcharges soar

Use code GTT26W at checkout and save $900 on first year of an annual Gold subscription!

Upgrade Subscription - Gold Trials

Become a Gold Subscriber and Save!

Arm your team with the most trusted information portal for the international container shipping industry.

Group Subscriptions - Wide Box

Get into a group subscription today

Use code FTW25 at checkout to save 25% on a Silver or Silver Plus annual subscription! 

Subscribe Now - FT to S/SP - Wide Box

SUBSCRIBE AND SAVE 25%

Use code GW595 and upgrade to Gold for just $595! Valid for first year of subscription.

Upgrade Subscription - S/SP to Gold - Wide Box

SAVE $900 ON A GOLD SUBSCRIPTION

Choose a subscription plan that works best for you!

Subscribe Now - Anonymous to S/SP - Wide Box

SUBSCRIBE TODAY

Access Journal of Commerce content for 30 days

Free Trial - Wide Box

START A FREE TRIAL TODAY

Use code GW995 at checkout to save $500 on first year of a Gold subscription!

Subscribe Now - FT to Gold - Wide Box

SAVE $500 ON A GOLD SUBSCRIPTION

Subscribe Now - Anonymous to Gold - Wide Box

START A FREE TRIAL: Access Journal of Commerce content for 30 days

Free Trial - Offer Box

Free Trial

SUBSCRIBE AND SAVE 25%: Use code FTW25 to save 25% on first year of a Silver or Silver Plus annual subscription!


Subscribe Now - FT to S/SP - Offer Box

Subscribe and Save

GET INTO A GROUP SUBSCRIPTION: Arm your team with unlimited Journal of Commerce content

Group Subscriptions - Offer Box

Group Subscriptions

SUBSCRIBE TODAY: Choose a subscription plan that works best for you!

Subscribe Now - Anonymous to S/SP - Offer Box

UPGRADE TO GOLD AND SAVE: Use code GTT26W at checkout and save $900 on first year of a Gold subscription!

Upgrade Subscription

Subscribe Now - Anonymous to Gold - Offer Box

SAVE $900 ON A GOLD SUBSCRIPTION: Use code GW595 and upgrade to Gold for just $595! Valid on first year of subscription.

Upgrade Subscription - S/SP to Gold - Offer Box

SAVE $500 ON A GOLD SUBSCRIPTION: Use code GW995 and save $500 on the first year of a Gold subscription!

Subscribe Now - FT to Gold - Offer Box

SUBSCRIBE AND SAVE

Monthly publication providing an editorial deep dive into global supply chain news

Journal of Commerce Magazine - Rectangle Box

Journal of Commerce Magazine

A premium access index of savings using domestic intermodal vs. OTR 

ISI Report - Rectangle Box

Intermodal Savings Index

An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

Breakbulk Report - Rectangle Box

Breakbulk Quarterly

An extensive dashboard of charts organized by trade lane, mode, and topic

Gateway - Rectangle Box

Gateway

Customers scoring their intermodal partners to identify the best service providers

Intermodal Service Scorecard - Rectangle Box

Intermodal Service Scorecard

A premium access outlook critical to shippers and transportation providers

QI Report - Rectangle Box

Quarterly Intelligence

The only editorially independent conference for the breakbulk & project cargo industry

Breakbulk Conference - Rectangle Box

Attend Breakbulk26

The Journal of Commerce’s analysis and coverage of North American and global rail news encompasses Class I railroad, intermodal marketing providers, and supporting drayage and truckload services. Reporting on freight railroad news today, journalists track volume, intermodal freight rates, service levels, precision schedule railroading, transloading, regulation, union labor and network investment at domestic and international intermodal terminals.

International rail

Stay updated with our rail transport news and trends. Journal of Commerce covers intermodal news, and port connectivity news in the container rail transport sector.

Rail News | Journal of Commerce

The Journal of Commerce’s surface transport news and analysis focuses on landside transport movement — from railroad news to trucking news — including full load trucking, less-than-truckload (LTL), refrigerated (or reefer) trucking, flatbed and domestic and international intermodal rail, and how it connects with seaports, inland rail hubs, distribution centers and transloading operations. Reporting on the surface transport sector covers the movement of domestic shipments within the United States and international cargoes transported via domestic equipment including trailers and 53-foot containers.

Discover comprehensive trucking news and trends with Journal of Commerce - from trucking LTL to regulation and trucking supply and demand.

Trucking News | Journal of Commerce

Trucking News

Explore the world of ground transport news - from trucks to railroads, intermodal connections, and port ties. Daily insights on US and global shipments.

Latest News

More News & Analysis

Ocean shipping patterns erode intermodal share from West Coast: analyst

Trans-Pacific contract talks accelerating after Walmart signs

STB declines to intervene on Meridian Speedway dispute