<div class="phx-topic abstract-wrapper">Hurricane Irma’s arrival this weekend threatens to roil US supply chains and seriously impact trucking rates.</div>

Hurricane Irma’s arrival this weekend threatens to roil US supply chains and seriously impact trucking rates.

<div class="phx-topic">Hurricane Irma tossed shipping containers like leaves in the Dutch territory of Sint Maarten.Hurricane Irma’s arrival this weekend threatens to roil US supply chains and double truckload spot rates, with analysts and transport providers warning it could take up to six months to recover.Transportation providers are still reeling from <a href="https://www.joc.com/special-topics/hurricane-harvey">Hurricane Harvey</a>, the Category 3 storm that hit the US Gulf Coast two weeks ago. Category 4 Irma is threatening to tighten road and rail capacity even further, bottleneck traffic into and out of the Southeast, send spot market rates surging, and <a href="https://www.joc.com/port-news/us-ports/southeast-us-ports-shuttering-irma-barrels-down_20170907.html">damage critical infrastructure</a>.“To say that this is going to have huge impacts and it’s going to be a puzzle for supply chain managers, when everything from Memphis to Charlotte is going to be impacted from high winds and rains, is an understatement,” Mark Montague, industry pricing analyst for DAT Solutions, told JOC.com on Friday. “This is unprecedented.”The ports of Miami and Everglades in Florida were closed Friday. The ports of Jacksonville and Savannah were still in operation Friday but scheduled to cease operations by Saturday. While preparations for gale force winds are being made at ports farther north in Charleston and Wilmington, North Carolina, there were no imminent closures as of Friday evening.Should the storm make landfall in South Florida as a Category 4 storm, as expected, and then slowly diminish in size and scale as it moves northwest through the interior Southeast, then at the very least shippers can expect tight capacity and historically higher rates through January of next year, said Troy Cooper, chief operating officer at XPO Logistics, the third-largest US trucking company.“You can never predict what’s going to happen,” Cooper told JOC.com on Friday. “But, I think it’s safe to say it will be very tight through the retail season. You’re going to see this continue into next year.”The full scope of Irma’s impact on rates won’t be known until next week, but spot rates, largely inbound to areas within the storm’s path, are anticipated to jump as high as, if not higher than, they did <a href="https://www.joc.com/trucking-logistics/harvey-adds-tailwind-us-truck-price-hikes_20170830.html">during Harvey</a>.“You probably heard some rates like $5 per mile or that rates were tripling. Certainly some of those could be true. I heard some of those as well,” said Montague. “But overall, rates from say the Dallas-Fort Worth area into the Corpus Christi area were up maybe two times up to $4.55 a mile.”And those are conservative forecasts. Should the storm not diminish as quickly before it reaches the Southeast’s major inland distribution centers of Atlanta; Greenville, South Carolina; and Charlotte, then Irma will threaten both the region’s primary corridors for commerce but also relief efforts, delaying any type recovery for months.“The projections are tropical storm-type weather for even Charlotte, winds around 50 or 70 miles per hour,” said Cooper. And a storm knocking out inland networks isn’t unheard of. “Hurricane Matthew, if you remember last year in North Carolina, there was a lot of stuff inland, off the coast, knocked out in flooding.”It could turn what was a regional disaster from Harvey into a national catastrophe.During Harvey, Montague said, “The Southeast distribution centers led by Atlanta, but also including Greenville, South Carolina and Charlotte and Memphis were sending product westbound to feed Houston. Because of that diversion, they were shipping less into the Northeast, so that burden fell on Midwest distribution centers in Ohio and Chicago, Illinois.”Two of the top US truckload carriers told JOC.com that resources, equipment, and drivers, were stretched to their limit on Friday. According to DAT Solutions, only two US states on Friday were reporting even a sizeable amount of trucking capacity: Arizona and Nebraska, and then only for refrigerated and van cargo. If Southeast logistics centers fall, it could deplete any reserved equipment and manpower nationwide. “Supply chain managers are going to have to get creative,” Montague said.Although the expected direct hit on Florida will be devastating — particularly to Miami — the state isn’t home to many major freight distribution centers.“The main supply chain designed to serve Florida the freight comes out of the Atlanta market. There is some warehousing in central Florida and Tampa and Jacksonville, but the primary place is Atlanta, secondary is Charlotte, tertiary is Nashville or Memphis,” said Montague. “If Atlanta gets hit at the tail end of this storm, that’s really bad news.”There is not a single Florida city in the top 15 US distribution centers, ranked by freight volume. Jacksonville is the top distribution center in Florida and its port handled 2.26 percent of total US containerized imports and exports last year.Florida is not a major supplier of goods to any part of the US outside of produce, and the peak shipping season for those goods is March through May. According to Montague, “There’s virtually nothing that comes out of Florida from July through September.”So the major increase to rates will be for cargo moving into the Southeast. There will be a temporary pause in that traffic over the weekend, as ports shutter and mandatory evacuations in coastal regions east of Interstate 95 take effect. Immediately before and after the storm, however, there has been and will be a surge of cargo on the roads.“When you think about getting on the road, most of those roads are impassable or in traffic,” Cooper said.But according to Montague, “there will be truckers brave enough to go down there.”Shippers are paying dearly for those drivers.Contact Reynolds Hutchins at <a href="mailto:reynolds.hutchins@ihsmarkit.com">reynolds.hutchins@ihsmarkit.com</a> and follow him on Twitter:</div>

Hurricane Irma tossed shipping containers like leaves in the Dutch territory of Sint Maarten. Hurricane Irma’s arrival this weekend threatens to roil US supply chains and double truckload spot rates, with analysts and transport providers warning it could take up to six months to recover. Transportation providers are still reeling from Hurricane Harvey , the Category 3 storm that hit the US Gulf Coast two weeks ago. Category 4 Irma is threatening to tighten road and rail capacity even further, bottleneck traffic into and out of the Southeast, send spot market rates surging, and damage critical infrastructure . “To say that this is going to have huge impacts and it’s going to be a puzzle for supply chain managers, when everything from Memphis to Charlotte is going to be impacted from high winds and rains, is an understatement,” Mark Montague, industry pricing analyst for DAT Solutions, told JOC.com on Friday. “This is unprecedented.” The ports of Miami and Everglades in Florida were closed Friday. The ports of Jacksonville and Savannah were still in operation Friday but scheduled to cease operations by Saturday. While preparations for gale force winds are being made at ports farther north in Charleston and Wilmington, North Carolina, there were no imminent closures as of Friday evening. Should the storm make landfall in South Florida as a Category 4 storm, as expected, and then slowly diminish in size and scale as it moves northwest through the interior Southeast, then at the very least shippers can expect tight capacity and historically higher rates through January of next year, said Troy Cooper, chief operating officer at XPO Logistics, the third-largest US trucking company. “You can never predict what’s going to happen,” Cooper told JOC.com on Friday. “But, I think it’s safe to say it will be very tight through the retail season. You’re going to see this continue into next year.” The full scope of Irma’s impact on rates won’t be known until next week, but spot rates, largely inbound to areas within the storm’s path, are anticipated to jump as high as, if not higher than, they did during Harvey . “You probably heard some rates like $5 per mile or that rates were tripling. Certainly some of those could be true. I heard some of those as well,” said Montague. “But overall, rates from say the Dallas-Fort Worth area into the Corpus Christi area were up maybe two times up to $4.55 a mile.” And those are conservative forecasts. Should the storm not diminish as quickly before it reaches the Southeast’s major inland distribution centers of Atlanta; Greenville, South Carolina; and Charlotte, then Irma will threaten both the region’s primary corridors for commerce but also relief efforts, delaying any type recovery for months. “The projections are tropical storm-type weather for even Charlotte, winds around 50 or 70 miles per hour,” said Cooper. And a storm knocking out inland networks isn’t unheard of. “Hurricane Matthew, if you remember last year in North Carolina, there was a lot of stuff inland, off the coast, knocked out in flooding.” It could turn what was a regional disaster from Harvey into a national catastrophe. During Harvey, Montague said, “The Southeast distribution centers led by Atlanta, but also including Greenville, South Carolina and Charlotte and Memphis were sending product westbound to feed Houston. Because of that diversion, they were shipping less into the Northeast, so that burden fell on Midwest distribution centers in Ohio and Chicago, Illinois.” Two of the top US truckload carriers told JOC.com that resources, equipment, and drivers, were stretched to their limit on Friday. According to DAT Solutions, only two US states on Friday were reporting even a sizeable amount of trucking capacity: Arizona and Nebraska, and then only for refrigerated and van cargo. If Southeast logistics centers fall, it could deplete any reserved equipment and manpower nationwide. “Supply chain managers are going to have to get creative,” Montague said. Although the expected direct hit on Florida will be devastating — particularly to Miami — the state isn’t home to many major freight distribution centers. “The main supply chain designed to serve Florida the freight comes out of the Atlanta market. There is some warehousing in central Florida and Tampa and Jacksonville, but the primary place is Atlanta, secondary is Charlotte, tertiary is Nashville or Memphis,” said Montague. “If Atlanta gets hit at the tail end of this storm, that’s really bad news.” There is not a single Florida city in the top 15 US distribution centers, ranked by freight volume. Jacksonville is the top distribution center in Florida and its port handled 2.26 percent of total US containerized imports and exports last year. Florida is not a major supplier of goods to any part of the US outside of produce, and the peak shipping season for those goods is March through May. According to Montague, “There’s virtually nothing that comes out of Florida from July through September.” So the major increase to rates will be for cargo moving into the Southeast. There will be a temporary pause in that traffic over the weekend, as ports shutter and mandatory evacuations in coastal regions east of Interstate 95 take effect. Immediately before and after the storm, however, there has been and will be a surge of cargo on the roads. “When you think about getting on the road, most of those roads are impassable or in traffic,” Cooper said. But according to Montague, “there will be truckers brave enough to go down there.” Shippers are paying dearly for those drivers. Contact Reynolds Hutchins at reynolds.hutchins@ihsmarkit.com and follow him on Twitter:

Trucking News

Breakbulk News

Container lines

Freight recovery from Irma to last months, spike truck rates

<div class="phx-topic abstract-wrapper">Some ships have been forced to bunker at alternative ports, but the war-driven energy shock hasn’t yet impacted the deployment of tonnage, ocean carriers said at an industry event in Georgia. </div>

Some ships have been forced to bunker at alternative ports, but the war-driven energy shock hasn’t yet impacted the deployment of tonnage, ocean carriers said at an industry event in Georgia.

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<div class="phx-topic">Sea Island, Georgia — Container line executives on Tuesday acknowledged that bunker fuel supplies globally are tightening amid the war-driven energy shock, causing congestion at some fuel hubs and forcing some ships to bunker at alternative ports. But they stopped short of saying there were outright fuels shortages that were impacting services. The tighter supplies are requiring more pre-booking work and coordination, but there haven’t been “shortages per se yet,” Fabio Santucci, president of Mediterranean Shipping Co.’s (MSC) US office, said at the Georgia International Trade Conference. Stuart Sandlin, president of Hapag-Lloyd North America, concurred, adding that while rising fuel costs are a problem, “there weren’t any red flags yet.” Shipping analysts <a href="https://www.joc.com/article/container-shipping-faces-blank-sailings-falling-demand-from-prolonged-iran-war-6208766">have warned</a> that ocean carriers may be forced to blank sailings and even outright cancel services in the coming months if bunker fuel supplies continue to tighten amid the ongoing closure of the Strait of Hormuz, through which 20% of the world’s oil supplies typically transit. For now, the focus for shippers is getting a handle on how much more they’ll be paying for fuel, how those costs are calculated, and how much more energy costs could rise. The roughly doubling of the cost of bunker fuel since the war in the Middle East began in late February has spurred ocean carriers to implement emergency fuel surcharges of hundreds of dollars per container, in addition to raising prices via the quarterly bunker adjustment factor (BAF). Because BAFs won’t reset until July 1, Hapag-Lloyd has so far had to eat the roughly doubling of energy costs, equating to <a href="https://www.joc.com/article/war-adding-40-50-million-per-week-to-hapag-lloyds-costs-ceo-6193532">about $50 million weekly</a>, Sandlin said. “We also [told shippers] that whatever you give us in that emergency fuel surcharge because it's in the rear, when the fuel price goes down, we will also give you back every ounce of money you paid us in the emergency fuel surcharge,’” Sandlin said. “We're not looking to double dip on awards.” <h3>No import cuts yet </h3>Ocean carrier executives said they haven’t seen a pullback in US importing since the war began, but noted 2026 would be a challenging year for volume with zero or minimal trade growth expected. US laden imports were down 5.2% year over year in the first quarter, according to PIERS, a sister product of JOC.com within S&amp;P Global. Still, March imports of 2.33 million TEUs were the highest since last August. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="ca83526a-50c9-4e3b-b637-6bc435f00c93"></dynamic-object></div>Volumes are holding up currently amid seasonal restocking, with major shipper customers saying they are planning for steady shipments for at least the next three months, Sandlin said. “(However), costs are rising much quicker than the revenues for us on the carrier side, and I think that that's a little bit of a risk because you've got to redeploy your assets to make profitable asset utilization,” he said. “If your services start to not be making a lot of money, then I think you have to look and see what that does for the long-term reliability of your import and export supply chains.” Contact Mark Szakonyi at <a href="mailto:mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>. </div>

Sea Island, Georgia — Container line executives on Tuesday acknowledged that bunker fuel supplies globally are tightening amid the war-driven energy shock, causing congestion at some fuel hubs and forcing some ships to bunker at alternative ports. But they stopped short of saying there were outright fuels shortages that were impacting services. The tighter supplies are requiring more pre-booking work and coordination, but there haven’t been “shortages per se yet,” Fabio Santucci, president of Mediterranean Shipping Co.’s (MSC) US office, said at the Georgia International Trade Conference. Stuart Sandlin, president of Hapag-Lloyd North America, concurred, adding that while rising fuel costs are a problem, “there weren’t any red flags yet.” Shipping analysts have warned that ocean carriers may be forced to blank sailings and even outright cancel services in the coming months if bunker fuel supplies continue to tighten amid the ongoing closure of the Strait of Hormuz, through which 20% of the world’s oil supplies typically transit. For now, the focus for shippers is getting a handle on how much more they’ll be paying for fuel, how those costs are calculated, and how much more energy costs could rise. The roughly doubling of the cost of bunker fuel since the war in the Middle East began in late February has spurred ocean carriers to implement emergency fuel surcharges of hundreds of dollars per container, in addition to raising prices via the quarterly bunker adjustment factor (BAF). Because BAFs won’t reset until July 1, Hapag-Lloyd has so far had to eat the roughly doubling of energy costs, equating to about $50 million weekly , Sandlin said. “We also [told shippers] that whatever you give us in that emergency fuel surcharge because it's in the rear, when the fuel price goes down, we will also give you back every ounce of money you paid us in the emergency fuel surcharge,’” Sandlin said. “We're not looking to double dip on awards.” No import cuts yet Ocean carrier executives said they haven’t seen a pullback in US importing since the war began, but noted 2026 would be a challenging year for volume with zero or minimal trade growth expected. US laden imports were down 5.2% year over year in the first quarter, according to PIERS, a sister product of JOC.com within S&P Global. Still, March imports of 2.33 million TEUs were the highest since last August. Volumes are holding up currently amid seasonal restocking, with major shipper customers saying they are planning for steady shipments for at least the next three months, Sandlin said. “(However), costs are rising much quicker than the revenues for us on the carrier side, and I think that that's a little bit of a risk because you've got to redeploy your assets to make profitable asset utilization,” he said. “If your services start to not be making a lot of money, then I think you have to look and see what that does for the long-term reliability of your import and export supply chains.” Contact Mark Szakonyi at  mark.szakonyi@spglobal.com .

Container Shipping News

Maritime

Tighter bunker supplies raising costs, but not impacting service: ocean carriers

<div class="phx-topic abstract-wrapper">Baker Hughes, Halliburton and SLB, key drivers of oil and gas project cargoes, say infrastructure repair in the Middle East and supply diversification moves outside the region should result in a heavy book of post-war work.</div>

Baker Hughes, Halliburton and SLB, key drivers of oil and gas project cargoes, say infrastructure repair in the Middle East and supply diversification moves outside the region should result in a heavy book of post-war work.

<div class="phx-topic">Despite supply chain disruptions and logistics cost increases caused by US-Israeli war against Iran and subsequent closure of the Strait of Hormuz, the world’s three largest oilfield services providers are forecasting a windfall of oil and gas projects in the coming years. Should they materialize, the projects would result in a flood of orders for industrial project cargo and breakbulk steel shipments globally. Executives with Baker Hughes, Halliburton and SLB echoed one another’s market outlook that came in their latest quarterly earnings statements, all of which were released in late April. The three Houston-based companies, key drivers of oil and gas project cargoes, face significant exposure to market volatility in the Middle East. During his company’s first-quarter earnings call April 24, SLB CEO Olivier Le Peuch said the global oil and gas supply has lost over 500 million barrels of oil production because of the conflict. “In this environment, energy security remains at the forefront,” Le Peuch said. “We expect many countries to accelerate efforts to diversify supply, strengthen domestic resource development and rebuild strategic and commercial inventories that have been drawn down during the conflict.” War-related disruptions in the Middle East — including energy infrastructure shutdowns in Qatar and Iraq and operational interruptions throughout the region — took a toll on SLB in the first quarter. Net income fell 6% year on year to $752 million, and SLB said its earnings are expected to decrease by 6 to 8 cents per share in the second quarter compared to Q1. Le Peuch cited three primary drivers of global energy projects for 2027 and 2028: the replenishment of depleted oil and gas inventories, the diversification of supply, and countries investing in local oil and gas projects to support long-term energy independence. “The fragility of the global energy complex we are witnessing today demonstrates the strategic importance and long-term value of oil and gas,” he said. <h3>Halliburton looks to long game </h3>Halliburton expects the Iran conflict to drive long-term growth from countries seeking energy security through investments in their own oil and gas projects. The company’s net income for the first quarter shot up 126% over last year to $461 million, or 55 cents per share. But citing rising costs for supply chain logistics and fuel, Halliburton said the company expects a decline of 7 to 9 cents per share in the second quarter compared to the first. “The closure of the Strait (of Hormuz) has resulted in our use of alternative supply chain routes, which has increased logistics costs,” Halliburton COO Shannon Slocum said during the company’s April 21 first-quarter earnings call. “We have also seen price increases in purchased materials and supplies related to the conflict.” Halliburton CEO Jeffrey Miller said the conflict has eliminated the supply overhang for global oil and gas markets. With that, energy security has become a core priority fueling project investments and oilfield services activity. “The world is fundamentally tighter in oil and gas than it was 60 days ago,” Miller said on the earnings call. He said the market trend supports a stronger environment for countries to invest in localized oil and gas projects to ensure a reliable energy supply while reducing dependency on shipments from the Middle East. The recent geopolitical disruptions are also creating an urgency to diversify in countries without their own oil and gas resources. “Energy security is no longer a talking point,” Miller said. “That is going to drive activity, and I think that change is not temporal, but a solid few years.” <h3>Baker Hughes eyes broader project mix </h3>Baker Hughes expects the spike in global demand for oil and gas to accompany an already full slate of projects in multiple sectors. The war has significantly obstructed global liquefied natural gas (LNG) markets, with 20% of worldwide LNG capacity now offline, CEO Lorenzo Simonelli said during the company’s April 24 first-quarter earnings call. “The recent infrastructure damage in the region and the effective closure of the Strait of Hormuz have materially constrained the LNG market’s ability to respond to growing demand, likely to result in a supply shortfall this year,” he said. Diversification worked to Baker Hughes’ advantage in the first quarter, as earnings increased 14% to 58 cents per share while project orders grew 26% year over year to $8.2 billion. That included $4.9 billion in orders for industrial and energy technology projects such as LNG infrastructure, industrial decarbonization, and gas turbines. Power systems, including equipment to support data centers, continue to drive growth and accounted for $1.4 billion of those new orders. “Global power demand is in a multi-year growth cycle, and it’s important to remember we’re only in the early stages,” Simonelli said, citing projections that power demand will double by 2040, driven by factors such as data centers, digital infrastructure expansion, and industrial energy transition projects. Contact Autumn Cafiero Giusti at <a href="mailto:autumn@autumngiusti.com">autumn@autumngiusti.com</a>. </div>

Despite supply chain disruptions and logistics cost increases caused by US-Israeli war against Iran and subsequent closure of the Strait of Hormuz, the world’s three largest oilfield services providers are forecasting a windfall of oil and gas projects in the coming years. Should they materialize, the projects would result in a flood of orders for industrial project cargo and breakbulk steel shipments globally. Executives with Baker Hughes, Halliburton and SLB echoed one another’s market outlook that came in their latest quarterly earnings statements, all of which were released in late April. The three Houston-based companies, key drivers of oil and gas project cargoes, face significant exposure to market volatility in the Middle East. During his company’s first-quarter earnings call April 24, SLB CEO Olivier Le Peuch said the global oil and gas supply has lost over 500 million barrels of oil production because of the conflict. “In this environment, energy security remains at the forefront,” Le Peuch said. “We expect many countries to accelerate efforts to diversify supply, strengthen domestic resource development and rebuild strategic and commercial inventories that have been drawn down during the conflict.” War-related disruptions in the Middle East — including energy infrastructure shutdowns in Qatar and Iraq and operational interruptions throughout the region — took a toll on SLB in the first quarter. Net income fell 6% year on year to $752 million, and SLB said its earnings are expected to decrease by 6 to 8 cents per share in the second quarter compared to Q1. Le Peuch cited three primary drivers of global energy projects for 2027 and 2028: the replenishment of depleted oil and gas inventories, the diversification of supply, and countries investing in local oil and gas projects to support long-term energy independence. “The fragility of the global energy complex we are witnessing today demonstrates the strategic importance and long-term value of oil and gas,” he said. Halliburton looks to long game Halliburton expects the Iran conflict to drive long-term growth from countries seeking energy security through investments in their own oil and gas projects. The company’s net income for the first quarter shot up 126% over last year to $461 million, or 55 cents per share. But citing rising costs for supply chain logistics and fuel, Halliburton said the company expects a decline of 7 to 9 cents per share in the second quarter compared to the first. “The closure of the Strait (of Hormuz) has resulted in our use of alternative supply chain routes, which has increased logistics costs,” Halliburton COO Shannon Slocum said during the company’s April 21 first-quarter earnings call. “We have also seen price increases in purchased materials and supplies related to the conflict.” Halliburton CEO Jeffrey Miller said the conflict has eliminated the supply overhang for global oil and gas markets. With that, energy security has become a core priority fueling project investments and oilfield services activity. “The world is fundamentally tighter in oil and gas than it was 60 days ago,” Miller said on the earnings call. He said the market trend supports a stronger environment for countries to invest in localized oil and gas projects to ensure a reliable energy supply while reducing dependency on shipments from the Middle East. The recent geopolitical disruptions are also creating an urgency to diversify in countries without their own oil and gas resources. “Energy security is no longer a talking point,” Miller said. “That is going to drive activity, and I think that change is not temporal, but a solid few years.” Baker Hughes eyes broader project mix Baker Hughes expects the spike in global demand for oil and gas to accompany an already full slate of projects in multiple sectors. The war has significantly obstructed global liquefied natural gas (LNG) markets, with 20% of worldwide LNG capacity now offline, CEO Lorenzo Simonelli said during the company’s April 24 first-quarter earnings call. “The recent infrastructure damage in the region and the effective closure of the Strait of Hormuz have materially constrained the LNG market’s ability to respond to growing demand, likely to result in a supply shortfall this year,” he said. Diversification worked to Baker Hughes’ advantage in the first quarter, as earnings increased 14% to 58 cents per share while project orders grew 26% year over year to $8.2 billion. That included $4.9 billion in orders for industrial and energy technology projects such as LNG infrastructure, industrial decarbonization, and gas turbines. Power systems, including equipment to support data centers, continue to drive growth and accounted for $1.4 billion of those new orders. “Global power demand is in a multi-year growth cycle, and it’s important to remember we’re only in the early stages,” Simonelli said, citing projections that power demand will double by 2040, driven by factors such as data centers, digital infrastructure expansion, and industrial energy transition projects. Contact Autumn Cafiero Giusti at autumn@autumngiusti.com .

Energy projects

Project cargo

Supply chain

Oilfield services majors bank on flood of oil, gas projects linked to Iran war

<div class="phx-topic abstract-wrapper">STG’s deal with a group of lenders who filed a lawsuit in New York last year clears the way for it to emerge from bankruptcy as the company has benefited from the rebound in intermodal demand.</div>

STG’s deal with a group of lenders who filed a lawsuit in New York last year clears the way for it to emerge from bankruptcy as the company has benefited from the rebound in intermodal demand.

<div class="phx-topic">STG Logistics has cleared the last major obstacle to emerging from Chapter 11 bankruptcy next month after reaching a settlement with a group of minority lenders that had challenged its restructuring. The settlement removes the last serious challenge to STG’s reorganization and leaves the company positioned to exit bankruptcy with customers, and freight volumes, largely intact. STG, which provides transloading, drayage, and domestic intermodal services, has met all the financial commitments made when it filed for Ch. 11 bankruptcy protection in January. Those included maintaining more than $50 million in cash and staying within budget targets for revenue and expenses over the past three months. The company increased volume year over year in the first quarter in Southern California, based on data from RailState, suggesting customers did not pull back business during the restructuring. The company is the fifth-largest US domestic intermodal provider, with 15,000 containers and about $720 million in annual revenue, according to an analysis of bankruptcy filings. STG also benefited from a broader rebound in intermodal demand as March was the <a href="https://www.joc.com/article/strong-march-volumes-give-intermodal-its-first-real-stress-test-in-years-6205604">third-strongest month on record for intermodal volume</a>, according to the Intermodal Association of North America (IANA). The settlement ends a bitter fight that played out over the last two years. After expanding rapidly during the pandemic-related freight boom, including its 2022 purchase of XPO Logistics’ intermodal division, STG entered the freight downturn with too much debt. The company restructured its debt and shifted valuable assets backing older loans into a new entity beyond the reach of some existing lenders, according to Axos and Siemens, who filed a lawsuit in New York last year. In January, Axos and Siemens scored an important win when a New York court ruled that the claims against STG could move forward. Less than a week later, STG filed for bankruptcy in New Jersey, moving the fight into bankruptcy court. Axos and Siemens continued to object, but the settlement has now resolved that challenge. Terms of the agreement were not disclosed. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

STG Logistics has cleared the last major obstacle to emerging from Chapter 11 bankruptcy next month after reaching a settlement with a group of minority lenders that had challenged its restructuring. The settlement removes the last serious challenge to STG’s reorganization and leaves the company positioned to exit bankruptcy with customers, and freight volumes, largely intact. STG, which provides transloading, drayage, and domestic intermodal services, has met all the financial commitments made when it filed for Ch. 11 bankruptcy protection in January. Those included maintaining more than $50 million in cash and staying within budget targets for revenue and expenses over the past three months. The company increased volume year over year in the first quarter in Southern California, based on data from RailState, suggesting customers did not pull back business during the restructuring. The company is the fifth-largest US domestic intermodal provider, with 15,000 containers and about $720 million in annual revenue, according to an analysis of bankruptcy filings. STG also benefited from a broader rebound in intermodal demand as March was the third-strongest month on record for intermodal volume , according to the Intermodal Association of North America (IANA). The settlement ends a bitter fight that played out over the last two years. After expanding rapidly during the pandemic-related freight boom, including its 2022 purchase of XPO Logistics’ intermodal division, STG entered the freight downturn with too much debt. The company restructured its debt and shifted valuable assets backing older loans into a new entity beyond the reach of some existing lenders, according to Axos and Siemens, who filed a lawsuit in New York last year. In January, Axos and Siemens scored an important win when a New York court ruled that the claims against STG could move forward. Less than a week later, STG filed for bankruptcy in New Jersey, moving the fight into bankruptcy court. Axos and Siemens continued to object, but the settlement has now resolved that challenge. Terms of the agreement were not disclosed. Contact Ari Ashe at ari.ashe@spglobal.com .

Port News

Rail News

Drayage

Truckload

Intermodal providers

Surface

STG clears final obstacle to exit bankruptcy as lender dispute ends

<div class="phx-topic abstract-wrapper">The truckload provider slashed its logistics division’s third-party carrier pool by 30% in the first quarter amid growing attention to truck safety nationwide and a federal crackdown on truck driver licensing. </div>

The truckload provider slashed its logistics division’s third-party carrier pool by 30% in the first quarter amid growing attention to truck safety nationwide and a federal crackdown on truck driver licensing.

<div class="phx-topic">Knight-Swift Transportation Holdings is making deep cuts in its brokerage carrier base, targeting businesses that company officials say may be unsafe. “We have cut down the number of carriers that we work with dramatically,” Adam Miller, CEO of the truckload and less-than-truckload (LTL) provider, told Wall Street analysts during the company’s first-quarter earnings call last week. “Just since the beginning of this year, we’re down 30% and we had made a large cut even earlier last year,” Miller said. The cuts at Knight-Swift come amid growing attention to truck safety nationwide, allegations of widespread illegal trucking and <a href="https://www.joc.com/article/usdot-releases-interim-final-rule-on-non-domiciled-cdl-holders-6169023">a federal crackdown on truck driver licensing</a>. “We felt it was prudent for us to take the steps to eliminate capacity that we didn’t feel comfortable with,” Miller said. “And do I think others will do that? I think some will.” Knight-Swift, which reported $7.5 billion in total revenue last year, had $127.6 million in logistics revenue, largely brokerage-based business, in the first quarter. That revenue was down 9.9% from a year earlier, driven by an 18.9% decline in load counts. <h3>Growing pressure to tighten standards </h3>Brokerages and carriers such as Knight-Swift that operate brokerages as part of a transportation portfolio are under growing pressure to tighten standards used to vet carriers. The US Supreme Court is currently considering a case that could determine what level of <a href="https://www.scotusblog.com/2026/02/court-to-consider-whether-freight-brokers-can-be-held-liable-for-negligent-hiring/">legal liability</a> brokerages bear when contracting with asset-based trucking firms. <a href="https://www.cbsnews.com/news/how-dangerous-trucking-schemes-putting-americans-at-risk-60-minutes-transcript/">Recent media coverage</a> about illegal trucking and unsafe carriers has heightened public attention on how brokers vet the carriers they select to haul freight. “We have taken a great number of steps to really ensure that we have high-quality, safe carriers,” Miller said during the conference call. “We vet how long you've been in business. We're looking at evidence that you have logs that we could see where your tractors are.” A real challenge for brokers and shippers, he said, is identifying and monitoring who is driving a brokered truck. “The broker has no idea, in most cases,” said Miller. “We are taking steps to ensure we have a copy of the license, [that] we know who’s in the truck, especially if they’re going to operate and leverage one of our trailers,” he added. In doing so, Knight-Swift is going well beyond basic legal requirements that a freight broker select trucking firms with active operating authority and motor carrier insurance. That’s a decision more brokers and carriers are going to face, said Miller, as a regulatory crackdown on truck driver licensing eliminates more capacity. “Some logistics companies may not have a choice because the capacity they’re leveraging today won’t exist,” he said. “We’re anticipating that our customers are going to start being more concerned about this as this becomes more of a relevant issue,” Miller said. “We’re already seeing that.” Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. </div>

Knight-Swift Transportation Holdings is making deep cuts in its brokerage carrier base, targeting businesses that company officials say may be unsafe. “We have cut down the number of carriers that we work with dramatically,” Adam Miller, CEO of the truckload and less-than-truckload (LTL) provider, told Wall Street analysts during the company’s first-quarter earnings call last week. “Just since the beginning of this year, we’re down 30% and we had made a large cut even earlier last year,” Miller said. The cuts at Knight-Swift come amid growing attention to truck safety nationwide, allegations of widespread illegal trucking and a federal crackdown on truck driver licensing . “We felt it was prudent for us to take the steps to eliminate capacity that we didn’t feel comfortable with,” Miller said. “And do I think others will do that? I think some will.” Knight-Swift, which reported $7.5 billion in total revenue last year, had $127.6 million in logistics revenue, largely brokerage-based business, in the first quarter. That revenue was down 9.9% from a year earlier, driven by an 18.9% decline in load counts. Growing pressure to tighten standards Brokerages and carriers such as Knight-Swift that operate brokerages as part of a transportation portfolio are under growing pressure to tighten standards used to vet carriers. The US Supreme Court is currently considering a case that could determine what level of legal liability brokerages bear when contracting with asset-based trucking firms. Recent media coverage about illegal trucking and unsafe carriers has heightened public attention on how brokers vet the carriers they select to haul freight. “We have taken a great number of steps to really ensure that we have high-quality, safe carriers,” Miller said during the conference call. “We vet how long you've been in business. We're looking at evidence that you have logs that we could see where your tractors are.” A real challenge for brokers and shippers, he said, is identifying and monitoring who is driving a brokered truck. “The broker has no idea, in most cases,” said Miller. “We are taking steps to ensure we have a copy of the license, [that] we know who’s in the truck, especially if they’re going to operate and leverage one of our trailers,” he added. In doing so, Knight-Swift is going well beyond basic legal requirements that a freight broker select trucking firms with active operating authority and motor carrier insurance. That’s a decision more brokers and carriers are going to face, said Miller, as a regulatory crackdown on truck driver licensing eliminates more capacity. “Some logistics companies may not have a choice because the capacity they’re leveraging today won’t exist,” he said. “We’re anticipating that our customers are going to start being more concerned about this as this becomes more of a relevant issue,” Miller said. “We’re already seeing that.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

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Knight-Swift making safety-related cuts to brokerage fleet

<div class="phx-topic abstract-wrapper">The near-term view for the industry is heavily dependent on how quickly the war in the Middle East is resolved, experts said at the Journal of Commerce’s Breakbulk and Project Cargo Conference 2026.</div>

The near-term view for the industry is heavily dependent on how quickly the war in the Middle East is resolved, experts said at the Journal of Commerce’s Breakbulk and Project Cargo Conference 2026.

<div class="phx-topic">The mix of industrial sectors that drive project cargo and breakbulk demand could well shift toward electrification and renewable energy in the coming years, but the industry is still driven by the oil and gas sectors despite fresh headwinds caused by the war in the Middle East. That sentiment, laid out in detail at the Journal of Commerce’s Breakbulk and Project Cargo Conference 2026 in New Orleans last week, cuts against the notion that service providers are totally consumed with data center construction. Tim Killen, head of growth at forwarder Fracht, said oil and gas still represents 25% of the planned capital expenditure investment for new projects globally over the next decade, compared with 8% to 10% for data centers, the sixth-highest project category. “We’ve had a lot of conversations over the last two days in terms of power generation and data centers,” Killen said at the conference. “But let’s recognize that both for North America and globally, oil and gas is critical. So we’re still focusing on that.” Among the sectors sandwiched between oil and gas and data centers that are driving new project capex are transformers, which Killen said has seen 300% growth in the last five years; infrastructure, such as bridges and water projects; and renewable energy, which accounts for 15% of capex for new projects. Cyril Varghese, global logistics director at Fluor, said the biggest issue clouding any outlook by project shippers, forwarders or carriers right now is not knowing how long the war in the Middle East will last. “What are the trickle effects going to be?” he said at Breakbulk26. “What is the trade reconfiguration going to look like? How much is protectionism and all countries trying to have a trade surplus or a balanced trade book impact your cargo movements across the globe?” Varghese said he is focused on what a prolonged conflict does to global GDP growth. “When you look at the [International Monetary Fund’s] World Economic Outlook, the recalibrated baseline for global growth is in the range of 3.1% for ’26 and 3.2% for ’27,” he said. “Now that’s in a baseline scenario, assuming that the conflict ends soon. A severe scenario takes the growth global growth rate to 2.5% and 2.2%.” Varghese’s contention is that carriers should be careful to not over-order breakbulk and multipurpose vessels with that uncertainty hanging over the industry, especially because new vessels entering the fleet tend to be able to carry more cargo than ones exiting the fleet. “If the overall [economic] growth slows down, and if there is more protectionism, which is coming, and if the industry just becomes sluggish, I think we would be prudent in terms of not going into an expansion spree,” he said. <h3>‘Flexibility crisis’ </h3>A more near-term issue is whether disruption to the supply of bunker fuel at key ports, especially in Asia, extends transit times and increases costs for projects. “On paper everything looks fine,” Melanie Drehkopf, chief commercial officer at dship Carriers, told the conference when asked about bunker availability. “In practice it’s getting tighter. There are longer lead times and you cannot just order bunker as you did before. The pricing validity window is shrinking, so if you have an offer, you better jump on it. Our flexibility is getting less and less, which means switching cargoes from one ship to another is harder.” Drehkopf said the industry doesn’t have a supply crisis yet, “but we have a flexibility crisis, especially in heavy-lift, where you don’t have regular ports.” Looking further out, she said if the war persists for another month and continues to curtail fuel supply through the Strait of Hormuz, lead times will get longer. “It’s all a big question mark,” Drehkopf said. “I don’t think it’s going to get better. I don’t think it will idle capacity, but maybe you need to wait two, three, or four days to get the bunkers you need. There are already bottlenecks of some commodities due to a mismatch of vessels and specific commodities.” Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

The mix of industrial sectors that drive project cargo and breakbulk demand could well shift toward electrification and renewable energy in the coming years, but the industry is still driven by the oil and gas sectors despite fresh headwinds caused by the war in the Middle East. That sentiment, laid out in detail at the Journal of Commerce’s Breakbulk and Project Cargo Conference 2026 in New Orleans last week, cuts against the notion that service providers are totally consumed with data center construction. Tim Killen, head of growth at forwarder Fracht, said oil and gas still represents 25% of the planned capital expenditure investment for new projects globally over the next decade, compared with 8% to 10% for data centers, the sixth-highest project category. “We’ve had a lot of conversations over the last two days in terms of power generation and data centers,” Killen said at the conference. “But let’s recognize that both for North America and globally, oil and gas is critical. So we’re still focusing on that.” Among the sectors sandwiched between oil and gas and data centers that are driving new project capex are transformers, which Killen said has seen 300% growth in the last five years; infrastructure, such as bridges and water projects; and renewable energy, which accounts for 15% of capex for new projects. Cyril Varghese, global logistics director at Fluor, said the biggest issue clouding any outlook by project shippers, forwarders or carriers right now is not knowing how long the war in the Middle East will last. “What are the trickle effects going to be?” he said at Breakbulk26. “What is the trade reconfiguration going to look like? How much is protectionism and all countries trying to have a trade surplus or a balanced trade book impact your cargo movements across the globe?” Varghese said he is focused on what a prolonged conflict does to global GDP growth. “When you look at the [International Monetary Fund’s] World Economic Outlook, the recalibrated baseline for global growth is in the range of 3.1% for ’26 and 3.2% for ’27,” he said. “Now that’s in a baseline scenario, assuming that the conflict ends soon. A severe scenario takes the growth global growth rate to 2.5% and 2.2%.” Varghese’s contention is that carriers should be careful to not over-order breakbulk and multipurpose vessels with that uncertainty hanging over the industry, especially because new vessels entering the fleet tend to be able to carry more cargo than ones exiting the fleet. “If the overall [economic] growth slows down, and if there is more protectionism, which is coming, and if the industry just becomes sluggish, I think we would be prudent in terms of not going into an expansion spree,” he said. ‘Flexibility crisis’ A more near-term issue is whether disruption to the supply of bunker fuel at key ports, especially in Asia, extends transit times and increases costs for projects. “On paper everything looks fine,” Melanie Drehkopf, chief commercial officer at dship Carriers, told the conference when asked about bunker availability. “In practice it’s getting tighter. There are longer lead times and you cannot just order bunker as you did before. The pricing validity window is shrinking, so if you have an offer, you better jump on it. Our flexibility is getting less and less, which means switching cargoes from one ship to another is harder.” Drehkopf said the industry doesn’t have a supply crisis yet, “but we have a flexibility crisis, especially in heavy-lift, where you don’t have regular ports.” Looking further out, she said if the war persists for another month and continues to curtail fuel supply through the Strait of Hormuz, lead times will get longer. “It’s all a big question mark,” Drehkopf said. “I don’t think it’s going to get better. I don’t think it will idle capacity, but maybe you need to wait two, three, or four days to get the bunkers you need. There are already bottlenecks of some commodities due to a mismatch of vessels and specific commodities.” Contact Eric Johnson at eric.johnson@spglobal.com .

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Oil supply worries, economic uncertainty cloud outlook for breakbulk sector

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