<div class="phx-topic abstract-wrapper">Four EPC majors — Fluor, KBR, TechnipFMC and Worley — reported double-digit growth in order backlogs and say they are optimistic about continued revenue momentum into 2024. </div>

Four EPC majors — Fluor, KBR, TechnipFMC and Worley — reported double-digit growth in order backlogs and say they are optimistic about continued revenue momentum into 2024.

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<div>The breakbulk and project cargo sector has a busy schedule ahead based on the latest earnings reports from engineering, procurement and construction (EPC) contractors. Despite mixed profit results, the latest earnings period brought revenue gains for four major EPCs: Fluor, KBR, TechnipFMC and Worley. All four companies reported double-digit growth in order backlogs and say they are optimistic about continued revenue momentum into 2024. <h2>Sustainability powers Worley </h2>Sustainability projects helped boost revenues and turn around profits for Australian-based energy services group Worley in its latest half-year earnings period, the company reported Feb. 28. For the six months ending Dec. 31,...

The breakbulk and project cargo sector has a busy schedule ahead based on the latest earnings reports from engineering, procurement and construction (EPC) contractors. Despite mixed profit results, the latest earnings period brought revenue gains for four major EPCs: Fluor, KBR, TechnipFMC and Worley. All four companies reported double-digit growth in order backlogs and say they are optimistic about continued revenue momentum into 2024. Sustainability powers Worley Sustainability projects helped boost revenues and turn around profits for Australian-based energy services group Worley in its latest half-year earnings period, the company reported Feb. 28. For the six months ending Dec. 31, Worley’s revenues rose 13% to $4 billion, while the company reported a $69 million profit, compared with last year’s $64.4 million loss for the same six-month period. The company also reported a $9.6 billion backlog, up 11% over the past 12 months, and is projecting revenue and procurement volume growth for 2024. However, Worley’s profit rebound took a hit as the company wrote off $37.8 million it was owed for services the company provided to a state-owned oil and gas firm in Ecuador. Revenue growth extended across all three of Worley’s segments — energy, chemicals and resources — with the strongest performance coming from its energy segment amid the company’s overall shift toward sustainability-focused projects. Those accounted for $1.9 billion of revenue, up 61% from a year ago and marking about half of the company’s revenues. Worley has set a goal of deriving 75% of its revenues from sustainability-related work by 2026. “Our ongoing project awards are evidence of our customers’ trust in us to develop, construct and maintain their infrastructure assets as well as help them on their journey towards a zero-carbon future,” CEO Chris Ashton said during the earnings call. Backlogs bolster Fluor Texas-based Fluor Corp. closed out 2023 with revenue gains and a higher backlog, although the company posted a $21 million loss in the fourth quarter, versus $9 million in profits for the same period last year. Full-year profits narrowed to $139 million, down 4% from 2022. The firm attributed the fourth-quarter loss to a $69 million settlement of claims related to work on the Gordie Howe International Bridge linking Detroit and Windsor, Ontario. Fluor also lost $93 million on the fourth-quarter sale of its Stork Latin America business. The company expects to close the transaction in the first quarter of 2024. Fluor reported on Feb. 20 that fourth-quarter revenues increased 3% to $3.8 billion, compared with the same period of 2022, while full-year revenues rose 13% to $15.5 billion. The revenue gains stemmed from growth in the company’s energy solutions segment, its missions solutions business serving the defense market and its urban solutions business for sectors including technology, manufacturing and mining. The company’s order backlog grew 13% to $29.4 billion in 2023, marking a double-digit increase for the second consecutive year. Fluor anticipates that this double-digit revenue growth will continue into 2024. For the quarter, Fluor reported $19.5 billion in new awards, including a $1.7 billion EPC contract for H2 Green Steel in Sweden and a $1.3 billion contract for a chemical project in Poland. “In 2023, we not only reached but surpassed a critical inflection point on our journey to solidifying our position as a technical solutions leader in the global engineering and construction industry,” CEO and chairman David Constable said in the company’s earnings statement. Mixed results for KBR Houston-based KBR posted revenue growth but shrinking fourth-quarter profits and a loss for the year, according to the company’s Feb. 20 earnings report. The company’s net income fell 77% to $21 million in the fourth quarter. For the year, KBR posted a $265 million loss, a reversal from its $190 million in net income the previous year. The company attributed the loss to debt and legal settlements. However, revenues topped $1.7 billion for the fourth quarter, up 8% from the same time frame in 2022. KBR attributed the revenue buildup to heightened demand in its sustainable technology segment and growth across defense and intelligence, science and space and international work in its government solutions segment. Full-year revenues totaled $7 billion, marking a 6% increase. KBR projects that its 2024 revenues will grow to between $7.4 billion and $7.7 billion. “We achieved an industry leading safety record, met or exceeded our key financial metrics and delivered a 10% increase in backlog and options in 2023,” KBR CEO Stuart Bradie said, referencing the company’s $21.7 billion order backlog for the year. ‘Unprecedented’ development drives TechnipFMC Thanks to improved performance in its subsea and surface technologies segments, multinational energy services contractor TechnipFMC posted quarterly and full-year gains across the board, the company reported in its latest earnings statements. Technip turned around its losses from the previous year, posting a $56.2 million profit in 2023 and a $53 million quarterly profit. In 2022, the company lost $26.7 million in the fourth quarter and $62 million for the full year. Revenues showed double-digit growth for both the quarter and the year, climbing 23% to $2.1 billion in the fourth quarter and 17% to $7.8 billion for all of 2023. “Any way you look at it, 2023 was a period of strong growth for our company,” CEO Doug Pferdehirt said during the company’s Feb. 22 earnings call. The company’s $13.2 billion backlog for the fiscal year represents a 41% spike from 2022. Orders in the company’s subsea segment grew 45% to $9.7 billion in 2023. The company raised its expectations for subsea orders by 20% to $30 billion over the three-year period ending in 2025. “We have entered an unprecedented time for the development of conventional energy resources, particularly offshore,” Pferdehirt said in the company’s earnings statement. He cited three major trends driving that development: a shift in the flow of global capital, an increased role for new technologies and an expanded role for subsea services driven by the needs of growing and aging infrastructure. Contact Autumn Cafiero Giusti at autumn@autumngiusti.com .

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Growing project backlogs a silver lining for EPCs amid mixed profit results

<div class="phx-topic abstract-wrapper">The service disruptions come as freight tracking platform Vizion said Friday there has been an 81% drop in daily bookings placed by shippers looking to import goods into key Persian Gulf ports.</div>

The service disruptions come as freight tracking platform Vizion said Friday there has been an 81% drop in daily bookings placed by shippers looking to import goods into key Persian Gulf ports.

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<div class="phx-topic">Gemini Cooperation is suspending some Middle East services, including those to Europe and Asia as well as regional shuttles, due to the ongoing war in the region. The alliance is also adding a new Asia-Europe loop that would partially replace the suspended east-west services, partners Maersk and Hapag-Lloyd said Friday. Maersk said the suspensions are being made “following our latest risk assessment and operational review and considering the escalating conflict affecting safe navigation in the Gulf region.” ”This decision has been taken as a precautionary measure to ensure the safety of our personnel and vessels while minimizing operational disruption across our wider network,” the carrier added in its advisory. The service disruptions come as freight tracking platform Vizion said Friday there has been an 81% drop in daily bookings placed by shippers looking to import goods into key Persian Gulf ports including Jebel Ali, Dammam, Umm Qasr, Sohar, Khalifa, Sharjah, and Al Jubail. Container ports in the Gulf usually book 3.4 million TEUs per year with an estimated cargo value of $140 billion, according to Vizion's Tradeview platform. The Gemini partners said two mainline services — ME11/IMX linking the Middle East, India and the Mediterranean and FM1/AGX linking Asia and the Middle East — would be halted starting next week. But a new AE19/SE4 service would be launched from March 13 that would replace most of the Asia port calls lost with the suspension of the FM1/AGX. Maersk said the westbound FM1 service being operated by the 10,100-TEU Vung Tau Express would terminate at Tanjung Pelepas in Malaysia on March 9 while the ME11 served by the 15,100-TEU Astrid Maersk would be curtailed at Salalah in Oman on March 13. The carrier said it was still determining the final eastbound FM1 and ME11 voyages and would inform shippers and cargo owners once discharge and contingency plans are confirmed. The ME11/IMX loop normally calls at Jebel Ali and Salalah, along with other ports such as Nheva Shava, Port Said and Valencia, while the FM1/AGX service calls at Jebel Ali in addition to its Asia calls at ports including Pusan, Shanghai, Ningbo, and Tanjung Pelepas. But US and Israeli strikes on Iran and Tehran’s retaliation across the region means the risk of drone and missile attacks in the Strait of Hormuz has closed the area to shipping, including access to Jebel Ali. As a result, the carriers said they have also dropped Jebel Ali from Gemini’s ME1/IOS service. The revised rotation is now Mundra, Nhava Sheva, Salalah, Port Tangier (TC1), Rotterdam, Wilhelmshaven, Hamburg, and London Gateway. <h3>New Gemini service to ease capacity cut </h3>To fill the reduction in cargo capacity caused by the FM1/AGX service suspension, the new Gemini AE19/SE4 loop will call at Jeddah in Saudi Arabia plus its West Med and East Med hubs at Tangier and Damietta (Egypt), respectively. The full rotation, via the Cape of Good Hope. is Xingang, Qingdao, Busan, Ningbo, Shanghai, Tanjung Pelepas, West Med hub, East Med hub, Jeddah, West Med hub, Singapore, and Xingang. The carriers said the first westbound sailing will be by the 13,092-TEU Maersk Elba at Xingang on March 13. The new service “will enable more flexibility and routing options for customers’ supply chain,” Maersk said in an advisory. Three Middle East/Gulf shuttles — OGS, UG2, and UGS — will also stop while Jebel Ali will be omitted from the rotation of the PKS service, which has a revised rotation of Karachi, Bin Qasim, Salalah, and Karachi. Hapag-Lloyd said alternatives are being evaluated following the demise of the shuttles, with details to be confirmed shortly. Meanwhile, Yang Ming said Friday it is declaring “an end of voyage” for cargo currently stranded at transshipment ports. Yang Ming’s other Premier Alliance partners, Ocean Network Express and HMM, have yet to confirm if the measure applies to them. ONE did announce Friday it was imposing an emergency surcharge of $1,200 per 20-foot container and $2,400 per 40-foot box on all imports and exports to and from Persian Gulf countries including Bahrain, Saudi Arabia (Dammam and Jubail), Kuwait, Oman, Qatar, and the United Arab Emirates, that have not been discharged or loaded by March 4. The carrier said the surcharge also applies to all cargo currently in transit, which will be diverted to the next safe port of discharge. At these contingency ports, cargo will be discharged and placed at the disposal of the customer for local pickup and subsequent handling. CMA CGM, meanwhile, has abandoned all alternative Middle East port options it was evaluating to keep shipping schedules running as best as possible. Sohar in Oman and Khor Fakkan in the UAE were part of those interim plans, but the carrier finally found even them unworkable in the current volatile scenario. CMA CGM is the latest carrier to declare a total “end of voyage” for Middle East coverage. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. Special correspondent Bency Mathew contributed to this report. </div>

Gemini Cooperation is suspending some Middle East services, including those to Europe and Asia as well as regional shuttles, due to the ongoing war in the region. The alliance is also adding a new Asia-Europe loop that would partially replace the suspended east-west services, partners Maersk and Hapag-Lloyd said Friday. Maersk said the suspensions are being made “following our latest risk assessment and operational review and considering the escalating conflict affecting safe navigation in the Gulf region.” ”This decision has been taken as a precautionary measure to ensure the safety of our personnel and vessels while minimizing operational disruption across our wider network,” the carrier added in its advisory. The service disruptions come as freight tracking platform Vizion said Friday there has been an 81% drop in daily bookings placed by shippers looking to import goods into key Persian Gulf ports including Jebel Ali, Dammam, Umm Qasr, Sohar, Khalifa, Sharjah, and Al Jubail. Container ports in the Gulf usually book 3.4 million TEUs per year with an estimated cargo value of $140 billion, according to Vizion's Tradeview platform. The Gemini partners said two mainline services — ME11/IMX linking the Middle East, India and the Mediterranean and FM1/AGX linking Asia and the Middle East — would be halted starting next week. But a new AE19/SE4 service would be launched from March 13 that would replace most of the Asia port calls lost with the suspension of the FM1/AGX. Maersk said the westbound FM1 service being operated by the 10,100-TEU Vung Tau Express would terminate at Tanjung Pelepas in Malaysia on March 9 while the ME11 served by the 15,100-TEU Astrid Maersk would be curtailed at Salalah in Oman on March 13. The carrier said it was still determining the final eastbound FM1 and ME11 voyages and would inform shippers and cargo owners once discharge and contingency plans are confirmed. The ME11/IMX loop normally calls at Jebel Ali and Salalah, along with other ports such as Nheva Shava, Port Said and Valencia, while the FM1/AGX service calls at Jebel Ali in addition to its Asia calls at ports including Pusan, Shanghai, Ningbo, and Tanjung Pelepas. But US and Israeli strikes on Iran and Tehran’s retaliation across the region means the risk of drone and missile attacks in the Strait of Hormuz has closed the area to shipping, including access to Jebel Ali. As a result, the carriers said they have also dropped Jebel Ali from Gemini’s ME1/IOS service. The revised rotation is now Mundra, Nhava Sheva, Salalah, Port Tangier (TC1), Rotterdam, Wilhelmshaven, Hamburg, and London Gateway. New Gemini service to ease capacity cut To fill the reduction in cargo capacity caused by the FM1/AGX service suspension, the new Gemini AE19/SE4 loop will call at Jeddah in Saudi Arabia plus its West Med and East Med hubs at Tangier and Damietta (Egypt), respectively. The full rotation, via the Cape of Good Hope. is Xingang, Qingdao, Busan, Ningbo, Shanghai, Tanjung Pelepas, West Med hub, East Med hub, Jeddah, West Med hub, Singapore, and Xingang. The carriers said the first westbound sailing will be by the 13,092-TEU Maersk Elba at Xingang on March 13. The new service “will enable more flexibility and routing options for customers’ supply chain,” Maersk said in an advisory. Three Middle East/Gulf shuttles — OGS, UG2, and UGS — will also stop while Jebel Ali will be omitted from the rotation of the PKS service, which has a revised rotation of Karachi, Bin Qasim, Salalah, and Karachi. Hapag-Lloyd said alternatives are being evaluated following the demise of the shuttles, with details to be confirmed shortly. Meanwhile, Yang Ming said Friday it is declaring “an end of voyage” for cargo currently stranded at transshipment ports. Yang Ming’s other Premier Alliance partners, Ocean Network Express and HMM, have yet to confirm if the measure applies to them. ONE did announce Friday it was imposing an emergency surcharge of $1,200 per 20-foot container and $2,400 per 40-foot box on all imports and exports to and from Persian Gulf countries including Bahrain, Saudi Arabia (Dammam and Jubail), Kuwait, Oman, Qatar, and the United Arab Emirates, that have not been discharged or loaded by March 4. The carrier said the surcharge also applies to all cargo currently in transit, which will be diverted to the next safe port of discharge. At these contingency ports, cargo will be discharged and placed at the disposal of the customer for local pickup and subsequent handling. CMA CGM, meanwhile, has abandoned all alternative Middle East port options it was evaluating to keep shipping schedules running as best as possible. Sohar in Oman and Khor Fakkan in the UAE were part of those interim plans, but the carrier finally found even them unworkable in the current volatile scenario. CMA CGM is the latest carrier to declare a total “end of voyage” for Middle East coverage. Contact Keith Wallis at keithwallis@hotmail.com . Special correspondent Bency Mathew contributed to this report.

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Gemini suspends, revamps Middle East services amid growing conflict

<div class="phx-topic abstract-wrapper">The new express service comes amid expectations of a rebound in capacity demand with the easing of tariffs between the two countries and ongoing trade negotiations.</div>

The new express service comes amid expectations of a rebound in capacity demand with the easing of tariffs between the two countries and ongoing trade negotiations.

<div class="phx-topic">CMA CGM is launching a standalone direct service between India and the US West Coast in another apparent revamp of its Asian networks after just <a href="https://www.joc.com/article/cma-cgm-to-launch-standalone-japan-europe-express-service-in-april-6177297">announcing a new Japan-Europe express service</a> to start in early April. As market updates suggest, the Marseille-based carrier has extended the port rotation of its Pearl River Express service between South China and the USWC to the Indian subcontinent, using about 13 vessels with capacities of 10,000 to 13,000 TEUs. The extended weekly loop includes four ports of call across the subcontinent: Nhava Sheva and Mundra in West India, Karachi in Pakistan, and Colombo in Sri Lanka. The relaunched Pearl’s full eastbound rotation will be Nhava Sheva, Mundra, Karachi, Colombo, Singapore, Haiphong, Xiamen, Nansha, Yantian and Los Angeles. On the westbound leg, vessels will call Los Angeles, Gwangyang, Qingdao, Shanghai, Ningbo, Shekou, Singapore, Nhava Sheva, Mundra and Karachi, according to a CMA CGM India advisory. The rotation structure seems to be in sync with ongoing Indian port restrictions for Pakistan transit cargo. CMA-CGM said the service upgrade seeks to enhance connectivity and coverage for Indian trades to the USWC. “The Pearl service will now offer an exclusive and direct connection from West India, Pakistan and Sri Lanka ports to Los Angeles,” the carrier said. The service is due to begin with the 10,000-TEU APL Qingdao departing Nhava Sheva March 30, offering a declared transit time of 47 days to Los Angeles. The restructured Pearl will compete with Ocean Network Express’ Pacific South 3 service, currently the only direct connection on the trade lane, which offers a faster 36-day transit from Nhava Sheva to Los Angeles. CMA CGM has typically relied on transshipment over Asian ports for coverage of trades between India and the USWC, mainly feeding via its Asia-Subcontinent Express (AS1) service with calls at Nhava Sheva and Mundra, according to industry sources. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="1cf22f06-bc03-4442-9050-628846faea40"></dynamic-object></div>New direct links between India and the US come amid expectations of a rebound in capacity demand with the easing of tariffs between the two countries and ongoing trade negotiations. Industry data also points to an upward move in Nhava Sheva–Los Angeles spot rates, pegged at $2,500 per FEU for late-March sailings, compared with the current $1,500 per FEU, sources said. Indian exports to the West Coast have shown some strength of late, hitting 19,117 TEUs in January, highest since September, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

CMA CGM is launching a standalone direct service between India and the US West Coast in another apparent revamp of its Asian networks after just announcing a new Japan-Europe express service to start in early April. As market updates suggest, the Marseille-based carrier has extended the port rotation of its Pearl River Express service between South China and the USWC to the Indian subcontinent, using about 13 vessels with capacities of 10,000 to 13,000 TEUs. The extended weekly loop includes four ports of call across the subcontinent: Nhava Sheva and Mundra in West India, Karachi in Pakistan, and Colombo in Sri Lanka. The relaunched Pearl’s full eastbound rotation will be Nhava Sheva, Mundra, Karachi, Colombo, Singapore, Haiphong, Xiamen, Nansha, Yantian and Los Angeles. On the westbound leg, vessels will call Los Angeles, Gwangyang, Qingdao, Shanghai, Ningbo, Shekou, Singapore, Nhava Sheva, Mundra and Karachi, according to a CMA CGM India advisory. The rotation structure seems to be in sync with ongoing Indian port restrictions for Pakistan transit cargo. CMA-CGM said the service upgrade seeks to enhance connectivity and coverage for Indian trades to the USWC. “The Pearl service will now offer an exclusive and direct connection from West India, Pakistan and Sri Lanka ports to Los Angeles,” the carrier said. The service is due to begin with the 10,000-TEU APL Qingdao departing Nhava Sheva March 30, offering a declared transit time of 47 days to Los Angeles. The restructured Pearl will compete with Ocean Network Express’ Pacific South 3 service, currently the only direct connection on the trade lane, which offers a faster 36-day transit from Nhava Sheva to Los Angeles. CMA CGM has typically relied on transshipment over Asian ports for coverage of trades between India and the USWC, mainly feeding via its Asia-Subcontinent Express (AS1) service with calls at Nhava Sheva and Mundra, according to industry sources. New direct links between India and the US come amid expectations of a rebound in capacity demand with the easing of tariffs between the two countries and ongoing trade negotiations. Industry data also points to an upward move in Nhava Sheva–Los Angeles spot rates, pegged at $2,500 per FEU for late-March sailings, compared with the current $1,500 per FEU, sources said. Indian exports to the West Coast have shown some strength of late, hitting 19,117 TEUs in January, highest since September, according to PIERS, a sister product of the Journal of Commerce within S&P Global. Contact Bency Mathew at bencyvmathew@gmail.com .

CMA CGM adds direct India-USWC string as part of Asia network overhaul

<div class="phx-topic abstract-wrapper">The push to launch futures contracts for container shipping has gained momentum in recent years given the seemingly never-ending volatility and disruption in the market.</div>

The push to launch futures contracts for container shipping has gained momentum in recent years given the seemingly never-ending volatility and disruption in the market.

<div class="phx-topic">Intercontinental Exchange (ICE) on Friday said it intends to launch four container freight futures contracts next month covering shipping routes linking Asia, Europe and the US. Subject to regulatory approval, the contracts will begin trading on ICE, owner of the New York Stock Exchange, on April 7, ICE said in a statement. The contracts, which ICE said “are designed to help the market manage container freight (price) risk,” will be indexed to the New York Shipping Exchange’s (NYSHEX) Freight Indices price assessments, <a href="https://www.joc.com/article/nyshex-enters-container-index-fray-targeting-floating-rate-contract-adoption-5996516">which were unveiled last May.</a>The four futures contracts, which will be US-denominated and cash-settled, will cover Asia to the US West Coast, Asia to the US East Coast, Asia to North Europe, and North Europe to the US East Coast. The ICE futures do not represent physical slots on container ships; they are a financial instrument that allows investors to hedge against future spot rate movements. The push to launch futures contracts for container shipping <a href="https://www.joc.com/article/near-constant-disruption-giving-new-momentum-to-freight-futures-5979859">has gained momentum in recent years</a> given the seemingly never-ending volatility in the market — from the supply chain disruption caused by the COVID-19 pandemic, the lengthy and costly vessel diversions around southern Africa to avoid the Red Sea and Suez Canal, and now with up to 10% of global capacity tied up due to the war in the Middle East. One big question about container shipping futures has been the potential liquidity of the market, meaning whether the contacts could gain enough traction and eventually become heavily traded. Previous attempts at launching similar container rate futures markets have struggled to generate demand. ICE sought to ease those doubts by pointing out the four contracts “will be supported by (its) network of extremely liquid energy markets.” Open interest, or the number of actively traded contracts, for ICE’s total oil market was at a record 18.7 million contracts as of Feb. 23, it said. “The container shipping industry is massive and critical for global trade, yet it is incredibly volatile,” Gordon Downes, CEO and co-founder of NYSHEX, said in the statement. “With the launch of ICE’s new freight futures, the market participants can far more easily hedge against unexpected swings in the market price.” Contact Kevin Saville at <a href="mailto:kevin.saville2@spglobal.com">kevin.saville2@spglobal.com.</a></div>

Intercontinental Exchange (ICE) on Friday said it intends to launch four container freight futures contracts next month covering shipping routes linking Asia, Europe and the US. Subject to regulatory approval, the contracts will begin trading on ICE, owner of the New York Stock Exchange, on April 7, ICE said in a statement. The contracts, which ICE said “are designed to help the market manage container freight (price) risk,” will be indexed to the New York Shipping Exchange’s (NYSHEX) Freight Indices price assessments, which were unveiled last May. The four futures contracts, which will be US-denominated and cash-settled, will cover Asia to the US West Coast, Asia to the US East Coast, Asia to North Europe, and North Europe to the US East Coast. The ICE futures do not represent physical slots on container ships; they are a financial instrument that allows investors to hedge against future spot rate movements. The push to launch futures contracts for container shipping has gained momentum in recent years given the seemingly never-ending volatility in the market — from the supply chain disruption caused by the COVID-19 pandemic, the lengthy and costly vessel diversions around southern Africa to avoid the Red Sea and Suez Canal, and now with up to 10% of global capacity tied up due to the war in the Middle East. One big question about container shipping futures has been the potential liquidity of the market, meaning whether the contacts could gain enough traction and eventually become heavily traded. Previous attempts at launching similar container rate futures markets have struggled to generate demand. ICE sought to ease those doubts by pointing out the four contracts “will be supported by (its) network of extremely liquid energy markets.” Open interest, or the number of actively traded contracts, for ICE’s total oil market was at a record 18.7 million contracts as of Feb. 23, it said. “The container shipping industry is massive and critical for global trade, yet it is incredibly volatile,” Gordon Downes, CEO and co-founder of NYSHEX, said in the statement. “With the launch of ICE’s new freight futures, the market participants can far more easily hedge against unexpected swings in the market price.” Contact Kevin Saville at kevin.saville2@spglobal.com.

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Intercontinental Exchange to launch container freight futures in April

<div class="phx-topic abstract-wrapper">While of concern to shippers and ocean carriers, the global impact of the war in the Middle East on container flows will be less severe than COVID-19 disruptions and Red Sea diversions, Lars Jensen told TPM26.</div>

While of concern to shippers and ocean carriers, the global impact of the war in the Middle East on container flows will be less severe than COVID-19 disruptions and Red Sea diversions, Lars Jensen told TPM26.

<div class="phx-topic">Long Beach, California — The war in the Middle East that has effectively shut the Persian Gulf and Strait of Hormuz is a problem for container shipping, but not on the scale of other recent disruptions the sector has faced. That was the closing message of the Journal of Commerce’s TPM 26 conference, delivered by industry analyst and CEO of Vespucci Maritime Lars Jensen. “This is going to sound weird. Globally, strictly on container shipping, it’s a problem, but it’s not a major problem,” Jensen told conference attendees. “It’s definitely not pandemic-scale.” <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177005_0.1.jpg"></img></div>When Houthi militants in Yemen began <a href="https://www.joc.com/article/red-sea-diversions-could-last-for-months-until-attack-risk-ends-drewry-5225718">their attacks on shipping in the Red Sea two years ago</a>, container ships serving the Asia-Europe, Asia-Mediterranean and Asia-US East Coast trade lanes were forced to make lengthy and costly diversions around the southern tip of Africa. The current danger zone in the Middle East is much more limited. “In this case, it is ... ‘only’ the cargo in the Gulf. So from a global perspective, yes there will be an impact,” Jensen said. “It will contract capacity some, but it’s not a major disaster for the countries in the Gulf.” Looking at the volume of containers destined for the Strait of Hormuz, either on board vessels already or at least booked within the next 90 days to head toward the Gulf, approximately 2 million TEUs will be impacted, he said. A significant portion of that total will be offloaded at ports around the Strait of Hormuz. The war, meanwhile, has put to rest the assumption importers had entering 2026 that container traffic from Asia bound for Europe and the US East Coast would return to the Suez Canal in the second half of this year, thereby reducing carriers’ leverage in pricing. “The baseline outlook for 2026 now has to include the assumption that the deviations around Africa will continue this year, and therefore materially strengthen the supply and demand balance,” Jensen said. As for when container ships will contemplate returning to the Suez Canal, he said that discussion has been kicked down the road for at least another six months. “So realistically, we are probably looking at least six months into the future before anybody is going to start contemplating doing this again, and that is if we stop the war basically today,” Jensen said. Major container lines have mostly avoided the Red Sea/Suez route since late 2023, when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing the diversions around southern Africa. Those attacks stopped last October after the ceasefire agreement between Israel and Hamas, prompting some major carriers to resume transits through the volatile area on a small scale in recent months. <h3>Rising oil prices, congestion are a concern </h3>In the short term, oil prices, and therefore bunker fuel prices, will increase, which will impact container shipping costs. And that means ocean carriers will respond with increased fuel surcharges. “On account of the Middle East, the carriers will go gangbusters in terms of implementing as many and as high surcharges as humanly possible, and not just on trades to and from the Gulf, [but] everywhere,” Jensen said. “They will be called emergency fuel surcharges, emergency conflict surcharges, and whatever nice names, but they will be a reality. The only question is, how high will it go and how long will it last.” Even cargo owners who are shipping only from Asia to the US West Coast will feel an impact from events in the Middle East in terms of surcharges and disrupted operations in the form of knock-on congestion. “You’re going to get all of these congestion effects in Asia that [are] going to impact everything and everyone, so you’re going to see these surcharges also on the Pacific,” Jensen said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Long Beach, California — The war in the Middle East that has effectively shut the Persian Gulf and Strait of Hormuz is a problem for container shipping, but not on the scale of other recent disruptions the sector has faced. That was the closing message of the Journal of Commerce’s TPM 26 conference, delivered by industry analyst and CEO of Vespucci Maritime Lars Jensen. “This is going to sound weird. Globally, strictly on container shipping, it’s a problem, but it’s not a major problem,” Jensen told conference attendees. “It’s definitely not pandemic-scale.” When Houthi militants in Yemen began their attacks on shipping in the Red Sea two years ago , container ships serving the Asia-Europe, Asia-Mediterranean and Asia-US East Coast trade lanes were forced to make lengthy and costly diversions around the southern tip of Africa. The current danger zone in the Middle East is much more limited. “In this case, it is ... ‘only’ the cargo in the Gulf. So from a global perspective, yes there will be an impact,” Jensen said. “It will contract capacity some, but it’s not a major disaster for the countries in the Gulf.” Looking at the volume of containers destined for the Strait of Hormuz, either on board vessels already or at least booked within the next 90 days to head toward the Gulf, approximately 2 million TEUs will be impacted, he said. A significant portion of that total will be offloaded at ports around the Strait of Hormuz. The war, meanwhile, has put to rest the assumption importers had entering 2026 that container traffic from Asia bound for Europe and the US East Coast would return to the Suez Canal in the second half of this year, thereby reducing carriers’ leverage in pricing. “The baseline outlook for 2026 now has to include the assumption that the deviations around Africa will continue this year, and therefore materially strengthen the supply and demand balance,” Jensen said. As for when container ships will contemplate returning to the Suez Canal, he said that discussion has been kicked down the road for at least another six months. “So realistically, we are probably looking at least six months into the future before anybody is going to start contemplating doing this again, and that is if we stop the war basically today,” Jensen said. Major container lines have mostly avoided the Red Sea/Suez route since late 2023, when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing the diversions around southern Africa. Those attacks stopped last October after the ceasefire agreement between Israel and Hamas, prompting some major carriers to resume transits through the volatile area on a small scale in recent months. Rising oil prices, congestion are a concern In the short term, oil prices, and therefore bunker fuel prices, will increase, which will impact container shipping costs. And that means ocean carriers will respond with increased fuel surcharges. “On account of the Middle East, the carriers will go gangbusters in terms of implementing as many and as high surcharges as humanly possible, and not just on trades to and from the Gulf, [but] everywhere,” Jensen said. “They will be called emergency fuel surcharges, emergency conflict surcharges, and whatever nice names, but they will be a reality. The only question is, how high will it go and how long will it last.” Even cargo owners who are shipping only from Asia to the US West Coast will feel an impact from events in the Middle East in terms of surcharges and disrupted operations in the form of knock-on congestion. “You’re going to get all of these congestion effects in Asia that [are] going to impact everything and everyone, so you’re going to see these surcharges also on the Pacific,” Jensen said. Contact Bill Mongelluzzo at  bill.mongelluzzo@spglobal.com .

TPM26: War a problem for container shipping, but not ‘pandemic-scale’: analyst

<div class="phx-topic abstract-wrapper">A sharp increase in imports from Asia, declining back-haul volume, and congestion delaying the return of empties are slowing down the repatriation of equipment back to Asia. </div>

A sharp increase in imports from Asia, declining back-haul volume, and congestion delaying the return of empties are slowing down the repatriation of equipment back to Asia.

<div class="phx-topic">Long Beach, California — The equipment imbalance on the Asia-Europe trade lane and repositioning empty containers is fast becoming a structural challenge for the region’s maxed-out ports, industry leaders said this week. While volume on the main Asia-Europe westbound lane increased 9.1% in 2025 against a capacity increase of 8.3% over the past two years, the backhaul trade volume was down 5.7% while capacity rose 11.5%, according to Nigel Pusey, CEO of Container Trades Statistics. “The container imbalance is the fundamental challenge of this trade, and how those boxes will continue to be fed in as the ability to recycle containers becomes more and more difficult,” Pusey told the Journal of Commerce’s TPM26 conference. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177005_0.1.jpg"></img></div>“Only 37% of the slots going between Europe and the Far East were actually carrying commercial cargo,” he added. Hanna Stelzel, director of containers at the Port of Rotterdam, said empty repositioning was becoming a structural challenge for ports in Europe that are all operating at high utilization levels. “We had approximately 10% growth on Asia-Europe in 2025, but the growth was mainly coming from imports,” she told the conference. “China into Rotterdam grew 40% compared to 2024. We have declining exports, and Rotterdam is often the first and last port of call, and that is causing enormous challenges in empty repositioning.” Stelzel explained that empties took up room in container yards and require extra moves as the containers are repositioned from one terminal to another. “We are already operating at maximum capacity in Rotterdam and all those extra moves, especially of empty containers, are something we would like to avoid to keep the port more fluid and more efficient, and that’s not possible if you have those extreme numbers of equipment that needs to be repositioned,” she added. <h3>Second-half surge in Rotterdam volume </h3>Total <a href="https://www.joc.com/article/rotterdam-congestion-limits-benefit-of-second-half-surge-in-imports-6176418">container volume at the Port of Rotterdam grew 3.1% in 2025</a>, driven by a second-half surge in imports from Asia and rising trade with North America that boosted annual throughput. The container imbalance and <a href="https://www.joc.com/article/tpm26-europes-persistent-port-congestion-wont-be-remedied-by-short-term-fixes-6180335">persistent port congestion in Europe</a> were also extending the life of the boxes, Pusey said. Instead of a container on the trade lane revolving three or four times a year, the increase in imports meant it was taking longer for carriers to discharge the containers, and the boxes were taking longer to be emptied and returned from inland locations. “That means you’ve actually got more boxes in the system and are having to find places to store them,” Pusey said. He warned that the war in the Middle East that has <a href="https://www.joc.com/article/carriers-pause-india-middle-east-cargo-bookings-amid-persian-gulf-port-chaos-6179223">halted shipping in the Persian Gulf</a> will worsen the current equipment imbalance. “The Middle East and India are interwoven into many schedules of many carriers, so there is going to be a massive impact,” Pusey said. “It’s probably far too early to say what’s going to happen, but the imbalance is going to get far worse.” Jakob Jeppesen, CEO of air and sea for Asia-Pacific at forwarder DSV, said Asia will continue to be a growth market for Europe as Asian brands expand their international presence. “When Asian brands go international, they look towards Europe,” Jeppesen told TPM26. “They will ship more than they need to build inventory to make sure that they have a resilient supply chain. We are seeing brands from India and from China. They used to be [original equipment] manufacturing, but now they want their own brands in retail stores, not only in e-commerce.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Long Beach, California — The equipment imbalance on the Asia-Europe trade lane and repositioning empty containers is fast becoming a structural challenge for the region’s maxed-out ports, industry leaders said this week. While volume on the main Asia-Europe westbound lane increased 9.1% in 2025 against a capacity increase of 8.3% over the past two years, the backhaul trade volume was down 5.7% while capacity rose 11.5%, according to Nigel Pusey, CEO of Container Trades Statistics. “The container imbalance is the fundamental challenge of this trade, and how those boxes will continue to be fed in as the ability to recycle containers becomes more and more difficult,” Pusey told the Journal of Commerce’s TPM26 conference. “Only 37% of the slots going between Europe and the Far East were actually carrying commercial cargo,” he added. Hanna Stelzel, director of containers at the Port of Rotterdam, said empty repositioning was becoming a structural challenge for ports in Europe that are all operating at high utilization levels. “We had approximately 10% growth on Asia-Europe in 2025, but the growth was mainly coming from imports,” she told the conference. “China into Rotterdam grew 40% compared to 2024. We have declining exports, and Rotterdam is often the first and last port of call, and that is causing enormous challenges in empty repositioning.” Stelzel explained that empties took up room in container yards and require extra moves as the containers are repositioned from one terminal to another. “We are already operating at maximum capacity in Rotterdam and all those extra moves, especially of empty containers, are something we would like to avoid to keep the port more fluid and more efficient, and that’s not possible if you have those extreme numbers of equipment that needs to be repositioned,” she added. Second-half surge in Rotterdam volume Total container volume at the Port of Rotterdam grew 3.1% in 2025 , driven by a second-half surge in imports from Asia and rising trade with North America that boosted annual throughput. The container imbalance and persistent port congestion in Europe were also extending the life of the boxes, Pusey said. Instead of a container on the trade lane revolving three or four times a year, the increase in imports meant it was taking longer for carriers to discharge the containers, and the boxes were taking longer to be emptied and returned from inland locations. “That means you’ve actually got more boxes in the system and are having to find places to store them,” Pusey said. He warned that the war in the Middle East that has halted shipping in the Persian Gulf will worsen the current equipment imbalance. “The Middle East and India are interwoven into many schedules of many carriers, so there is going to be a massive impact,” Pusey said. “It’s probably far too early to say what’s going to happen, but the imbalance is going to get far worse.” Jakob Jeppesen, CEO of air and sea for Asia-Pacific at forwarder DSV, said Asia will continue to be a growth market for Europe as Asian brands expand their international presence. “When Asian brands go international, they look towards Europe,” Jeppesen told TPM26. “They will ship more than they need to build inventory to make sure that they have a resilient supply chain. We are seeing brands from India and from China. They used to be [original equipment] manufacturing, but now they want their own brands in retail stores, not only in e-commerce.” Contact Greg Knowler at greg.knowler@spglobal.com .

TPM26: Empty boxes pose structural challenge for Europe’s busy ports

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