<div class="phx-topic abstract-wrapper">US Customs and Border Protection’s 90-day suspension of the carrier’s trusted trade status ended Sept. 16, but not before damaging Mediterranean Shipping Co's brand and spurring some multinational cargo owners to hold off on booking.</div>

US Customs and Border Protection’s 90-day suspension of the carrier’s trusted trade status ended Sept. 16, but not before damaging Mediterranean Shipping Co's brand and spurring some multinational cargo owners to hold off on booking.

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<div>Mediterranean Shipping Co. has regained privileges via a United States trusted trader program after a temporary suspension stemming from the June 17 seizure of 20 tons of cocaine from a vessel at the Port of Philadelphia.US Customs and Border Protection’s (CBP) 90-day suspension of the second-largest global container carrier from C-TPAT ended Sept. 16, but not before damaging MSC’s brand and spurring some multinational cargo owners to hold off on booking with MSC due to the loss of its trusted trader status. Under the voluntary C-TPAT program, members receive fewer cargo inspections due to them maintaining a safe supply chain...

Mediterranean Shipping Co. has regained privileges via a United States trusted trader program after a temporary suspension stemming from the June 17 seizure of 20 tons of cocaine from a vessel at the Port of Philadelphia. US Customs and Border Protection’s (CBP) 90-day suspension of the second-largest global container carrier from C-TPAT ended Sept. 16, but not before damaging MSC’s brand and spurring some multinational cargo owners to hold off on booking with MSC due to the loss of its trusted trader status. Under the voluntary C-TPAT program, members receive fewer cargo inspections due to them maintaining a safe supply chain and submitting to periodic audits, according to CBP. Since the drug bust, MSC has said it would work with authorities and continue to adhere to C-TPAT requirements even while its membership in the program was suspended. MSC was unable to comment beyond confirming its C-TPAT status had been restored last week. The temporary suspension shook other carriers’ confidence in C-TPAT, with some telling JOC.com privately that they fear similar suspensions as drug smugglers are finding ways around security measures they take that go beyond what the trusted trader program requires. Smugglers, for example, have welded contraband to the hulls of vessels, one reason why CMA CGM is developing autonomous drones to inspect vessels. And while the seizure of cocaine from the MSC Gayane grabbed national headlines as the largest-ever American cocaine bust — equating to approximately 1.3 billion in estimated street value — it was one of many such incidents in recent months. Earlier this month, for example, Malaysian authorities seized $575 million of cocaine at a marine container terminal in the Port of Penang, according to Channel News Asia. MSC vessels have been involved in at least three similar incidents this year alone. A joint US task force found 1.5 tons of cocaine in containers discharged from the MSC Carlotta on Feb. 28 at the Port of New York and New Jersey, and Peruvian authorities discovered another 2.4 tons when the ship called in Callao just two months later. In January, Mexican customs officials seized cocaine on the cruise ship MSC Divina during a stop in Cozumel. And the June seizure of $10 million worth of cocaine at the Port of Baltimore suggests that MSC isn’t the only carrier whose ships had been used to transport illicit cargo, although such seizures haven’t been as widely publicized. Media reports didn’t identify the carrier involved in the shipments coming from Panama. MSC transported just under 1.53 million TEU of US import cargo in the first half of 2019, according to data from PIERS, a sister product of JOC.com within IHS Markit, making it the second-largest carrier in the trade with 12.8 percent of the market.

Container lines

MSC regains C-TPAT status after suspension ends

<div class="phx-topic abstract-wrapper">China export forecasts could top 8 million vehicles this year, providing a steady flow of cargo for the expected 8% increase in the global ro/ro fleet.</div>

China export forecasts could top 8 million vehicles this year, providing a steady flow of cargo for the expected 8% increase in the global ro/ro fleet.

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<div class="phx-topic">Surging vehicle exports from China to developing markets will offset looming fears of overcapacity in the vehicle carrier market, the head of one of the roll-on/roll-off sector’s biggest operators said. Lasse Kristoffersen, president and CEO of Wallenius Wilhelmsen, predicted the growth in vehicle exports, especially from China, will match the influx of new vehicle carrier capacity this year based on manufacturers’ sales forecasts. He said China’s top seven manufacturers, including BYD, Geely, Chery and Nio, planned to ship an extra 2.3 million vehicles to overseas markets this year on top of official total vehicle exports of 5.9 million units. That followed a 24% rise in China’s vehicle exports to 6.9 million last year, up from 5 million in the year prior, Kristoffersen said during a results briefing last week. Kristoffersen noted the peak in pure car and truck carrier (PCTC) deliveries last year with 75 ships totaling 600,000 car equivalent units (CEU) joining the global fleet. A further 67 vessels are set for delivery this year, adding to the current fleet of 899 ships, according to figures from maritime consultant AXS Marine and British shipbroking house Clarksons.   This year’s new vessel deliveries equate to an 8% rise in total fleet capacity to 5.3 million CEUs this year, adding to the 13% increase last year. “This extra export volume more or less matches the extra capacity coming out of shipyards,” Kristoffersen said during the briefing. “That’s why we believe China will surprise on the upside.” Both Mitsui OSK Lines and “K” Line, in earnings statements last week, said they expected “solid demand” for vehicle exports to continue this year. <h3>Focus on emerging markets </h3>Kristoffersen said China’s vehicle export boom is being driven by a surge in exports to emerging markets including Latin America, where volumes are expected to grow 40% this year, and the Middle East, where 14% growth is expected. These developing markets call for longer two-month voyages, which reduces the impact of the influx of new shipping capacity, he said. Kristoffersen was commenting after several analysts, including Clarksons and AXS Marine, recently warned that the vehicle carrier market faces overcapacity, falling freight rates and lackluster demand growth on the back of limited scrapping. “While Chinese car and vehicle exports continue to record strong [volumes], the expansion of the PCTC fleet has become increasingly disproportionate to underlying market fundamentals, “ASX RoRo said in its February market report. “While Chinese vehicle exports continue to expand and are unlikely to slow materially, this growth largely reflects a shift in production and export patterns rather than a meaningful increase in global vehicle demand,” the report added. China’s vehicle exports continue to outpace Japan, which it overtook as the world’s biggest vehicle exporter in 2023. Japan and South Korea have both seen vehicle exports fall by almost 2% over the last two years, while Western manufacturers saw a steeper decline of between 4% and 10% in exports to Asia last year. “Unless demolition activity picks up more decisively, utilization and earnings are likely to come under pressure,” the AXS RoRo report said. Clarksons was slightly more upbeat, saying while one-year vessel charter rates had fallen 63% at the end of last year from “exceptional highs” in 2024, carriers generally continue to report “healthy earnings as cargo continues to be moved under contracts renegotiated at higher levels.” Highlighting the potential for vessel scrapping, Mitsui OSK Lines said in an earnings report this month that 29%, or 239 vehicle carriers, of the existing fleet of 819 ships is over 20 years old, while 18% is more than 26 years old. Kristoffersen said the decline in rates, from $115,000 per day for a 6,500-CEU ship in the first half of 2024 to almost $45,000 per day last month, has also opened opportunities to charter ships at more realistic levels for ad hoc spot vehicle and high-and-heavy cargoes. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Surging vehicle exports from China to developing markets will offset looming fears of overcapacity in the vehicle carrier market, the head of one of the roll-on/roll-off sector’s biggest operators said. Lasse Kristoffersen, president and CEO of Wallenius Wilhelmsen, predicted the growth in vehicle exports, especially from China, will match the influx of new vehicle carrier capacity this year based on manufacturers’ sales forecasts. He said China’s top seven manufacturers, including BYD, Geely, Chery and Nio, planned to ship an extra 2.3 million vehicles to overseas markets this year on top of official total vehicle exports of 5.9 million units. That followed a 24% rise in China’s vehicle exports to 6.9 million last year, up from 5 million in the year prior, Kristoffersen said during a results briefing last week. Kristoffersen noted the peak in pure car and truck carrier (PCTC) deliveries last year with 75 ships totaling 600,000 car equivalent units (CEU) joining the global fleet. A further 67 vessels are set for delivery this year, adding to the current fleet of 899 ships, according to figures from maritime consultant AXS Marine and British shipbroking house Clarksons.   This year’s new vessel deliveries equate to an 8% rise in total fleet capacity to 5.3 million CEUs this year, adding to the 13% increase last year. “This extra export volume more or less matches the extra capacity coming out of shipyards,” Kristoffersen said during the briefing. “That’s why we believe China will surprise on the upside.” Both Mitsui OSK Lines and “K” Line, in earnings statements last week, said they expected “solid demand” for vehicle exports to continue this year. Focus on emerging markets Kristoffersen said China’s vehicle export boom is being driven by a surge in exports to emerging markets including Latin America, where volumes are expected to grow 40% this year, and the Middle East, where 14% growth is expected. These developing markets call for longer two-month voyages, which reduces the impact of the influx of new shipping capacity, he said. Kristoffersen was commenting after several analysts, including Clarksons and AXS Marine, recently warned that the vehicle carrier market faces overcapacity, falling freight rates and lackluster demand growth on the back of limited scrapping. “While Chinese car and vehicle exports continue to record strong [volumes], the expansion of the PCTC fleet has become increasingly disproportionate to underlying market fundamentals, “ASX RoRo said in its February market report. “While Chinese vehicle exports continue to expand and are unlikely to slow materially, this growth largely reflects a shift in production and export patterns rather than a meaningful increase in global vehicle demand,” the report added. China’s vehicle exports continue to outpace Japan, which it overtook as the world’s biggest vehicle exporter in 2023. Japan and South Korea have both seen vehicle exports fall by almost 2% over the last two years, while Western manufacturers saw a steeper decline of between 4% and 10% in exports to Asia last year. “Unless demolition activity picks up more decisively, utilization and earnings are likely to come under pressure,” the AXS RoRo report said. Clarksons was slightly more upbeat, saying while one-year vessel charter rates had fallen 63% at the end of last year from “exceptional highs” in 2024, carriers generally continue to report “healthy earnings as cargo continues to be moved under contracts renegotiated at higher levels.” Highlighting the potential for vessel scrapping, Mitsui OSK Lines said in an earnings report this month that 29%, or 239 vehicle carriers, of the existing fleet of 819 ships is over 20 years old, while 18% is more than 26 years old. Kristoffersen said the decline in rates, from $115,000 per day for a 6,500-CEU ship in the first half of 2024 to almost $45,000 per day last month, has also opened opportunities to charter ships at more realistic levels for ad hoc spot vehicle and high-and-heavy cargoes. Contact Keith Wallis at keithwallis@hotmail.com .

Breakbulk carriers

Ro/ro cargo

Breakbulk News

Maritime

Surging China auto exports to counter carrier overcapacity fears: Wilhelmsen CEO

<div class="phx-topic abstract-wrapper">The increase in volume that would result across the trans-Atlantic and trans-Pacific corridors was particularly welcome, according to Hapag-Lloyd’s CEO.</div>

The increase in volume that would result across the trans-Atlantic and trans-Pacific corridors was particularly welcome, according to Hapag-Lloyd’s CEO.

<div class="phx-topic">Hapag-Lloyd’s $4.2 billion acquisition of Zim Integrated Shipping Services that was announced Monday will significantly improve the Hamburg-based carrier’s position on several major trade lanes. While cementing the buyer’s position <a href="https://www.joc.com/article/hapag-lloyds-plan-to-acquire-zim-would-deepen-shipping-oligopoly-6170073">as the world’s fifth-largest container shipping company</a>, the takeover will grow Hapag-Lloyd’s volume share on the trans-Atlantic from 24% to 27%, on the trans-Pacific from 7% to 12%, in Asia from 9% to 11%, on Asia-Latin America from 11% to 14%, and from 2% to 7% on the intra-Europe trade, according to data from Container Trades Statistics (CTS) cited by Hapag-Lloyd. Hapag-Lloyd CEO Rolf Habben Jansen highlighted as particularly welcome the increase in volume that would result across the trans-Atlantic and trans-Pacific corridors. “When we look for a minute at the trade portfolios on the Atlantic and trans-Pacific, if we joined forces we would really get into very strong position,” he told reporters during an online briefing Monday shortly after signing the Zim deal in Tel Aviv. A 27% market share on the trans-Atlantic would put Hapag-Lloyd in second place behind Mediterranean Shipping Co. at 29%, according to the CTS figures cited by Hapag-Lloyd. According to PIERS, a sister company of the Journal of Commerce within S&amp;P Global, Hapag-Lloyd had a market share of 19.6% on the trans-Atlantic in January, behind MSC’s 22.6%. But Hapag-Lloyd held the top position throughout the fourth quarter of 2025 with a share that exceeded 25% in October and December. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="ce24ca8a-5149-4e8e-a00a-5743e4d2abba"></dynamic-object></div>On the trans-Pacific, the addition of Zim would put Hapag-Lloyd level with Ocean Network Express in third position behind MSC at 13%, according to CTS. Hapag-Lloyd will also inherit Zim’s slot-sharing agreement with ONE. Habben Jansen said the Asia-Latin America trade has long been a corridor he has wanted to expand. In 2023, Hapag-Lloyd strengthened its position with the acquisition of SM SAAM terminal business while growing dedicated service networks on the trade lane. “Zim has done really well on Asia-Latin America in the last couple of years and this would allow us to get closer to the 15%, 16% [volume share] that we’ve always aspired to,” Habben Jansen told reporters. MSC holds the largest market share on the trade at 21%. <h3>Intra-Europe share ‘too small’ </h3>The Zim volume added on the intra-Europe trade would put Hapag-Lloyd level with Cosco Shipping at 7%, although considering it is a home market for the Hamburg-based carrier, Habben Jansen indicated there is still room to grow. “Intra-Europe for Hapag-Lloyd is too small in my view,” he said. “We would like to get to a market share of around 10%, and this would help us make a good step in that direction.” The Zim deal is expected to be completed by the end of the year, subject to approval of the Israeli carrier’s shareholders and regulatory approval in several jurisdictions. The acquisition comes as container shipping moves into a supply-driven downcycle, with the declining market sharply illustrated in Hapag-Lloyd’s preliminary results for 2025 <a href="https://www.joc.com/article/fourth-quarter-rate-slump-drags-down-hapag-lloyds-2025-financials-6166755">that included a steep drop in profitability</a>. Zim’s earnings have yet to be announced. Hapag-Lloyd’s estimated 2025 revenue for the combined entity would be $28 billion, a $1.1 billion drop from 2024. In earnings before interest and taxes, the $5.3 billion reported in 2024 by both carriers is expected to plummet to $2 billion should Zim hit the higher end of its 2025 forecast. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Hapag-Lloyd’s $4.2 billion acquisition of Zim Integrated Shipping Services that was announced Monday will significantly improve the Hamburg-based carrier’s position on several major trade lanes. While cementing the buyer’s position as the world’s fifth-largest container shipping company , the takeover will grow Hapag-Lloyd’s volume share on the trans-Atlantic from 24% to 27%, on the trans-Pacific from 7% to 12%, in Asia from 9% to 11%, on Asia-Latin America from 11% to 14%, and from 2% to 7% on the intra-Europe trade, according to data from Container Trades Statistics (CTS) cited by Hapag-Lloyd. Hapag-Lloyd CEO Rolf Habben Jansen highlighted as particularly welcome the increase in volume that would result across the trans-Atlantic and trans-Pacific corridors. “When we look for a minute at the trade portfolios on the Atlantic and trans-Pacific, if we joined forces we would really get into very strong position,” he told reporters during an online briefing Monday shortly after signing the Zim deal in Tel Aviv. A 27% market share on the trans-Atlantic would put Hapag-Lloyd in second place behind Mediterranean Shipping Co. at 29%, according to the CTS figures cited by Hapag-Lloyd. According to PIERS, a sister company of the Journal of Commerce within S&P Global, Hapag-Lloyd had a market share of 19.6% on the trans-Atlantic in January, behind MSC’s 22.6%. But Hapag-Lloyd held the top position throughout the fourth quarter of 2025 with a share that exceeded 25% in October and December. On the trans-Pacific, the addition of Zim would put Hapag-Lloyd level with Ocean Network Express in third position behind MSC at 13%, according to CTS. Hapag-Lloyd will also inherit Zim’s slot-sharing agreement with ONE. Habben Jansen said the Asia-Latin America trade has long been a corridor he has wanted to expand. In 2023, Hapag-Lloyd strengthened its position with the acquisition of SM SAAM terminal business while growing dedicated service networks on the trade lane. “Zim has done really well on Asia-Latin America in the last couple of years and this would allow us to get closer to the 15%, 16% [volume share] that we’ve always aspired to,” Habben Jansen told reporters. MSC holds the largest market share on the trade at 21%. Intra-Europe share ‘too small’ The Zim volume added on the intra-Europe trade would put Hapag-Lloyd level with Cosco Shipping at 7%, although considering it is a home market for the Hamburg-based carrier, Habben Jansen indicated there is still room to grow. “Intra-Europe for Hapag-Lloyd is too small in my view,” he said. “We would like to get to a market share of around 10%, and this would help us make a good step in that direction.” The Zim deal is expected to be completed by the end of the year, subject to approval of the Israeli carrier’s shareholders and regulatory approval in several jurisdictions. The acquisition comes as container shipping moves into a supply-driven downcycle, with the declining market sharply illustrated in Hapag-Lloyd’s preliminary results for 2025 that included a steep drop in profitability . Zim’s earnings have yet to be announced. Hapag-Lloyd’s estimated 2025 revenue for the combined entity would be $28 billion, a $1.1 billion drop from 2024. In earnings before interest and taxes, the $5.3 billion reported in 2024 by both carriers is expected to plummet to $2 billion should Zim hit the higher end of its 2025 forecast. Contact Greg Knowler at greg.knowler@spglobal.com .

Container Shipping News

Zim deal to strengthen Hapag-Lloyd’s market share across key trade lanes

<div class="phx-topic abstract-wrapper">Fragmented regional greenhouse gas regulatory frameworks such as the EU ETS have increased the complexity of operating a global network and will be difficult to navigate, observers say.</div>

Fragmented regional greenhouse gas regulatory frameworks such as the EU ETS have increased the complexity of operating a global network and will be difficult to navigate, observers say.

<div class="phx-topic">A series of maritime carbon pricing schemes either in effect or under development in various jurisdictions is reinforcing industry concerns that the absence of global regulation will lead to overlapping measures that undermine shipping’s decarbonization drive. The International Maritime Organization last October was forced to <a href="https://www.joc.com/article/delay-in-imo-decarbonization-plans-robs-green-fuel-investors-of-certainty-6101250">delay adoption of its net-zero framework</a> for a year. At the time, critics warned the delay would lead to a host of local carbon pricing initiatives that would be difficult for carriers to navigate; according to design and engineering consultancy BAR Technologies, momentum is building in that direction. “Carbon compliance is becoming more fragmented by the month,” BAR Technologies CEO John Cooper said in a statement. “Instead of building momentum behind a single global framework, we’re creating a patchwork of schemes with different baselines, rules and cost mechanisms. “That creates confusion, inflates costs, and weakens the industry’s ability to invest in real, scalable solutions,” he added. According to the International Carbon Action Partnership (ICAP), the carbon pricing measures currently in effect are the European Union emissions trading system (EU ETS), the South Korean ETS, the New Zealand ETS, and the China-Shanghai pilot ETS that has been in force since 2013. A Brazilian greenhouse gas (GHG) emissions trading system is under development. Last week, the British House of Commons voted to roll out a UK ETS to the domestic maritime industry from July 1, while it considers expanding that to include international maritime voyages starting or ending in the UK, with a proposed start date of 2028. But the UK Chamber of Shipping warned that the policy risks harming UK competitiveness while increasing costs for island communities and slowing progress toward net-zero. It called for alignment with EU ETS rules to avoid double‑charging and carbon leakage, and for a phased in or “monitor‑only” period until operators and ports have the systems required for compliance. “The sector supports the UK’s climate goals, but cannot deliver meaningful emissions reduction without the necessary fuels, infrastructure and clear guidance in place — and [with] unreasonable timeframes to implement flawed policy,” a spokesperson for the UK chamber said in a statement, noting that premature implementation risks higher costs for freight. Maersk noted in its annual report for 2025 published earlier this month that regional GHG regulatory frameworks such as the EU ETS have increased the complexity of operating a global network. “With each regulation having different standards and criteria, the need for allocation of lower GHG emission fuels to cover the compliance requirements of different regulations and customer demands in the most cost-effective manner, complexity is added,” the carrier said, adding that global regulation was required to curb emissions. The IMO’s net-zero framework was expected to be adopted at a special meeting of its Marine Environment Protection Committee (MEPC) in London in October last year after the measure was approved by a majority of member states the previous April. But the regulation was postponed for one year after it was derailed by US-led opposition during the combative October meeting. <h3>Europe’s ETS now fully phased in </h3>From a container shipping perspective, the EU ETS is by far the most significant carbon pricing mechanism currently in effect. Compliance has been phased in over the past two years, and 100% of reported maritime emissions are now covered in the EU ETS allowances with carriers passing on the costs to their customers. The regulation covers 100% of emissions for voyages between two EU ports and 50% of emissions for voyages starting or ending outside the EU for any ship of over 5,000 gross tons. Vessels are required to buy European Union Allowances (EUAs) to cover the emissions generated by their voyages and surrender the allowances by September of the following year. Failure to comply can lead to a penalty of €100 per ton. Methane and nitrous oxide have been included in the emissions calculations from this year, with the inclusion designed to incentivize a shift toward cleaner fuels, although the infrastructure and cost of those alternatives remain significant barriers. The EUA price is forecast by carbon market specialist Grey Epoch to rise 19% in 2026 to €86 ($101) per metric ton of CO2 equivalent. According to Deutsche Bank, the EU carbon price will range between $70 to $177 in 2026. Visibility provider Searoutes noted in a recent market update that the introduction of the EU ETS in 2024 coincided with Red Sea ship diversions when ETS surcharges added just 1% to shipping costs, a drop in the ocean as rates soared. But in 2026, the market situation has changed. Rates have fallen and EU ETS compliance costs have increased, with carrier surcharges now averaging $168 per FEU from Asia to North Europe, 8% of the current rate on Drewry’s World Container Index. Searoutes warns that surcharges could jump to 12% or more of total costs should a full resumption of Red Sea transits occur this year.Contact Greg Knowler at <a href="">greg.knowler@spglobal.com</a>. </div>

A series of maritime carbon pricing schemes either in effect or under development in various jurisdictions is reinforcing industry concerns that the absence of global regulation will lead to overlapping measures that undermine shipping’s decarbonization drive. The International Maritime Organization last October was forced to delay adoption of its net-zero framework for a year. At the time, critics warned the delay would lead to a host of local carbon pricing initiatives that would be difficult for carriers to navigate; according to design and engineering consultancy BAR Technologies, momentum is building in that direction. “Carbon compliance is becoming more fragmented by the month,” BAR Technologies CEO John Cooper said in a statement. “Instead of building momentum behind a single global framework, we’re creating a patchwork of schemes with different baselines, rules and cost mechanisms. “That creates confusion, inflates costs, and weakens the industry’s ability to invest in real, scalable solutions,” he added. According to the International Carbon Action Partnership (ICAP), the carbon pricing measures currently in effect are the European Union emissions trading system (EU ETS), the South Korean ETS, the New Zealand ETS, and the China-Shanghai pilot ETS that has been in force since 2013. A Brazilian greenhouse gas (GHG) emissions trading system is under development. Last week, the British House of Commons voted to roll out a UK ETS to the domestic maritime industry from July 1, while it considers expanding that to include international maritime voyages starting or ending in the UK, with a proposed start date of 2028. But the UK Chamber of Shipping warned that the policy risks harming UK competitiveness while increasing costs for island communities and slowing progress toward net-zero. It called for alignment with EU ETS rules to avoid double‑charging and carbon leakage, and for a phased in or “monitor‑only” period until operators and ports have the systems required for compliance. “The sector supports the UK’s climate goals, but cannot deliver meaningful emissions reduction without the necessary fuels, infrastructure and clear guidance in place — and [with] unreasonable timeframes to implement flawed policy,” a spokesperson for the UK chamber said in a statement, noting that premature implementation risks higher costs for freight. Maersk noted in its annual report for 2025 published earlier this month that regional GHG regulatory frameworks such as the EU ETS have increased the complexity of operating a global network. “With each regulation having different standards and criteria, the need for allocation of lower GHG emission fuels to cover the compliance requirements of different regulations and customer demands in the most cost-effective manner, complexity is added,” the carrier said, adding that global regulation was required to curb emissions. The IMO’s net-zero framework was expected to be adopted at a special meeting of its Marine Environment Protection Committee (MEPC) in London in October last year after the measure was approved by a majority of member states the previous April. But the regulation was postponed for one year after it was derailed by US-led opposition during the combative October meeting. Europe’s ETS now fully phased in From a container shipping perspective, the EU ETS is by far the most significant carbon pricing mechanism currently in effect. Compliance has been phased in over the past two years, and 100% of reported maritime emissions are now covered in the EU ETS allowances with carriers passing on the costs to their customers. The regulation covers 100% of emissions for voyages between two EU ports and 50% of emissions for voyages starting or ending outside the EU for any ship of over 5,000 gross tons. Vessels are required to buy European Union Allowances (EUAs) to cover the emissions generated by their voyages and surrender the allowances by September of the following year. Failure to comply can lead to a penalty of €100 per ton. Methane and nitrous oxide have been included in the emissions calculations from this year, with the inclusion designed to incentivize a shift toward cleaner fuels, although the infrastructure and cost of those alternatives remain significant barriers. The EUA price is forecast by carbon market specialist Grey Epoch to rise 19% in 2026 to €86 ($101) per metric ton of CO2 equivalent. According to Deutsche Bank, the EU carbon price will range between $70 to $177 in 2026. Visibility provider Searoutes noted in a recent market update that the introduction of the EU ETS in 2024 coincided with Red Sea ship diversions when ETS surcharges added just 1% to shipping costs, a drop in the ocean as rates soared. But in 2026, the market situation has changed. Rates have fallen and EU ETS compliance costs have increased, with carrier surcharges now averaging $168 per FEU from Asia to North Europe, 8% of the current rate on Drewry’s World Container Index. Searoutes warns that surcharges could jump to 12% or more of total costs should a full resumption of Red Sea transits occur this year. Contact Greg Knowler at  greg.knowler@spglobal.com . 

Transport, Trade and Regulation News

Shipping decarbonization drive faces patchwork of carbon tax measures

<div class="phx-topic abstract-wrapper">A heavily oversupplied equipment market born out of the pandemic disruption is forcing chassis providers to ensure visibility technology plays a growing role as a differentiator. </div>

A heavily oversupplied equipment market born out of the pandemic disruption is forcing chassis providers to ensure visibility technology plays a growing role as a differentiator.

<div class="phx-topic">Amid a US marine chassis market that is deeply oversupplied in part due to the fluid flow of cargo through ports in 2025, leading chassis lessors are stepping up deployment of location sensors as a competitive tool to create value for beneficial cargo owners (BCOs), forwarders and truckers. The ports of Los Angeles and Long Beach last year handled record loaded import volumes of over 10 million TEUs, according to S&amp;P Global Market Intelligence, with virtually no congestion. That points, among other things, to cargo being quickly unloaded at warehouses and containers and chassis put back into circulation with little or no delay, in contrast to the pandemic cargo rush when equipment was idled for weeks, creating an historic bottleneck. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6170490_0.1.jpg"></img></div>As a result of the COVID-19 experience, thousands of additional marine chassis entered the market during and after the crisis, mirroring heavy investments in trucks, containers and warehouse space. “All of which contributed to the overall US transport and logistics system functioning with little to no friction ... even at import volumes that have been at or above COVID levels for all of 2025,” said Ron Widdows, CEO of chassis provider Flexi-Van Leasing. The glut of chassis equipment is severe — Flexi- Van estimates half of the US fleet of 600,000 marine container chassis are utilized currently, and returns are occurring 20% faster, cutting further into lessors’ revenues. “The latent capacity in the system will be there for some time,” Widdows said. “The asset provider part of the supply chain has done a wonderful job in creating the asset availability ... and now suffers the impact of a very efficient supply chain and the impact on asset utilization.” The chassis leasing space has led to a sharper competitive environment with visibility technology playing a growing role as a differentiator. The offerings fall into the category of in-transit versus milestone visibility, in which chassis units, and by extension the containers and cargo they are carrying, are tracked in real time with various benefits derived from the information. It is not dissimilar to efforts by carriers including Hapag-Lloyd, to connect their full fleet of dry containers, also aiming to improve on milestone visibility derived from readings at junctures such as marine container gates or arrival at an ultimate destination. “The shipping industry has long relied on discrete and often inaccurate event updates that may lag by hours or even days,” WiseTech Global CEO Zubin Appoo <a href="https://www.wisetechglobal.com/news/wisetech-global-and-hapag-lloyd-launch-iot-container-tracking-pilot-to-deliver-next-generation-supply-chain-visibility/">said on Feb. 10 in announcing an agreement</a> with Hapag-Lloyd to make its container location data available to customers. <h3>Competition growing amid new tech solutions </h3>Flexi-Van introduced a technology-based offering from the beginning of its current iteration in 2016 as American Intermodal Management, or AIM. In 2020, AIM acquired Flexi-Van, whose origins go back to the early days of containers in the 1950s, with the idea of extending its tech-based and new equipment offering into the larger footprint of a legacy national intermodal equipment provider (IEP). That was a natural progression for AIM, which emerged out of the stressed 2014–15 period at Los Angeles-Long Beach that was marked by a disruptive longshore labor negotiation and an aging, formerly carrier-owned chassis fleet that was subject to regular roadability delays within the context of the much-debated “pool of pools” system. AIM entered the market as an outsider with a new model, offering new and guaranteed equipment under direct leases and a near-port location using longshore union labor. The GPS devices allowed for visibility and resulted in opportunities for cost savings during the round trip from terminal to warehouse through to return. “Fundamentally from the beginning the idea was to establish relationships directly with BCOs and the motor carriers that support them,” Widdows said, noting the concept of AIM came out of APL where Widdows had previously served as CEO and which had implemented equipment tracking at Pier 300 in Los Angeles beginning in the 1990s. “If you can better manage your flow and impact the efficiency of inland transportation, this has much larger financial implications than the cost of the chassis.” Now competition in the space is growing as other lessors bring tech solutions to BCO-specific offerings. Last year, for example, chassis provider DCLI introduced an offering called Direct Chassis Link Reserve tailored to BCOs, providing marine chassis capacity with newer units (seven years old or less), GPS-enabled visibility, and locations at major ports. Trac Intermodal, the other large IEP in the US, described GPS technology as a “cornerstone” of its offering, saying advanced GPS solutions are offered as an add-on to term leases. Trac says each chassis is equipped with GPS, enabling customers to track location, monitor movement, and optimize utilization. It says that by pairing GPS tracking with geofencing, it ensures billing starts only when a chassis leaves the customer’s facility while giving motor carriers, ocean carriers, BCOs, railroads, and non-vessel operating common carriers visibility into their equipment and helping them identify idle assets and reduce delays. Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>.</div>

Amid a US marine chassis market that is deeply oversupplied in part due to the fluid flow of cargo through ports in 2025, leading chassis lessors are stepping up deployment of location sensors as a competitive tool to create value for beneficial cargo owners (BCOs), forwarders and truckers. The ports of Los Angeles and Long Beach last year handled record loaded import volumes of over 10 million TEUs, according to S&P Global Market Intelligence, with virtually no congestion. That points, among other things, to cargo being quickly unloaded at warehouses and containers and chassis put back into circulation with little or no delay, in contrast to the pandemic cargo rush when equipment was idled for weeks, creating an historic bottleneck. As a result of the COVID-19 experience, thousands of additional marine chassis entered the market during and after the crisis, mirroring heavy investments in trucks, containers and warehouse space. “All of which contributed to the overall US transport and logistics system functioning with little to no friction ... even at import volumes that have been at or above COVID levels for all of 2025,” said Ron Widdows, CEO of chassis provider Flexi-Van Leasing. The glut of chassis equipment is severe — Flexi- Van estimates half of the US fleet of 600,000 marine container chassis are utilized currently, and returns are occurring 20% faster, cutting further into lessors’ revenues. “The latent capacity in the system will be there for some time,” Widdows said. “The asset provider part of the supply chain has done a wonderful job in creating the asset availability ... and now suffers the impact of a very efficient supply chain and the impact on asset utilization.” The chassis leasing space has led to a sharper competitive environment with visibility technology playing a growing role as a differentiator. The offerings fall into the category of in-transit versus milestone visibility, in which chassis units, and by extension the containers and cargo they are carrying, are tracked in real time with various benefits derived from the information. It is not dissimilar to efforts by carriers including Hapag-Lloyd, to connect their full fleet of dry containers, also aiming to improve on milestone visibility derived from readings at junctures such as marine container gates or arrival at an ultimate destination. “The shipping industry has long relied on discrete and often inaccurate event updates that may lag by hours or even days,” WiseTech Global CEO Zubin Appoo said on Feb. 10 in announcing an agreement with Hapag-Lloyd to make its container location data available to customers. Competition growing amid new tech solutions Flexi-Van introduced a technology-based offering from the beginning of its current iteration in 2016 as American Intermodal Management, or AIM. In 2020, AIM acquired Flexi-Van, whose origins go back to the early days of containers in the 1950s, with the idea of extending its tech-based and new equipment offering into the larger footprint of a legacy national intermodal equipment provider (IEP). That was a natural progression for AIM, which emerged out of the stressed 2014–15 period at Los Angeles-Long Beach that was marked by a disruptive longshore labor negotiation and an aging, formerly carrier-owned chassis fleet that was subject to regular roadability delays within the context of the much-debated “pool of pools” system. AIM entered the market as an outsider with a new model, offering new and guaranteed equipment under direct leases and a near-port location using longshore union labor. The GPS devices allowed for visibility and resulted in opportunities for cost savings during the round trip from terminal to warehouse through to return. “Fundamentally from the beginning the idea was to establish relationships directly with BCOs and the motor carriers that support them,” Widdows said, noting the concept of AIM came out of APL where Widdows had previously served as CEO and which had implemented equipment tracking at Pier 300 in Los Angeles beginning in the 1990s. “If you can better manage your flow and impact the efficiency of inland transportation, this has much larger financial implications than the cost of the chassis.” Now competition in the space is growing as other lessors bring tech solutions to BCO-specific offerings. Last year, for example, chassis provider DCLI introduced an offering called Direct Chassis Link Reserve tailored to BCOs, providing marine chassis capacity with newer units (seven years old or less), GPS-enabled visibility, and locations at major ports. Trac Intermodal, the other large IEP in the US, described GPS technology as a “cornerstone” of its offering, saying advanced GPS solutions are offered as an add-on to term leases. Trac says each chassis is equipped with GPS, enabling customers to track location, monitor movement, and optimize utilization. It says that by pairing GPS tracking with geofencing, it ensures billing starts only when a chassis leaves the customer’s facility while giving motor carriers, ocean carriers, BCOs, railroads, and non-vessel operating common carriers visibility into their equipment and helping them identify idle assets and reduce delays. Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

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Real-time chassis location becoming competitive edge in leasing

<div class="phx-topic abstract-wrapper">The acquisition is expected to be completed this year, and will strengthen the combined network on the trans-Pacific, intra-Asia, the Atlantic, Latin America, and East Mediterranean while bringing up to $500 million in synergies, Hapag-Lloyd's CEO said. </div>

The acquisition is expected to be completed this year, and will strengthen the combined network on the trans-Pacific, intra-Asia, the Atlantic, Latin America, and East Mediterranean while bringing up to $500 million in synergies, Hapag-Lloyd's CEO said.

<div class="phx-topic">Hapag-Lloyd inked a $4.2 billion deal Monday to acquire 100% of Zim Integrated Shipping Services, cementing the buyer’s position <a href="https://www.joc.com/article/hapag-lloyds-plan-to-acquire-zim-would-deepen-shipping-oligopoly-6170073">as the world’s fifth-largest container shipping company</a> with a fleet of over 400 vessels, a slot capacity of over 3 million TEUs, and an annual transport volume of more than 18 million TEUs. Financing the transaction from cash reserves and a $2.5 billion bridging fund, Hapag-Lloyd will take over the international operations of Zim but leave control of domestic operations to Israel-based private equity group FIMI Opportunity Funds. The deal is expected to be completed by the end of the year, subject to approval of Zim shareholders and regulatory approval in several jurisdictions. Hapag-Lloyd CEO Rolf Habben Jansen said the acquisition of the 10th largest ocean carrier would strengthen the combined network on the trans-Pacific, intra-Asia, the Atlantic, Latin America, and East Mediterranean while generating significant synergies. “We expect to see about $300 million to $500 million in synergies, mainly in network and procurement,” Habben Jansen told reporters during an online briefing shortly after signing the deal in Tel Aviv, noting that the synergies would bring down slot costs by an estimated $25 per TEU. “We know how to create those synergies, as we have done so in previous transactions,” he added. Zim will be the sixth carrier Hapag-Lloyd has taken over following previous deals for cpships (2005), CSAV (2014), UASC (2017), NileDutch (2021), and DAL (2022). <h3>‘A fair price’ </h3>Asked whether the $4.2 billion acquisition cost was too high, Habben Jansen said he believed it was “a fair price.” ”It was certainly not a low price that we paid, but we believe that it’s an excellent asset, and as such, I think the premium is justified,” he said. Analysts at investment bank J.P. Morgan were not convinced by the takeover premium, calling the price offered “a significant premium to forward expectations.” An analyst note said this was likely a reflection of the competitive nature of the tender and efforts by strategic players to increase market share in a highly competitive market dynamic where players without a large order book were disadvantaged. J.P. Morgan expects Zim’s earnings before interest, taxes, amortization and depreciation (EBITDA) margin for 2025 to be 30%, compared to 20% in 2023 and 11% in 2019, leaving “material downside potential as the container shipping cycle turns.” “This we expect will likely limit the value creation potential for Hapag-Lloyd in the coming years,” the bank said, although it noted that Hapag-Lloyd appeared less concerned over near-term dynamics, “despite a more challenging multi-year period ahead.” The international element of Zim’s capacity that Hapag-Lloyd will acquire is chartered, thus increasing the chartered portion of Hapag-Lloyd's fleet from its current 39% to 52%. Habben Jansen said there were benefits to holding chartered tonnage in a down cycle, but conceded that the level would be too high. “Dependent on how good or not so good the market is, you have a lot more flexibility in adjusting your cost base than if you do not have a large chunk of chartered tonnage,” he told reporters. “Having said that, I think if this transaction is completed, then the percentage of chartered tonnage that we would have is probably a bit on the high side,” he added. “So over time, one should expect that we then bring that down.” Only Ocean Network Express and Yang Ming have charter ratios above 50%, with other top 10 carriers below 40%. In the case of Evergreen and HMM, it is as low as 30% and 18%, respectively, Lars Jensen, CEO of Vespucci Maritime and a Journal of Commerce contributor, noted in a LinkedIn post. “This can prove to be a competitive advantage as the market is heading towards a cyclical downturn where the ability to tactically reduce the size of the operated fleet by redelivering charter vessels can be an important element of maintaining a high utilization and low unit cost,” Jensen wrote Monday. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com.</a></div>

Hapag-Lloyd inked a $4.2 billion deal Monday to acquire 100% of Zim Integrated Shipping Services, cementing the buyer’s position as the world’s fifth-largest container shipping company with a fleet of over 400 vessels, a slot capacity of over 3 million TEUs, and an annual transport volume of more than 18 million TEUs. Financing the transaction from cash reserves and a $2.5 billion bridging fund, Hapag-Lloyd will take over the international operations of Zim but leave control of domestic operations to Israel-based private equity group FIMI Opportunity Funds. The deal is expected to be completed by the end of the year, subject to approval of Zim shareholders and regulatory approval in several jurisdictions. Hapag-Lloyd CEO Rolf Habben Jansen said the acquisition of the 10th largest ocean carrier would strengthen the combined network on the trans-Pacific, intra-Asia, the Atlantic, Latin America, and East Mediterranean while generating significant synergies. “We expect to see about $300 million to $500 million in synergies, mainly in network and procurement,” Habben Jansen told reporters during an online briefing shortly after signing the deal in Tel Aviv, noting that the synergies would bring down slot costs by an estimated $25 per TEU. “We know how to create those synergies, as we have done so in previous transactions,” he added. Zim will be the sixth carrier Hapag-Lloyd has taken over following previous deals for cpships (2005), CSAV (2014), UASC (2017), NileDutch (2021), and DAL (2022). ‘A fair price’ Asked whether the $4.2 billion acquisition cost was too high, Habben Jansen said he believed it was “a fair price.” ”It was certainly not a low price that we paid, but we believe that it’s an excellent asset, and as such, I think the premium is justified,” he said. Analysts at investment bank J.P. Morgan were not convinced by the takeover premium, calling the price offered “a significant premium to forward expectations.” An analyst note said this was likely a reflection of the competitive nature of the tender and efforts by strategic players to increase market share in a highly competitive market dynamic where players without a large order book were disadvantaged. J.P. Morgan expects Zim’s earnings before interest, taxes, amortization and depreciation (EBITDA) margin for 2025 to be 30%, compared to 20% in 2023 and 11% in 2019, leaving “material downside potential as the container shipping cycle turns.” “This we expect will likely limit the value creation potential for Hapag-Lloyd in the coming years,” the bank said, although it noted that Hapag-Lloyd appeared less concerned over near-term dynamics, “despite a more challenging multi-year period ahead.” The international element of Zim’s capacity that Hapag-Lloyd will acquire is chartered, thus increasing the chartered portion of Hapag-Lloyd's fleet from its current 39% to 52%. Habben Jansen said there were benefits to holding chartered tonnage in a down cycle, but conceded that the level would be too high. “Dependent on how good or not so good the market is, you have a lot more flexibility in adjusting your cost base than if you do not have a large chunk of chartered tonnage,” he told reporters. “Having said that, I think if this transaction is completed, then the percentage of chartered tonnage that we would have is probably a bit on the high side,” he added. “So over time, one should expect that we then bring that down.” Only Ocean Network Express and Yang Ming have charter ratios above 50%, with other top 10 carriers below 40%. In the case of Evergreen and HMM, it is as low as 30% and 18%, respectively, Lars Jensen, CEO of Vespucci Maritime and a Journal of Commerce contributor, noted in a LinkedIn post. “This can prove to be a competitive advantage as the market is heading towards a cyclical downturn where the ability to tactically reduce the size of the operated fleet by redelivering charter vessels can be an important element of maintaining a high utilization and low unit cost,” Jensen wrote Monday. Contact Greg Knowler at greg.knowler@spglobal.com.

Hapag-Lloyd bolsters fleet with $4.2 billion deal to acquire Zim

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