<div class="phx-topic abstract-wrapper">So far, the Port of Tampa and Port Miami are only seeing small cargo volumes, but shippers looking to cut travel time and costs for cargo sent across the US-Mexico border may increasingly choose the sea route, if the conventional land-based route’s delays don’t diminish.</div>

So far, the Port of Tampa and Port Miami are only seeing small cargo volumes, but shippers looking to cut travel time and costs for cargo sent across the US-Mexico border may increasingly choose the sea route, if the conventional land-based route’s delays don’t diminish.

<div><div><img></div>Port Miami began investigating ways to increase Mexican business five years ago, but progress really picked up when Grupo México Transportes purchased Florida East Coast Railway from Fortress Investment Group in 2017. (Above: Port Miami.) Photo credit: Shutterstock.com.Importers from <a>Mexico</a> are increasingly turning to ocean services connecting to Florida ports to serve central Florida and the Southeast, avoiding the risks of higher costs, longer transits, and sharper delays from conventional land routes across the US-Mexico border.The <a>Port of Tampa Bay</a> says cargo volume on two routes started two years ago have increased dramatically — by 232 percent in 2017 and...

Port Miami began investigating ways to increase Mexican business five years ago, but progress really picked up when Grupo México Transportes purchased Florida East Coast Railway from Fortress Investment Group in 2017. (Above: Port Miami.) Photo credit: Shutterstock.com. Importers from Mexico are increasingly turning to ocean services connecting to Florida ports to serve central Florida and the Southeast, avoiding the risks of higher costs, longer transits, and sharper delays from conventional land routes across the US-Mexico border. The Port of Tampa Bay says cargo volume on two routes started two years ago have increased dramatically — by 232 percent in 2017 and a 90 percent increase predicted this year — in large part serving the central Florida consumer market. And the port is looking to leverage that business to encourage shippers to consider moving cargo into Atlanta, South Carolina, and even the Northeast from the port. Port Miami began investigating ways to increase Mexican business five years ago, but progress really picked up when Grupo México Transportes purchased Florida East Coast Railway from Fortress Investment Group in 2017. Eric Olafson, Port Miami director of global trade and business development, used an example of moving a container from Central Mexico to Atlanta to explain how ports can be attractive. “If we do it all trucking, it would take six days and $6,000,” he said. “If you go to the coast and send it from either Veracruz or Tampico to Miami and then up to Atlanta, it would be four days and the cost all in would be $3,500 to $4,000. So not only do you save time, but you also save money.” Sea also offers a simpler move, the ports say. Cross-border freight by land, while a thriving business, is also one that involves multiple trucks, stopping points, extensive paperwork, and a third-party logistics company to handle the cumbersome process. So far, the two ports are still only seeing small cargo volumes on the route. Tampa Bay’s cargo from Mexico totaled 8,554 TEU, and Miami’s totaled fewer than 10,000. About two-thirds of the cross-border traffic between the United States and Mexico goes by truck, about 13 percent by sea, and about the same by rail, said Raul Alfonso, executive vice president and chief commercial officer, Port Tampa Bay. Given truck capacity concerns, shippers diversify But the combination of difficulties in moving by land has prompted some shippers to look for alternative freight routes, Jose Minarro, senior vice president, Mexico customs, for Transplace, told the JOC Mexico Trade Forum on Aug. 1. “We hear customers more and more trying to diversify, trying not to put all their eggs in one basket,” he said. “So we've seen tremendous growth in intermodal, versus pure truck in the last five years,” and it could include sea and air, he said. Still, convincing shippers and truckers to try a new route is not easy, said Craig Mygatt, CEO of SeaLand, a Maersk Line affiliate that serves mainly the United States and Latin America. One challenge is to overcome the “cultural aspect” that shippers stick to their existing routes. Another is that trucking cargo across the border offers shippers more flexibility than does sea, he said. “So if you get to Laredo, you can sell your avocados over to Florida, or you can sell them to New York, or Chicago, or Los Angeles,” he said. “And you can look at the pricing of the avocado in those different markets, and divert cargo that normally would have run to Philadelphia and say ‘Ok, the LA market is strong right now, let’s shift and de-van, sell our avocados to LA.’” The difficulty of matching that flexibility was one of the factors cited by Port of Philadelphia officials for the discontinuance of the port’s SeaLand service from the ports of Altamira and Veracruz in the spring of 2017, about a year into its operation. Truck traffic from Mexico into the United States rose 3.6 percent in the first quarter, US Bureau of Transportation Statistics (BTS) data show. The dollar value of US-Mexico trade by truck from January to May 2018 increased 12.2 percent over the year before, to $174.1 billion, according to the BTS figures. The weight of US-Mexico trade by truck increased by 14.6 percent over the year before, the figures show. At Laredo, Texas, the largest border crossing by truck volume, the number of trucks across the border increased by 6.5 percent to 1.15 million in the first six months of 2018 over the same period a year before. Strong freight demand and higher trucking rates within the United States mean fewer trucks are available this year for northbound loads at the US-Mexico border. Shippers are traditionally hit hard in the spring and early summer, the peak produce shipping season from Mexico, when the imbalance in northbound and southbound shipments between the United States and Mexico creates a shortage of trucks and containers. And this year, it has been worse, with an imbalance rising to about three northbound trucks to one southbound truck. When it’s moved by land across the US-Mexico border, freight is typically consolidated at its starting point in Mexico and placed on a truck that is dropped and hooked to a cross-border Mexican trucking company. Meanwhile, Mexican and US customs brokers send paperwork to respective governments. On arrival at a crossing point, the Mexican truck drops the freight, which is then hooked up to a US truck, because most carriers are unable to meet the requirements to operate in both countries. Getting to the border can take a 24-hour drive from Mexico City, an 18-hour drive from Durango, or an eight-hour drive from Monterrey. Inspections — whether customs, US Department of Agriculture, drug or explosives, or other checks — can add up to three hours. And in the current environment, finding a truck to take the container on the next leg on a northbound move could add several days, Minarro said. The process at the moment is made more difficult by the lack of capacity on both sides of the border, largely due to driver shortages and a difficulty finding equipment. US capacity has been impaired by the electronic logging device rules that took effect in December. And two new regulations in Mexico, which require double-tractor trailers to be registered with the government and limit driver hours, are expected to further tighten capacity there. Florida’s opportunity Florida port officials look at these logistical hurdles and see opportunity. “On an average day, there is an average of 25,000 border crossings on land and the value of US-Mexico trade shipments was $557 billion last year,” said Olafson. “So even a small percentage changing over to water would be significant.” That’s partly because Mexico is, at present, not a big trading partner with the Port of Miami. Mexico’s 2017 volume of fewer than 10,000 TEU sent to Miami is 14th among countries sending cargo to the port — well below the 140,000 TEU sent each year by China and below the 15,000 to 25,000 TEU sent by Honduras, Guatemala, and the Dominican Republic. Port Everglades officials have been approached too, although its main trading partners are in the Caribbean, Central America, and South America — not Mexico. The Port of Tampa Bay cites speed as a key advantage, saying it takes two to two-and-a-half days’ sailing time to reach Tampa from the largest Gulf Coast ports in Mexico, among them Altamira, Tuxpan, and Veracruz. From Tampa Bay, it takes an additional one-and-a-half days by truck to reach South Carolina from Tampa, and two-and-a-half days to make that trip by rail, for a total of four to five days from Mexico’s Gulf Coast to South Carolina, Alfonso said. Taking cargo from Tampa Bay to the Northeast takes three days by truck, and six days by rail — for a total of about five to eight-and-a-half days from Mexico’s Gulf Coast to the Northeast, the port says. Transit from Miami northward takes roughly the same time because trucking from Tampa Bay to Interstate 95 washes out Miami’s southernmost location. The reliability factor “If at the end of the day our supply chain is more reliable, has a shorter transit time, offers savings, and allows the shippers to grow to be successful, I think we're on the right track,” Alfonso told the JOC Mexico Trade Forum. “Ocean, with rail, with truck, works,” he said. “There's got to be an evaluation process for all of the shippers and logistics supply providers to analyze what are the real costs, what are the real deficiencies.” The ocean alternative also offers the benefit that it would provide cargo going north to the many truckers that bring cargo for the central Florida consumer market, and would otherwise have to go back empty because there is little northbound cargo, Alfonso said. Mygatt said sea is also cheaper because it burns less fuel per container. Taking a single container from Mexico City to Miami by truck would use about 350 gallons of fuel, compared with about 80 gallons by ocean on a ship that is 80 percent full, with a short truck drive to the port in Mexico, he said. And sea moves get more attractive to shippers the farther into Mexico a load originates, he said. While it’s tough to convince a shipper moving cargo from close to the border that a sea move is better than trucking, “down near Mexico City, that really has a lot of potential.” “Truckers are going to have to drive that much more distance, and the shortage of truckers and drivers could create a bottleneck,” he said. “And once you have a bottleneck then people find a solution.” Contact Hugh R. Morley at hugh.morley@ihsmarkit.com and follow him on Twitter: @HughRMorley1 .Contact Ari Ashe at ari.ashe@ihsmarkit.com and follow him on Twitter @arijashe . ** RELATED STORIES: US Gulf ports build on importer draw US retailers see 'good year' for container imports in 2018

Trucking News

Rail News

North American ports

US importers from Mexico ramp up ocean routing to avoid land border

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

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

Feature image

<div class="phx-topic">Container lines that paused trans-Pacific service contract talks to assess the impact of the war in the Middle East are back at the table, and expectations are that major retailers will sign in the coming week now that Walmart has finalized its 2026-27 contracts with a half-dozen carriers. Walmart’s move opens the door for other major retailers and, in turn, smaller importers and then non-vessel operating common carriers to ink their own service contracts, which typically go into effect May 1. Despite the <a href="https://www.joc.com/article/china-india-warn-carriers-on-higher-pricing-tied-to-middle-east-conflict-6183986">unknowns in terms of length and scope of the now two-week long Middle East war</a>, carriers say big-box retailers want to lock in vessel capacity. Kevin Parkerson, an industry consultant who previously managed logistics for big-box retailers, told the Journal of Commerce Friday that Walmart, <a href="https://www.joc.com/article/top-100-importerexporter-rankings-largest-us-shippers-outpace-hot-market-6000608">the largest US importer</a>, has wrapped up its contract discussions with its core carriers. A source close to Walmart who asked to remain anonymous confirmed. Carriers, and some forwarders, are urging customers to move expeditiously in their contract negotiations, rather than allowing uncertainties in global trade to deter them. “We now have seen an unpredictable shock to the global ocean market in like four of the last six years,” a carrier executive who asked not to be named told the Journal of Commerce. “Some BCOs (beneficial cargo owners) recognized that and wanted to take risk off the table; they signed early and at higher rates than many were predicting.” The executive added that analyst forecasts of supply and demand have rarely matched reality in recent years due to that outsized volatility. Geopolitical events including diversions away from the Red Sea, unpredictable US tariff policy and even more weather events, impacting ocean reliability, have begun to shift some shippers’ thinking, he said. “Some shippers have come to realize that pushing carriers well below breakeven to save a few cents on their cost of goods is not worth the risk of a major unpredictable event happening,” the executive said. <h3>Recouping higher fuel costs </h3>While securing space remains paramount for cargo owners, rising bunker fuel prices, driven by the closure of the Strait of Hormuz, <a href="https://www.joc.com/article/fmc-says-closely-monitoring-carrier-rate-moves-tied-to-middle-east-war-6184781">is also driving contract discussions regarding bunker fuel adjustment factors</a>. Shippers are reluctant to compensate carriers for the rising operating costs tied to the Middle East on a trade lane that is not directly impacted. “The uncertainty and waiting around for clarity or resolution is not helpful to anyone,” Parkerson said. “Yes, it may impact overall capacity. Yes, it may impact fuel prices. But at this point, that shouldn’t delay the process of contracting. Everybody seems to be proceeding cautiously.” At the moment, securing capacity in the Asia–US West Coast trade is not a significant issue that would slow negotiations. “Asia to the West Coast will be fine,” a second carrier executive told the Journal of Commerce, noting that if the war in the Middle East drags on for some weeks, East Coast routings from the Indian sub-continent could be impacted by the <a href="https://www.joc.com/article/waves-of-diverted-containers-swamping-middle-east-ports-6183989">congestion that is already building at some ports in the region</a>. In the interim, most importers would be wise to secure the minimum quantity commitments (MQCs) in their contracts as soon as they have a handle on what their space requirements will be, a third carrier executive said. “Those BCOs who are slow-walking their negotiations to wait for better prices — it may backfire,” the executive said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

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

Trans-Pacific

Container Shipping News

Maritime

Trans-Pacific contract talks accelerating after Walmart signs

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

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

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

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

Transport, Trade and Regulation News

North-American rail

Intermodal providers

Surface

STB declines to intervene on Meridian Speedway dispute

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

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

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

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

Container lines

Rail and ocean carriers consolidating shipping infrastructure: analyst

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

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

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

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

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Asia-Europe

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

<div class="phx-topic abstract-wrapper">While the logistical hurdles of sending cargo to the region are more of an inconvenience at this point for US exporters rather than a full-blown crisis, shippers see a bigger risk in the war’s longevity and the downstream effect of higher oil prices.</div>

While the logistical hurdles of sending cargo to the region are more of an inconvenience at this point for US exporters rather than a full-blown crisis, shippers see a bigger risk in the war’s longevity and the downstream effect of higher oil prices.

<div class="phx-topic">US exporters are scrambling to locate containers they have shipped to the Middle East but were subsequently dropped off at unknown ports after ocean carriers were forced to halt almost all services due to the war with Iran. While the logistical hurdles for Middle East cargo are more of an inconvenience at this point for US exporters rather than a full-blown crisis, shippers see a bigger risk in the war’s longevity and the downstream effect of higher oil prices. Mediterranean Shipping Co. invoked an “end of voyage” clause this week on exports into Jebel Ali in Dubai, allowing the carrier to discharge containers at the next available port on the ship’s rotation, forwarders tell the Journal of Commerce. The end-of-voyage clause also includes an $800 surcharge. Stephen Zambo, president of third-party logistics provider AGL Group, said he has about 70 containers on the water with MSC destined for the Middle East. He is now figuring out where the next port of call will be for those boxes and bracing his customers for more costs and delays due to the redirections. Along with those containers, AGL has three containers on the ONE Majesty that was attacked in the Strait of Hormuz on Wednesday. Although the vessel suffered some damage, Zambo was told the ship would continue its original voyage. “We’re having to figure out each day what’s going on and what we need to do,” Zambo said. “It’s like it’s been over the last two years with tariffs and other crises, sort of wait-and-see how things play out and act accordingly.” MSC handles about half the container volumes from the US to the Middle East each year, which amounts to about 290,000 TEUs, according to PIERS, a sister company of the Journal of Commerce within S&amp;P Global. Maersk and CMA CGM are the second- and third-busiest carriers on that trade lane. Tim Avanzato, director of global logistics for paper and plastic products maker Lanca Sales, told the Journal of Commerce there’s little risk of that US export cargo backing up at ports, as most of it can be sold to other markets. However, the shutdown of the Strait of Hormuz and the resulting surge in oil prices is concerning because that raises the cost of the products that Lanca Sales distributes. Water and hygiene services company Ecolab imposed a 10% to 14% energy surcharge on its products on Wednesday due to crude oil futures rising to over $100 per barrel. “The Mideast situation is more of an inconvenience at this point,” Avanzato said. “But the fallout if this goes on for weeks? It’s a catastrophe.” Zambo said there are other markets that US exporters can tap. But some products such as certain softwoods are milled specifically for Middle East markets. “The lumber producers are now trying to figure out what to do with the product they have,” he said. Higher oil prices have also resulted in escalating fuel surcharges for all trades. Zambo said he has been in discussions about shipping trans-Atlantic cargo into the US, but carriers have been unwilling to commit to rates due to the surge in fuel prices. <h3>Reviewing new routes </h3>The director of global logistics for a Houston-based chemicals company told the Journal of Commerce he is expecting his iso-tanks onboard MSC vessels destined for Jebel Ali to land in India now due to the end-of-voyage clause. He is now looking at new routes outside of the Middle East’s main port. CMA CGM, which last week suspended all Middle East bookings, on Wednesday reopened bookings for alternative ports such as the UAE’s Khor Fakkan or Oman’s Sohar port, which sit outside of the Strait of Hormuz. CMA CGM is also offering service to Saudi Arabia’s Red Sea port of Jeddah <a href="https://www.joc.com/article/as-war-rages-multimodal-demand-surges-on-asia-europe-landbridge-6185162">and trucking cargo from there</a>. But Jeddah would also involve transiting the Red Sea, which raises the risk of a potential attack by Iran-aligned Houthi rebels. The source said the regional risk is such that MSC has also suspended bookings into Israel’s Haifa, leaving Zim Integrated Shipping Services as the only carrier to service that port. MSC’s suspension of Haifa service could not be independently confirmed. “The Red Sea is a mess,” the executive said. “I have no confidence it will get there.” He added that he’s looking to move containers to Egypt’s Port Said, a transshipment hub outside of the immediate warzone at the northern end of the Suez Canal on the Mediterranean Sea. Outside of servicing his customers, the source said his main concern now is how the oil price spike will play out for the economy. The cost of intermediate chemicals from the Middle East, including ammonia and cyclo-hexane, has jumped, resulting in further cost pressures for his own company’s products. “Fuel costs are going to kill everybody,” he said. “That’s the wildcard.” Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

US exporters are scrambling to locate containers they have shipped to the Middle East but were subsequently dropped off at unknown ports after ocean carriers were forced to halt almost all services due to the war with Iran. While the logistical hurdles for Middle East cargo are more of an inconvenience at this point for US exporters rather than a full-blown crisis, shippers see a bigger risk in the war’s longevity and the downstream effect of higher oil prices. Mediterranean Shipping Co. invoked an “end of voyage” clause this week on exports into Jebel Ali in Dubai, allowing the carrier to discharge containers at the next available port on the ship’s rotation, forwarders tell the Journal of Commerce. The end-of-voyage clause also includes an $800 surcharge. Stephen Zambo, president of third-party logistics provider AGL Group, said he has about 70 containers on the water with MSC destined for the Middle East. He is now figuring out where the next port of call will be for those boxes and bracing his customers for more costs and delays due to the redirections. Along with those containers, AGL has three containers on the ONE Majesty that was attacked in the Strait of Hormuz on Wednesday. Although the vessel suffered some damage, Zambo was told the ship would continue its original voyage. “We’re having to figure out each day what’s going on and what we need to do,” Zambo said. “It’s like it’s been over the last two years with tariffs and other crises, sort of wait-and-see how things play out and act accordingly.” MSC handles about half the container volumes from the US to the Middle East each year, which amounts to about 290,000 TEUs, according to PIERS, a sister company of the Journal of Commerce within S&P Global. Maersk and CMA CGM are the second- and third-busiest carriers on that trade lane. Tim Avanzato, director of global logistics for paper and plastic products maker Lanca Sales, told the Journal of Commerce there’s little risk of that US export cargo backing up at ports, as most of it can be sold to other markets. However, the shutdown of the Strait of Hormuz and the resulting surge in oil prices is concerning because that raises the cost of the products that Lanca Sales distributes. Water and hygiene services company Ecolab imposed a 10% to 14% energy surcharge on its products on Wednesday due to crude oil futures rising to over $100 per barrel. “The Mideast situation is more of an inconvenience at this point,” Avanzato said. “But the fallout if this goes on for weeks? It’s a catastrophe.” Zambo said there are other markets that US exporters can tap. But some products such as certain softwoods are milled specifically for Middle East markets. “The lumber producers are now trying to figure out what to do with the product they have,” he said. Higher oil prices have also resulted in escalating fuel surcharges for all trades. Zambo said he has been in discussions about shipping trans-Atlantic cargo into the US, but carriers have been unwilling to commit to rates due to the surge in fuel prices. Reviewing new routes The director of global logistics for a Houston-based chemicals company told the Journal of Commerce he is expecting his iso-tanks onboard MSC vessels destined for Jebel Ali to land in India now due to the end-of-voyage clause. He is now looking at new routes outside of the Middle East’s main port. CMA CGM, which last week suspended all Middle East bookings, on Wednesday reopened bookings for alternative ports such as the UAE’s Khor Fakkan or Oman’s Sohar port, which sit outside of the Strait of Hormuz. CMA CGM is also offering service to Saudi Arabia’s Red Sea port of Jeddah and trucking cargo from there . But Jeddah would also involve transiting the Red Sea, which raises the risk of a potential attack by Iran-aligned Houthi rebels. The source said the regional risk is such that MSC has also suspended bookings into Israel’s Haifa, leaving Zim Integrated Shipping Services as the only carrier to service that port. MSC’s suspension of Haifa service could not be independently confirmed. “The Red Sea is a mess,” the executive said. “I have no confidence it will get there.” He added that he’s looking to move containers to Egypt’s Port Said, a transshipment hub outside of the immediate warzone at the northern end of the Suez Canal on the Mediterranean Sea. Outside of servicing his customers, the source said his main concern now is how the oil price spike will play out for the economy. The cost of intermediate chemicals from the Middle East, including ammonia and cyclo-hexane, has jumped, resulting in further cost pressures for his own company’s products. “Fuel costs are going to kill everybody,” he said. “That’s the wildcard.” Contact Michael Angell at michael.angell@spglobal.com .

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US exports to Middle East in limbo amid war zone service disruptions

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If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

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