Intermodal providers

The railroad is reducing demurrage fees and restoring additional free time that was eliminated in the past two years as international intermodal volumes have fallen sharply from East Coast ports.

Union Pacific’s launch of direct intermodal service from Houston comes two weeks after competitor BNSF announced it would begin a new service from the port’s Barbours Cut marine terminal.

As shippers scramble to shed unwanted inventory, more than 80% responding to a Journal of Commerce survey reported that they’ve kept 53-foot domestic containers for too long, incurring detention fees.

A “perfect storm” of poor schedule reliability, persistently high electricity prices, weak demand and cheaper diesel for trucking continues to undermine Europe’s rail-dominated combined transport sector.

Customers were largely satisfied with intermodal service in early 2023, citing CSX and J. B. Hunt as the top overall providers in North America, according to a Journal of Commerce biannual survey.

The railroad will start a twice-weekly service to Dallas and once-weekly service to Denver, but no ocean carrier as yet is offering inland moves from Houston.

One might expect that Western Canadian ports have benefited from cargo bound for the US Midwest being diverted from the US West Coast to avoid potential labor disruption, but that has not been the case, notes analyst Larry Gross.

Intermodal shippers are saving less than a year ago, but they should anticipate that savings will increase in the months ahead as more annual contracts are signed.

Jones Act carrier Crowley will offer a new international container service from Mexico’s Gulf Coast into Mobile that will use Canadian National for inland reach to the US Midwest and Canada.

New York-New Jersey port truckers who worked five days per week last year are now down to about half that amount, sending spot drayage rates well below levels seen in 2021 and 2022.

Norfolk Southern Railway will institute a mandatory appointment system for truckers handling ocean containers at its Memphis terminal and plans to expand the requirement to Atlanta before the end of the year.

Beyond the dynamics of the new partnerships, intermodal providers acknowledge that generating fresh cross-border business will be important for long-term growth to fill new containers, but only if the price is right.

CPKC signed a deal with Swift Intermodal for a new daily train between central Mexico and Chicago less than 24 hours after Union Pacific announced a partnership with Canadian National and Ferromex.

Schneider National has inked a multiyear partnership with CPKC on intermodal service between Mexico and the US Midwest, a move that will provide new options for shippers seeking a single train to move their north-south freight.

Some truckers think it is unfair that shippers incur demurrage on weekends when railroads are open and chassis locations are closed, but it’s a complex issue without an easy answer.

Intermodal providers began idling thousands of domestic containers when demand fell sharply in the first quarter, causing an equipment glut across the US.

Data shows there is significant room for growth in the Mexican intermodal market, something the joining of Canadian Pacific Railway and Kansas City Southern could help spur, writes analyst Larry Gross.

To reduce costs, FedEx’s system-wide network overhaul will create a stronger North American “ground-air” trucking network, including FedEx Freight, and increase its use of US intermodal rail, the company says.

The Port of New York and New Jersey aims to complete a project in the next two years designed to speed the movement of intermodal trains as other ports along the East Coast jockey for discretionary cargo.

Despite being prepared for divestiture, the performance of global forwarder DB Schenker is the only reason Deutsche Bahn group is profitable at present.