<div>Eurotunnel, the Anglo-French operator of the rail tunnel across the English Channel, warned that it could be forced to eliminate 600 jobs if it loses an appeal against a U.K. order to cease its roll-on, roll-off shipping service between Britain and France.The U.K. Competition Commission in June said Eurotunnel’s entry into the shipping market <a>would significantly increase its 40 percent share of traffic and boost freight rates</a>.Eurotunnel entered the main cross-channel ferry route between Dover and Calais in 2012 following its <a>$100 million acquisition of three vessels from SeaFrance</a>, the shipping unit of French rail operator SNCF, which filed for...

Eurotunnel, the Anglo-French operator of the rail tunnel across the English Channel, warned that it could be forced to eliminate 600 jobs if it loses an appeal against a U.K. order to cease its roll-on, roll-off shipping service between Britain and France. The U.K. Competition Commission in June said Eurotunnel’s entry into the shipping market would significantly increase its 40 percent share of traffic and boost freight rates . Eurotunnel entered the main cross-channel ferry route between Dover and Calais in 2012 following its $100 million acquisition of three vessels from SeaFrance , the shipping unit of French rail operator SNCF, which filed for bankruptcy. If Eurotunnel loses its appeal, CEO Jacques Gounon said the company would have to terminate the contract of 600 members of a workers cooperative that operates its MyFerryLink service. Separately, Gounon said France and the U.K. plan to reject a demand by European Union regulators to lower its “excessive” charges for freight and passenger trains using the Channel Tunnel. The EU says an estimated 43 percent of the tunnel’s capacity is unused, in part because of high charges. The regulator also ruled that a 65-year agreement reserving 50 percent of freight traffic for DB Schenker, the logistics unit of German railway Deutsche Bahn, breaches EU rules because it is too long.

Maritime

International rail

600 Jobs at Risk in Ro-Ro Appeal, Eurotunnel Says

<div class="phx-topic abstract-wrapper">Reshuffling port calls because of a potential Trump administration fee on Chinese-built and -operated ships would place additional strain on the US intermodal supply chain, railroad executives say.</div>

Reshuffling port calls because of a potential Trump administration fee on Chinese-built and -operated ships would place additional strain on the US intermodal supply chain, railroad executives say.

Feature image

<div class="phx-topic">If a Trump administration proposal to <a href="https://www.joc.com/article/us-port-tax-would-scramble-ocean-services-raise-shipper-costs-drewry-5952046">tax Chinese-built and -operated ships</a> calling at US ports is enacted, the nation’s Class I railroads could face the challenge of attempting to move cargo through fewer entry points without disrupting service, railroad executives said Tuesday. Executives from CSX Transportation and Union Pacific Railroad, speaking at the J.P. Morgan Industrials Conference, said while they could accommodate a shift toward larger ports, it would not come without “significant” disruption. “Certainly, this potential port fee that could come into play would have a significant disruptive impact,” said CSX CFO Sean Pelkey. “If there's more consolidation at ports that we serve and there's more volume that wants to come into those ports, that's a good thing. We can be a part of the solution for that. But it could also result in more congestion as well, which could have significant disruptive effects.” Congestion on the rail network is a key concern. During last year’s peak shipping season, service disruptions on the US West Coast coincided with double-digit percentage growth in cargo volume. In October, 795 of UP’s loaded intermodal railcars sat idle for at least 48 hours, according to the US Surface Transportation Board. That same month, UP’s average intermodal train speed fell to 27.9 miles per hour during the week of Oct. 9-16, its slowest week since 2019. Mediterranean Shipping Co. CEO Soren Toft <a href="https://www.joc.com/article/tpm25-port-tax-on-chinese-ships-will-make-some-routes-unviable-mscs-toft-5954640">said at TPM25 last week</a> that it would no longer be economically viable for carriers to call smaller US ports if the Trump plan was implemented, something echoed by UP CEO Jennifer Hamann. “It does lend preference to the larger ports...,” Hamann said at the J.P. Morgan event. Eric Gehringer, Union Pacific’s executive vice president of operations, said recent capital investments have given the railroad the flexibility to absorb volume shifts from smaller ports like Oakland to major gateways such as Los Angeles. “[In] Inland Empire, we've been able to add another 70,000 lifts last year and we're going to add in even more than that this year,” Gehringer said at the J.P. Morgan event. “If you think about the whole intermodal network in total over the last handful of years, we've added in almost 1 million lifts across our network. We've been building in this capacity, and we'll be able to handle that volume.” According to a Journal of Commerce analysis of data from the Intermodal Association of North America, roughly 10,000 to 15,000 ocean containers move by rail each year from Oakland to Chicago, similar to the volume from the Port of Mobile and the Port of Philadelphia to Chicago. By comparison, BNSF Railway and Union Pacific haul that same volume from Southern California to Chicago every 10 to 14 days. There are no other rail-served routes handling more than 10,000 international loads annually from ports in Jacksonville, Mobile, New Orleans, Philadelphia or Wilmington, North Carolina. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a></div>

If a Trump administration proposal to tax Chinese-built and -operated ships calling at US ports is enacted, the nation’s Class I railroads could face the challenge of attempting to move cargo through fewer entry points without disrupting service, railroad executives said Tuesday. Executives from CSX Transportation and Union Pacific Railroad, speaking at the J.P. Morgan Industrials Conference, said while they could accommodate a shift toward larger ports, it would not come without “significant” disruption. “Certainly, this potential port fee that could come into play would have a significant disruptive impact,” said CSX CFO Sean Pelkey. “If there's more consolidation at ports that we serve and there's more volume that wants to come into those ports, that's a good thing. We can be a part of the solution for that. But it could also result in more congestion as well, which could have significant disruptive effects.” Congestion on the rail network is a key concern. During last year’s peak shipping season, service disruptions on the US West Coast coincided with double-digit percentage growth in cargo volume. In October, 795 of UP’s loaded intermodal railcars sat idle for at least 48 hours, according to the US Surface Transportation Board. That same month, UP’s average intermodal train speed fell to 27.9 miles per hour during the week of Oct. 9-16, its slowest week since 2019. Mediterranean Shipping Co. CEO Soren Toft said at TPM25 last week that it would no longer be economically viable for carriers to call smaller US ports if the Trump plan was implemented, something echoed by UP CEO Jennifer Hamann. “It does lend preference to the larger ports...,” Hamann said at the J.P. Morgan event. Eric Gehringer, Union Pacific’s executive vice president of operations, said recent capital investments have given the railroad the flexibility to absorb volume shifts from smaller ports like Oakland to major gateways such as Los Angeles. “[In] Inland Empire, we've been able to add another 70,000 lifts last year and we're going to add in even more than that this year,” Gehringer said at the J.P. Morgan event. “If you think about the whole intermodal network in total over the last handful of years, we've added in almost 1 million lifts across our network. We've been building in this capacity, and we'll be able to handle that volume.” According to a Journal of Commerce analysis of data from the Intermodal Association of North America, roughly 10,000 to 15,000 ocean containers move by rail each year from Oakland to Chicago, similar to the volume from the Port of Mobile and the Port of Philadelphia to Chicago. By comparison, BNSF Railway and Union Pacific haul that same volume from Southern California to Chicago every 10 to 14 days. There are no other rail-served routes handling more than 10,000 international loads annually from ports in Jacksonville, Mobile, New Orleans, Philadelphia or Wilmington, North Carolina. Contact Ari Ashe at ari.ashe@spglobal.com

North-American rail

North American ports

Proposed US tax on Chinese ship calls could pressure intermodal networks

<div class="phx-topic abstract-wrapper">The explosion of logistics software-as-a-service tools is leading shippers to build data foundations that reside outside of their internal systems. </div>

The explosion of logistics software-as-a-service tools is leading shippers to build data foundations that reside outside of their internal systems.

<div class="phx-topic">Shippers wrestling with decisions on which software and data partners to use are starting to build internal data warehousing capabilities to make it easier to test which of those providers are solving actual problems. That’s a new development and a shift from the traditional environment where a shipper wanting to trial a new technology would have to create a time-consuming and expensive integration with each new prospective provider. Data warehouses are repositories where an enterprise can house information across its organization – not only in logistics and transportation – to make it easier to store, manage and analyze large amounts of data. Among the largest providers of data warehouses, also called data lakes, are Snowflake, Databricks, Microsoft Azure and Amazon. “We knew we needed a data warehouse, and it was a fairly fast standup,” Julia Bedanova, chief operating officer at Million Dollar Baby, said at the Journal of Commerce’s TPM25 conference in Long Beach last week. “Within three months we were getting value out of that, because we invested in that foundation with Databricks first versus integrating with all these various solutions providers, or with sheer force, forcing the integrations.” That foundation has allowed Million Dollar Baby to trial and use a number of software-as-a-service (SaaS) and data-as-a-service (DaaS) products to support its logistics team. “The [application programming interfaces] are easy and clean, all of my partners are able to look into it and we’re able to exchange data in a very safe and segregated manner,” she said. “That was a critical piece to us being able to accelerate scaling and trying new solutions.” The process has become so streamlined, in fact, that Bedanova had to recently exert some control over the number of SaaS products to which Million Dollar Baby is subscribed. “One of the things we’ve been observing, and almost in awe of, is how huge that SaaS line in our budget has ballooned over the years,” she said. “It’s quadrupled over the last three years. It’s not just supply chain, it’s across the board. [Shippers] are becoming that much more dependent on SaaS companies.” <h3>Enabling multi-vendor approach </h3>Another shipper, Abercrombie &amp; Fitch, also noted its use of Databricks as a backbone that enabled predictive estimated times of arrival (ETAs) for import shipments in which it depends on two software vendors and a third-party logistics provider to collaborate. “We’ve changed the way we integrate with partners,” Kristen Kravitz, group vice president of transportation at Abercrombie, said during a separate session at TPM25. “We’ve moved to a Power BI environment with Databricks.” Power BI is a data visualization tool that helps businesses build reports. Tying it to a data warehouse that pulls data from all of a company’s systems is becoming de rigeur, according to numerous software executives who spoke to the Journal of Commerce at TPM25. In Abercrombie’s case, the company was transitioning from relying wholly on a retired E2open product for track and trace to one that pulled data from project44 and its origin management provider Century Supply Chain Solutions into the E2open transportation management system it uses. That relied not only on cooperation between those providers – who would ordinarily compete fiercely with one another for Abercrombie’s business – but on Abercrombie’s ability to make data from its internal systems more accurate and accessible. “We wanted to pull better information in with the platforms we’re already using, whether it’s E2open, project44 or Century,” Kravitz said. “It’s unlocked much better reporting and visibility for us. Making better, faster, data-driven decisions was a big piece of this. We needed to modernize the foundation.” Kravitz said that Abercrombie historically relied on E2open to integrate with its vendors and partners for visibility. “We just didn’t have the resources,” she said. “And now our architecture allows us to do that to a greater degree. Some of it is [the data warehouse] but some of it is work we’ve done internally to change the way we connect as well.” <h3>‘No choice’ </h3>Gautam Prem Jain, CEO of transportation management visibility software vendor GoComet, said at TPM25 that “most companies don’t have a choice” when it comes to integrations. “They have their [enterprise resource planning system] set up in a certain way and now they need to figure out how to make do,” he said. “It’s up to SaaS providers to not make it harder to test and buy in that environment. “It’s a catch-22 situation. If you integrate, it will take six months to a year to show value,” Jain added. “The [proof of concept] should be able to happen without integration quickly to demonstrate the [return on investment] because enterprises want to be able to see value really fast.” Logistics technology integration specialists are aware of the trend, among both forwarders and shippers. Coneksion, formerly Youredi, is used by shippers and forwarders to connect to shipping lines, ports, terminals and software vendors and is an integration partner with Azure. Prompt, which provides software to both segments, said it has a data warehouse product specifically designed to plug into widely used forwarding software platforms like CargoWise One and Magaya. Chain.io, which also serves both segments, has a native integration with Snowflake. Chain CEO Brian Glick told the Journal of Commerce that its work revolves around sanitizing and structuring the data before it goes into a data warehouse. “Otherwise, lots of bad and unstructured data goes in and people have trouble making sense of it when they want to do analytics,” Glick said. Contact Eric Johnson at eric.johnson@spglobal.com.</div>

Shippers wrestling with decisions on which software and data partners to use are starting to build internal data warehousing capabilities to make it easier to test which of those providers are solving actual problems. That’s a new development and a shift from the traditional environment where a shipper wanting to trial a new technology would have to create a time-consuming and expensive integration with each new prospective provider. Data warehouses are repositories where an enterprise can house information across its organization – not only in logistics and transportation – to make it easier to store, manage and analyze large amounts of data. Among the largest providers of data warehouses, also called data lakes, are Snowflake, Databricks, Microsoft Azure and Amazon. “We knew we needed a data warehouse, and it was a fairly fast standup,” Julia Bedanova, chief operating officer at Million Dollar Baby, said at the Journal of Commerce’s TPM25 conference in Long Beach last week. “Within three months we were getting value out of that, because we invested in that foundation with Databricks first versus integrating with all these various solutions providers, or with sheer force, forcing the integrations.” That foundation has allowed Million Dollar Baby to trial and use a number of software-as-a-service (SaaS) and data-as-a-service (DaaS) products to support its logistics team. “The [application programming interfaces] are easy and clean, all of my partners are able to look into it and we’re able to exchange data in a very safe and segregated manner,” she said. “That was a critical piece to us being able to accelerate scaling and trying new solutions.” The process has become so streamlined, in fact, that Bedanova had to recently exert some control over the number of SaaS products to which Million Dollar Baby is subscribed. “One of the things we’ve been observing, and almost in awe of, is how huge that SaaS line in our budget has ballooned over the years,” she said. “It’s quadrupled over the last three years. It’s not just supply chain, it’s across the board. [Shippers] are becoming that much more dependent on SaaS companies.” Enabling multi-vendor approach Another shipper, Abercrombie & Fitch, also noted its use of Databricks as a backbone that enabled predictive estimated times of arrival (ETAs) for import shipments in which it depends on two software vendors and a third-party logistics provider to collaborate. “We’ve changed the way we integrate with partners,” Kristen Kravitz, group vice president of transportation at Abercrombie, said during a separate session at TPM25. “We’ve moved to a Power BI environment with Databricks.” Power BI is a data visualization tool that helps businesses build reports. Tying it to a data warehouse that pulls data from all of a company’s systems is becoming de rigeur, according to numerous software executives who spoke to the Journal of Commerce at TPM25. In Abercrombie’s case, the company was transitioning from relying wholly on a retired E2open product for track and trace to one that pulled data from project44 and its origin management provider Century Supply Chain Solutions into the E2open transportation management system it uses. That relied not only on cooperation between those providers – who would ordinarily compete fiercely with one another for Abercrombie’s business – but on Abercrombie’s ability to make data from its internal systems more accurate and accessible. “We wanted to pull better information in with the platforms we’re already using, whether it’s E2open, project44 or Century,” Kravitz said. “It’s unlocked much better reporting and visibility for us. Making better, faster, data-driven decisions was a big piece of this. We needed to modernize the foundation.” Kravitz said that Abercrombie historically relied on E2open to integrate with its vendors and partners for visibility. “We just didn’t have the resources,” she said. “And now our architecture allows us to do that to a greater degree. Some of it is [the data warehouse] but some of it is work we’ve done internally to change the way we connect as well.” ‘No choice’ Gautam Prem Jain, CEO of transportation management visibility software vendor GoComet, said at TPM25 that “most companies don’t have a choice” when it comes to integrations. “They have their [enterprise resource planning system] set up in a certain way and now they need to figure out how to make do,” he said. “It’s up to SaaS providers to not make it harder to test and buy in that environment. “It’s a catch-22 situation. If you integrate, it will take six months to a year to show value,” Jain added. “The [proof of concept] should be able to happen without integration quickly to demonstrate the [return on investment] because enterprises want to be able to see value really fast.” Logistics technology integration specialists are aware of the trend, among both forwarders and shippers. Coneksion, formerly Youredi, is used by shippers and forwarders to connect to shipping lines, ports, terminals and software vendors and is an integration partner with Azure. Prompt, which provides software to both segments, said it has a data warehouse product specifically designed to plug into widely used forwarding software platforms like CargoWise One and Magaya. Chain.io, which also serves both segments, has a native integration with Snowflake. Chain CEO Brian Glick told the Journal of Commerce that its work revolves around sanitizing and structuring the data before it goes into a data warehouse. “Otherwise, lots of bad and unstructured data goes in and people have trouble making sense of it when they want to do analytics,” Glick said. Contact Eric Johnson at eric.johnson@spglobal.com.

Logistics Technology News

Shippers investing in data warehousing capability to increase software options

<div class="phx-topic abstract-wrapper">As a top tier of mega carriers has emerged through consolidation and organic growth, so has the need of those carriers to align their dominance on the ocean with capacity at ports.</div>

As a top tier of mega carriers has emerged through consolidation and organic growth, so has the need of those carriers to align their dominance on the ocean with capacity at ports.

<div class="phx-topic">Container lines going back to Sea-Land Service Inc. have seen value in controlling marine terminals, but the advantages — and the competition to acquire key facilities — are intensifying in line with growing port congestion, finite port capacity and the growing dominance of a top tier of mega carriers. Securing port access and the efficiencies it brings, while allowing competitors to be blocked out, was the major victory achieved by Mediterranean Shipping Co. by participating via its terminal operating unit in the <a href="https://www.joc.com/article/hutchison-inks-228-billion-deal-to-sell-majority-of-port-holdings-to-blackrock-til-5955819">$23 billion deal with BlackRock to acquire the non-China assets of CK Hutchison’s terminal portfolio</a>. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5960667_0.1.jpg"></img></div>As a top tier of mega carriers has emerged through consolidation and organic growth, so has the need of those carriers to align their dominance on the ocean with capacity at ports. “The aspiration of major carriers and alliances today is the ability to control their own destiny with regard to port and terminal operating capability,” said Peter Levesque, advanced leadership fellow at Harvard University who has led terminal operating businesses, including Modern Terminals and Ports America. MSC, through its Terminal Investment Limited (TiL) unit, will gain access to terminals at 43 ports in 23 countries totaling 199 berths — although some of those <a href="https://www.joc.com/article/big-hutchison-deal-could-reshuffle-global-ports-network-drewry-5958162">terminals may be divested pursuant to antitrust review in Europe</a> — and will emerge as the world’s largest terminal operator. “The fact that TIL is involved in this deal with Blackrock speaks volumes as to what MSC looks to achieve in global terminal operating capability and competitive advantage,” Levesque said. The competition among carriers for prized port assets can be seen on multiple fronts. Hapag-Lloyd last year announced the creation of a terminal operating unit, reflecting its commitment to “expansive terminal operations,” and <a href="https://www.joc.com/article/hapag-lloyds-ports-arm-buys-majority-stake-in-le-havre-terminal-5959230">on Monday announced the acquisition of a majority stake in a Le Havre terminal operator</a>. Growing terminal portfolios are controlled by Maersk, CMA CGM and Ocean Network Express. “There is a tendency for each shipping line now to build their own terminal portfolio,” said Robbert van Trooijen, head of consultancy Inception Partners LLC Inc. and the former Maersk head of Asia-Pacific and Latin America. Carriers are growing increasingly aggressive in pursuit of ports. In its winning bid to acquire Global Container Terminal facilities at Bayonne and Staten Island, CMA CGM agreed to the surprise terms of sharing detention and demurrage revenue with the Port Authority of New York and New Jersey, and to helping fund quayside improvements. <a href="https://www.ckh.com.hk/en/media/press_each.php?id=3431">CK Hutchison said</a> the TiL/BlackRock deal resulted from a “competitive process in which numerous bids and expressions of interest were received,” which reportedly included other carriers. <h3>Moves driven by port congestion, capacity constraints </h3>Carriers’ urgency in acquiring terminals reflects concerns about growing port congestion globally combined with limited greenfield port projects. “Globally, terminal capacity is under significant constraint. Globally, port congestion is growing,” said van Trooijen. “There is a lack of greenfield projects out there that will deliver expansion, so getting your hands on existing capacity, and especially a portfolio of this size, this was a once-in-a-decade opportunity.” The ratio of a ship’s time at sea versus time in port has grown from 80-20 to 70-30 in recent years, said Johnson Leung of Linerlytica. China in recent years has stopped building port capacity ahead of demand as it did for many years, leading to growing congestion at Shanghai and Ningbo. Controlling terminals enables carriers to control costs at the terminal, tightly coordinate port calls and ensure its ships are guaranteed priority on arrival and departure. Control of hub ports is deemed the essential ingredient in delivering the <a href="https://www.joc.com/article/tpm25-gemini-hitting-90-reliability-target-as-new-network-rolls-out-habben-jansen-5955794">90%-plus schedule reliability promised by the hub-and-spoke Gemini alliance.</a>“Controlling key port infrastructure provides carriers with cost and operating efficiencies that are difficult to achieve with non-carrier-affiliated terminals and government port authorities,” Levesque said. The growing dominance of the top tier of carriers, where MSC crossed the 20% market share threshold and the top five carriers control 65% of capacity, according to Alphaliner, is forcing third-party terminal businesses to align with key carriers able to provide the volume needed to keep terminals profitable. “For a big terminal operator, you increasingly need to have a long-term relationship with carriers with whom you have more than average cooperation if you want to safeguard your future for the long term,” van Trooijen said. “Terminal operators who are successful are the ones who have developed long-term carrier relationships.” Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>.</div>

Container lines going back to Sea-Land Service Inc. have seen value in controlling marine terminals, but the advantages — and the competition to acquire key facilities — are intensifying in line with growing port congestion, finite port capacity and the growing dominance of a top tier of mega carriers. Securing port access and the efficiencies it brings, while allowing competitors to be blocked out, was the major victory achieved by Mediterranean Shipping Co. by participating via its terminal operating unit in the $23 billion deal with BlackRock to acquire the non-China assets of CK Hutchison’s terminal portfolio . As a top tier of mega carriers has emerged through consolidation and organic growth, so has the need of those carriers to align their dominance on the ocean with capacity at ports. “The aspiration of major carriers and alliances today is the ability to control their own destiny with regard to port and terminal operating capability,” said Peter Levesque, advanced leadership fellow at Harvard University who has led terminal operating businesses, including Modern Terminals and Ports America. MSC, through its Terminal Investment Limited (TiL) unit, will gain access to terminals at 43 ports in 23 countries totaling 199 berths — although some of those terminals may be divested pursuant to antitrust review in Europe — and will emerge as the world’s largest terminal operator. “The fact that TIL is involved in this deal with Blackrock speaks volumes as to what MSC looks to achieve in global terminal operating capability and competitive advantage,” Levesque said. The competition among carriers for prized port assets can be seen on multiple fronts. Hapag-Lloyd last year announced the creation of a terminal operating unit, reflecting its commitment to “expansive terminal operations,” and on Monday announced the acquisition of a majority stake in a Le Havre terminal operator . Growing terminal portfolios are controlled by Maersk, CMA CGM and Ocean Network Express. “There is a tendency for each shipping line now to build their own terminal portfolio,” said Robbert van Trooijen, head of consultancy Inception Partners LLC Inc. and the former Maersk head of Asia-Pacific and Latin America. Carriers are growing increasingly aggressive in pursuit of ports. In its winning bid to acquire Global Container Terminal facilities at Bayonne and Staten Island, CMA CGM agreed to the surprise terms of sharing detention and demurrage revenue with the Port Authority of New York and New Jersey, and to helping fund quayside improvements. CK Hutchison said the TiL/BlackRock deal resulted from a “competitive process in which numerous bids and expressions of interest were received,” which reportedly included other carriers. Moves driven by port congestion, capacity constraints Carriers’ urgency in acquiring terminals reflects concerns about growing port congestion globally combined with limited greenfield port projects. “Globally, terminal capacity is under significant constraint. Globally, port congestion is growing,” said van Trooijen. “There is a lack of greenfield projects out there that will deliver expansion, so getting your hands on existing capacity, and especially a portfolio of this size, this was a once-in-a-decade opportunity.” The ratio of a ship’s time at sea versus time in port has grown from 80-20 to 70-30 in recent years, said Johnson Leung of Linerlytica. China in recent years has stopped building port capacity ahead of demand as it did for many years, leading to growing congestion at Shanghai and Ningbo. Controlling terminals enables carriers to control costs at the terminal, tightly coordinate port calls and ensure its ships are guaranteed priority on arrival and departure. Control of hub ports is deemed the essential ingredient in delivering the 90%-plus schedule reliability promised by the hub-and-spoke Gemini alliance. “Controlling key port infrastructure provides carriers with cost and operating efficiencies that are difficult to achieve with non-carrier-affiliated terminals and government port authorities,” Levesque said. The growing dominance of the top tier of carriers, where MSC crossed the 20% market share threshold and the top five carriers control 65% of capacity, according to Alphaliner, is forcing third-party terminal businesses to align with key carriers able to provide the volume needed to keep terminals profitable. “For a big terminal operator, you increasingly need to have a long-term relationship with carriers with whom you have more than average cooperation if you want to safeguard your future for the long term,” van Trooijen said. “Terminal operators who are successful are the ones who have developed long-term carrier relationships.” Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

Container lines

Marine terminals

International ports

Hutchison deal shows thirst of big carriers to control global terminal assets

<div class="phx-topic abstract-wrapper">US-bound spot truck shipments from Canada are shrinking but rates are rising, while Mexico-US spot market shipments outpace pricing, according to DAT Freight &amp; Analytics. </div>

US-bound spot truck shipments from Canada are shrinking but rates are rising, while Mexico-US spot market shipments outpace pricing, according to DAT Freight & Analytics.

<div class="phx-topic">The flow of goods moving across the US-Canada border shrank last week, but not the cost of moving them, as a trade war between the two neighbors deepened. Rates in the Toronto-to-Chicago lane, one of the heaviest for cross-border truck traffic between the US and Canada, rose 18% week over week while spot volumes dropped 20% in the week ended March 7, according to DAT Freight &amp; Analytics. From Chicago to Toronto, rates rose 8% while loads dropped 2% week over week. Canadian spot market capacity has been shrinking. Available Canadian spot truck capacity fell 29% year over year in January despite a 2% increase from December, according to Loadlink Technologies, a sister company of DAT within Roper Industries. The push to move high volumes of goods south ahead of US tariffs exacerbated that tightness. The story was different on the southern US border last week, where shipments from Mexico rose 12% week over week and 19% year over year, according to DAT. However, northbound spot rates from the border in March were up only 3 cents per mile from February. That reflects the differences in cross-border trucking between the US, Mexico and Canada. US-bound loads from Mexico are typically transferred to US trucks at the border, often through cross docks in border entry points such as Laredo, Texas. Southbound Canadian shipments move straight to their destinations. Pause and restart <a href="https://nam11.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.joc.com%2Farticle%2Ftpm25-chaos-erupts-as-us-tariffs-disrupt-cross-border-trucking-with-mexico-canada-5957555&amp;data=05%7C02%7Ckevin.saville2%40spglobal.com%7C4d58a1be910c4d2a0c9208dd600782fc%7C8f3e36ea80394b4081a77dc0599e8645%7C1%7C0%7C638772307560798379%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&amp;sdata=22fWzX9CigDH8nfsQQU8bw9ix2Fv603N%2FAEb3N%2BzhtU%3D&amp;reserved=0">Freight flows across both borders were scrambled</a> when the US implemented 25% tariffs on goods from Canada and Mexico last Tuesday, delaying shipments and raising costs. Many shippers temporarily “hit the pause button” on US-bound loads from Mexico when tariffs took effect, said Jordan Dewart, president of Mexico for Redwood Logistics. The White House rolled back some tariffs on Mexico and Canada last Wednesday, postponing import taxes on the Canadian and Mexican automotive sectors until April 2. “Our American automotive industry, which provides American jobs, should not suffer significant disruption just because of the structure of its supply chain,” the White House said in a statement. Tariffs for goods that meet rules of origin under the US-Mexico-Canada Agreement (USMCA), including many agricultural products, were also delayed until April 2. The exemptions cover about 38% of Canadian goods and 50% of Mexican goods, according to the White House. That means about 62% of Canadian goods and half of Mexican products are still subject to US tariffs. Shippers can expect high cross-border freight volumes and rates to continue as the April 2 deadline approaches. In the meantime, Mexico and Canada have slapped retaliatory tariffs on US goods. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

The flow of goods moving across the US-Canada border shrank last week, but not the cost of moving them, as a trade war between the two neighbors deepened. Rates in the Toronto-to-Chicago lane, one of the heaviest for cross-border truck traffic between the US and Canada, rose 18% week over week while spot volumes dropped 20% in the week ended March 7, according to DAT Freight & Analytics. From Chicago to Toronto, rates rose 8% while loads dropped 2% week over week. Canadian spot market capacity has been shrinking. Available Canadian spot truck capacity fell 29% year over year in January despite a 2% increase from December, according to Loadlink Technologies, a sister company of DAT within Roper Industries. The push to move high volumes of goods south ahead of US tariffs exacerbated that tightness. The story was different on the southern US border last week, where shipments from Mexico rose 12% week over week and 19% year over year, according to DAT. However, northbound spot rates from the border in March were up only 3 cents per mile from February. That reflects the differences in cross-border trucking between the US, Mexico and Canada. US-bound loads from Mexico are typically transferred to US trucks at the border, often through cross docks in border entry points such as Laredo, Texas. Southbound Canadian shipments move straight to their destinations. Pause and restart Freight flows across both borders were scrambled when the US implemented 25% tariffs on goods from Canada and Mexico last Tuesday, delaying shipments and raising costs. Many shippers temporarily “hit the pause button” on US-bound loads from Mexico when tariffs took effect, said Jordan Dewart, president of Mexico for Redwood Logistics. The White House rolled back some tariffs on Mexico and Canada last Wednesday, postponing import taxes on the Canadian and Mexican automotive sectors until April 2. “Our American automotive industry, which provides American jobs, should not suffer significant disruption just because of the structure of its supply chain,” the White House said in a statement. Tariffs for goods that meet rules of origin under the US-Mexico-Canada Agreement (USMCA), including many agricultural products, were also delayed until April 2. The exemptions cover about 38% of Canadian goods and 50% of Mexican goods, according to the White House. That means about 62% of Canadian goods and half of Mexican products are still subject to US tariffs. Shippers can expect high cross-border freight volumes and rates to continue as the April 2 deadline approaches. In the meantime, Mexico and Canada have slapped retaliatory tariffs on US goods. Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Surface

Cross-border spot truck rates rise as shippers ride tariff rollercoaster

<div class="phx-topic abstract-wrapper">The threat underscores the fragility of the Red Sea security situation and the reluctance of ocean carriers to return to Suez Canal transits until the safety of crew, ships and cargo can be guaranteed. </div>

The threat underscores the fragility of the Red Sea security situation and the reluctance of ocean carriers to return to Suez Canal transits until the safety of crew, ships and cargo can be guaranteed. 

<div class="phx-topic">Houthi militants have threatened to resume attacks on merchant shipping in the Red Sea by midweek unless Israel resumes humanitarian aid and electricity supplies to Gaza that were cut earlier this month. Speaking during a televised address on March 8, Houthi leader Abdul-Malik Al-Houthi set a four-day deadline for Israel to lift a blockade on aid deliveries into Gaza — which have been halted since March 2 — after which time the Houthis would “resume our naval operations against the Israeli enemy.” The Houthis had paused attacks on international shipping and on Israel on Jan. 19, except for vessels wholly owned by Israeli individuals and/or sailing under the Israeli flag, in line with the ceasefire between Israel and Hamas in Gaza that expired on March 1 without being extended or progressing to its proposed second stage. S&amp;P Global Market Intelligence said in a risk assessment Monday that the Houthi threat to resume attacks on Israel “is credible.” “A resumption of Houthi ‘naval operations’ would represent a severe risk to all vessels in transit in the Red Sea and Gulf of Aden, regardless of affiliation with Israel, due to uncertainties around targeting selection,” S&amp;P Global Market Intelligence said. The high potential for strikes on shipping to resume was highlighted by Jack Kennedy, head of Middle East and North Africa country risk at S&amp;P Global Market Intelligence, at the Journal of Commerce's TPM25 conference in Long Beach, Calif., last week. S&amp;P Global is the parent company of the Journal of Commerce. “We expect the ceasefire process is likely to break down in the next 12 months and military operations will resume in Gaza,” was Kennedy’s bleak assessment. The threat underscores the fragility of the Red Sea security situation and the reluctance of ocean carriers to resume Suez Canal transits until the safety of crew, ships and cargo can be guaranteed. Carriers have been diverting vessels around southern Africa since the Houthi attacks on shipping began 15 months ago. “It has to be safe, and right now it is not safe,” Soren Toft, CEO of Mediterranean Shipping Co. (MSC), told TPM25. “It is all linked to a number of agreements in the Middle East that are still being discussed, so for us there will be no immediate return to the Red Sea,” Toft added. “Could it happen next month, two months, six months? I don’t know. Eventually it will happen.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Houthi militants have threatened to resume attacks on merchant shipping in the Red Sea by midweek unless Israel resumes humanitarian aid and electricity supplies to Gaza that were cut earlier this month. Speaking during a televised address on March 8, Houthi leader Abdul-Malik Al-Houthi set a four-day deadline for Israel to lift a blockade on aid deliveries into Gaza — which have been halted since March 2 — after which time the Houthis would “resume our naval operations against the Israeli enemy.” The Houthis had paused attacks on international shipping and on Israel on Jan. 19, except for vessels wholly owned by Israeli individuals and/or sailing under the Israeli flag, in line with the ceasefire between Israel and Hamas in Gaza that expired on March 1 without being extended or progressing to its proposed second stage. S&P Global Market Intelligence said in a risk assessment Monday that the Houthi threat to resume attacks on Israel “is credible.” “A resumption of Houthi ‘naval operations’ would represent a severe risk to all vessels in transit in the Red Sea and Gulf of Aden, regardless of affiliation with Israel, due to uncertainties around targeting selection,” S&P Global Market Intelligence said. The high potential for strikes on shipping to resume was highlighted by Jack Kennedy, head of Middle East and North Africa country risk at S&P Global Market Intelligence, at the Journal of Commerce's TPM25 conference in Long Beach, Calif., last week. S&P Global is the parent company of the Journal of Commerce. “We expect the ceasefire process is likely to break down in the next 12 months and military operations will resume in Gaza,” was Kennedy’s bleak assessment. The threat underscores the fragility of the Red Sea security situation and the reluctance of ocean carriers to resume Suez Canal transits until the safety of crew, ships and cargo can be guaranteed. Carriers have been diverting vessels around southern Africa since the Houthi attacks on shipping began 15 months ago. “It has to be safe, and right now it is not safe,” Soren Toft, CEO of Mediterranean Shipping Co. (MSC), told TPM25. “It is all linked to a number of agreements in the Middle East that are still being discussed, so for us there will be no immediate return to the Red Sea,” Toft added. “Could it happen next month, two months, six months? I don’t know. Eventually it will happen.” Contact Greg Knowler at greg.knowler@spglobal.com .

Container Shipping News

Asia-Europe

Houthi militants threaten to restart attacks on Red Sea shipping

Use code GTW695 at checkout and save $800 on first year of an annual Gold subscription!

Upgrade Subscription - Gold Trials

Become a Gold Subscriber and Save!

Arm your team with the most trusted information portal for the international container shipping industry.

Group Subscriptions - Wide Box

Get into a group subscription today

Use code STSW20 at checkout to save 20% on the first year of any annual subscription! 

Subscribe Now - Free Trials - Wide Box

SUBSCRIBE AND SAVE

Use code GUW795 at checkout and save $700 on first year of a Gold subscription!

Upgrade Subscription - Wide Box

UPGRADE AND SAVE

Access Journal of Commerce content for 30 days

Free Trial - Wide Box

START A FREE TRIAL TODAY

Subscribe Now - Anonymous - Wide Box

SUBSCRIBE TODAY

The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

SMC3rates_shutterstock_5247046.jpg

Shippers save money, time with automated transportation bidding tools

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>

SMC3rates_shutterstock_5247046 (1).jpg

Filling the Supply Chain Education Gap with LTL Education Courses

SUBSCRIBE TODAY: Choose a plan that works best for you!

Subscribe Now - Anonymous - Offer Box

Subscribe Today

START A FREE TRIAL: Access Journal of Commerce content for 30 days

Free Trial - Offer Box

Free Trial

SUBSCRIBE AND SAVE: Use code STSW20 at checkout to save 20% on first year of any subscription plan!


Subscribe Now - Free Trials - Offer Box

GET INTO A GROUP SUBSCRIPTION: Arm your team with unlimited Journal of Commerce content

Group Subscriptions - Offer Box

Group Subscriptions

UPGRADE TO GOLD AND SAVE: Use code GTW695 at checkout and save $800 on first year of a Gold subscription!

Upgrade Subscription

UPGRADE AND SAVE: Use code GUW795 at checkout and save $700 on first year of a Gold subscription! 

Upgrade Subscription - Offer Box

A premium access index of savings using domestic intermodal vs. OTR 

ISI Report - Rectangle Box

Intermodal Savings Index

An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

Breakbulk Report - Rectangle Box

Breakbulk Quarterly

An extensive dashboard of charts organized by trade lane, mode, and topic

Gateway - Rectangle Box

Gateway

Customers scoring their intermodal partners to identify the best service providers

Intermodal Service Scorecard - Rectangle Box

Intermodal Service Scorecard

A premium access outlook critical to shippers and transportation providers

QI Report - Rectangle Box

Quarterly Intelligence

The only editorially independent conference for the breakbulk & project cargo industry

Breakbulk Conference - Rectangle Box

Attend Breakbulk25

The Journal of Commerce’s analysis and coverage of North American and global rail news encompasses Class I railroad, intermodal marketing providers, and supporting drayage and truckload services. Reporting on freight railroad news today, journalists track volume, intermodal freight rates, service levels, precision schedule railroading, transloading, regulation, union labor and network investment at domestic and international intermodal terminals.

Intermodal providers

Stay updated with our rail transport news and trends. Journal of Commerce covers intermodal news, and port connectivity news in the container rail transport sector.

Rail News | Journal of Commerce

Rail News

The Journal of Commerce’s surface transport news and analysis focuses on landside transport movement — from railroad news to trucking news — including full load trucking, less-than-truckload (LTL), refrigerated (or reefer) trucking, flatbed and domestic and international intermodal rail, and how it connects with seaports, inland rail hubs, distribution centers and transloading operations. Reporting on the surface transport sector covers the movement of domestic shipments within the United States and international cargoes transported via domestic equipment including trailers and 53-foot containers.

Discover comprehensive trucking news and trends with Journal of Commerce - from trucking LTL to regulation and trucking supply and demand.

Trucking News | Journal of Commerce

Explore the world of ground transport news - from trucks to railroads, intermodal connections, and port ties. Daily insights on US and global shipments.

Latest News

More News & Analysis

Proposed US tax on Chinese ship calls could pressure intermodal networks

Shippers investing in data warehousing capability to increase software options

Hutchison deal shows thirst of big carriers to control global terminal assets