<div class="phx-topic abstract-wrapper">Austria's effort to finance trans-Alpine rail improvements by sharply increasing Brenner Pass highwa</div>

Austria's effort to finance trans-Alpine rail improvements by sharply increasing Brenner Pass highwa

<div>Austria's effort to finance trans-Alpine rail improvements by sharply increasing Brenner Pass highway tolls has been struck down by a European court, spurring Austrian officials to threaten a countersuit.Austrian Transport Minister Michael Schmid said this week that he would refuse to lower the Brenner tolls - as ordered last week by the European Court of Justice in Luxembourg - unless the European Union proposes another way to help Austria pay for improvements to its railroad network across the Alps.Schmid also threatened to file a countersuit challenging an EU system - called the ''eco-point'' regime - that governs how many trucks...

Austria's effort to finance trans-Alpine rail improvements by sharply increasing Brenner Pass highway tolls has been struck down by a European court, spurring Austrian officials to threaten a countersuit. Austrian Transport Minister Michael Schmid said this week that he would refuse to lower the Brenner tolls - as ordered last week by the European Court of Justice in Luxembourg - unless the European Union proposes another way to help Austria pay for improvements to its railroad network across the Alps.Schmid also threatened to file a countersuit challenging an EU system - called the ''eco-point'' regime - that governs how many trucks are permitted to transit the Austrian Alps. That crossing has become a bottleneck in commerce between Northern and Southern Europe. The European court, acting on complaints filed by Germany, Italy and other European nations that say their motor carriers are unfairly penalized by the high tolls, ruled that the high tolls violated EU rules because they unfairly discriminated against non-Austrian trucks and they recouped far more than the actual costs of maintaining the Brenner Pass highway. German and Italian motor carriers, along with the transport minister of Germany's southern state of Bavaria, Otto Wiesheu, hailed the court ruling and urged the Austrian government to quickly lower the tolls, which increased in 1995 and 1995 for transiting trucks with more than three axles. But Schmid and other high-ranking Austrian officials - including Prime Minister Wolfgang Schuessel - said the ruling was unfair to Austria, which has been struggling to find the finances to pay for bolstering rail capacity over the Brenner and other Alpine passes to Italy. Just a week before the European court's judgment, EU transport ministers had agreed to pressure Austria to modify the way it implements the ''eco-point'' system, which this year has led to potentially drastic reductions in the number of German trucks allowed to transit Austrian highways on the way to or from Italy. The Austrian government, pressured by environmental groups that blockaded the Brenner Pass in June, cut back on the number of eco-points that it distributes to European motor carriers to allow them to use the congested Brenner. Austrian officials argue that the eco-point agreement, reached when Austria joined the EU in 1991, allows it to reduce the number of transiting trucks to protect the Alpine environment. In Austria and neighboring countries, the problems of trans-Alpine transit have worsened in recent years, as North-South commerce between Germany and Italy has sharply increased, and environmental groups have pushed harder to restrict transport by motor carriers, which cause more air pollution than trains. But Austria has lagged in building up its rail freight capacity.

Transport, Trade and Regulation News

COURT RULING REKINDLES BRENNER PASS DEBATE

<div class="phx-topic abstract-wrapper">The decline reflects the wider slide in container freight rates from August, which accelerated in October and November as cargo demand eased.</div>

The decline reflects the wider slide in container freight rates from August, which accelerated in October and November as cargo demand eased.

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<div class="phx-topic">Taiwan's Big Three container lines saw an accelerating decline in revenues over the last six months, although they remain significantly higher than monthly revenues in 2023, filings this week with the Taiwan stock exchange show. Figures from Evergreen Marine, Taiwan’s largest container line, show monthly revenues dropped 30% between the peak in July and December. Yang Ming Marine Transport saw a similar pattern, with monthly revenues falling 32% between July and December, while intra-Asia-focused Wan Hai Lines saw a 28% drop in the same period. The slump reflects the wider slide in container freight rates from August, which accelerated in October and November as cargo demand eased. The Shanghai Containerized Freight Index (SCFI), which measures spot container rates on a basket of trades including the trans-Pacific from Shanghai, plunged 43% in the third quarter alone, the biggest third-quarter drop since 2022. That followed an early peak season as shippers forward booked shipments to offset port congestion and voyage delays and the threat of disruption due to industrial action by dockworkers on the US East and Gulf coasts in October. “With the end of the US East [and Gulf] coast port strike, concerns about supply chain disruptions ... eased, leading to increased competitive pressure in the market,” Yang Ming said in market comments about the fourth quarter. Evergreen and Wan Hai Lines did see a slight uptick in December revenues from November on the back of higher freight rates ahead of the Lunar New Year holidays. Overall, Evergreen saw monthly revenues slide from $1.6 billion in July to $1.1 billion in December, stock exchange filings show. Total revenues for the year were $14 billion, up 68% compared with $8.4 billion in 2023. Yang Ming reported monthly revenues of $770 million in July, falling to $521 million in December. But revenues for all of 2024 totaled $6.7 billion, up 58% from $4.2 billion in the year prior. Similarly, Wan Hai Lines recorded revenues of $608 million in July compared with $435 million in December. Full-year revenue of $4.9 billion was up 62% from $3 million in 2023. Other carriers are expected to report a similar slide in revenues after rates peaked in the middle of last year. <a href="https://www.joc.com/article/cosco-forecasts-95-jump-in-2024-net-profit-on-robust-volumes-freight-rates-5920588">OOCL on Friday</a> said revenues fell to $2.5 billion in the fourth quarter, despite an increase in liftings, from $3 billion in the third quarter. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Taiwan's Big Three container lines saw an accelerating decline in revenues over the last six months, although they remain significantly higher than monthly revenues in 2023, filings this week with the Taiwan stock exchange show. Figures from Evergreen Marine, Taiwan’s largest container line, show monthly revenues dropped 30% between the peak in July and December. Yang Ming Marine Transport saw a similar pattern, with monthly revenues falling 32% between July and December, while intra-Asia-focused Wan Hai Lines saw a 28% drop in the same period. The slump reflects the wider slide in container freight rates from August, which accelerated in October and November as cargo demand eased. The Shanghai Containerized Freight Index (SCFI), which measures spot container rates on a basket of trades including the trans-Pacific from Shanghai, plunged 43% in the third quarter alone, the biggest third-quarter drop since 2022. That followed an early peak season as shippers forward booked shipments to offset port congestion and voyage delays and the threat of disruption due to industrial action by dockworkers on the US East and Gulf coasts in October. “With the end of the US East [and Gulf] coast port strike, concerns about supply chain disruptions ... eased, leading to increased competitive pressure in the market,” Yang Ming said in market comments about the fourth quarter. Evergreen and Wan Hai Lines did see a slight uptick in December revenues from November on the back of higher freight rates ahead of the Lunar New Year holidays. Overall, Evergreen saw monthly revenues slide from $1.6 billion in July to $1.1 billion in December, stock exchange filings show. Total revenues for the year were $14 billion, up 68% compared with $8.4 billion in 2023. Yang Ming reported monthly revenues of $770 million in July, falling to $521 million in December. But revenues for all of 2024 totaled $6.7 billion, up 58% from $4.2 billion in the year prior. Similarly, Wan Hai Lines recorded revenues of $608 million in July compared with $435 million in December. Full-year revenue of $4.9 billion was up 62% from $3 million in 2023. Other carriers are expected to report a similar slide in revenues after rates peaked in the middle of last year. OOCL on Friday said revenues fell to $2.5 billion in the fourth quarter, despite an increase in liftings, from $3 billion in the third quarter. Contact Keith Wallis at keithwallis@hotmail.com .

Container Shipping News

Container lines

Maritime

Taiwan’s Big Three carriers see 30% slide in H2 monthly revenues after rate slump

<div class="phx-topic abstract-wrapper">The carrier’s top-line financials are a clear signal that container shipping is firmly back in profitable territory following a poor end to 2023 that left several carriers nursing losses.</div>

The carrier’s top-line financials are a clear signal that container shipping is firmly back in profitable territory following a poor end to 2023 that left several carriers nursing losses.

<div class="phx-topic">Cosco Shipping Holdings, the parent of Cosco Shipping and OOCL, on Friday said it expects $7.5 billion in net profit for 2024, a 95% year-over-year jump that the carrier attributed to an increase in volumes and higher freight rates. While Cosco did not provide the volume or revenue figures in its estimated annual results, the China state-owned carrier noted in an announcement to the Hong Kong Exchange that the Red Sea diversions had caused a shortage in capacity and kept rates at “a relatively high level.” “In 2024, the company recorded an increase in volume and freight rate of its container shipping business on a year-over-year basis, achieving better operating results,” Cosco said in the statement. Also released Friday was an operational update from Cosco subsidiary OOCL. Although no profit and loss details were published — full financial results will be announced in March — the OOCL result gave a little more color on fourth-quarter and full-year performance. OOCL reported 2024 annual revenue just shy of $10 billion, with the 30% year-over-year increase driven by a booming fourth quarter when volume rose 3.5% to 7.6 million TEUs and average revenue per TEU rose 46.2% compared with the last three months of 2023. The operating result and Cosco’s 2024 earnings forecast show container shipping is firmly back in profitable territory following a poor end to 2023 when several carriers, including <a href="https://www.joc.com/article/red-sea-crisis-wont-prevent-likely-significant-operating-loss-2024-maersk_20240208.html">Maersk</a> and <a href="https://www.joc.com/article/hapag-lloyd-reports-q4-loss-falling-rates-red-sea-disruption_20240130.html">Hapag-Lloyd</a>, reported <a href="https://www.joc.com/article/evergreen-wai-hai-join-peers-in-reporting-sharply-lower-2023-financials-5214522">fourth-quarter operating losses</a>. <h3>High average revenue per TEU </h3>The trans-Pacific trade led both volume and revenue growth at OOCL last year, with 2024 volume up 10% to 2 million TEUs and revenue on the lane soaring 53.5% to $3.8 billion. Asia-Europe volume of 1.4 million TEUs was down 6.5% while revenue fell 11% to $1.4 billion. Trans-Atlantic volumes fell 0.6% to 479,517 with revenue declining 26% to $616 million. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="4bf824e9-ea85-4405-857e-04a7fa8dec88"></dynamic-object></div>OOCL’s largest segment by volume is effectively two trade lanes, intra-Asia and Australasia, which reported a 7.4% increase in demand to 3.6 million TEUs and revenue rising 17.1% to just under $3 billion. It was the fourth quarter where the big financial numbers were recorded as the carrier capitalized on trans-Pacific and trans-Atlantic frontloading ahead of <a href="https://www.joc.com/article/us-retailers-prepare-for-new-ila-strike-threat-tariffs-on-china-imports-5822904">a threatened increase in US tariffs on China</a> by the new Trump administration and <a href="https://www.joc.com/article/front-loading-of-ocean-cargo-diminishing-ch-robinson-ceo-says-5907756">an earlier Lunar New Year</a>. <h3>Trans-Pacific leads Q4 volume growth </h3>While OOCL’s total fourth-quarter volume rose 6.1% to just under 2 million TEUs, a sharp rise in average rate levels propelled revenue in the last three months of 2024 to $2.5 billion, up 55% year over year. The trans-Pacific led OOCL’s fourth-quarter volume growth, increasing 14.5% to 551,734 TEUs with revenue up 61.7% at $967 million. While Asia-Europe recorded a 6.5% decline in volume to 363,125 TEUs, revenue on the trade rose 75.4% to $553 million as diversions around southern Africa <a href="https://www.joc.com/article/ongoing-red-sea-effect-reaches-deep-into-asia-europe-trade-lane-5878610">absorbed all available capacity and drove up rate levels</a>. Trans-Atlantic fourth-quarter volume rose 11.3% to 119,733 TEUs, while revenue was up 22.9% to $163 million. Intra-Asia-Australasia volume in the fourth quarter increased 6.3% to 951,318 TEUs and revenue was up 44.3% year over year at $828 million. OOCL’s operational result also highlighted the gap between demand and available capacity, a result of strong demand all year on the trans-Pacific and the Africa diversions absorbing all excess supply. In the fourth quarter, the volume growth of 6.1% across all the carrier’s trade lanes was accompanied by available capacity growth of 4.2%. The full-year volume growth of 3.5% came as available capacity increased by just 0.3%. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Cosco Shipping Holdings, the parent of Cosco Shipping and OOCL, on Friday said it expects $7.5 billion in net profit for 2024, a 95% year-over-year jump that the carrier attributed to an increase in volumes and higher freight rates. While Cosco did not provide the volume or revenue figures in its estimated annual results, the China state-owned carrier noted in an announcement to the Hong Kong Exchange that the Red Sea diversions had caused a shortage in capacity and kept rates at “a relatively high level.” “In 2024, the company recorded an increase in volume and freight rate of its container shipping business on a year-over-year basis, achieving better operating results,” Cosco said in the statement. Also released Friday was an operational update from Cosco subsidiary OOCL. Although no profit and loss details were published — full financial results will be announced in March — the OOCL result gave a little more color on fourth-quarter and full-year performance. OOCL reported 2024 annual revenue just shy of $10 billion, with the 30% year-over-year increase driven by a booming fourth quarter when volume rose 3.5% to 7.6 million TEUs and average revenue per TEU rose 46.2% compared with the last three months of 2023. The operating result and Cosco’s 2024 earnings forecast show container shipping is firmly back in profitable territory following a poor end to 2023 when several carriers, including Maersk and Hapag-Lloyd , reported fourth-quarter operating losses . High average revenue per TEU The trans-Pacific trade led both volume and revenue growth at OOCL last year, with 2024 volume up 10% to 2 million TEUs and revenue on the lane soaring 53.5% to $3.8 billion. Asia-Europe volume of 1.4 million TEUs was down 6.5% while revenue fell 11% to $1.4 billion. Trans-Atlantic volumes fell 0.6% to 479,517 with revenue declining 26% to $616 million. OOCL’s largest segment by volume is effectively two trade lanes, intra-Asia and Australasia, which reported a 7.4% increase in demand to 3.6 million TEUs and revenue rising 17.1% to just under $3 billion. It was the fourth quarter where the big financial numbers were recorded as the carrier capitalized on trans-Pacific and trans-Atlantic frontloading ahead of a threatened increase in US tariffs on China by the new Trump administration and an earlier Lunar New Year . Trans-Pacific leads Q4 volume growth While OOCL’s total fourth-quarter volume rose 6.1% to just under 2 million TEUs, a sharp rise in average rate levels propelled revenue in the last three months of 2024 to $2.5 billion, up 55% year over year. The trans-Pacific led OOCL’s fourth-quarter volume growth, increasing 14.5% to 551,734 TEUs with revenue up 61.7% at $967 million. While Asia-Europe recorded a 6.5% decline in volume to 363,125 TEUs, revenue on the trade rose 75.4% to $553 million as diversions around southern Africa absorbed all available capacity and drove up rate levels . Trans-Atlantic fourth-quarter volume rose 11.3% to 119,733 TEUs, while revenue was up 22.9% to $163 million. Intra-Asia-Australasia volume in the fourth quarter increased 6.3% to 951,318 TEUs and revenue was up 44.3% year over year at $828 million. OOCL’s operational result also highlighted the gap between demand and available capacity, a result of strong demand all year on the trans-Pacific and the Africa diversions absorbing all excess supply. In the fourth quarter, the volume growth of 6.1% across all the carrier’s trade lanes was accompanied by available capacity growth of 4.2%. The full-year volume growth of 3.5% came as available capacity increased by just 0.3%. Contact Greg Knowler at greg.knowler@spglobal.com .

Trans-Atlantic

Asia-Europe

Trans-Pacific

Cosco forecasts 95% jump in 2024 net profit on robust volumes, freight rates

<div class="phx-topic abstract-wrapper">The US last-mile market has become fragmented, benefiting shippers from both a cost and capacity perspective. </div>

The US last-mile market has become fragmented, benefiting shippers from both a cost and capacity perspective.

<div class="phx-topic">The big picture: Large parcel carriers FedEx and UPS are discounting rates to attract volumes, while retailers are courting business-to-consumer (B2C) shipments by offering free delivery through subscription services. Shippers have spread volumes out among a number of carriers, which has also taken volumes from the large carriers. The more profitable business-to-business (B2B) parcel market is not expected to increase until manufacturing demand picks up. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5914613_0.1.png"></img></div>A look back: FedEx and UPS struggled in the B2C last-mile market last year, and B2B parcel volumes remained muted due to weak global manufacturing activity. Shippers diversifying the number of carriers they use and increased competition from regional carriers, retailers such as Amazon, Target and Walmart, the US Postal Service and parcel management technology tools have forced FedEx and UPS to lower rates to regain lost volumes. According to AFS Logistics, the cost to ship a ground parcel declined 2.5% year over year in the third quarter of 2024 due to higher discounts and lower average package weights. Those lighter parcels are often e-commerce related, which is the future of ground parcels, according to FedEx CFO Bill Dietrich. “E-commerce is going to make up a large percentage, probably up to 90% of the volume growth of our ground network,” Dietrich said at the November Baird Global Industrial Conference. “We just have to find the right cost structure to accommodate it.” Despite automation investments that have lowered some operating costs, FedEx and UPS are struggling to compete within the B2C last-mile market. Protecting revenue per parcel is a priority for both carriers, but it conflicts with discounting rates to attract volumes. A look ahead: Higher rates for 2025 went into effect as early as Dec. 23, 2024, with UPS’ average rate increases of 5.9% followed by other last-mile carriers’ rate increases effective in January. However, FedEx and UPS will likely continue to discount ground parcel rates because of the expected continuation of stronger B2C volumes. Amazon, Walmart and Target will benefit the most in terms, volume-wise, because of the expected increase in e-commerce demand and subscription services that each provide, which also include free delivery services. B2C parcel volumes will continue to shift away from FedEx and UPS. B2B volumes may see some gains, but not much, at least for the first half of the year. According to Deloitte, manufacturers are expected to continue to face a challenging and uncertain business climate due to a combination of higher costs, potential policy changes following the US and global elections, and geopolitical uncertainty in 2025. Until manufacturing demand improves, FedEx and UPS will face a competitive B2C last-mile market in which lower rates are the norm. This assumes, however, that consumer spending will remain resilient. Year-to-date through October, US retail sales rose 2.4% from the same period in 2023, according to data from the US Census Bureau. But slowing economic growth and the uncertainty of a new presidential administration could result in a pullback in consumer spending this year. The next inflection: Prior to the COVID-19 pandemic, shippers tended to split parcel volumes between FedEx, UPS and the US Postal System. Since then, however, the last-mile market has become much more fragmented, benefiting shippers from a cost and capacity perspective. But it has left FedEx and UPS trying to figure out how to profitably compete in the B2C parcel market while they wait for the B2B market to revive. Contact Cathy Morrow Roberson at <a href="mailto:cathy.morrowroberso@spglobal.com">cathy.morrowroberso@spglobal.com.</a></div>

The big picture: Large parcel carriers FedEx and UPS are discounting rates to attract volumes, while retailers are courting business-to-consumer (B2C) shipments by offering free delivery through subscription services. Shippers have spread volumes out among a number of carriers, which has also taken volumes from the large carriers. The more profitable business-to-business (B2B) parcel market is not expected to increase until manufacturing demand picks up. A look back: FedEx and UPS struggled in the B2C last-mile market last year, and B2B parcel volumes remained muted due to weak global manufacturing activity. Shippers diversifying the number of carriers they use and increased competition from regional carriers, retailers such as Amazon, Target and Walmart, the US Postal Service and parcel management technology tools have forced FedEx and UPS to lower rates to regain lost volumes. According to AFS Logistics, the cost to ship a ground parcel declined 2.5% year over year in the third quarter of 2024 due to higher discounts and lower average package weights. Those lighter parcels are often e-commerce related, which is the future of ground parcels, according to FedEx CFO Bill Dietrich. “E-commerce is going to make up a large percentage, probably up to 90% of the volume growth of our ground network,” Dietrich said at the November Baird Global Industrial Conference. “We just have to find the right cost structure to accommodate it.” Despite automation investments that have lowered some operating costs, FedEx and UPS are struggling to compete within the B2C last-mile market. Protecting revenue per parcel is a priority for both carriers, but it conflicts with discounting rates to attract volumes. A look ahead: Higher rates for 2025 went into effect as early as Dec. 23, 2024, with UPS’ average rate increases of 5.9% followed by other last-mile carriers’ rate increases effective in January. However, FedEx and UPS will likely continue to discount ground parcel rates because of the expected continuation of stronger B2C volumes. Amazon, Walmart and Target will benefit the most in terms, volume-wise, because of the expected increase in e-commerce demand and subscription services that each provide, which also include free delivery services. B2C parcel volumes will continue to shift away from FedEx and UPS. B2B volumes may see some gains, but not much, at least for the first half of the year. According to Deloitte, manufacturers are expected to continue to face a challenging and uncertain business climate due to a combination of higher costs, potential policy changes following the US and global elections, and geopolitical uncertainty in 2025. Until manufacturing demand improves, FedEx and UPS will face a competitive B2C last-mile market in which lower rates are the norm. This assumes, however, that consumer spending will remain resilient. Year-to-date through October, US retail sales rose 2.4% from the same period in 2023, according to data from the US Census Bureau. But slowing economic growth and the uncertainty of a new presidential administration could result in a pullback in consumer spending this year. The next inflection: Prior to the COVID-19 pandemic, shippers tended to split parcel volumes between FedEx, UPS and the US Postal System. Since then, however, the last-mile market has become much more fragmented, benefiting shippers from a cost and capacity perspective. But it has left FedEx and UPS trying to figure out how to profitably compete in the B2C parcel market while they wait for the B2B market to revive. Contact Cathy Morrow Roberson at cathy.morrowroberso@spglobal.com.

Last Mile News

Surface

FedEx, UPS to continue discounting parcel rates amid increased competition

<div class="phx-topic abstract-wrapper">A confluence of factors, including vessel bunching at Asian load ports and a pre-Lunar New Year cargo surge, have combined to cause congestion at the port and reduce its railcar availability.</div>

A confluence of factors, including vessel bunching at Asian load ports and a pre-Lunar New Year cargo surge, have combined to cause congestion at the port and reduce its railcar availability.

<div class="phx-topic">Port of Vancouver stakeholders expect they will have to navigate at least three more weeks of congestion as Canada’s largest port works to clear a backlog of rail containers that built up in December. A confluence of factors — including vessel bunching at Asian load ports, a pre-Lunar New Year cargo surge, <a href="https://www.joc.com/article/bc-container-ports-set-for-shutdown-after-foremen-begin-strike-5785499">a strike by dockworker foremen</a> in November and shorter trains due to winter operating conditions — combined to cause congestion at the port and reduce Vancouver’s railcar availability last month. As a result, the average rail container dwell time at the port’s four container terminals spiked to 6.9 days in December — the highest since last March – and up from 5.2 days in November and 4.5 days in October, according to data on the port’s website. “We are seeing an increase in the number of vessels waiting to enter the Port of Vancouver due to arrival delays associated with winter weather in Asia and the seasonal pre-Lunar New Year impact causing a surge in volume,” a spokesperson for the Vancouver Fraser Port Authority told the Journal of Commerce Wednesday. “As such, we anticipate that high on-dock times will continue for the rest of January.” Terminal operators and the railroads say they are chipping away at the rail container backlog and note conditions will improve further at the end of the month when import volumes are expected to drop significantly due to many factories in Asia closing for a week or two for the Lunar New Year celebrations that start Jan. 29. <h3>Train restrictions during Canadian cold snap </h3>Canadian National Railway (CN) in December was already recovering from a backlog of rail containers from the dockworkers’ strike and vessel bunching when a cold snap in Western Canada resulted in operating restrictions, including running shorter trains, that impacted CN’s network velocity, a CN spokesperson told the Journal of Commerce. “CN is working closely with the port operators to clear out these volumes as the vessel discharge normalizes over the next three weeks,” a spokesperson for the railroad said. “We are already seeing some improvements and are confident that the dwell metric will fall back to normal levels as we catch up on the backlog over the next few weeks.” Canadian Pacific Kansas City (CPKC) said Thursday its railcars are cycling efficiently through its network and that the supply of cars is good. Demand is forecast to remain strong through January, a CPKC spokesperson said. DP World Canada, which operates the Centerm terminal in Vancouver, said it is working with the railroads to handle the increased import volumes leading up to the Lunar New Year on Jan. 29. “We should be back to normal in a few weeks,” said CEO Doug Smith. Meanwhile, the elevated rail container dwell times at the marine terminals have not had an impact on drayage operations in Vancouver, said David Earle, CEO of the British Columbia Trucking Association. The only change Earle said he’s noted in recent days is that a small number of inbound containers that had been booked to leave the terminals by rail are being redirected to long-haul truckers for movement inland. <h3>Prince Rupert back to normal </h3>The Port of Prince Rupert, which faced challenges similar to Vancouver last month, saw its rail container dwell times spike to an average of nearly 10 days in mid-December, said Brian Friesen, vice president of trade development at the port. The average dwell dropped to 6.1 days for the week of Dec. 20 and has continued to slide in January. “The dwells are now below two days,” Friesen said. “It’s all fluid now.” Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Port of Vancouver stakeholders expect they will have to navigate at least three more weeks of congestion as Canada’s largest port works to clear a backlog of rail containers that built up in December. A confluence of factors — including vessel bunching at Asian load ports, a pre-Lunar New Year cargo surge, a strike by dockworker foremen in November and shorter trains due to winter operating conditions — combined to cause congestion at the port and reduce Vancouver’s railcar availability last month. As a result, the average rail container dwell time at the port’s four container terminals spiked to 6.9 days in December — the highest since last March – and up from 5.2 days in November and 4.5 days in October, according to data on the port’s website. “We are seeing an increase in the number of vessels waiting to enter the Port of Vancouver due to arrival delays associated with winter weather in Asia and the seasonal pre-Lunar New Year impact causing a surge in volume,” a spokesperson for the Vancouver Fraser Port Authority told the Journal of Commerce Wednesday. “As such, we anticipate that high on-dock times will continue for the rest of January.” Terminal operators and the railroads say they are chipping away at the rail container backlog and note conditions will improve further at the end of the month when import volumes are expected to drop significantly due to many factories in Asia closing for a week or two for the Lunar New Year celebrations that start Jan. 29. Train restrictions during Canadian cold snap Canadian National Railway (CN) in December was already recovering from a backlog of rail containers from the dockworkers’ strike and vessel bunching when a cold snap in Western Canada resulted in operating restrictions, including running shorter trains, that impacted CN’s network velocity, a CN spokesperson told the Journal of Commerce. “CN is working closely with the port operators to clear out these volumes as the vessel discharge normalizes over the next three weeks,” a spokesperson for the railroad said. “We are already seeing some improvements and are confident that the dwell metric will fall back to normal levels as we catch up on the backlog over the next few weeks.” Canadian Pacific Kansas City (CPKC) said Thursday its railcars are cycling efficiently through its network and that the supply of cars is good. Demand is forecast to remain strong through January, a CPKC spokesperson said. DP World Canada, which operates the Centerm terminal in Vancouver, said it is working with the railroads to handle the increased import volumes leading up to the Lunar New Year on Jan. 29. “We should be back to normal in a few weeks,” said CEO Doug Smith. Meanwhile, the elevated rail container dwell times at the marine terminals have not had an impact on drayage operations in Vancouver, said David Earle, CEO of the British Columbia Trucking Association. The only change Earle said he’s noted in recent days is that a small number of inbound containers that had been booked to leave the terminals by rail are being redirected to long-haul truckers for movement inland. Prince Rupert back to normal The Port of Prince Rupert, which faced challenges similar to Vancouver last month, saw its rail container dwell times spike to an average of nearly 10 days in mid-December, said Brian Friesen, vice president of trade development at the port. The average dwell dropped to 6.1 days for the week of Dec. 20 and has continued to slide in January. “The dwells are now below two days,” Friesen said. “It’s all fluid now.” Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Port News

Rail News

North American ports

Marine terminals

North-American rail

Vancouver braces for congestion, high rail dwells through January

<div class="phx-topic abstract-wrapper">The project, expected to drive further investment at Europe’s second-busiest port, is the largest investment in Europe’s chemical industry in more than 20 years. </div>

The project, expected to drive further investment at Europe’s second-busiest port, is the largest investment in Europe’s chemical industry in more than 20 years.

<div class="phx-topic">Transportation of outsized and heavy-lift cargo components for INEOS’ $4 billion Project One ethane cracker at Belgium’s Port of Antwerp is set to peak this year in the ramp up to the cracker becoming operational in mid-2026, the chemical company says.About 35% of the total shipment volumes for the complex have already arrived at the INEOS marshalling yard in Antwerp, Gert Geeve, INEOS Project One logistics manager, told the Journal of Commerce.The cracker will produce 1.45 million metric tons of ethane a year and is the largest investment in Europe’s chemical industry in more than 20 years. The project is expected to drive further investment at the Port of Antwerp, INEOS said.Ethane is a key component in manufactured goods such as washing machines, automotive and healthcare products, wind turbine blades, solar panels and packaging, while hydrogen is produced as a by-product of the cracking process.The Port of Antwerp described the construction of Project One as “a unique project on a unique scale” that poses “enormous logistical challenges.” The scheme has brought together a smorgasbord of heavy-lift specialists. Freight forwarder and project logistics company deugro UK is involved in organizing the ocean transport of components, while Belgian forwarder Gosselin Group is the logistics control tower for the project, according to INEOS and the Port of Antwerp.Ocean shipments have been carried out by BigLift Shipping and Jumbo Maritime, while Belgian heavy lift and transport player Sarens and German counterpart Felbermayr are involved in craning and the land transport of components.BigLift Shipping’s heavy-lift vessel Happy Star delivered the first heavy-lift cargo last June, a 591-ton splitter and a 347-ton demethanizer.That was followed by two shipments in August and September, each carrying five bullet-shaped gas processing units weighing 570 metric tons each and transported by Jumbo Maritime’s heavy-lift vessels Jumbo Fairmaster and Jumbo Fairplayer from Zhangjiagang in China’s Jiangsu province.The shipment of the 10 tanks — critical elements in Project One’s storage and processing infrastructure — was organized by deugro UK in partnership with deugro China and deugro Chartering, Jumbo Maritime and the Port of Antwerp.<h3>Challenge to secure suitable ships</h3>deugro said sourcing the heavy-lift vessels and loading the cargo onboard the ships posed challenges.“A challenge was to identify and secure sufficient vessel space on suitable heavy-lift vessels with the appropriate lifting capacities and within the tight schedule of only six weeks, from the receipt of the order to loading,” Kai von Taube, deugro’s head of global chartering, told the Journal of Commerce.The Jumbo Fairmaster, with a total lifting capacity of 3,000 metric tons, and the Jumbo Fairplayer, with a smaller combined capacity of 1,800 metric tons, are among the few heavy-lift vessels globally capable of handling loads of more than 1,500 metric tons.“[The number of] such vessels which can safely handle and ship sensitive oversized and heavy lift components are limited and often booked for considerable periods in advance,” von Taube said. “However, thanks … to our long-standing strategic carrier relationships, we were able to secure the required vessel space within just two weeks.” David Richardson, deugro’s UK operations manager, added that loading oversized and heavy-lift cargo components onto a floating vessel is “always a critical operation.” “Even more when deck and vessel space is strictly limited and calculated down to the nearest centimeter,” he told the Journal of Commerce.Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Transportation of outsized and heavy-lift cargo components for INEOS’ $4 billion Project One ethane cracker at Belgium’s Port of Antwerp is set to peak this year in the ramp up to the cracker becoming operational in mid-2026, the chemical company says. About 35% of the total shipment volumes for the complex have already arrived at the INEOS marshalling yard in Antwerp, Gert Geeve, INEOS Project One logistics manager, told the Journal of Commerce. The cracker will produce 1.45 million metric tons of ethane a year and is the largest investment in Europe’s chemical industry in more than 20 years. The project is expected to drive further investment at the Port of Antwerp, INEOS said. Ethane is a key component in manufactured goods such as washing machines, automotive and healthcare products, wind turbine blades, solar panels and packaging, while hydrogen is produced as a by-product of the cracking process. The Port of Antwerp described the construction of Project One as “a unique project on a unique scale” that poses “enormous logistical challenges.” The scheme has brought together a smorgasbord of heavy-lift specialists. Freight forwarder and project logistics company deugro UK is involved in organizing the ocean transport of components, while Belgian forwarder Gosselin Group is the logistics control tower for the project, according to INEOS and the Port of Antwerp. Ocean shipments have been carried out by BigLift Shipping and Jumbo Maritime, while Belgian heavy lift and transport player Sarens and German counterpart Felbermayr are involved in craning and the land transport of components. BigLift Shipping’s heavy-lift vessel Happy Star delivered the first heavy-lift cargo last June, a 591-ton splitter and a 347-ton demethanizer. That was followed by two shipments in August and September, each carrying five bullet-shaped gas processing units weighing 570 metric tons each and transported by Jumbo Maritime’s heavy-lift vessels Jumbo Fairmaster and Jumbo Fairplayer from Zhangjiagang in China’s Jiangsu province. The shipment of the 10 tanks — critical elements in Project One’s storage and processing infrastructure — was organized by deugro UK in partnership with deugro China and deugro Chartering, Jumbo Maritime and the Port of Antwerp. Challenge to secure suitable ships deugro said sourcing the heavy-lift vessels and loading the cargo onboard the ships posed challenges. “A challenge was to identify and secure sufficient vessel space on suitable heavy-lift vessels with the appropriate lifting capacities and within the tight schedule of only six weeks, from the receipt of the order to loading,” Kai von Taube, deugro’s head of global chartering, told the Journal of Commerce. The Jumbo Fairmaster, with a total lifting capacity of 3,000 metric tons, and the Jumbo Fairplayer, with a smaller combined capacity of 1,800 metric tons, are among the few heavy-lift vessels globally capable of handling loads of more than 1,500 metric tons. “[The number of] such vessels which can safely handle and ship sensitive oversized and heavy lift components are limited and often booked for considerable periods in advance,” von Taube said. “However, thanks … to our long-standing strategic carrier relationships, we were able to secure the required vessel space within just two weeks.” David Richardson, deugro’s UK operations manager, added that loading oversized and heavy-lift cargo components onto a floating vessel is “always a critical operation.” “Even more when deck and vessel space is strictly limited and calculated down to the nearest centimeter,” he told the Journal of Commerce.Contact Keith Wallis at keithwallis@hotmail.com .

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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

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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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