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<div class="phx-topic abstract-wrapper">Jittery shareholders of China logistics operator Sinotrans frantically off-loaded shares following mainland media reports that its subsidiaries were involved in making multiple pledges of the same inventory as loan collateral.</div>

Jittery shareholders of China logistics operator Sinotrans frantically off-loaded shares following mainland media reports that its subsidiaries were involved in making multiple pledges of the same inventory as loan collateral.

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<div>HONG KONG — Jittery shareholders of China logistics operator Sinotrans frantically off-loaded shares following mainland media reports that its subsidiaries were involved in making multiple pledges of the same inventory as loan collateral.Sinotrans shares plunged almost 30 percent on the Hong Kong Exchange before trading of the state-owned company was suspended. A statement filed on the exchange said trading was halted pending clarification of the media reports. Trading resumed today and the stock made some gains.A news report by China Business News (CBN) claimed that the person in charge of the Guangxi and Liuzhou branches of Sinotrans and CSC Group...

HONG KONG — Jittery shareholders of China logistics operator Sinotrans frantically off-loaded shares following mainland media reports that its subsidiaries were involved in making multiple pledges of the same inventory as loan collateral. Sinotrans shares plunged almost 30 percent on the Hong Kong Exchange before trading of the state-owned company was suspended. A statement filed on the exchange said trading was halted pending clarification of the media reports. Trading resumed today and the stock made some gains. A news report by China Business News (CBN) claimed that the person in charge of the Guangxi and Liuzhou branches of Sinotrans and CSC Group was detained by police for alleged involvement in multiple pledges of the same inventory as collateral for bank loans. According to CBN, the damage totaled $490 million (3 billion RMB) as of Aug. 2014. Sinotrans told Citi Research in a hastily convened conference call with analysts that the Guangxi and Liuzhou branches involved in the reported scandal were subsidiaries under the parentco, Sinotrans and CSC group, and should have no impact on Sinotrans itself. The company executive said Sinotrans has started to use extra caution about the collateral management business in the last two years and plans to gradually exit this business. “Currently, Sinotrans has limited operation in collateral management, which is strictly supervised. The management believes the risk is well under control,” Sinotrans told the analysts. Asked by Citi what the risk exposure was of Sinotrans’ collateral management business, the company said it was difficult to quantify. “Collateral management business is quite complex and involves multiple parities, including banks, cargo owners, warehouse operators, etc. Due to the high risk, collateral management is under stringent control by Sinotrans. For example, the collateral management business is strictly supervised by senior management and any new collateral management business must be approved by headquarters in Beijing,” the company said. The company will be hoping such platitudes will soothe its jittery shareholders. Their startled reaction to reports of a possible collateral financing fraud is understandable following the Qingdao port financing scandal that was uncovered in June. Investigators are still trying to uncover the full extent of that fraud that involved multiple pledging of the same inventory of metals as collateral for loans. In a statement to the Hong Kong Exchange, Sinotrans said it would not be responsible for the profits or losses of its subsidiaries as they would be borne by the parent firm. Sinotrans has operations across the supply chain, with business in freight forwarding, logistics, storage and terminal services, and other related segments that include express services, trucking, and some marine transportation. The company recently separated the logistics segment from the freight forwarding business that handles services such as contract logistics, project logistics, and chemical logistics. Freight forwarding is the largest segment that accounted for 77 percent of total revenue in the first half, while the logistics business contributes 14 percent of total revenue. Citi Research said the major downside risks facing Sinotrans were slower than expected foreign trade, growing competition in the China 3PL business, asset restructuring at unfavorable prices, and the risk of slowing down cross-border e-commerce. Contact Greg Knowler at gknowler@joc.com and follow him on Twitter: @greg_knowler.

Fraud reports send wary Sinotrans investors racing for the exits

<div class="phx-topic abstract-wrapper">Those companies are combining to get the terminals, talent and technology they need to compete as larger carriers increasingly seek business in their markets. </div>

Those companies are combining to get the terminals, talent and technology they need to compete as larger carriers increasingly seek business in their markets.

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<div class="phx-topic">Merger and acquisition activity in the already highly-consolidated US less-than-truckload (LTL) market is picking up speed — not from the top down, but from the bottom up. That could mean new options for shippers trying to find the right home for their LTL freight in a market that has been in flux since <a href="https://www.joc.com/article/us-ltl-sector-growth-efficiencies-still-fueled-by-loss-of-yellow-5715785">Yellow collapsed in July 2023</a>. While large companies such as TFI International and Knight-Swift Transportation Holdings are <a href="https://www.joc.com/article/interest-in-us-ltl-ma-activity-seen-rising-as-2025-approaches-5772881">talking about LTL acquisitions</a>, small carriers are expanding by acquisition, too. “I think if you’re not growing, you’re sinking,” Mike Moran, president of Moran Transportation, told the Journal of Commerce this week. “If you don’t maintain a certain size and a certain growth rate, you’ll have a hard time competing in this market.” Chicago-based Moran Transportation on Tuesday said it was buying RMX Freight Systems, another small LTL provider, expanding its coverage area, terminals and workforce. Terms of the deal were not disclosed, but it adds three states to Moran’s service map, bringing its total number of terminals to 12 and its truck fleet to 675 vehicles. Moran will now have coverage from points in the Dakotas and Missouri in the West to Ohio and points in Kentucky and West Virginia in the East. The Moran-RMX combination is the latest in a string of acquisitions quietly reshaping the lower tier of LTL providers as defined by revenue, further consolidating the sector. Smaller carriers were among the fastest-growing LTL companies in 2023, and acquisitions propelled that growth. CrossCountry Freight Solutions, for example, was ranked 40th among US LTL carriers in 2020, but in <a href="https://www.joc.com/article/journal-of-commerce-rankings-ltl-sector-revenue-drops-despite-yellow-distortion-5199865">2024 rose to 25th place</a> in the Journal of Commerce/SJ Consulting Group rankings thanks to several acquisitions. More recently, DC Logistics acquired the US freight business of GLS, the Netherlands-based parcel carrier, including its LTL assets known as <a href="https://gls-group.com/GROUP/en/GLS-Group-Announces-Strategic-Sale-of-US-Freight-Division-to-DC-Logistics/">Mountain Valley Express</a>. Jack Cooper has expressed interest in purchasing LTL provider <a href="https://www.joc.com/article/standard-forwarding-deal-would-speed-consolidation-among-small-ltl-carriers-5719767">Standard Forwarding</a> from DHL. These companies are combining to get the terminals, talent and technology they need to compete as larger carriers increasingly seek business in regional markets, said Satish Jindel, president of transportation research firm SJ Consulting Group. “As a small carrier, it’s increasingly difficult to have all of the ‘three Ts’ — terminals, talent and technology,” Jindel said. “There are more of these small acquisitions coming.” <h3>Shrinking LTL pool for shippers </h3>Moran believes smaller carriers are part of a value proposition for shippers that is increasingly under threat. “The largest LTL carriers command a sizable chunk of the market,” he said. “I tell my customers that when the big carriers are the last ones left standing, you will pay whatever they want.” And large carriers are <a href="https://www.joc.com/article/us-ltl-carriers-raising-rates-as-shippers-keep-wary-eye-on-2025-5782152">pressing for rate hikes</a> in 2025. The 40 largest LTL carriers account for 91.8% of total LTL sector revenue of $56.6 billion, according to the Journal of Commerce/SJ Consulting Group rankings. Already, pressure is growing on the smallest LTL carriers to “join or die,” according to Jindel. “Shippers are reducing the number of carriers they work with, and if you have only three or four states in your service area, it’s going to be harder to compete,” he said. Still, that doesn’t mean smaller carriers are the cheaper alternative. “We target customers who demand high-quality service in our market, but we won’t haul for free,” Moran said. “There’s definitely a market for commoditized carriers, but that’s not our world.” With about $50 million in annual revenue this year, Moran Transportation is too small to be ranked among the Journal of Commerce/SJ Consulting Group list of Top 40 LTL carriers, but the company may get there. Moran said he had looked at six to eight potential acquisitions before deciding on RMX. “We’re in acquisition mode,” Moran said. “We’re looking and talking and trying to find the next acquisition to build density in our network and to grow where we want to grow.” Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

Merger and acquisition activity in the already highly-consolidated US less-than-truckload (LTL) market is picking up speed — not from the top down, but from the bottom up. That could mean new options for shippers trying to find the right home for their LTL freight in a market that has been in flux since Yellow collapsed in July 2023 . While large companies such as TFI International and Knight-Swift Transportation Holdings are talking about LTL acquisitions , small carriers are expanding by acquisition, too. “I think if you’re not growing, you’re sinking,” Mike Moran, president of Moran Transportation, told the Journal of Commerce this week. “If you don’t maintain a certain size and a certain growth rate, you’ll have a hard time competing in this market.” Chicago-based Moran Transportation on Tuesday said it was buying RMX Freight Systems, another small LTL provider, expanding its coverage area, terminals and workforce. Terms of the deal were not disclosed, but it adds three states to Moran’s service map, bringing its total number of terminals to 12 and its truck fleet to 675 vehicles. Moran will now have coverage from points in the Dakotas and Missouri in the West to Ohio and points in Kentucky and West Virginia in the East. The Moran-RMX combination is the latest in a string of acquisitions quietly reshaping the lower tier of LTL providers as defined by revenue, further consolidating the sector. Smaller carriers were among the fastest-growing LTL companies in 2023, and acquisitions propelled that growth. CrossCountry Freight Solutions, for example, was ranked 40th among US LTL carriers in 2020, but in 2024 rose to 25th place in the Journal of Commerce/SJ Consulting Group rankings thanks to several acquisitions. More recently, DC Logistics acquired the US freight business of GLS, the Netherlands-based parcel carrier, including its LTL assets known as Mountain Valley Express . Jack Cooper has expressed interest in purchasing LTL provider Standard Forwarding from DHL. These companies are combining to get the terminals, talent and technology they need to compete as larger carriers increasingly seek business in regional markets, said Satish Jindel, president of transportation research firm SJ Consulting Group. “As a small carrier, it’s increasingly difficult to have all of the ‘three Ts’ — terminals, talent and technology,” Jindel said. “There are more of these small acquisitions coming.” Shrinking LTL pool for shippers Moran believes smaller carriers are part of a value proposition for shippers that is increasingly under threat. “The largest LTL carriers command a sizable chunk of the market,” he said. “I tell my customers that when the big carriers are the last ones left standing, you will pay whatever they want.” And large carriers are pressing for rate hikes in 2025. The 40 largest LTL carriers account for 91.8% of total LTL sector revenue of $56.6 billion, according to the Journal of Commerce/SJ Consulting Group rankings. Already, pressure is growing on the smallest LTL carriers to “join or die,” according to Jindel. “Shippers are reducing the number of carriers they work with, and if you have only three or four states in your service area, it’s going to be harder to compete,” he said. Still, that doesn’t mean smaller carriers are the cheaper alternative. “We target customers who demand high-quality service in our market, but we won’t haul for free,” Moran said. “There’s definitely a market for commoditized carriers, but that’s not our world.” With about $50 million in annual revenue this year, Moran Transportation is too small to be ranked among the Journal of Commerce/SJ Consulting Group list of Top 40 LTL carriers, but the company may get there. Moran said he had looked at six to eight potential acquisitions before deciding on RMX. “We’re in acquisition mode,” Moran said. “We’re looking and talking and trying to find the next acquisition to build density in our network and to grow where we want to grow.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

Smaller US LTL carriers increasingly merging in ‘sink or swim’ market

<div class="phx-topic abstract-wrapper">The new network will have a grace period for about three months as the first full port rotations are completed but must then quickly prove it can raise on-time performance to the promised levels, says Maersk’s CEO.</div>

The new network will have a grace period for about three months as the first full port rotations are completed but must then quickly prove it can raise on-time performance to the promised levels, says Maersk’s CEO.

<div class="phx-topic">Gemini Cooperation will have a 13-week window from Feb. 1 to get the new network up and running before partners Maersk and Hapag-Lloyd come under pressure to prove they can deliver on the promised 90% schedule reliability, according to Maersk CEO Vincent Clerc. Clerc told analysts during <a href="https://www.joc.com/article/maersks-existing-fleet-size-sufficient-to-handle-short-term-demand-growth-ceo-5782669">Maersk’s third-quarter earnings</a> call Thursday he was expecting “an orderly transition” as the carrier moves over to Gemini from the 2M Alliance with Mediterranean Shipping Co. and as Hapag-Lloyd exits THE Alliance. But it will take about three months for the new network to stabilize, the CEO noted. “The longest service we have is a 13-week rotation, so it will take about 13 weeks until the last ship and the full cycle of the service is working on the same network, so from February for three months we will live in a hybrid world,” he said. Once the network is stabilized, Clerc said Gemini will need to quickly demonstrate that it is capable of dramatically improving reliability across its network. “The focus is on quality and the common agreement [with partner Hapag-Lloyd] is that doing it right the first time with high quality is going to be cheaper than operating a network with 50% reliability,” he said. “Our first target is to deliver the proof points to customers. Initially we need to have a successful transition into Gemini. We need to deliver the quality in terms of production cost and production quality that we have promised,” Clerc added. “At some point we will see how much value that creates for customers and how we can participate in that.” <h3>No need to discount or price aggressively </h3>During the startup period, Clerc acknowledged that customers signing with Gemini would not accept higher rate levels based simply on a promise of 90% reliability. But he insisted that the carrier would not have to offer discounts to attract customers to the new network. ”In a market that is as volatile as it is today, with the many disruptions that there are, I don’t think that customers will be willing to pay more for higher reliability without having seen what they’re getting,” Clerc said. ”But I see no reason why, when we’re selling a higher quality and higher reliability, we would have to discount or price more aggressively in order to sign up customers,” he added. February will also see the launch of the Premier Alliance, formerly known as THE Alliance, and <a href="https://www.joc.com/article/mscs-global-scale-enables-standalone-network-coverage-5726563">MSC striking off on its own</a> when the 2M Alliance ends. While MSC and the other alliances will focus on providing direct port-to-port services, Gemini will structure its port calls around <a href="https://www.joc.com/article/lofty-reliability-goals-for-gemini-alliance-hang-on-key-service-assumptions-5214653">a “hub-and-spoke” network</a> where Maersk and Hapag-Lloyd control the terminals and the shuttles that will provide onward transport to destination. It is this large transshipment element within the Gemini network that has raised shipper skepticism over the promise of 90% on-time performance, because it typically adds transit time and delays and because, historically, the on-time performance of carriers has been far below that level. Global schedule reliability from January to September this year has been stuck between 50% and 55%, with the average delays for vessels at 5.37 days, according to Sea-Intelligence Maritime Analysis. Maersk’s schedule reliability in September, the most recent data available, was at 55.5% while Hapag-Lloyd had 48.7%. Clerc said teams from Maersk and Hapag-Lloyd conducted exhaustive tests over the past couple of years to determine the efficiency of a hub-and-spoke network before arriving at the 90% reliability figure. “We did not go out with that number lightly,” he said. “The core issue now is to scale this up and then we’ll have to see if there is anything that has not been tested ... but we feel confident we have tested all we could think of in terms of resilience of the product.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Gemini Cooperation will have a 13-week window from Feb. 1 to get the new network up and running before partners Maersk and Hapag-Lloyd come under pressure to prove they can deliver on the promised 90% schedule reliability, according to Maersk CEO Vincent Clerc. Clerc told analysts during Maersk’s third-quarter earnings call Thursday he was expecting “an orderly transition” as the carrier moves over to Gemini from the 2M Alliance with Mediterranean Shipping Co. and as Hapag-Lloyd exits THE Alliance. But it will take about three months for the new network to stabilize, the CEO noted. “The longest service we have is a 13-week rotation, so it will take about 13 weeks until the last ship and the full cycle of the service is working on the same network, so from February for three months we will live in a hybrid world,” he said. Once the network is stabilized, Clerc said Gemini will need to quickly demonstrate that it is capable of dramatically improving reliability across its network. “The focus is on quality and the common agreement [with partner Hapag-Lloyd] is that doing it right the first time with high quality is going to be cheaper than operating a network with 50% reliability,” he said. “Our first target is to deliver the proof points to customers. Initially we need to have a successful transition into Gemini. We need to deliver the quality in terms of production cost and production quality that we have promised,” Clerc added. “At some point we will see how much value that creates for customers and how we can participate in that.” No need to discount or price aggressively During the startup period, Clerc acknowledged that customers signing with Gemini would not accept higher rate levels based simply on a promise of 90% reliability. But he insisted that the carrier would not have to offer discounts to attract customers to the new network. ”In a market that is as volatile as it is today, with the many disruptions that there are, I don’t think that customers will be willing to pay more for higher reliability without having seen what they’re getting,” Clerc said. ”But I see no reason why, when we’re selling a higher quality and higher reliability, we would have to discount or price more aggressively in order to sign up customers,” he added. February will also see the launch of the Premier Alliance, formerly known as THE Alliance, and MSC striking off on its own when the 2M Alliance ends. While MSC and the other alliances will focus on providing direct port-to-port services, Gemini will structure its port calls around a “hub-and-spoke” network where Maersk and Hapag-Lloyd control the terminals and the shuttles that will provide onward transport to destination. It is this large transshipment element within the Gemini network that has raised shipper skepticism over the promise of 90% on-time performance, because it typically adds transit time and delays and because, historically, the on-time performance of carriers has been far below that level. Global schedule reliability from January to September this year has been stuck between 50% and 55%, with the average delays for vessels at 5.37 days, according to Sea-Intelligence Maritime Analysis. Maersk’s schedule reliability in September, the most recent data available, was at 55.5% while Hapag-Lloyd had 48.7%. Clerc said teams from Maersk and Hapag-Lloyd conducted exhaustive tests over the past couple of years to determine the efficiency of a hub-and-spoke network before arriving at the 90% reliability figure. “We did not go out with that number lightly,” he said. “The core issue now is to scale this up and then we’ll have to see if there is anything that has not been tested ... but we feel confident we have tested all we could think of in terms of resilience of the product.” Contact Greg Knowler at greg.knowler@spglobal.com .

Gemini faces 13-week phase-in before 90% reliability promise is tested: Clerc

<div class="phx-topic abstract-wrapper">The gains suggest Hub benefited from an aggressive pricing posture in bids that went live earlier this year, reversing some of its market share loss in 2023 by offering attractive rates to shippers.</div>

The gains suggest Hub benefited from an aggressive pricing posture in bids that went live earlier this year, reversing some of its market share loss in 2023 by offering attractive rates to shippers.

<div class="phx-topic">Hub Group experienced double-digit growth in its intermodal volumes for the third quarter, but cautioned that a frontloaded peak season may lead to a softer finish to the year. It comes as the bid season begins in earnest, with shippers aiming to hold rates steady while intermodal carriers seek modest rate increases for 2025. The second-largest North American intermodal provider on Wednesday reported a 12% increase in intermodal volume in the third quarter compared with the year-ago period, although revenue per load declined 16%. The Intermodal Association of North America (IANA) said total intermodal volumes in North America rose 6% year over year in the third quarter. Hub’s results suggest it benefited from an <a href="https://word-edit.officeapps.live.com/we/il-share-while-schneiders-q2-volume-stays-flat-5703104">aggressive pricing posture</a> in bids that went live earlier this year, reversing some of its market share loss in 2023 by offering attractive rates to shippers. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="3be84174-0ae7-4dbf-bd93-969d716de272"></dynamic-object></div>Phil Yeager, chief executive of Hub Group, attributed some of the Q3 volume increase to shippers frontloading cargo to avoid the <a href="https://www.joc.com/article/ila-usmx-agree-on-new-wage-offer-and-contract-extension-that-reopens-ports-5741882">labor unrest on the East Coast</a>. He also said the peak season has resembled a normal pre-pandemic peak that will taper off in the next few weeks. “October was strong with a 12% increase in volume, but with the rest of the [fourth] quarter, we think the pull forward has eaten into some of our original expectations for volume,” Yeager said on an earnings call Wednesday. Rival intermodal provider J.B. Hunt said earlier in October that frontloading was a factor in rising volumes, but was unclear how much it would impact the full fourth quarter. The Journal of Commerce forecasts North American railroads will haul a total of 2 million to 2.2 million domestic containers in the fourth quarter, compared with 2.1 million last year. <h3>Bid season ramps up </h3>Shippers have begun soliciting contract rates for 2025 that would typically start between January and April and run for 12 months. Shippers want to roll over current low rates into next year, while intermodal carriers are looking for an increase in rates, according to conversations the Journal of Commerce has had with parties on both sides. Shippers have secured intermodal rate reductions for two consecutive years after double-digit hikes in 2021 and 2022. “It’s still a competitive rate environment, but we’re not seeing anything that’s irrational,” Yeager said. “Everyone wants to get their assets moving, but I think [providers] want to steer prices upwards. We’re not anticipating, as we go into bid season, that prices will go down. It’s unknown how much they’ll go up.” Trucking rates, as a leading indicator, will be critical in determining how much intermodal rates could rise in 2025. Trucking analysts and executives at the Journal of Commerce Inland Distribution Conference in October forecast that truckload rates would rise by <a href="https://www.joc.com/article/domestic-intermodal-rate-pressure-building-on-stronger-truck-pricing-5741060">low- to mid-single digits</a> in early 2025 contracts, with intermodal rates a couple of percentage points lower than that. Nevertheless, Hub Group’s truck brokerage division is expected to remain pressured by prices in the fourth quarter, casting doubt on whether truckload carriers have much leverage as rate talks with shippers proceed. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

Hub Group experienced double-digit growth in its intermodal volumes for the third quarter, but cautioned that a frontloaded peak season may lead to a softer finish to the year. It comes as the bid season begins in earnest, with shippers aiming to hold rates steady while intermodal carriers seek modest rate increases for 2025. The second-largest North American intermodal provider on Wednesday reported a 12% increase in intermodal volume in the third quarter compared with the year-ago period, although revenue per load declined 16%. The Intermodal Association of North America (IANA) said total intermodal volumes in North America rose 6% year over year in the third quarter. Hub’s results suggest it benefited from an aggressive pricing posture in bids that went live earlier this year, reversing some of its market share loss in 2023 by offering attractive rates to shippers. Phil Yeager, chief executive of Hub Group, attributed some of the Q3 volume increase to shippers frontloading cargo to avoid the labor unrest on the East Coast . He also said the peak season has resembled a normal pre-pandemic peak that will taper off in the next few weeks. “October was strong with a 12% increase in volume, but with the rest of the [fourth] quarter, we think the pull forward has eaten into some of our original expectations for volume,” Yeager said on an earnings call Wednesday. Rival intermodal provider J.B. Hunt said earlier in October that frontloading was a factor in rising volumes, but was unclear how much it would impact the full fourth quarter. The Journal of Commerce forecasts North American railroads will haul a total of 2 million to 2.2 million domestic containers in the fourth quarter, compared with 2.1 million last year. Bid season ramps up Shippers have begun soliciting contract rates for 2025 that would typically start between January and April and run for 12 months. Shippers want to roll over current low rates into next year, while intermodal carriers are looking for an increase in rates, according to conversations the Journal of Commerce has had with parties on both sides. Shippers have secured intermodal rate reductions for two consecutive years after double-digit hikes in 2021 and 2022. “It’s still a competitive rate environment, but we’re not seeing anything that’s irrational,” Yeager said. “Everyone wants to get their assets moving, but I think [providers] want to steer prices upwards. We’re not anticipating, as we go into bid season, that prices will go down. It’s unknown how much they’ll go up.” Trucking rates, as a leading indicator, will be critical in determining how much intermodal rates could rise in 2025. Trucking analysts and executives at the Journal of Commerce Inland Distribution Conference in October forecast that truckload rates would rise by low- to mid-single digits in early 2025 contracts, with intermodal rates a couple of percentage points lower than that. Nevertheless, Hub Group’s truck brokerage division is expected to remain pressured by prices in the fourth quarter, casting doubt on whether truckload carriers have much leverage as rate talks with shippers proceed. Contact Ari Ashe at ari.ashe@spglobal.com .

Hub Group’s Q3 intermodal volumes jump amid cargo frontloading

<div class="phx-topic abstract-wrapper">The Viau and Maisonneuve marine terminals closed to ship, rail and truck traffic Thursday morning as members of the Canadian Union of Public Employees Local 375, which represents 1,200 dockworkers at Montreal, walked off the job. </div>

The Viau and Maisonneuve marine terminals closed to ship, rail and truck traffic Thursday morning as members of the Canadian Union of Public Employees Local 375, which represents 1,200 dockworkers at Montreal, walked off the job.

<div class="phx-topic">The Port of Montreal is warning that shippers may face diverted cargoes as an indefinite strike began Thursday at two marine terminals handling Mediterranean Shipping Co. container services, with over two dozen vessels facing an impact depending on the length of the current work stoppage. The Viau and Maisonneuve marine terminals operated by Termont International closed to ship, rail and truck traffic Thursday morning as <a href="https://www.joc.com/article/montreal-dockworkers-target-mscs-terminals-for-strike-this-week-5781453">members of the Canadian Union of Public Employees (CUPE) Local 375, which represents 1,200 dockworkers at Montreal, walked off the job</a>. Montreal Port Authority (MPA) Chief Executive Julie Gascon said in a statement Thursday that the shutdown “undermines the reliability and image of our logistics sector.” The open-ended strike follows <a href="https://www.joc.com/article/port-of-montreal-to-face-three-day-strike-against-two-terminals-next-week-5737483">a three-day, port-wide work stoppage</a> at the start of October, <a href="https://www.joc.com/article/montreal-dockworkers-to-refuse-overtime-in-latest-salvo-against-port-employers-5745362">a boycott of overtime work</a> and <a href="https://www.joc.com/article/montreal-dockworkers-plan-one-day-port-strike-on-sunday-5773614">another port-wide strike this past Sunday</a>. “This new work stoppage at the Viau and Maisonneuve terminals, at the very hub of our supply chain, can only have a deeply negative impact on thousands of local businesses, as well as on the economy of Quebec and Canada as a whole,” Gascon said. Montreal’s two other international container terminals remain open. The strike at the two terminals will idle more than 1 million TEUs of Montreal’s total 2.3 million TEUs in terminal capacity. The MPA said five ships with combined capacity of 18,000 TEUs are currently headed for the two terminals, with those ships carrying time-sensitive pharmaceutical and medical goods. Refrigerated containers holding such goods are already backlogged at the port due to the earlier labor actions, the MPA said, adding that some scheduled outbound rail service has been canceled due to the backlog. Over the next three weeks, 26 ships are scheduled to call the two terminals, with the MPA saying that vessels “could change their port of destination” due to the strike. “It is imperative that the parties reach an agreement,” Gascon said. “The need to reach an agreement quickly is acute and cannot be ignored.” MSC, whose terminal arm jointly owns and operates Termont International, said in a customer advisory Wednesday that it is “working to minimize disruptions to our customers’ supply chains” and that “vessel impacts will be communicated as available and relevant.” The Maritime Employers Association (MEA), which represents Montreal’s terminals and stevedores, said Thursday it “deplores” the strike. The MEA and Local 375 have been in protracted negotiations for a new collective bargaining agreement since the last one expired at the end of 2023. The MEA said in its statement that Local 375 has made a demand to change work hours without formal negotiations. It said that “schedules used on the different docks ... called into question by the union in recent days, are enshrined in the collective agreement in force and cannot be used as a bargaining chip for a strike targeting a single operator, as is the case today.” The CUPE did not respond to a request for comment. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>.</div>

The Port of Montreal is warning that shippers may face diverted cargoes as an indefinite strike began Thursday at two marine terminals handling Mediterranean Shipping Co. container services, with over two dozen vessels facing an impact depending on the length of the current work stoppage. The Viau and Maisonneuve marine terminals operated by Termont International closed to ship, rail and truck traffic Thursday morning as members of the Canadian Union of Public Employees (CUPE) Local 375, which represents 1,200 dockworkers at Montreal, walked off the job . Montreal Port Authority (MPA) Chief Executive Julie Gascon said in a statement Thursday that the shutdown “undermines the reliability and image of our logistics sector.” The open-ended strike follows a three-day, port-wide work stoppage at the start of October, a boycott of overtime work and another port-wide strike this past Sunday . “This new work stoppage at the Viau and Maisonneuve terminals, at the very hub of our supply chain, can only have a deeply negative impact on thousands of local businesses, as well as on the economy of Quebec and Canada as a whole,” Gascon said. Montreal’s two other international container terminals remain open. The strike at the two terminals will idle more than 1 million TEUs of Montreal’s total 2.3 million TEUs in terminal capacity. The MPA said five ships with combined capacity of 18,000 TEUs are currently headed for the two terminals, with those ships carrying time-sensitive pharmaceutical and medical goods. Refrigerated containers holding such goods are already backlogged at the port due to the earlier labor actions, the MPA said, adding that some scheduled outbound rail service has been canceled due to the backlog. Over the next three weeks, 26 ships are scheduled to call the two terminals, with the MPA saying that vessels “could change their port of destination” due to the strike. “It is imperative that the parties reach an agreement,” Gascon said. “The need to reach an agreement quickly is acute and cannot be ignored.” MSC, whose terminal arm jointly owns and operates Termont International, said in a customer advisory Wednesday that it is “working to minimize disruptions to our customers’ supply chains” and that “vessel impacts will be communicated as available and relevant.” The Maritime Employers Association (MEA), which represents Montreal’s terminals and stevedores, said Thursday it “deplores” the strike. The MEA and Local 375 have been in protracted negotiations for a new collective bargaining agreement since the last one expired at the end of 2023. The MEA said in its statement that Local 375 has made a demand to change work hours without formal negotiations. It said that “schedules used on the different docks ... called into question by the union in recent days, are enshrined in the collective agreement in force and cannot be used as a bargaining chip for a strike targeting a single operator, as is the case today.” The CUPE did not respond to a request for comment. Contact Michael Angell at michael.angell@spglobal.com .

Montreal warns of vessel diversions as strike against MSC terminals begins

<div class="phx-topic abstract-wrapper">While conventional retailers were decreasing their orders, the growth of e-commence shipments from Asia was more consistent as elevated air cargo rates pushed more shippers to move goods via ocean transport, the carrier’s CEO said. </div>

While conventional retailers were decreasing their orders, the growth of e-commence shipments from Asia was more consistent as elevated air cargo rates pushed more shippers to move goods via ocean transport, the carrier’s CEO said.

<div class="phx-topic">Ocean carrier Matson is expecting elevated rates for its Asian services for the rest of the year amid steady e-commerce growth, US tariff threats, potential labor disruption and constrained capacity due to ongoing Red Sea diversions. That comes after Matson said its net income surged 66% year over year in the third quarter to $199 million due to strong freight rates supported by market uncertainty. CEO Matt Cox, during a third-quarter earnings call Wednesday, said that while conventional retailers were decreasing their orders, the growth of e-commerce shipments from Asia was more consistent as <a href="https://www.joc.com/article/air-cargo-thrives-on-e-commerce-disruption-driven-demand-5703214">elevated air cargo rates</a> pushed more shippers to move goods via ocean transport. The mid-January expiration of a tentative labor agreement for US East and Gulf coast dockworkers was also putting upward pressure on rates, Cox said. “At some point, expect elevated freight rates in the trans-Pacific trade lane to moderate, but the timing will depend on the persistence of the underlying economic supply chain and geopolitical conditions,” he said. “At this moment, it is unclear if any of the elements of risk will normalize during 2025.” Reflecting greater pricing power, Matson’s revenue rose 16.3% to $962 million during the third quarter even as total volumes, including those on its US Jones Act trades, rose just 0.4% to 107,900 FEUs. Third-quarter China volumes inched up 2.6% to 40,000 FEUs in the same period. The fourth quarter forecast was, in part, supported by expected retail growth bolstered by a robust e-commerce sector. But Matson also pointed to several market disruptions tightening supply chain conditions — such as ongoing Red Sea diversions and the brief strike at US East and Gulf coast ports — as the primary cause for increased freight rates. “For the fourth quarter, we expect our China service freight rates to be significantly higher than [Q3 2023], but lower than the average rates achieved in the [2024] third quarter as the peak season demand eases,” said Cox. Matson’s Q4 outlook expects operating income for ocean transportation will be “meaningfully higher” than levels in the year-ago period. The market has been signaling <a href="https://www.joc.com/article/strong-imports-low-blanks-extend-peak-season-on-eastbound-trans-pacific-5782101">robust trans-Pacific volumes</a> for several weeks, and Cox pointed to several other factors offering upward support for rates, including the US presidential election and what that may mean for tariffs. Furthermore, there are market expectations for a marginal volume push driven by shippers who intend on frontloading cargo ahead of another potential labor interruption in January. Cox said some of Matson’s shippers have already “derisked” their freight by diverting it into the West Coast. Still, the Matson CEO said year-over-year expectations for the fourth quarter remain bullish. That outlook is reinforced by the strong spot market for trans-Pacific cargo, where rates for ex-Asia imports into North America have more than doubled since last year. Contact Laura Robb at <a href=" mailto:Laura.Robb@spglobal.com.">laura.robb@spglobal.com</a>. </div>

Ocean carrier Matson is expecting elevated rates for its Asian services for the rest of the year amid steady e-commerce growth, US tariff threats, potential labor disruption and constrained capacity due to ongoing Red Sea diversions. That comes after Matson said its net income surged 66% year over year in the third quarter to $199 million due to strong freight rates supported by market uncertainty. CEO Matt Cox, during a third-quarter earnings call Wednesday, said that while conventional retailers were decreasing their orders, the growth of e-commerce shipments from Asia was more consistent as elevated air cargo rates pushed more shippers to move goods via ocean transport. The mid-January expiration of a tentative labor agreement for US East and Gulf coast dockworkers was also putting upward pressure on rates, Cox said. “At some point, expect elevated freight rates in the trans-Pacific trade lane to moderate, but the timing will depend on the persistence of the underlying economic supply chain and geopolitical conditions,” he said. “At this moment, it is unclear if any of the elements of risk will normalize during 2025.” Reflecting greater pricing power, Matson’s revenue rose 16.3% to $962 million during the third quarter even as total volumes, including those on its US Jones Act trades, rose just 0.4% to 107,900 FEUs. Third-quarter China volumes inched up 2.6% to 40,000 FEUs in the same period. The fourth quarter forecast was, in part, supported by expected retail growth bolstered by a robust e-commerce sector. But Matson also pointed to several market disruptions tightening supply chain conditions — such as ongoing Red Sea diversions and the brief strike at US East and Gulf coast ports — as the primary cause for increased freight rates. “For the fourth quarter, we expect our China service freight rates to be significantly higher than [Q3 2023], but lower than the average rates achieved in the [2024] third quarter as the peak season demand eases,” said Cox. Matson’s Q4 outlook expects operating income for ocean transportation will be “meaningfully higher” than levels in the year-ago period. The market has been signaling robust trans-Pacific volumes for several weeks, and Cox pointed to several other factors offering upward support for rates, including the US presidential election and what that may mean for tariffs. Furthermore, there are market expectations for a marginal volume push driven by shippers who intend on frontloading cargo ahead of another potential labor interruption in January. Cox said some of Matson’s shippers have already “derisked” their freight by diverting it into the West Coast. Still, the Matson CEO said year-over-year expectations for the fourth quarter remain bullish. That outlook is reinforced by the strong spot market for trans-Pacific cargo, where rates for ex-Asia imports into North America have more than doubled since last year. Contact Laura Robb at laura.robb@spglobal.com .

Freight rates supported by bullish fundamentals to persist through Q4: Matson

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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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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>

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