<div class="phx-topic abstract-wrapper">Banks in the United States, Europe and Japan have little choice but to lend more money to debt-laden</div>

Banks in the United States, Europe and Japan have little choice but to lend more money to debt-laden

<div>Banks in the United States, Europe and Japan have little choice but to lend more money to debt-laden countries like Brazil, Argentina and Mexico if they're to recover a reasonable chunk of the $300 billion they're owed, a Trilateral Commission panel found.But the authors of a study analyzing Third World debt differed sharply on how much new credit should be extended to such countries and in their views on how willing the banks will be to extend that credit.One of the four panelists went so far as to suggest that governments in United States, Europe and Japan should be prepared...

Banks in the United States, Europe and Japan have little choice but to lend more money to debt-laden countries like Brazil, Argentina and Mexico if they're to recover a reasonable chunk of the $300 billion they're owed, a Trilateral Commission panel found. But the authors of a study analyzing Third World debt differed sharply on how much new credit should be extended to such countries and in their views on how willing the banks will be to extend that credit.One of the four panelists went so far as to suggest that governments in United States, Europe and Japan should be prepared to set up a rescue bank with powers to work for greater internal economic growth in problem countries if granting more credit fails. Martin Feldstein, a Harvard professor and former economic adviser to President Reagan, said he does not believe the international banking system is close to the brink of disaster as the results of its problem loans in South America, Latin America and Africa. The banks have a very strong incentive to continue providing capital as they did in Mexico last Friday, as they will in the next six weeks in Argentina, and as they will with a longer, more agonizing delay in Brazil," he said. The new agreement with Mexico calls for up to $7.7 million in additional lending - an increase of 3 percent-4 percent a year in Mexican debt to private lenders. The demands the Brazilians have made, that they say are consistent with strong economic growth in Brazil, call for limiting their debt payments to 2.5 percent of their gross national product," he said. That would require increased lending by banks at a rate of about 4 percent of what they currently owe - about $4 billion." Mr. Feldstein said he does not believe that request brings international finance to the edge of collapse. What Brazil is calling for is a responsible request," he said. Brazil's debt (if granted the additional money) would increase in dollar terms, but remain constant in real terms. The $4 billion increase in Brazil's $100 billion debt would represent no increase in the real, inflation-adjusted size of its liability. The ratio of its debt to GNP would go down, the ratio of its debt to exports would go down, the ratio of its debt to the assets of the lending banks would go down - so the situation would be improving." The Brazilians estimate that with such funding, the country could achieve 7 percent real growth, he said. That's a relatively healthy situation," he said. All four of the panelists - Mr. Feldstein, who is president of the National Bureau of Economic Research; Herve de Carmoy, chief international executive for Europe's Midland Bank; Koei Narusawa, economic adviser to the president of the Bank of Tokyo; and Paul Krugman, economics professor at the Massachusetts Institute of Technology - agreed that banks will have to stretch out repayment and at least loan the debtor countries enough to pay the interest on what they already owe. Mr. de Carmoy, who proposed the government rescue fund, said that in several countries, additional credit and rescheduling of debt will be enough to get Third World countries through a crisis brought on by falling commodity prices. But we see that there is a distinct risk at sometime in the future that the situation could get much worse," he said. That's why we've said that within the framework possibly of the World Bank, a new institution should be set up with to work with the (debtor) countries so they will promote policies that would generate greater economic growth."

Maritime

LOANS SEEN CONTINUING TO DEBTOR COUNTRIES

<div class="phx-topic abstract-wrapper">The US producer price index shows LTL pricing has been flat since September, but carriers continue to push for annualized increases in service contracts. </div>

The US producer price index shows LTL pricing has been flat since September, but carriers continue to push for annualized increases in service contracts.

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<div class="phx-topic">The long-term rise in US less-than-truckload (LTL) pricing following the collapse of Yellow in 2023 is colliding with soft demand. That’s likely to give US shippers some leverage to resist LTL carrier requests for steep rate hikes in annual contract negotiations. The US producer price index (PPI) for long-distance LTL trucking was flat for the fourth straight month in December, according to data released Tuesday by the US Bureau of Labor Statistics (BLS). That’s the longest plateau for the LTL PPI since the recovery from the pandemic began in 2020 and an indicator that price hikes have stalled. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="92030a49-a365-46c9-89b8-472c39b44640"></dynamic-object></div>The LTL PPI has dropped 1.6% from its most recent high point last July, an indication LTL rates — still 5.5% higher <a href="https://www.joc.com/article/us-ltl-sector-growth-efficiencies-still-fueled-by-loss-of-yellow-5715785">than when Yellow shut down</a> in July 2023 — are not ready to rise much higher without more demand. On a year-over-year basis, the LTL PPI was up 3% from December 2023 and only 5.9% below its peak in June 2022, a sign of the resilience of LTL pricing. The BLS’ truckload PPI is 23.4% below its peak in May 2022. In comparison, the PPI for long-distance truckload services rose 1.3% in December from November, reaching its highest level since November 2023, but it is still fairly flat. The December reading from the BLS was 0.8% higher than a year ago. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="502bfcce-8a5c-4a30-b4a2-18030e5ba3df"></dynamic-object></div>Low demand is helping shippers <a href="https://www.joc.com/article/us-truckload-spot-rates-rising-but-shippers-keeping-lid-on-contract-rates-5919921">keep a lid on truckload contract rates</a>. It’s not clear where new LTL or truckload freight might come from. The freight downturn that began in 2022 is still alive in 2025, despite hopes it would end last year. Freight volumes are steady but stagnant early in the first quarter, according to AFS Logistics. “We haven’t seen a lull since the holidays, so freight volumes have been steady,” said Aaron LaGanke, vice president of freight services at the third-party logistics provider. “But we haven’t seen a big dip or an increase in demand either. It’s pretty flat.” <h3>Fresh demand absent </h3>“We’re in a depressed freight market,” said an LTL carrier executive who asked not to be identified. “Shipment activity is relatively flat year over year. We’re all waiting for the event or trend that will unleash increased demand for freight, but it’s not there.” LTL carriers are better positioned, even in a flat market, to negotiate higher pricing. For one, the market is highly consolidated. But perhaps more importantly, LTL providers in 2025 have a much better understanding of their costs, their service value and margins. “They do a good job of knowing their numbers,” LaGanke said, noting that will support some rate hikes, depending on the carrier. Shippers have told the Journal of Commerce they are seeing contract LTL rates rise, but in low single-digit percentages. The LTL PPI was still 3% higher on an annualized basis in December, and 5.5% higher than it was in July 2023, the month Yellow shut down and reshaped the LTL landscape. The amount of LTL savings shippers can expect depends on their freight, their lanes and their carriers, LaGanke said. But shippers and carriers are both getting better at fitting the right freight with the right network. Shippers have seen savings in LTL fuel surcharges. The average US retail diesel price was down 26 cents from a year ago as of Monday. The average fuel surcharge from major LTL carriers fell 3.4% in the fourth quarter from the third quarter, AFS Logistics said. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>. </div>

The long-term rise in US less-than-truckload (LTL) pricing following the collapse of Yellow in 2023 is colliding with soft demand. That’s likely to give US shippers some leverage to resist LTL carrier requests for steep rate hikes in annual contract negotiations. The US producer price index (PPI) for long-distance LTL trucking was flat for the fourth straight month in December, according to data released Tuesday by the US Bureau of Labor Statistics (BLS). That’s the longest plateau for the LTL PPI since the recovery from the pandemic began in 2020 and an indicator that price hikes have stalled. The LTL PPI has dropped 1.6% from its most recent high point last July, an indication LTL rates — still 5.5% higher than when Yellow shut down in July 2023 — are not ready to rise much higher without more demand. On a year-over-year basis, the LTL PPI was up 3% from December 2023 and only 5.9% below its peak in June 2022, a sign of the resilience of LTL pricing. The BLS’ truckload PPI is 23.4% below its peak in May 2022. In comparison, the PPI for long-distance truckload services rose 1.3% in December from November, reaching its highest level since November 2023, but it is still fairly flat. The December reading from the BLS was 0.8% higher than a year ago. Low demand is helping shippers keep a lid on truckload contract rates . It’s not clear where new LTL or truckload freight might come from. The freight downturn that began in 2022 is still alive in 2025, despite hopes it would end last year. Freight volumes are steady but stagnant early in the first quarter, according to AFS Logistics. “We haven’t seen a lull since the holidays, so freight volumes have been steady,” said Aaron LaGanke, vice president of freight services at the third-party logistics provider. “But we haven’t seen a big dip or an increase in demand either. It’s pretty flat.” Fresh demand absent “We’re in a depressed freight market,” said an LTL carrier executive who asked not to be identified. “Shipment activity is relatively flat year over year. We’re all waiting for the event or trend that will unleash increased demand for freight, but it’s not there.” LTL carriers are better positioned, even in a flat market, to negotiate higher pricing. For one, the market is highly consolidated. But perhaps more importantly, LTL providers in 2025 have a much better understanding of their costs, their service value and margins. “They do a good job of knowing their numbers,” LaGanke said, noting that will support some rate hikes, depending on the carrier. Shippers have told the Journal of Commerce they are seeing contract LTL rates rise, but in low single-digit percentages. The LTL PPI was still 3% higher on an annualized basis in December, and 5.5% higher than it was in July 2023, the month Yellow shut down and reshaped the LTL landscape. The amount of LTL savings shippers can expect depends on their freight, their lanes and their carriers, LaGanke said. But shippers and carriers are both getting better at fitting the right freight with the right network. Shippers have seen savings in LTL fuel surcharges. The average US retail diesel price was down 26 cents from a year ago as of Monday. The average fuel surcharge from major LTL carriers fell 3.4% in the fourth quarter from the third quarter, AFS Logistics said. Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Surface

US LTL truck pricing flat, but still elevated despite low demand

<div class="phx-topic abstract-wrapper">Domestic intermodal providers are frustrated that they’ve been unable to win significant rate increases in contracts in early 2025, but capacity in trucking and rail is still abundant and easy to procure.</div>

Domestic intermodal providers are frustrated that they’ve been unable to win significant rate increases in contracts in early 2025, but capacity in trucking and rail is still abundant and easy to procure.

<div class="phx-topic">Domestic intermodal providers are expressing frustration with what they say is a challenging freight market as early bids on annual contracts with shippers have yielded only small rate increases in California and flat or declining rates in other regions. That reality is underscoring a tough pricing environment for carriers as 2025 begins. One asset-based intermodal executive who did not want to be identified said he was “disappointed” with the results of annual contracts already awarded for 2025, saying they fell below his expectations. The source said he hopes to eke out a 1% or 2% increase on annual contracts that are inked in the first quarter and lobby for mid-single-digit percentage increases on a second wave of intermodal bids this spring. Meanwhile, J.B. Hunt Transport Services, the largest US intermodal carrier, has urged shippers to engage in “transparent conversations” about freight rates. In an advisory sent to shippers last week that was obtained by the Journal of Commerce, the company cited <a href="https://www.joc.com/article/domestic-intermodal-rate-pressure-building-on-stronger-truck-pricing-5741060">robust California outbound volumes</a> during the 2024 peak season as a reason to agree to higher rates now. “Inflation and rising costs have made our current margins unsustainable over the long term,” the advisory said. Railroads moved more than 82,000 containers from the Southwest to the Midwest last October, a record for any month, according to the Intermodal Association of North America (IANA). The Journal of Commerce estimates railroads hauled about 50,000 containers from Los Angeles to Chicago, the busiest US lane, that month, also a record. One intermodal shipper who did not want to be identified said despite the robust peak season in Southern California for trucking and rail, there is still abundant capacity available to handle current freight demand, adding that rate increases won’t occur until shippers struggle to procure containers or trailers. “As long as the supply of containers, drivers and over-the-road equipment is sufficient for freight demand, rates are going to stay flat or go down as carriers compete to keep their equipment moving,” the shipper said. “Rates only go up significantly when the supply is insufficient or inadequate to handle freight demand, causing shippers to worry whether their product will move downstream in enough time to generate revenue.” <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e322a7e3-8b94-4c1d-a1f3-896d029aad84"></dynamic-object></div><h3>Flexibility to negotiate </h3>Union Pacific Railroad (UP) is seeking rate increases in California while conceding to flat or lower rates in several inland markets, according to a pricing matrix compiled by the company and obtained by the Journal of Commerce. Aggregate pricing for low-volume shippers, which serves as a ceiling for negotiations with customers moving higher volumes, shows proposed increases of 5.9% in Southern California and 3.1% in Northern California, effective Feb. 1. However, UP has shown flexibility to negotiate more aggressive rates to keep incumbent customers or take business away from competitors. “If UP really wants the lane and it fits well within their network, they’re willing to help us retain existing business and compete against J.B. Hunt,” said a non-asset intermodal marketing company (IMC) executive. “Other BNSF partners are also offering attractive rates to take business from UP.” The need to work aggressively to keep or win business has some intermodal carriers and brokers pessimistic about the first half of the year. “The magic date for me is June,” a second non-asset IMC executive told the Journal of Commerce. “Either truckload capacity will have shrunk considerably and the market dynamics have shifted, or it’ll be another tough year for carriers,” BNSF and UP seem reluctant to raise rates in inland markets such as Chicago, Memphis, Minneapolis and St. Louis, with proposed rates flat or lower than a year ago, according to pricing documents from UP and BNSF partners seen by the Journal of Commerce. Adding pressure to the domestic intermodal market is Amazon, which is leveraging its fleet of more than 20,000 branded containers. The e-commerce giant is courting shippers with very aggressive rates to fill its boxes on backhauls from the inland to the West Coast in a bid to balance its freight flows originating on the West Coast, according to two intermodal shippers who spoke with the Journal of Commerce. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Domestic intermodal providers are expressing frustration with what they say is a challenging freight market as early bids on annual contracts with shippers have yielded only small rate increases in California and flat or declining rates in other regions. That reality is underscoring a tough pricing environment for carriers as 2025 begins. One asset-based intermodal executive who did not want to be identified said he was “disappointed” with the results of annual contracts already awarded for 2025, saying they fell below his expectations. The source said he hopes to eke out a 1% or 2% increase on annual contracts that are inked in the first quarter and lobby for mid-single-digit percentage increases on a second wave of intermodal bids this spring. Meanwhile, J.B. Hunt Transport Services, the largest US intermodal carrier, has urged shippers to engage in “transparent conversations” about freight rates. In an advisory sent to shippers last week that was obtained by the Journal of Commerce, the company cited robust California outbound volumes during the 2024 peak season as a reason to agree to higher rates now. “Inflation and rising costs have made our current margins unsustainable over the long term,” the advisory said. Railroads moved more than 82,000 containers from the Southwest to the Midwest last October, a record for any month, according to the Intermodal Association of North America (IANA). The Journal of Commerce estimates railroads hauled about 50,000 containers from Los Angeles to Chicago, the busiest US lane, that month, also a record. One intermodal shipper who did not want to be identified said despite the robust peak season in Southern California for trucking and rail, there is still abundant capacity available to handle current freight demand, adding that rate increases won’t occur until shippers struggle to procure containers or trailers. “As long as the supply of containers, drivers and over-the-road equipment is sufficient for freight demand, rates are going to stay flat or go down as carriers compete to keep their equipment moving,” the shipper said. “Rates only go up significantly when the supply is insufficient or inadequate to handle freight demand, causing shippers to worry whether their product will move downstream in enough time to generate revenue.” Flexibility to negotiate Union Pacific Railroad (UP) is seeking rate increases in California while conceding to flat or lower rates in several inland markets, according to a pricing matrix compiled by the company and obtained by the Journal of Commerce. Aggregate pricing for low-volume shippers, which serves as a ceiling for negotiations with customers moving higher volumes, shows proposed increases of 5.9% in Southern California and 3.1% in Northern California, effective Feb. 1. However, UP has shown flexibility to negotiate more aggressive rates to keep incumbent customers or take business away from competitors. “If UP really wants the lane and it fits well within their network, they’re willing to help us retain existing business and compete against J.B. Hunt,” said a non-asset intermodal marketing company (IMC) executive. “Other BNSF partners are also offering attractive rates to take business from UP.” The need to work aggressively to keep or win business has some intermodal carriers and brokers pessimistic about the first half of the year. “The magic date for me is June,” a second non-asset IMC executive told the Journal of Commerce. “Either truckload capacity will have shrunk considerably and the market dynamics have shifted, or it’ll be another tough year for carriers,” BNSF and UP seem reluctant to raise rates in inland markets such as Chicago, Memphis, Minneapolis and St. Louis, with proposed rates flat or lower than a year ago, according to pricing documents from UP and BNSF partners seen by the Journal of Commerce. Adding pressure to the domestic intermodal market is Amazon, which is leveraging its fleet of more than 20,000 branded containers. The e-commerce giant is courting shippers with very aggressive rates to fill its boxes on backhauls from the inland to the West Coast in a bid to balance its freight flows originating on the West Coast, according to two intermodal shippers who spoke with the Journal of Commerce. Contact Ari Ashe at ari.ashe@spglobal.com .

North-American rail

Intermodal providers

Intermodal providers navigate tough pricing environment at start of year

<div class="phx-topic abstract-wrapper">The pricing move means a general rate increase planned by carriers for Jan. 15 will not be implemented, forwarders say, because demand is not sufficient to support another boost.</div>

The pricing move means a general rate increase planned by carriers for Jan. 15 will not be implemented, forwarders say, because demand is not sufficient to support another boost.

<div class="phx-topic">Most ocean carriers on the eastbound trans-Pacific are extending their current spot rates through the end of January, a sign that liners are losing pricing power even before the trade enters its weakest month of the year. Three of those carriers — including Hapag-Lloyd — are even taking the uncommon step of offering customers guaranteed rates into mid-February, sources say. Those pricing moves mean a general rate increase (GRI) planned by carriers for Jan. 15 will not be implemented, forwarders told the Journal of Commerce, because demand, while strong enough now to support the current rate level, is not sufficient to support another boost. “We’re not only getting two-week [guaranteed] rates, we’re [also] getting 30-day rates to Feb. 15,” said Christian Sur, executive vice president of ocean freight contract logistics at the forwarder Unique Logistics International. The fact that Hapag-Lloyd and two smaller lines that sources identified as Wan Hai and SM Lines have extended their rates for a full month to mid-February is especially significant because carriers normally guarantee rates for only two weeks. The advanced undercutting suggests carriers expect capacity to outpace demand even more in the coming month, further eroding pricing power. <h3>Lunar New Year factory closures </h3>The weakening market is driven by the reality that many factories in Asia will soon close for a week or two for the annual Lunar New Year holiday that begins Jan. 29. By guaranteeing spot rates through the end of the month, carriers are attempting to build “roll pools” of containers at Asian load ports to carry them into February, said James Caradonna, executive vice president at the forwarder M&amp;R Spedag Group. “Space is still OK, but some carriers are not as full as others,” Caradonna said, adding some carriers are willing to provide customers the space they want even if they exceed the minimum quantity commitment (MQC) in their contracts. Carriers confirm that with the Lunar New Year holidays approaching, further rate hikes are unlikely. “Rates are coming down pretty fast to the West Coast,” a carrier executive told the Journal of Commerce. A second carrier source acknowledged: “It seems like rates have crested and are drifting lower.” Spot rates from North Asia to the West Coast were $4,700 per FEU as of Jan. 13, down 10% on the week, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. East Coast rates of $6,000 were down 7% from last week. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e7a65aab-9aac-4f07-9b74-1793746c01ef"></dynamic-object></div>Customers also have access to discounts provided by so-called “bullet” rates, which are special commodity- or trade lane-specific rates that are lower than the posted spot rates and freight-all-kinds (FAK) rates paid by forwarders. “The promotional rates are starting to proliferate,” said Kurt McElroy, executive vice president of the forwarder Kerry Apex. Bookings for shipments into February have peaked and will only decline further, he said, adding special rates to the West Coast are in the low $4,000s. An industry consultant who did not want to be identified said the fact that some carriers are extending current spot rates into mid-February indicates the drop in demand is accelerating. And that means some customers may choose to delay bookings of non-essential merchandise to see if spot rates decline further during the factory closures in Asia, the source said. Now that the International Longshoremen’s Association (ILA) has reached a tentative contract agreement with East and Gulf coast employees, <a href="https://www.joc.com/article/ila-usmx-reach-tentative-deal-that-avoids-another-port-strike-5919519">averting a second strike</a>, shippers are focusing primarily on what the tariff policy of President-elect Donald Trump will be after he takes office Jan. 20. If the higher tariffs Trump has threatened do not take effect on day one of the new administration but are staggered into the spring and summer, the eastbound trans-Pacific will experience a “massive frontloading” of imports, McElroy said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Most ocean carriers on the eastbound trans-Pacific are extending their current spot rates through the end of January, a sign that liners are losing pricing power even before the trade enters its weakest month of the year. Three of those carriers — including Hapag-Lloyd — are even taking the uncommon step of offering customers guaranteed rates into mid-February, sources say. Those pricing moves mean a general rate increase (GRI) planned by carriers for Jan. 15 will not be implemented, forwarders told the Journal of Commerce, because demand, while strong enough now to support the current rate level, is not sufficient to support another boost. “We’re not only getting two-week [guaranteed] rates, we’re [also] getting 30-day rates to Feb. 15,” said Christian Sur, executive vice president of ocean freight contract logistics at the forwarder Unique Logistics International. The fact that Hapag-Lloyd and two smaller lines that sources identified as Wan Hai and SM Lines have extended their rates for a full month to mid-February is especially significant because carriers normally guarantee rates for only two weeks. The advanced undercutting suggests carriers expect capacity to outpace demand even more in the coming month, further eroding pricing power. Lunar New Year factory closures The weakening market is driven by the reality that many factories in Asia will soon close for a week or two for the annual Lunar New Year holiday that begins Jan. 29. By guaranteeing spot rates through the end of the month, carriers are attempting to build “roll pools” of containers at Asian load ports to carry them into February, said James Caradonna, executive vice president at the forwarder M&R Spedag Group. “Space is still OK, but some carriers are not as full as others,” Caradonna said, adding some carriers are willing to provide customers the space they want even if they exceed the minimum quantity commitment (MQC) in their contracts. Carriers confirm that with the Lunar New Year holidays approaching, further rate hikes are unlikely. “Rates are coming down pretty fast to the West Coast,” a carrier executive told the Journal of Commerce. A second carrier source acknowledged: “It seems like rates have crested and are drifting lower.” Spot rates from North Asia to the West Coast were $4,700 per FEU as of Jan. 13, down 10% on the week, according to Platts, a sister company of the Journal of Commerce within S&P Global. East Coast rates of $6,000 were down 7% from last week. Customers also have access to discounts provided by so-called “bullet” rates, which are special commodity- or trade lane-specific rates that are lower than the posted spot rates and freight-all-kinds (FAK) rates paid by forwarders. “The promotional rates are starting to proliferate,” said Kurt McElroy, executive vice president of the forwarder Kerry Apex. Bookings for shipments into February have peaked and will only decline further, he said, adding special rates to the West Coast are in the low $4,000s. An industry consultant who did not want to be identified said the fact that some carriers are extending current spot rates into mid-February indicates the drop in demand is accelerating. And that means some customers may choose to delay bookings of non-essential merchandise to see if spot rates decline further during the factory closures in Asia, the source said. Now that the International Longshoremen’s Association (ILA) has reached a tentative contract agreement with East and Gulf coast employees, averting a second strike , shippers are focusing primarily on what the tariff policy of President-elect Donald Trump will be after he takes office Jan. 20. If the higher tariffs Trump has threatened do not take effect on day one of the new administration but are staggered into the spring and summer, the eastbound trans-Pacific will experience a “massive frontloading” of imports, McElroy said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Container Shipping News

Container lines

Trans-Pacific

Carriers extend spot rates in bid to avoid further rate erosion in eastbound trans-Pac

<div class="phx-topic abstract-wrapper">The shipowner’s decision to expand its MPV fleet is underpinned by expected growth in project cargo volumes and a lack of suitable ships. </div>

The shipowner’s decision to expand its MPV fleet is underpinned by expected growth in project cargo volumes and a lack of suitable ships.

<div class="phx-topic">A four-ship leasing deal by Norden reflects strong project cargo demand growth and sound market fundamentals, the Denmark-headquartered shipowner said Tuesday.Two 17,500-deadweight metric ton (dwt) multipurpose vessels (MPVs) are due to be delivered by the end of 2026 in a deal that includes options to purchase the vessels at the end of the lease agreements, the company said in a statement.Norden has an option to declare an additional two vessel leases with delivery in 2027. The first two ships will take Norden’s fleet of specialized project cargo vessels to 45, CEO Jan Rindbo said. “[The ships are] designed to handle windmill components, large-scale batteries, industrial plant equipment and breakbulk cargoes like steel and forestry products — enabling us to meet the evolving needs of our customers,” Rindbo said in the statement.The company declined to give further details about the leasing company or if the ships are newbuild or secondhand vessels. The vessels have an innovative design with the bridge located at the front of the ship, optimizing cargo space capacity for project cargo such as windmill blades. The ships are also biofuel compatible, Norden said.Norden entered the project cargo and MPV market in June 2023 when it acquired Thorco Projects.“Since entering the project cargo segment in 2023, our focus has been on growth within this part of the business,” Thomas Mikkelsen, Norden’s head of projects and parceling, said in the statement.“The multipurpose [vessel] segment benefits from favorable supply fundamentals with a rapidly ageing fleet and low order book, coupled with a strong projected demand outlook,” added Mikkelsen, who was previously the CEO of Thorco Projects.<h3>Drewry warns of limited MPV capacity </h3>Mikkelsen’s comments echo the upbeat outlook of the project cargo sector from maritime analyst Drewry Research, which has forecast an increase in charter rates for MPVs this year due to limited vessel supply and high demand.Drewry said the MPV fleet did not grow as much as expected last year because fewer vessels were delivered and scrapped. There were also fewer orders for new vessels placed in the second half of last year. Consequently, “deliveries are likely to be muted over the next two years,” Anurag Kumar, Drewry’s senior research analyst, said in the outlook.<div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="1e7f3686-4313-47cb-9fe9-d40ac8e832e6"></dynamic-object></div>The MPV fleet totaled 31.6 million dwt on Jan. 1, according to British shipbroking house Clarksons, a figure virtually unchanged since 2022. Clarksons also forecasts that vessels totaling 1.8 million dwt will be delivered this year.“A tight supply of project cargo vessels [MPVs] will persist due to a low order book, resulting in higher charter rates,” Kumar said. “If delays in deliveries increase in 2025, we may see rates surging in 2026 for project cargo.”He added that, “demand for project cargo vessels will be robust in 2025, particularly on intra-Asia, supported by energy projects that remain on schedule.”Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

A four-ship leasing deal by Norden reflects strong project cargo demand growth and sound market fundamentals, the Denmark-headquartered shipowner said Tuesday. Two 17,500-deadweight metric ton (dwt) multipurpose vessels (MPVs) are due to be delivered by the end of 2026 in a deal that includes options to purchase the vessels at the end of the lease agreements, the company said in a statement. Norden has an option to declare an additional two vessel leases with delivery in 2027. The first two ships will take Norden’s fleet of specialized project cargo vessels to 45, CEO Jan Rindbo said. “[The ships are] designed to handle windmill components, large-scale batteries, industrial plant equipment and breakbulk cargoes like steel and forestry products — enabling us to meet the evolving needs of our customers,” Rindbo said in the statement. The company declined to give further details about the leasing company or if the ships are newbuild or secondhand vessels. The vessels have an innovative design with the bridge located at the front of the ship, optimizing cargo space capacity for project cargo such as windmill blades. The ships are also biofuel compatible, Norden said. Norden entered the project cargo and MPV market in June 2023 when it acquired Thorco Projects. “Since entering the project cargo segment in 2023, our focus has been on growth within this part of the business,” Thomas Mikkelsen, Norden’s head of projects and parceling, said in the statement. “The multipurpose [vessel] segment benefits from favorable supply fundamentals with a rapidly ageing fleet and low order book, coupled with a strong projected demand outlook,” added Mikkelsen, who was previously the CEO of Thorco Projects. Drewry warns of limited MPV capacity Mikkelsen’s comments echo the upbeat outlook of the project cargo sector from maritime analyst Drewry Research, which has forecast an increase in charter rates for MPVs this year due to limited vessel supply and high demand. Drewry said the MPV fleet did not grow as much as expected last year because fewer vessels were delivered and scrapped. There were also fewer orders for new vessels placed in the second half of last year. Consequently, “deliveries are likely to be muted over the next two years,” Anurag Kumar, Drewry’s senior research analyst, said in the outlook. The MPV fleet totaled 31.6 million dwt on Jan. 1, according to British shipbroking house Clarksons, a figure virtually unchanged since 2022. Clarksons also forecasts that vessels totaling 1.8 million dwt will be delivered this year. “A tight supply of project cargo vessels [MPVs] will persist due to a low order book, resulting in higher charter rates,” Kumar said. “If delays in deliveries increase in 2025, we may see rates surging in 2026 for project cargo.” He added that, “demand for project cargo vessels will be robust in 2025, particularly on intra-Asia, supported by energy projects that remain on schedule.” Contact Keith Wallis at keithwallis@hotmail.com .

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Norden MPV leasing deal capitalizes on global fleet undercapacity

<div class="phx-topic abstract-wrapper">The carrier said its ability to capture market share was directly linked to a shift in trade dynamics as mainline operators outsourced intra-regional services to more agile operators.</div>

The carrier said its ability to capture market share was directly linked to a shift in trade dynamics as mainline operators outsourced intra-regional services to more agile operators.

<div class="phx-topic">Intra-Europe specialist carrier Unifeeder tripled its market share in the Mediterranean in 2024 as deep-sea liners diverting around Africa to avoid the Red Sea outsourced coverage of the region to smaller operators. The DP World subsidiary said in a statement Tuesday its market share of the intra-Mediterranean trade had risen from 1.5% in 2023 to 4.3% last year, with data from Alphaliner showing that Unifeeder recorded the highest capacity growth of all carriers in the region. Unifeeder CEO Martin Gaard Christiansen said the carrier’s growth in the Mediterranean and Black Sea was a result of the rapidly evolving shipping landscape in the region. ”The shipping industry is going through profound shifts, with geopolitical and economic factors driving the need for more agile and responsive supply chain solutions,” Gaard said in the statement. Vessel diversions around southern Africa add up to two weeks to transit times and absorb an additional 10% of capacity. Rather than connect with ports inside the Mediterranean, deep-sea carriers, in a bid to maintain weekly schedules, <a href="https://www.joc.com/article/ocean-carriers-slash-port-calls-as-red-sea-disruptions-grow-5219908">often offload South Europe cargo at hubs</a> in North Europe or at ports just inside the Atlantic entrance to the Mediterranean. The cargo is then transshipped eastward to destinations inside the Mediterranean or Black Sea. Unifeeder said the intra-Mediterranean trade sector as a whole saw overall capacity expand by 9.3%, or almost 50,000 TEUs, by December last year compared with December 2023. The carrier noted that its ability to capture market share was directly linked to a shift in trade dynamics as mainline operators outsourced intra-regional services to more agile operators. <h3>Increasing Mediterranean transshipment </h3>Those changes in the Asia-Mediterranean network led to a host of new services being rolled out across the Med and Black Sea last year by both mainline carriers and smaller intra-Europe operators. Unifeeder alone launched seven new intra-Mediterranean services in the past 12 months, adding 10,600 TEUs of capacity and increasing its average vessel size to 1,186 TEUs, with plans to expand services into the Black Sea later this month. The carrier’s Mediterranean fleet now totals 20 vessels with a total capacity of 24,000 TEUs. <a href="https://www.joc.com/article/turkish-liners-shift-to-india-for-suez-routings-with-relays-to-us-europe-5919049">Turkish shipping company Arkas</a> last week announced the Feb. 10 launch of its direct India Med Service that will operate four vessels, each having a capacity of 2,500-2,800 TEUs. The additional volume coming into the Mediterranean from India will see Arkas restructuring its network with a new Blue Med Service merging two existing services jointly operated with CMA CGM. Unimed will launch a new service to connect Turkey to Bulgaria this month, while from Jan. 24 CMA CGM will add their new Odessa Express connecting Odessa with Piraeus and Ambarli in Turkey using two ships of 1,100 TEUs and 1,500 TEUs. Maersk this week launched its new Mediterranean Sea C (SLN) service that has replaced the Mediterranean Sea A (SLZ) and Mediterranean Sea B (SLH) services it operates jointly with Arkas. Ocean Network Express (ONE) on Jan. 18 will launch two feeder services covering the Adriatic and south Mediterranean. The Adriatic Service 1 (AD1) will use three ships of 1,000 TEUs and replace ONE’s existing Adriatic Israel Butterfly (AIB) service. There is set to be a significant increase in intra-Mediterranean ocean traffic from Feb. 1 when the <a href="https://www.joc.com/article/hapag-lloyd-says-gemini-alliance-cargo-bookings-to-open-dec-3-5846853">Gemini Cooperation between Maersk and Hapag-Lloyd</a> is launched. According to published Gemini schedules, vessels on the Asia-Mediterranean trade will provide weekly connectivity with Asia at gateway ports in Spain, Italy, the Adriatic and Turkey, with shuttles transporting cargo to destination terminals. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Intra-Europe specialist carrier Unifeeder tripled its market share in the Mediterranean in 2024 as deep-sea liners diverting around Africa to avoid the Red Sea outsourced coverage of the region to smaller operators. The DP World subsidiary said in a statement Tuesday its market share of the intra-Mediterranean trade had risen from 1.5% in 2023 to 4.3% last year, with data from Alphaliner showing that Unifeeder recorded the highest capacity growth of all carriers in the region. Unifeeder CEO Martin Gaard Christiansen said the carrier’s growth in the Mediterranean and Black Sea was a result of the rapidly evolving shipping landscape in the region. ”The shipping industry is going through profound shifts, with geopolitical and economic factors driving the need for more agile and responsive supply chain solutions,” Gaard said in the statement. Vessel diversions around southern Africa add up to two weeks to transit times and absorb an additional 10% of capacity. Rather than connect with ports inside the Mediterranean, deep-sea carriers, in a bid to maintain weekly schedules, often offload South Europe cargo at hubs in North Europe or at ports just inside the Atlantic entrance to the Mediterranean. The cargo is then transshipped eastward to destinations inside the Mediterranean or Black Sea. Unifeeder said the intra-Mediterranean trade sector as a whole saw overall capacity expand by 9.3%, or almost 50,000 TEUs, by December last year compared with December 2023. The carrier noted that its ability to capture market share was directly linked to a shift in trade dynamics as mainline operators outsourced intra-regional services to more agile operators. Increasing Mediterranean transshipment Those changes in the Asia-Mediterranean network led to a host of new services being rolled out across the Med and Black Sea last year by both mainline carriers and smaller intra-Europe operators. Unifeeder alone launched seven new intra-Mediterranean services in the past 12 months, adding 10,600 TEUs of capacity and increasing its average vessel size to 1,186 TEUs, with plans to expand services into the Black Sea later this month. The carrier’s Mediterranean fleet now totals 20 vessels with a total capacity of 24,000 TEUs. Turkish shipping company Arkas last week announced the Feb. 10 launch of its direct India Med Service that will operate four vessels, each having a capacity of 2,500-2,800 TEUs. The additional volume coming into the Mediterranean from India will see Arkas restructuring its network with a new Blue Med Service merging two existing services jointly operated with CMA CGM. Unimed will launch a new service to connect Turkey to Bulgaria this month, while from Jan. 24 CMA CGM will add their new Odessa Express connecting Odessa with Piraeus and Ambarli in Turkey using two ships of 1,100 TEUs and 1,500 TEUs. Maersk this week launched its new Mediterranean Sea C (SLN) service that has replaced the Mediterranean Sea A (SLZ) and Mediterranean Sea B (SLH) services it operates jointly with Arkas. Ocean Network Express (ONE) on Jan. 18 will launch two feeder services covering the Adriatic and south Mediterranean. The Adriatic Service 1 (AD1) will use three ships of 1,000 TEUs and replace ONE’s existing Adriatic Israel Butterfly (AIB) service. There is set to be a significant increase in intra-Mediterranean ocean traffic from Feb. 1 when the Gemini Cooperation between Maersk and Hapag-Lloyd is launched. According to published Gemini schedules, vessels on the Asia-Mediterranean trade will provide weekly connectivity with Asia at gateway ports in Spain, Italy, the Adriatic and Turkey, with shuttles transporting cargo to destination terminals. Contact Greg Knowler at greg.knowler@spglobal.com .

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Unifeeder boosts market share as Red Sea diversions grow Med business

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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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