<div class="phx-topic abstract-wrapper">Two stevedoring companies are looking to the Federal Maritime Commission to stop what they say is an unlawful access fee at the Port of Baltimore after one of them was invoiced $1.2 million. </div>

Two stevedoring companies are looking to the Federal Maritime Commission to stop what they say is an unlawful access fee at the Port of Baltimore after one of them was invoiced $1.2 million.

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<div>Two Baltimore stevedoring companies say a marine terminal operator (MTO) tried to shut them out of work at the port and then invoiced one of them for $1.2 million in fees for not being the MTO’s preferred stevedoring provider. The two companies, Ports America Chesapeake (PAC) and Marine Terminals Corporation-East (MTCE), filed a complaint with the Federal Maritime Commission (FMC) Friday. The problem began last November when AMPORTS, an auto processor and MTO, sent a letter to its ocean carrier partners stating it had selected Ceres Terminals as the “sole stevedoring provider” with exclusive rights to perform roll-on/roll-off (ro/ro) vessel...

Two Baltimore stevedoring companies say a marine terminal operator (MTO) tried to shut them out of work at the port and then invoiced one of them for $1.2 million in fees for not being the MTO’s preferred stevedoring provider. The two companies, Ports America Chesapeake (PAC) and Marine Terminals Corporation-East (MTCE), filed a complaint with the Federal Maritime Commission (FMC) Friday. The problem began last November when AMPORTS, an auto processor and MTO, sent a letter to its ocean carrier partners stating it had selected Ceres Terminals as the “sole stevedoring provider” with exclusive rights to perform roll-on/roll-off (ro/ro) vessel operations for its location at the Port of Baltimore beginning Jan. 1, according to the complaint. The letter also said that use of any other “unlicensed” stevedoring companies would result in a $25 per unit fee to enter the AMPORTS facility. “[T]he intended charge of $25 per car to access the AMPORTS terminal without a contract is blatantly excessive, both in relation to the cost of providing the mysterious alleged service for access, and in relation to the overall economics of ro/ro stevedoring on a per unit basis,” PAC wrote in a December letter to AMPORTS that was included in the FMC filing. PAC and MTCE, which both offer auto and ro/ro stevedoring services in Baltimore, said AMPORTS had no legal basis to assess or collect a fee from Baltimore stevedoring companies. “[W]e intend to continue providing stevedoring services to ocean carrier customers loading and unloading at AMPORTS facilities at our discretion and expressly without agreeing to AMPORTS’ assessment of its proposed $25 per unit fees and without paying any such fees,” PAC said. AMPORTS did not immediately respond to a request for comment. PAC says AMPORTS agreed in late December to suspend the fee to conduct further research about its implementation, but then in April reinstated the charge and retroactively invoiced PAC $1.27 million for fees that accrued starting in January, despite the fee having been suspended during that time. PAC has not paid the fees. “AMPORTS’ unilateral assertion that it has assessed, or intends to assess, the unlawful fee on [Ports America] does not constitute a legal basis to actually assess it or collect it from [Ports America],” PAC said. PAC is requesting an oral hearing before the FMC, saying attempts to resolve the matter have failed. Contact Teri Errico Griffis at teri.griffis@spglobal.com .

Port News

Ro/ro cargo

North American ports

Transport, Trade and Regulation News

New FMC complaint challenges ‘unlawful’ stevedoring fees in Baltimore

<div class="phx-topic abstract-wrapper">Contract logistics was the star performer in the company’s portfolio in 2024, with gross profit rising 4% to $4 billion.</div>

Contract logistics was the star performer in the company’s portfolio in 2024, with gross profit rising 4% to $4 billion.

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<div class="phx-topic">Swiss logistics giant Kuehne + Nagel is facing a volatile business environment due to uncertain consumer demand and geopolitical risks but remains confident about growth prospects this year, company executives said Tuesday. “[The year] has started well. We are gaining market share in certain areas,” CEO Stefen Paul told an online earnings briefing. The gains include areas such as healthcare and e-commerce within K+N’s contract logistics division, he added. Paul said more details about the company’s financial outlook and future business direction would be given at a capital markets day on March 25. Paul and CFO Markus Blanka-Graff were commenting after reporting that K+N saw improved cargo volumes in the second half of last year. Highlighting the improvement, Blanka-Graff said fourth-quarter group earnings rose 11% to $354 million while revenue climbed 19% to $7.6 billion. The gains helped “deliver a solid financial result” for the full year, with revenue climbing 4% to $28 billion, Paul said during the briefing. But profitability remained under pressure, reflecting the wider difficult trading conditions. Total group earnings fell 16% to $1.3 billion for the full year while earnings before interest and taxation (EBIT) fell 13% to $1.9 billion. Contract logistics was the star performer in K+N’s portfolio in 2024, with gross profit rising 4% to $4 billion. Paul said contract logistics posted another year of record-high EBIT, which climbed 14% to $255 million. <h3>Mixed results in other divisions </h3>K+N’s sea freight division saw a 3% increase in underlying container volumes to 4.3 million TEUs last year, but gross profit slipped 11% to $2.3 billion. Paul was upbeat about the forecast contribution of IMC, the US drayage company whose acquisition was completed in early January. He estimated IMC would contribute between $50 to $60 per container in gross profit this year. Paul said there were better volumes in the company’s air freight division last year, with total volumes rising to 4 million metric tons. But while the division’s fourth-quarter EBIT was up 17% to $166 million, it was down 14% to $537 million for the full year. Road logistics also suffered from headwinds in key markets and yields were under pressure due to low demand and weakness in selected industries and regions, Paul said without giving details. The division saw EBIT drop 26% to $110 million last year, though full-year revenue was unchanged at around $4 billion. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com.</a></div>

Swiss logistics giant Kuehne + Nagel is facing a volatile business environment due to uncertain consumer demand and geopolitical risks but remains confident about growth prospects this year, company executives said Tuesday. “[The year] has started well. We are gaining market share in certain areas,” CEO Stefen Paul told an online earnings briefing. The gains include areas such as healthcare and e-commerce within K+N’s contract logistics division, he added. Paul said more details about the company’s financial outlook and future business direction would be given at a capital markets day on March 25. Paul and CFO Markus Blanka-Graff were commenting after reporting that K+N saw improved cargo volumes in the second half of last year. Highlighting the improvement, Blanka-Graff said fourth-quarter group earnings rose 11% to $354 million while revenue climbed 19% to $7.6 billion. The gains helped “deliver a solid financial result” for the full year, with revenue climbing 4% to $28 billion, Paul said during the briefing. But profitability remained under pressure, reflecting the wider difficult trading conditions. Total group earnings fell 16% to $1.3 billion for the full year while earnings before interest and taxation (EBIT) fell 13% to $1.9 billion. Contract logistics was the star performer in K+N’s portfolio in 2024, with gross profit rising 4% to $4 billion. Paul said contract logistics posted another year of record-high EBIT, which climbed 14% to $255 million. Mixed results in other divisions K+N’s sea freight division saw a 3% increase in underlying container volumes to 4.3 million TEUs last year, but gross profit slipped 11% to $2.3 billion. Paul was upbeat about the forecast contribution of IMC, the US drayage company whose acquisition was completed in early January. He estimated IMC would contribute between $50 to $60 per container in gross profit this year. Paul said there were better volumes in the company’s air freight division last year, with total volumes rising to 4 million metric tons. But while the division’s fourth-quarter EBIT was up 17% to $166 million, it was down 14% to $537 million for the full year. Road logistics also suffered from headwinds in key markets and yields were under pressure due to low demand and weakness in selected industries and regions, Paul said without giving details. The division saw EBIT drop 26% to $110 million last year, though full-year revenue was unchanged at around $4 billion. Contact Keith Wallis at keithwallis@hotmail.com.

Maritime

Air Cargo

Supply chain

K+N sees volatility ahead from uncertain demand, geopolitical risks

<div class="phx-topic abstract-wrapper">The Barstow International Gateway (BIG) could cut transit times on international intermodal business and increase the resiliency of Southern California ports during freight surges, BNSF CEO Kate Farmer said.</div>

The Barstow International Gateway (BIG) could cut transit times on international intermodal business and increase the resiliency of Southern California ports during freight surges, BNSF CEO Kate Farmer said.

<div class="phx-topic">Long Beach, California — BNSF Railway is moving forward with its $1.5 billion Barstow International Gateway (BIG) project in California, a 4,800-acre logistics hub that would be North America’s largest intermodal facility, CEO Kate Farmer said Monday. BNSF believes the facility would increase fluidity through the ports of Los Angeles and Long Beach, Farmer told the Journal of Commerce’s TPM25 conference. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5951878_0.1.jpg"></img></div>Located about 130 miles from the ports, BIG would handle transloaded cargo and international intermodal shipments bound for smaller inland markets while reducing port congestion and cutting emissions from trucks hauling containers between marine terminals and rail ramps. It is due to open in 2027 or 2028. The project was in jeopardy last year but is now proceeding after the California Air Resources Board withdrew a proposed locomotive emissions regulation on Jan. 15. The rule, which had drawn opposition from industry groups, was rescinded shortly before President Donald Trump took office. If completed, the facility is expected to improve cargo flow through West Coast marine terminals. “The real benefit is for the smaller markets like St. Louis, where we don’t have the density to run a dedicated IPI train daily,” Farmer said. “Right now, that freight sits in the marine terminals and waits. With BIG, we can flush the terminals, improving capacity for the high-volume lanes [such as Chicago, Dallas, Memphis and Kansas City].” Other potential destinations for shipments through Barstow include Cincinnati, Cleveland and Columbus, as well as new markets still under discussion. “We’re working with our customers on Southern California to Phoenix, Southern California to Denver — services that don’t exist today,” Farmer said. “Barstow allows us to aggregate that freight and have a more efficient operation.” OOCL, one of BNSF’s largest ocean carrier partners, has voiced strong support for the Barstow project. “It makes sense that major markets will continue to move directly from marine terminals, but having the flexibility to send smaller volume markets through Barstow with more regular service opens up new possibilities,” said Andrew Donohue, vice president of customer service for OOCL, speaking at TPM25. Exports, empty containers and bare railcars will be consolidated in Barstow for more efficient delivery to Southern California ports. The Barstow location would include warehousing, allowing shippers to consolidate cargo on-site while avoiding highway weight restrictions. The warehouses will be accessible by private roads, a setup similar to <a href="https://word-edit.officeapps.live.com/we/CPKC,%20Americold%20say%20to%20expand%20cold%20chain%20partnership%20into%20Mexico%20%7C%20Journal%20of%20Commerce">Canadian Pacific Kansas City’s deal with Americold</a>. <h3>Better communication with ocean carriers</h3>Farmer emphasized that a new transportation management system (TMS) will be key to BIG’s success, ensuring coordination among ocean carriers, terminal operators and the railroad. She said the system will complement, rather than compete with, the US Department of Transportation’s FLOW initiative. “The system will help us manage operations inside BIG and extend visibility to warehouses and distribution centers, which is a game changer,” Farmer said. “As we sit down and have these conversations with the ocean carriers, the key is the collaboration. It’s on a vessel for two weeks. We’re having conversations with ocean carriers, BCOs and the marine terminals.” BNSF also sees the Barstow project as a way to slow the shift of cargo away from the West Coast to ports along the East and Gulf coasts. Farmer said that if BIG can reduce transit times by two to three days and serve as a pressure relief valve during freight surges, then shippers may have greater confidence in the resilience of supply chains through West Coast ports. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Long Beach, California — BNSF Railway is moving forward with its $1.5 billion Barstow International Gateway (BIG) project in California, a 4,800-acre logistics hub that would be North America’s largest intermodal facility, CEO Kate Farmer said Monday. BNSF believes the facility would increase fluidity through the ports of Los Angeles and Long Beach, Farmer told the Journal of Commerce’s TPM25 conference. Located about 130 miles from the ports, BIG would handle transloaded cargo and international intermodal shipments bound for smaller inland markets while reducing port congestion and cutting emissions from trucks hauling containers between marine terminals and rail ramps. It is due to open in 2027 or 2028. The project was in jeopardy last year but is now proceeding after the California Air Resources Board withdrew a proposed locomotive emissions regulation on Jan. 15. The rule, which had drawn opposition from industry groups, was rescinded shortly before President Donald Trump took office. If completed, the facility is expected to improve cargo flow through West Coast marine terminals. “The real benefit is for the smaller markets like St. Louis, where we don’t have the density to run a dedicated IPI train daily,” Farmer said. “Right now, that freight sits in the marine terminals and waits. With BIG, we can flush the terminals, improving capacity for the high-volume lanes [such as Chicago, Dallas, Memphis and Kansas City].” Other potential destinations for shipments through Barstow include Cincinnati, Cleveland and Columbus, as well as new markets still under discussion. “We’re working with our customers on Southern California to Phoenix, Southern California to Denver — services that don’t exist today,” Farmer said. “Barstow allows us to aggregate that freight and have a more efficient operation.” OOCL, one of BNSF’s largest ocean carrier partners, has voiced strong support for the Barstow project. “It makes sense that major markets will continue to move directly from marine terminals, but having the flexibility to send smaller volume markets through Barstow with more regular service opens up new possibilities,” said Andrew Donohue, vice president of customer service for OOCL, speaking at TPM25. Exports, empty containers and bare railcars will be consolidated in Barstow for more efficient delivery to Southern California ports. The Barstow location would include warehousing, allowing shippers to consolidate cargo on-site while avoiding highway weight restrictions. The warehouses will be accessible by private roads, a setup similar to Canadian Pacific Kansas City’s deal with Americold . Better communication with ocean carriers Farmer emphasized that a new transportation management system (TMS) will be key to BIG’s success, ensuring coordination among ocean carriers, terminal operators and the railroad. She said the system will complement, rather than compete with, the US Department of Transportation’s FLOW initiative. “The system will help us manage operations inside BIG and extend visibility to warehouses and distribution centers, which is a game changer,” Farmer said. “As we sit down and have these conversations with the ocean carriers, the key is the collaboration. It’s on a vessel for two weeks. We’re having conversations with ocean carriers, BCOs and the marine terminals.” BNSF also sees the Barstow project as a way to slow the shift of cargo away from the West Coast to ports along the East and Gulf coasts. Farmer said that if BIG can reduce transit times by two to three days and serve as a pressure relief valve during freight surges, then shippers may have greater confidence in the resilience of supply chains through West Coast ports. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

North-American rail

Surface

TPM25: BNSF believes Barstow hub can improve service to smaller markets

<div class="phx-topic abstract-wrapper">Fluor, KBR, TechnipFMC and Worley are predicting moderate to strong growth in project orders this year, buoyed by oil and gas work. </div>

Fluor, KBR, TechnipFMC and Worley are predicting moderate to strong growth in project orders this year, buoyed by oil and gas work.

<div class="phx-topic">With a dramatic shift in US federal policy to push oil and gas development, engineering, procurement and construction (EPC) companies are predicting an uptick in work that could dial up project cargo activity in 2025. A significant portion of project cargo comes from EPCs that procure and transport equipment and materials for the construction of major energy and industrial projects globally. The growth predictions come after varied results in the latest earnings period for four major EPCs — Fluor, KBR, TechnipFMC and Worley.Houston-based KBR is projecting double-digit revenue growth in 2025 after landing multiple large defense contracts in the fourth quarter. “We believe our business portfolio is well-aligned with the priorities of the new administration in the US, especially in the areas of national security and energy policy,” CEO Stuart Bradie said in the company’s 2024 earnings remarks on Feb. 24.Contract awards included $445 million from the Department of Defense, $187 million from the Department of State and $88 million from the US Naval Air Systems Command. In September, KBR secured a $10 billion joint contract with TechnipFMC for a liquefied natural gas (LNG) project in southwest Louisiana, while one of the company’s other LNG projects — a southeast Louisiana facility being developed by LNG provider Venture Global, achieved its first production in December. Along with the company’s acquisition of defense contractor LinQuest, defense and technology projects helped drive KBR’s 2024 revenues to $7.7 billion, a 17% increase over 2023. <h3>Orders on pace for TechnipFMC</h3>Multinational energy services contractor TechnipFMC is projecting its subsea energy business will reach $30 billion in orders over three years by the end of 2025.“We remain positive on the outlook for energy given the anticipated growth in demand, with affordability and security of supply now major considerations,” CEO Doug Pferdehirt said in the company’s Feb. 27 earnings remarks.Work orders rose 7% to $10.4 billion in the company’s subsea segment, which accounts for the lion’s share of TechnipFMC business and develops systems for undersea oil and gas exploration and extraction. In the fourth quarter, subsea orders included a contract exceeding $1 billion from TotalEnergies for the GranMorgu project, the first oil and gas development for offshore Suriname.Across all segments, orders increased 5% to $11.6 billion in 2024, driving up the company’s order backlog by 9% to $14.4 billion, while the company’s revenues grew 16% to $9.1 billion for the year.Australian engineering group Worley is projecting “moderate” growth in 2025 after market challenges curbed progress in the first half of the company’s fiscal year, which ended Dec. 31. In his Feb. 26 remarks on the company’s half-year earnings results, CEO Chris Ashton said “policy and economic headwinds” are influencing the pace of the energy transition, resulting in increased uncertainty and canceled projects. “This uncertainty has been further driven by ongoing geopolitical tensions, global inflation and supply chain challenges that continue to disrupt global markets in the sectors we serve,” Ashton said.One hurdle Worley cited — work delays on a Venture Global LNG facility under construction 20 miles south of New Orleans — was cleared Jan. 21 when the US government lifted a year-long ban on new LNG exports.Worley’s project backlog for its fiscal first half fell 14% to $7.9 billion because of the cancellation of a battery materials project in Sweden.Worley won $4.1 billion in work in the first half of the year, up 6% from the previous year. Revenues fell 3% to $3.5 billion. <h3>Fluor sets sights on datacenters</h3>After a decline in new contracts in 2024, Fluor is tapping into the growing demand for datacenters — and the large amounts of energy needed to power them.“We’re in conversations or have agreements with the top four data center developers,” CFO Jim Breuer said during the company’s Feb. 18 earnings call. Breuer will transition to the CEO role in May. On the call, current CEO David Constable cited potential opportunities for meeting the substantial energy demands the datacenters create. “Our expertise in power generation, both thermal and nuclear, is going to play a key role in supporting our clients’ needs,” Constable said.New awards fell 21% to $15.1 billion for the year, while Fluor works through a $28.5 billion backlog, which fell 3% from the previous year.Revenues rose 5.4% to $16.3 billion in 2024, and the company is projecting 15% revenue growth in 2025.Contact Autumn Cafiero Giusti at <a href="mailto:autumn@autumngiusti.com">autumn@autumngiusti.com</a>.</div>

With a dramatic shift in US federal policy to push oil and gas development, engineering, procurement and construction (EPC) companies are predicting an uptick in work that could dial up project cargo activity in 2025. A significant portion of project cargo comes from EPCs that procure and transport equipment and materials for the construction of major energy and industrial projects globally. The growth predictions come after varied results in the latest earnings period for four major EPCs — Fluor, KBR, TechnipFMC and Worley. Houston-based KBR is projecting double-digit revenue growth in 2025 after landing multiple large defense contracts in the fourth quarter. “We believe our business portfolio is well-aligned with the priorities of the new administration in the US, especially in the areas of national security and energy policy,” CEO Stuart Bradie said in the company’s 2024 earnings remarks on Feb. 24. Contract awards included $445 million from the Department of Defense, $187 million from the Department of State and $88 million from the US Naval Air Systems Command. In September, KBR secured a $10 billion joint contract with TechnipFMC for a liquefied natural gas (LNG) project in southwest Louisiana, while one of the company’s other LNG projects — a southeast Louisiana facility being developed by LNG provider Venture Global, achieved its first production in December. Along with the company’s acquisition of defense contractor LinQuest, defense and technology projects helped drive KBR’s 2024 revenues to $7.7 billion, a 17% increase over 2023. Orders on pace for TechnipFMC Multinational energy services contractor TechnipFMC is projecting its subsea energy business will reach $30 billion in orders over three years by the end of 2025. “We remain positive on the outlook for energy given the anticipated growth in demand, with affordability and security of supply now major considerations,” CEO Doug Pferdehirt said in the company’s Feb. 27 earnings remarks. Work orders rose 7% to $10.4 billion in the company’s subsea segment, which accounts for the lion’s share of TechnipFMC business and develops systems for undersea oil and gas exploration and extraction. In the fourth quarter, subsea orders included a contract exceeding $1 billion from TotalEnergies for the GranMorgu project, the first oil and gas development for offshore Suriname. Across all segments, orders increased 5% to $11.6 billion in 2024, driving up the company’s order backlog by 9% to $14.4 billion, while the company’s revenues grew 16% to $9.1 billion for the year. Australian engineering group Worley is projecting “moderate” growth in 2025 after market challenges curbed progress in the first half of the company’s fiscal year, which ended Dec. 31. In his Feb. 26 remarks on the company’s half-year earnings results, CEO Chris Ashton said “policy and economic headwinds” are influencing the pace of the energy transition, resulting in increased uncertainty and canceled projects. “This uncertainty has been further driven by ongoing geopolitical tensions, global inflation and supply chain challenges that continue to disrupt global markets in the sectors we serve,” Ashton said. One hurdle Worley cited — work delays on a Venture Global LNG facility under construction 20 miles south of New Orleans — was cleared Jan. 21 when the US government lifted a year-long ban on new LNG exports. Worley’s project backlog for its fiscal first half fell 14% to $7.9 billion because of the cancellation of a battery materials project in Sweden. Worley won $4.1 billion in work in the first half of the year, up 6% from the previous year. Revenues fell 3% to $3.5 billion. Fluor sets sights on datacenters After a decline in new contracts in 2024, Fluor is tapping into the growing demand for datacenters — and the large amounts of energy needed to power them. “We’re in conversations or have agreements with the top four data center developers,” CFO Jim Breuer said during the company’s Feb. 18 earnings call. Breuer will transition to the CEO role in May. On the call, current CEO David Constable cited potential opportunities for meeting the substantial energy demands the datacenters create. “Our expertise in power generation, both thermal and nuclear, is going to play a key role in supporting our clients’ needs,” Constable said. New awards fell 21% to $15.1 billion for the year, while Fluor works through a $28.5 billion backlog, which fell 3% from the previous year. Revenues rose 5.4% to $16.3 billion in 2024, and the company is projecting 15% revenue growth in 2025. Contact Autumn Cafiero Giusti at autumn@autumngiusti.com .

Energy projects

Project cargo

Breakbulk News

EPCs bullish on US energy segment for projects, growth

<div class="phx-topic abstract-wrapper">An oversupply of vessels, carrier rate wars and bleak consumer sentiment are positioned to oppress the container shipping market in 2025, experts told TPM25. </div>

An oversupply of vessels, carrier rate wars and bleak consumer sentiment are positioned to oppress the container shipping market in 2025, experts told TPM25.

<div class="phx-topic">Long Beach, California — The container shipping market is poised to recede this year, and the downcycle could be more severe than prior bear markets, industry experts at the Journal of Commerce’s TPM25 conference said Monday. A container market downcycle is already “well underway,” said Parash Jain, global head of Transport and Logistics Research at HSBC. “This downturn could be worse than past downturns,” said Jain, speaking during a panel session on the container shipping outlook for 2025. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5951877_0.1.jpg"></img></div>Jain pointed to several factors that could provide fuel for the downcycle, including uneven demand growth globally, a worsening supply-demand imbalance, a hefty order book that is poised to exacerbate an already significant oversupply issue and increased carrier war chests that could prolong price wars. According to Jain, global nominal fleet growth at 33% far outpaced container trade volume growth of 9% in 2024, although disruptions absorbed much of that extra capacity. If those disruptions recede, oversupply will likely return and drag rates lower, he said. In addition to overcapacity, uneven demand growth globally poses a growing hurdle for the industry. While volumes on the Asia-to-North America trade grew 28% from 2019 to 2024, the North America-Asia lane shrunk 15% and the Europe-Asia trade declined 23% during that same time, Jain said. Unbalanced demand growth worsens the supply-demand imbalance and exacerbates equipment availability hurdles, he said. At the same time, shrinking consumer demand and increasingly aggressive tariffs pose a potential hurdle for the industry this year, according to Chris Rogers, head of supply chain research at S&amp;P Global Market Intelligence. “That’s likely to prove inflationary, which could start to hit consumer spending in a way maybe we didn’t see last time around,” Rogers said. S&amp;P Global is the parent company of the Journal of Commerce. Meanwhile, a US proposal to tax Chinese tonnage and port calls could introduce further uncertainty, said Jain, which is “sufficient enough to create chaos come April.” Still, the proposal’s viability has been met with significant skepticism. The shipping industry is in a “new area of volatility,” said Heather Hwang, head of the sea pricing strategy department at logistics provider LX Pantos. Spot ocean rates in the eastbound trans-Pacific have fallen more than 53% to the US West Coast this year, according to Platts, a sister company of the Journal of Commerce within S&amp;P Global. Contact Laura Robb at <a href="mailto:Laura.Robb@spglobal.com">laura.robb@spglobal.com</a>.  </div>

Long Beach, California — The container shipping market is poised to recede this year, and the downcycle could be more severe than prior bear markets, industry experts at the Journal of Commerce’s TPM25 conference said Monday. A container market downcycle is already “well underway,” said Parash Jain, global head of Transport and Logistics Research at HSBC. “This downturn could be worse than past downturns,” said Jain, speaking during a panel session on the container shipping outlook for 2025. Jain pointed to several factors that could provide fuel for the downcycle, including uneven demand growth globally, a worsening supply-demand imbalance, a hefty order book that is poised to exacerbate an already significant oversupply issue and increased carrier war chests that could prolong price wars. According to Jain, global nominal fleet growth at 33% far outpaced container trade volume growth of 9% in 2024, although disruptions absorbed much of that extra capacity. If those disruptions recede, oversupply will likely return and drag rates lower, he said. In addition to overcapacity, uneven demand growth globally poses a growing hurdle for the industry. While volumes on the Asia-to-North America trade grew 28% from 2019 to 2024, the North America-Asia lane shrunk 15% and the Europe-Asia trade declined 23% during that same time, Jain said. Unbalanced demand growth worsens the supply-demand imbalance and exacerbates equipment availability hurdles, he said. At the same time, shrinking consumer demand and increasingly aggressive tariffs pose a potential hurdle for the industry this year, according to Chris Rogers, head of supply chain research at S&P Global Market Intelligence. “That’s likely to prove inflationary, which could start to hit consumer spending in a way maybe we didn’t see last time around,” Rogers said. S&P Global is the parent company of the Journal of Commerce. Meanwhile, a US proposal to tax Chinese tonnage and port calls could introduce further uncertainty, said Jain, which is “sufficient enough to create chaos come April.” Still, the proposal’s viability has been met with significant skepticism. The shipping industry is in a “new area of volatility,” said Heather Hwang, head of the sea pricing strategy department at logistics provider LX Pantos. Spot ocean rates in the eastbound trans-Pacific have fallen more than 53% to the US West Coast this year, according to Platts, a sister company of the Journal of Commerce within S&P Global. Contact Laura Robb at laura.robb@spglobal.com . 

Container Shipping News

TPM25: Container market downturn creating ‘new era of volatility’

<div class="phx-topic abstract-wrapper">Truckload spot shipments and pricing in trade corridors such as Toronto-to-Chicago have soared since the US election, but the increases flow in both directions. </div>

Truckload spot shipments and pricing in trade corridors such as Toronto-to-Chicago have soared since the US election, but the increases flow in both directions.

<div class="phx-topic">Truckload volumes and spot rates for freight moving between Canada and the US are surging in advance of US tariffs scheduled to be implemented Tuesday. Dry-van spot-market volumes from Toronto to Chicago rose 57% in the week ending Feb. 28, while rates in the cross-border lane rose 7%, according to DAT Freight &amp; Analytics. US President Donald Trump on Monday afternoon announced that 25% US tariffs on goods imported from Canada and Mexico will indeed take effect March 4 as scheduled. The impact of those potential tariffs — and the possibility of reciprocal tariffs — is already affecting freight and pricing on both sides of the US-Canadian border. Spot rates from the US to Canada on average have climbed 18% since the US election and 6% in the last two weeks to their highest level in two years, DAT said. In Canada, spot rates for US-bound loads are up 7% on average since the election and 5% in the last two weeks, the load-board operator and spot market data provider said. Cross-border freight accounted for an atypical 72% of posted loads in January at Canadian load-board operator Loadlink, a sister company of DAT within Roper Industries. Businesses on both sides of the border are trying to get ahold of critical goods ahead of the Trump administration tariffs, which were postponed last month until March 4. “Many businesses are accelerating their shipments to avoid future cost hikes associated with tariffs,” Loadlink said in its most recent freight report. <h3>Preparing for ‘future complications’ </h3>Loadlink’s Canadian spot market freight index, a measure of volume, jumped 40% in January from December and was up 13% year over year. At the same time, available Canadian spot truck capacity fell 29% year over year in January, despite a 2% increase from December. “The increase in shipping loads, especially across the border, indicates Canadian and American companies are getting ready for any future complications,” Loadlink said. Rate increases for freight headed from the US-Mexican border to US markets have been much more muted than on the US-Canada border, according to DAT. The average rate from Laredo, Texas, the largest US truck border crossing, to Detroit was up only 3 cents per mile over the seven days ending March 3, according to DAT. Laredo-to-Chicago rates rose just 2 cents per mile in the same period, while rates in the shorter haul lane linking Laredo and Dallas rose 4 cents per mile. That reflects the differences in cross-border trucking between the US and Mexico and Canada and the US, with the latter being much more open and fluid. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

Truckload volumes and spot rates for freight moving between Canada and the US are surging in advance of US tariffs scheduled to be implemented Tuesday. Dry-van spot-market volumes from Toronto to Chicago rose 57% in the week ending Feb. 28, while rates in the cross-border lane rose 7%, according to DAT Freight & Analytics. US President Donald Trump on Monday afternoon announced that 25% US tariffs on goods imported from Canada and Mexico will indeed take effect March 4 as scheduled. The impact of those potential tariffs — and the possibility of reciprocal tariffs — is already affecting freight and pricing on both sides of the US-Canadian border. Spot rates from the US to Canada on average have climbed 18% since the US election and 6% in the last two weeks to their highest level in two years, DAT said. In Canada, spot rates for US-bound loads are up 7% on average since the election and 5% in the last two weeks, the load-board operator and spot market data provider said. Cross-border freight accounted for an atypical 72% of posted loads in January at Canadian load-board operator Loadlink, a sister company of DAT within Roper Industries. Businesses on both sides of the border are trying to get ahold of critical goods ahead of the Trump administration tariffs, which were postponed last month until March 4. “Many businesses are accelerating their shipments to avoid future cost hikes associated with tariffs,” Loadlink said in its most recent freight report. Preparing for ‘future complications’ Loadlink’s Canadian spot market freight index, a measure of volume, jumped 40% in January from December and was up 13% year over year. At the same time, available Canadian spot truck capacity fell 29% year over year in January, despite a 2% increase from December. “The increase in shipping loads, especially across the border, indicates Canadian and American companies are getting ready for any future complications,” Loadlink said. Rate increases for freight headed from the US-Mexican border to US markets have been much more muted than on the US-Canada border, according to DAT. The average rate from Laredo, Texas, the largest US truck border crossing, to Detroit was up only 3 cents per mile over the seven days ending March 3, according to DAT. Laredo-to-Chicago rates rose just 2 cents per mile in the same period, while rates in the shorter haul lane linking Laredo and Dallas rose 4 cents per mile. That reflects the differences in cross-border trucking between the US and Mexico and Canada and the US, with the latter being much more open and fluid. Contact William B. Cassidy at bill.cassidy@spglobal.com .

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

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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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