<div class="phx-topic abstract-wrapper">The Teamsters union won an organizing vote at Pioneer Logistics Corp., a small dedicated truckload f</div>

The Teamsters union won an organizing vote at Pioneer Logistics Corp., a small dedicated truckload f

<div>The Teamsters union won an organizing vote at Pioneer Logistics Corp., a small dedicated truckload fleet that nonetheless represents one of the union's bigger wins in that segment of the industry.The vote, conducted last week, was 60 to 48 for the union, which announced the results Wednesday. The company has 121 drivers based in Flat Rock, Mich.; Statesville, N.C.; Monroe, Ohio; Lexington, Ky.; and Marion, Ind.The company has 64 tractors and 130 trailers delivering parts on a just- in-time basis to the Auto Alliance International Inc. plant in Flat Rock, which produces Mazda and Ford automobiles. The company is a...

The Teamsters union won an organizing vote at Pioneer Logistics Corp., a small dedicated truckload fleet that nonetheless represents one of the union's bigger wins in that segment of the industry. The vote, conducted last week, was 60 to 48 for the union, which announced the results Wednesday. The company has 121 drivers based in Flat Rock, Mich.; Statesville, N.C.; Monroe, Ohio; Lexington, Ky.; and Marion, Ind.The company has 64 tractors and 130 trailers delivering parts on a just- in-time basis to the Auto Alliance International Inc. plant in Flat Rock, which produces Mazda and Ford automobiles. The company is a subsidiary of TNT Logistics North America, part of TNT Ltd. The Teamsters estimated that only 3 percent of truckload drivers are union members. While major carriers deal with problems of high driver turnover and a shortage of drivers, the union has been unable to exploit those conditions to their benefit. But much of the driver problem faced by the truckload industry is caused by conditions not present at Pioneer - such as weeks at a time away from home. Drivers at Pioneer are generally home every night, or every other night, and have regular routes. "Mostly it has to do with job security, benefits and wages," said Bob Muehlenkamp, the Teamsters' organizing director, referring to the issues in the campaign. "They've simply fallen way behind Teamster standards." Jim Davidson, senior vice president and general manager of TNT Logistics North America, said the Teamsters failed in its attempts to organize some other drivers at Pioneer a year ago. "Surprisingly, and for whatever reason, they haven't done a good job at that," he said about the union's truckload organizing efforts. He said he is not concerned about losing the Auto Alliance business to the other carrier serving the plant, CTI, at least not immediately. "It depends, obviously, on the union's demands," Mr. Davidson said. "If we find ourselves uncompetitive, then our customer obviously will take care of that situation." Mr. Muehlenkamp said the union is making more of a push in the truckload sector than it has in the past. He said its efforts are helped by the driver shortage. "I think that is giving guys a little more confidence," he said. But Mr. Muehlenkamp said that despite the driver shortage, many companies still will fire or punish drivers who talk about a union. The union charges that a Pioneer driver was fired for being a union supporter, and it said the National Labor Relations Board filed a formal complaint against Pioneer for unlawful interrogation of its employees. Lana Batts, president of the Interstate Truckload Carriers Conference, said truckload driver wages have risen in the past year, as rate increases have gone primarily to driver compensation. But she points to the economy, lifestyle issues and demographics as more the cause of the shortage than wages. "The driver shortage is caused by the very nature of the business itself, and certainly not something that the union or companies can change," she said.

TEAMSTERS WINS VOTE AT PIONEER LOGISTICS

<div class="phx-topic abstract-wrapper">The carrier’s investment, announced while its chief executive met at the White House with President Donald Trump, comes amid heightened political sensitivities in the US as far as the container shipping industry is concerned.</div>

The carrier’s investment, announced while its chief executive met at the White House with President Donald Trump, comes amid heightened political sensitivities in the US as far as the container shipping industry is concerned.

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<div class="phx-topic">CMA CGM announced Thursday it would spend $20 billion over the next four years to significantly bolster its logistics presence in the US, including expanding its US-flag fleet and increasing capacity at key US ports. The stunning announcement from the French shipping giant came as Rodolphe Saadé, chairman and CEO of CMA CGM Group, met at the White House with US President Donald Trump. The meeting between Trump and Saadé and the huge investment from the ocean carrier also comes amid heightened political sensitivities in the US as far as the container shipping industry is concerned. Trump’s US Trade Representative has <a href="https://www.joc.com/article/us-port-tax-would-scramble-ocean-services-raise-shipper-costs-drewry-5952046">proposed slamming Chinese-built and -operated ships calling US ports with huge fees</a>, while the administration is making a push to re-energize the US shipbuilding sector. “Over the next four years, we will significantly grow our US-flagged fleet, expand the capacity of key container ports on both coasts, develop state-of-the-art warehousing across the country, and establish a significant air cargo hub in Chicago,” Saadé said in a statement. “This will create 10,000 new American jobs and further strengthen our partnership with American customers and public authorities.” The US investment plan for CMA CGM includes adding 30 new vessels to the fleet of its US-flag carrier APL and deploying five new Boeing 777 freighters to serve a new air cargo hub it will build in Chicago. The carrier said it will also develop infrastructure at ports in New York/New Jersey, Los Angeles, Houston, Miami and Dutch Harbor in Alaska and build or expand 400 “state-of-the-art" warehouses across the US. It will also develop a new logistics research and development hub in Boston. In comments from the Oval Office, Trump praised Saadé, saying that “knowing him,” he wouldn’t be surprised if CMA CGM becomes the world’s top container line. CMA CGM is now the world’s third-largest carrier as measured by tonnage. “He’s going to be investing $20 billion into the United States because of the election,” Trump said. “...We lost our way. For many years we didn’t do anything. We used to build a ship a day.” Trump said in the coming weeks he would announce a massive US shipbuilding program as the White House <a href="https://www.joc.com/article/trumps-expansionist-worldview-puts-us-maritime-interests-in-spotlight-5946935">aims to galvanize an industry</a> that’s been in decline since World War II. <h3>Spending plan follows prior US terminal investments </h3>The CMA CGM investment follows the company acquiring two marine terminals at the Port of New York and New Jersey in 2023. It also acquired the <a href="https://www.joc.com/article/cma-cgm-flexes-financial-might-fenix-marine-acquisition_20211103.html">Fenix Marine Services container terminal in Los Angeles in late 2021.</a>Thanks to record-setting profits in 2021 and 2022, container lines have invested heavily in marine terminals. Mediterranean Shipping Co., the world’s largest container line as measured by tonnage, is on track to become the largest global terminal operator after its Terminal Investment Limited (TiL) arm and BlackRock Group <a href="https://www.joc.com/article/hutchison-inks-228-billion-deal-to-sell-majority-of-port-holdings-to-blackrock-til-5955819">on Tuesday announced</a> they would acquire the majority of Hutchison Port Holdings’ network outside of China and Hong Kong in a $22.8 billion deal. Contact Mark Szakonyi at <a href="mailto:mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>.</div>

CMA CGM announced Thursday it would spend $20 billion over the next four years to significantly bolster its logistics presence in the US, including expanding its US-flag fleet and increasing capacity at key US ports. The stunning announcement from the French shipping giant came as Rodolphe Saadé, chairman and CEO of CMA CGM Group, met at the White House with US President Donald Trump. The meeting between Trump and Saadé and the huge investment from the ocean carrier also comes amid heightened political sensitivities in the US as far as the container shipping industry is concerned. Trump’s US Trade Representative has proposed slamming Chinese-built and -operated ships calling US ports with huge fees , while the administration is making a push to re-energize the US shipbuilding sector. “Over the next four years, we will significantly grow our US-flagged fleet, expand the capacity of key container ports on both coasts, develop state-of-the-art warehousing across the country, and establish a significant air cargo hub in Chicago,” Saadé said in a statement. “This will create 10,000 new American jobs and further strengthen our partnership with American customers and public authorities.” The US investment plan for CMA CGM includes adding 30 new vessels to the fleet of its US-flag carrier APL and deploying five new Boeing 777 freighters to serve a new air cargo hub it will build in Chicago. The carrier said it will also develop infrastructure at ports in New York/New Jersey, Los Angeles, Houston, Miami and Dutch Harbor in Alaska and build or expand 400 “state-of-the-art" warehouses across the US. It will also develop a new logistics research and development hub in Boston. In comments from the Oval Office, Trump praised Saadé, saying that “knowing him,” he wouldn’t be surprised if CMA CGM becomes the world’s top container line. CMA CGM is now the world’s third-largest carrier as measured by tonnage. “He’s going to be investing $20 billion into the United States because of the election,” Trump said. “...We lost our way. For many years we didn’t do anything. We used to build a ship a day.” Trump said in the coming weeks he would announce a massive US shipbuilding program as the White House aims to galvanize an industry that’s been in decline since World War II. Spending plan follows prior US terminal investments The CMA CGM investment follows the company acquiring two marine terminals at the Port of New York and New Jersey in 2023. It also acquired the Fenix Marine Services container terminal in Los Angeles in late 2021. Thanks to record-setting profits in 2021 and 2022, container lines have invested heavily in marine terminals. Mediterranean Shipping Co., the world’s largest container line as measured by tonnage, is on track to become the largest global terminal operator after its Terminal Investment Limited (TiL) arm and BlackRock Group on Tuesday announced they would acquire the majority of Hutchison Port Holdings’ network outside of China and Hong Kong in a $22.8 billion deal. Contact Mark Szakonyi at mark.szakonyi@spglobal.com .

Supply chain

Container Shipping News

Port News

Container lines

Port infrastructure

North American ports

Maritime

CMA CGM to invest $20 billion in US shipping, ports and logistics

<div class="phx-topic abstract-wrapper">Analyst Lars Jensen’s closing message to conference participants planning their supply chains for the coming year is to move slowly and carefully because it will take months before clarity emerges.</div>

Analyst Lars Jensen’s closing message to conference participants planning their supply chains for the coming year is to move slowly and carefully because it will take months before clarity emerges.

<div class="phx-topic">Long Beach, California — Container shipping in the major east-west trade lanes could face as much as six months of disruption this year in vessel capacity, consumer demand and the direction of freight rates as the industry grapples with the impact of Trump administration tariffs and geopolitical developments such as the Red Sea crisis. That was the message provided Wednesday at the close of the Journal of Commerce’s TPM25 by Lars Jensen, CEO of Vespucci Maritime. Jensen told shippers who are planning their supply chains for the coming year to move slowly and carefully because it will take some months before clarity is achieved. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5951880_0.1.jpg"></img></div>“The reality is it is impossible to predict even one or two months from now,” he said. “This period of uncertainty could last for quite a while.” The resumption of Suez Canal transits, which will eventually free up a significant amount of vessel capacity in the Asia-Europe and trans-Pacific trades, appears to be inching closer. However, carriers will not rush back until they can be confident vessels can transit the corridor safely, Jensen said. If they return too soon and attacks on vessels resume, carriers’ networks will be completely out of balance. “It could be one or two months, but more likely six months from now,” Jensen said of Suez transits, which have been effectively on hold for the past 15 months. Jensen suggested the best time to resume regular transits through the key waterway is near Golden Week in October, when factories in China shut down and import volumes drop. Even then, shippers should anticipate mounting container backlogs at key load centers, he said. <h3>Trans-Pac spot rates decline </h3>Trans-Pacific spot rates, meanwhile, continue to decline. Rates as of Wednesday were $3,400 per FEU to the East Coast, down 4% week over week and 39% lower year over year. West Coast rates of $2,300 per FEU were 6% lower on the week and down 41% year over year, according to Platts, a Journal of Commerce sister product within S&amp;P Global. The declines are the normal “competitive dynamics among carriers” during the post-Lunar New Year lull, but Jensen, also a Journal of Commerce analyst, said he believes it’s only temporary. “Demand remains strong,” he said. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e7a65aab-9aac-4f07-9b74-1793746c01ef"></dynamic-object></div>Rate uncertainty is likely in the coming months as carriers adjust their networks to the new alliances that took effect in February. Carriers will also adjust capacity in response to fluctuations in consumer demand as new tariffs unfold, Jensen said. However, if a rate collapse is to come following a return to Suez Canal transits, it is still some months away, he said. <h3>Trump and USTR vs. container shipping </h3>Donald Trump’s threats to impose punishing tariffs on the largest US trading partners of Mexico, Canada and China, and the threat of counter-tariffs, change literally by the day. This injects huge uncertainty into shippers’ supply chain planning efforts and possibly foreshadows a shift to a permanently fragmented global trading order, Jensen said. “This is a world where old rules don’t apply,” he said. Somewhat farcical but potentially costly developments embodied in the “America First” Ships for America plan, as well as the US Trade Representative’s (USTR’s) proposal to impose huge levies on calls by Chinese-built or operated vessels, further muddy the waters of the US container trades, said Jensen. USTR’s proposed policy of taxing carriers $1 million per call by vessels built in Chinese shipyards would likely force carriers to consolidate their calls into larger load-center ports on each coast to reduce operational costs. This would work to the disadvantage of smaller ports likely eliminated from the rotations, Jensen said. “These people [at USTR] have zero knowledge of shipping,” he said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

Long Beach, California — Container shipping in the major east-west trade lanes could face as much as six months of disruption this year in vessel capacity, consumer demand and the direction of freight rates as the industry grapples with the impact of Trump administration tariffs and geopolitical developments such as the Red Sea crisis. That was the message provided Wednesday at the close of the Journal of Commerce’s TPM25 by Lars Jensen, CEO of Vespucci Maritime. Jensen told shippers who are planning their supply chains for the coming year to move slowly and carefully because it will take some months before clarity is achieved. “The reality is it is impossible to predict even one or two months from now,” he said. “This period of uncertainty could last for quite a while.” The resumption of Suez Canal transits, which will eventually free up a significant amount of vessel capacity in the Asia-Europe and trans-Pacific trades, appears to be inching closer. However, carriers will not rush back until they can be confident vessels can transit the corridor safely, Jensen said. If they return too soon and attacks on vessels resume, carriers’ networks will be completely out of balance. “It could be one or two months, but more likely six months from now,” Jensen said of Suez transits, which have been effectively on hold for the past 15 months. Jensen suggested the best time to resume regular transits through the key waterway is near Golden Week in October, when factories in China shut down and import volumes drop. Even then, shippers should anticipate mounting container backlogs at key load centers, he said. Trans-Pac spot rates decline Trans-Pacific spot rates, meanwhile, continue to decline. Rates as of Wednesday were $3,400 per FEU to the East Coast, down 4% week over week and 39% lower year over year. West Coast rates of $2,300 per FEU were 6% lower on the week and down 41% year over year, according to Platts, a Journal of Commerce sister product within S&P Global. The declines are the normal “competitive dynamics among carriers” during the post-Lunar New Year lull, but Jensen, also a Journal of Commerce analyst, said he believes it’s only temporary. “Demand remains strong,” he said. Rate uncertainty is likely in the coming months as carriers adjust their networks to the new alliances that took effect in February. Carriers will also adjust capacity in response to fluctuations in consumer demand as new tariffs unfold, Jensen said. However, if a rate collapse is to come following a return to Suez Canal transits, it is still some months away, he said. Trump and USTR vs. container shipping Donald Trump’s threats to impose punishing tariffs on the largest US trading partners of Mexico, Canada and China, and the threat of counter-tariffs, change literally by the day. This injects huge uncertainty into shippers’ supply chain planning efforts and possibly foreshadows a shift to a permanently fragmented global trading order, Jensen said. “This is a world where old rules don’t apply,” he said. Somewhat farcical but potentially costly developments embodied in the “America First” Ships for America plan, as well as the US Trade Representative’s (USTR’s) proposal to impose huge levies on calls by Chinese-built or operated vessels, further muddy the waters of the US container trades, said Jensen. USTR’s proposed policy of taxing carriers $1 million per call by vessels built in Chinese shipyards would likely force carriers to consolidate their calls into larger load-center ports on each coast to reduce operational costs. This would work to the disadvantage of smaller ports likely eliminated from the rotations, Jensen said. “These people [at USTR] have zero knowledge of shipping,” he said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Transport, Trade and Regulation News

Forwarding

Asia-Europe

Trans-Pacific

TPM25: Carriers, shippers face year of turmoil and uncertainty

<div class="phx-topic abstract-wrapper">DHL group CEO Tobias Meyer recognized that the division’s performance remained lackluster, with the “volatile” gross profit/EBIT conversion rate below DHL’s 35% target. </div>

DHL group CEO Tobias Meyer recognized that the division’s performance remained lackluster, with the “volatile” gross profit/EBIT conversion rate below DHL’s 35% target.

<div class="phx-topic">Strong volumes and gross profit growth buoyed revenue and profitability for DHL Global Forwarding in the fourth quarter, but the division continued to underperform for the full year, company executives said Thursday. Melanie Kreis, DHL’s CFO, said Global Forwarding saw “above-market volume growth in the fourth quarter.” Air freight experienced a 12% increase in gross profit per unit in the quarter, while there was a 10% increase for ocean freight year over year due to the strong peak season, Kreis told analysts during an earnings briefing Thursday. But the division’s earnings before interest and taxes (EBIT) were down 25% to $276 million in the quarter due to a one-off revaluation of the DanzasAEI Emirates acquisition in 2023. The revaluation amounted to $123 million. “Take that out and Global Forwarding ... had an increase in EBIT growth [of 13%] in the fourth quarter,” Kreis said. <h3>‘Long-term’ target on DSV </h3>DHL group CEO Tobias Meyer recognized that the division’s performance remained lackluster, with the gross profit/EBIT conversion rate below DHL’s 35% target, but he remained confident about longer-term prospects and thought DHL Global Forwarding was already closing on its competitors. “The division has made great progress in terms of cost efficiencies, but the conversion rate is driven by the gross profit per unit level and that has been very volatile,” Meyer said. “We need to continue to work on that.” He reiterated that the aim is still to catch up with competitor DSV but said that “will be more in the longer term.” “With the volume and margin development in the fourth quarter we see ourselves on a good trajectory with global forwarding, especially in ocean freight,” Meyer said. “I expect us to continue on that trajectory to close that gap towards the peer group that we’re aiming to be part of and ultimately exceed in terms of the balance of volume growth and conversion rate.” Meyer said he expected DHL Global Forwarding to experience volatility this year, partly because of ocean carriers at some point resuming regular transits through the Suez Canal. Meyer did not forecast when that could happen but said “rates will be different when the Suez Canal reopens. Whether that’s good or bad we’ll have to wait and see.” Overall, Global Forwarding reported a 2% increase in revenue to $21.3 billion last year, including $5.5 billion in the fourth quarter, which was up 12% from the year prior. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

Strong volumes and gross profit growth buoyed revenue and profitability for DHL Global Forwarding in the fourth quarter, but the division continued to underperform for the full year, company executives said Thursday. Melanie Kreis, DHL’s CFO, said Global Forwarding saw “above-market volume growth in the fourth quarter.” Air freight experienced a 12% increase in gross profit per unit in the quarter, while there was a 10% increase for ocean freight year over year due to the strong peak season, Kreis told analysts during an earnings briefing Thursday. But the division’s earnings before interest and taxes (EBIT) were down 25% to $276 million in the quarter due to a one-off revaluation of the DanzasAEI Emirates acquisition in 2023. The revaluation amounted to $123 million. “Take that out and Global Forwarding ... had an increase in EBIT growth [of 13%] in the fourth quarter,” Kreis said. ‘Long-term’ target on DSV DHL group CEO Tobias Meyer recognized that the division’s performance remained lackluster, with the gross profit/EBIT conversion rate below DHL’s 35% target, but he remained confident about longer-term prospects and thought DHL Global Forwarding was already closing on its competitors. “The division has made great progress in terms of cost efficiencies, but the conversion rate is driven by the gross profit per unit level and that has been very volatile,” Meyer said. “We need to continue to work on that.” He reiterated that the aim is still to catch up with competitor DSV but said that “will be more in the longer term.” “With the volume and margin development in the fourth quarter we see ourselves on a good trajectory with global forwarding, especially in ocean freight,” Meyer said. “I expect us to continue on that trajectory to close that gap towards the peer group that we’re aiming to be part of and ultimately exceed in terms of the balance of volume growth and conversion rate.” Meyer said he expected DHL Global Forwarding to experience volatility this year, partly because of ocean carriers at some point resuming regular transits through the Suez Canal. Meyer did not forecast when that could happen but said “rates will be different when the Suez Canal reopens. Whether that’s good or bad we’ll have to wait and see.” Overall, Global Forwarding reported a 2% increase in revenue to $21.3 billion last year, including $5.5 billion in the fourth quarter, which was up 12% from the year prior. Contact Keith Wallis at keithwallis@hotmail.com .

DHL Global Forwarding buoyed by good Q4, but acknowledges weak spots

<div class="phx-topic abstract-wrapper">Major carriers on the India-US East Coast trade are reporting success on their March rate recovery efforts, thanks in large part to recent sailing cuts, prompting some of them to announce even higher increases for next month.</div>

Major carriers on the India-US East Coast trade are reporting success on their March rate recovery efforts, thanks in large part to recent sailing cuts, prompting some of them to announce even higher increases for next month.

<div class="phx-topic">Maersk — via Maersk Line, Ltd. (MLL) and CMA CGM’s sister liner unit APL — have reached an agreement to swap slots on two of their Asia-US services using US-flag ships. Under the pact, APL will offer Maersk slots of 210 TEUs, including 80 TEUs eastbound and 130 TEUs westbound, on the former’s fully US-flag Transpacific Eagle Express 1 (EX1) service that covers Asia-US West Coast trades. In return, APL will gain charter rights for 100 TEUs, including 80 TEUs eastbound and 20 TEUs westbound, on Maersk’s MECL loop between India and the US East Coast. Local industry sources who spoke with the Journal of Commerce have linked the move to the US’ Cargo Preference Act of 1954, also referred to as “government-impelled cargo,” which requires that at least half of government-sponsored cargo be transported on US-flag ships. The slot exchange framework, which has been approved by the US Federal Maritime Commission (FMC), also allows both parties to swap additional space for the movement of “preference cargo” on an ad hoc basis. “MLL shall maintain a minimum of 50% US-flag sailings on a quarterly basis in the MECL service, and APL shall maintain 100% US-flag sailings in the EX1 service,” the agreement states. The weekly EX1 rotates Qingdao, Shanghai, Busan, Los Angeles, Oakland, Yokohama, Naha and Qingdao, according to available data. The MECL has a full rotation of Jebel Ali, Mundra, Pipavav, Nhava Sheva, Salalah, Newark, Charleston, Savannah, Houston, Norfolk, Newark, Tangier and Salalah. The partly US-flag routing began calling Mundra in late February, thus enhancing Maersk’s weekly capacity for Indian export loads. Significantly, the slot-swapping arrangement gives CMA CGM, through APL, its second service between West India and North America in addition to its premier standalone “Indamex” loop amid the heightened industry race for market share leadership. <h3>Carriers push rate quotes higher </h3>Meanwhile, major carriers on the India-US East Coast trade are reporting success on their March rate recovery efforts, thanks in large part to recent sailing cuts, prompting some of them to announce even higher increases for next month. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="893ffa5c-0a69-45c7-a555-425e44318711"></dynamic-object></div>Mediterranean Shipping Co. in a March 4 advisory told Indian customers it will push rates up by a further $1,500 per container for all loads to the US East and Gulf coasts and San Juan, Puerto Rico, beginning April 1. Forwarder sources put updated March spot booking quotes by carrier at: CMA CGM — $2,435 per TEU and $2,650 per FEU from March 15; Maersk — $2,698 and $2,658 through March; and Hapag-Lloyd — $2,541 and $2,702 through March. Platts, a sister company of the Journal of Commerce within S&amp;P Global, pegged actual spot rates at $1,433 per FEU as of March 5, up 2% on the week. Contact Bency Mathew at <a href="https://www.joc.com/article/bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>.</div>

Maersk — via Maersk Line, Ltd. (MLL) and CMA CGM’s sister liner unit APL — have reached an agreement to swap slots on two of their Asia-US services using US-flag ships. Under the pact, APL will offer Maersk slots of 210 TEUs, including 80 TEUs eastbound and 130 TEUs westbound, on the former’s fully US-flag Transpacific Eagle Express 1 (EX1) service that covers Asia-US West Coast trades. In return, APL will gain charter rights for 100 TEUs, including 80 TEUs eastbound and 20 TEUs westbound, on Maersk’s MECL loop between India and the US East Coast. Local industry sources who spoke with the Journal of Commerce have linked the move to the US’ Cargo Preference Act of 1954, also referred to as “government-impelled cargo,” which requires that at least half of government-sponsored cargo be transported on US-flag ships. The slot exchange framework, which has been approved by the US Federal Maritime Commission (FMC), also allows both parties to swap additional space for the movement of “preference cargo” on an ad hoc basis. “MLL shall maintain a minimum of 50% US-flag sailings on a quarterly basis in the MECL service, and APL shall maintain 100% US-flag sailings in the EX1 service,” the agreement states. The weekly EX1 rotates Qingdao, Shanghai, Busan, Los Angeles, Oakland, Yokohama, Naha and Qingdao, according to available data. The MECL has a full rotation of Jebel Ali, Mundra, Pipavav, Nhava Sheva, Salalah, Newark, Charleston, Savannah, Houston, Norfolk, Newark, Tangier and Salalah. The partly US-flag routing began calling Mundra in late February, thus enhancing Maersk’s weekly capacity for Indian export loads. Significantly, the slot-swapping arrangement gives CMA CGM, through APL, its second service between West India and North America in addition to its premier standalone “Indamex” loop amid the heightened industry race for market share leadership. Carriers push rate quotes higher Meanwhile, major carriers on the India-US East Coast trade are reporting success on their March rate recovery efforts, thanks in large part to recent sailing cuts, prompting some of them to announce even higher increases for next month. Mediterranean Shipping Co. in a March 4 advisory told Indian customers it will push rates up by a further $1,500 per container for all loads to the US East and Gulf coasts and San Juan, Puerto Rico, beginning April 1. Forwarder sources put updated March spot booking quotes by carrier at: CMA CGM — $2,435 per TEU and $2,650 per FEU from March 15; Maersk — $2,698 and $2,658 through March; and Hapag-Lloyd — $2,541 and $2,702 through March. Platts, a sister company of the Journal of Commerce within S&P Global, pegged actual spot rates at $1,433 per FEU as of March 5, up 2% on the week. Contact Bency Mathew at bencyvmathew@gmail.com .

Maersk, APL swap slots on India/Asia-US trades under US-flag networks

<div class="phx-topic abstract-wrapper">Spot rates soared as the deadline for US tariffs approached this week, and now many shipments are stranded in transit, according to logistics providers. </div>

Spot rates soared as the deadline for US tariffs approached this week, and now many shipments are stranded in transit, according to logistics providers.

<div class="phx-topic">Long Beach, California — Truck traffic in Laredo, Texas, surged for weeks until Tuesday, when the Trump administration’s 25% tariff on Mexican imports took effect. “Monday was just absolutely chaotic, and then yesterday was eerily slow,” Jordan Dewart, president of Redwood Mexico, told the Journal of Commerce Wednesday. “We had dozens and dozens of customers literally hit the pause button on all their northbound shipments from Mexico, wherever they were in transit,” Dewart said, speaking from Laredo. “They’ve all said, ‘Hey, let’s wait this out a few days to see what happens.’” <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5951880_0.1.jpg"></img></div>What’s happening is the collection of millions of dollars of duties that many shippers have never had to pay before when importing from Mexico or Canada, another US tariff target. “We have a customs broker partner here at the [Mexican] border, and they [took in] payments in excess of $1 million yesterday,” the first day tariffs were collected, Dewart said. Those payments came from multiple customers of Redwood Logistics “and every one of those customers had never paid” tariffs on Mexican goods previously, Dewart said. One customer had planned to bring a truckload shipment into the US Monday before the tariffs took effect, but a flat tire kept the drayage truck from crossing until Tuesday, he said. “A shipment that could have avoided the tariffs entirely instead was subject to $50,000 in duties,” said Dewart. <h3>Delays disrupting capacity </h3>Logistics providers expect to hear many similar stories as the Trump administration accelerates its trade wars with Mexico, Canada, China and other countries. Tariff threats and then the imposition of tariffs led to a surge in freight heading toward the US-Mexico border in January and February, causing congestion and delays. Now freight is being delayed as importers try to discern what twist the tariffs might take next. Late Wednesday, for example, the White House announced that cars and trucks produced in Mexico and Canada would be exempt from the 25% tariffs for one month. That’s likely to lead to a surge in high-value automotive imports in March. High-value shipments from Mexico and Canada surged in February, pushing up spot-market truckload rates in lanes between Canada, Mexico and the US by double digits. “We’ve seen easily 50% to 75% spot rate increases for some hot must-have type items [from Canada],” Paul Brashier, vice president of global logistics at ITS Logistics, said Wednesday. “It’s almost been similar to what we saw during COVID when shippers would say, ‘just let us know what it costs’ if we could cover a load — they were more worried about getting the shipment than what it would cost them,” Brashier told the Journal of Commerce. Earlier this week, US spot market load board operator DAT Freight &amp; Analytics reported surging spot rates and volumes in cross-border lanes connecting the US and Canada. 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. Dewart noted that President Donald Trump plans to speak with Mexican President Claudia Sheinbaum Thursday, raising hopes that some tariff pressure may be relieved. “Frankly, the only trading partner that we have that knows how to handle [Trump] is Mexico’s Sheinbaum. She’s been able to work with him,” Peter Friedmann, executive director of the Agriculture Transportation Coalition (AgTC), said at the Journal of Commerce’s TPM25 conference here Wednesday. <h3>Redesigning supply chains </h3>But the uncertainty is costing US importers millions of dollars not only in tariff duties but in delays and last-minute changes in supply chains, logistics providers said. “Pretty much when Trump was inaugurated, we started fielding a lot more requests for [supply chain] design work, for heavy volume flows inbound to the US from Mexico and Canada,” said Brashier. Now with many shipments stuck in transit, especially between Mexico and the US, it’s unclear what the impact will be on volumes and pricing in the days and weeks ahead — but costs aren’t likely to go down as long as the disruption persists. “Contract rates are in a holding pattern, I’d say, to see what happens next,” Dewart said. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

Long Beach, California — Truck traffic in Laredo, Texas, surged for weeks until Tuesday, when the Trump administration’s 25% tariff on Mexican imports took effect. “Monday was just absolutely chaotic, and then yesterday was eerily slow,” Jordan Dewart, president of Redwood Mexico, told the Journal of Commerce Wednesday. “We had dozens and dozens of customers literally hit the pause button on all their northbound shipments from Mexico, wherever they were in transit,” Dewart said, speaking from Laredo. “They’ve all said, ‘Hey, let’s wait this out a few days to see what happens.’” What’s happening is the collection of millions of dollars of duties that many shippers have never had to pay before when importing from Mexico or Canada, another US tariff target. “We have a customs broker partner here at the [Mexican] border, and they [took in] payments in excess of $1 million yesterday,” the first day tariffs were collected, Dewart said. Those payments came from multiple customers of Redwood Logistics “and every one of those customers had never paid” tariffs on Mexican goods previously, Dewart said. One customer had planned to bring a truckload shipment into the US Monday before the tariffs took effect, but a flat tire kept the drayage truck from crossing until Tuesday, he said. “A shipment that could have avoided the tariffs entirely instead was subject to $50,000 in duties,” said Dewart. Delays disrupting capacity Logistics providers expect to hear many similar stories as the Trump administration accelerates its trade wars with Mexico, Canada, China and other countries. Tariff threats and then the imposition of tariffs led to a surge in freight heading toward the US-Mexico border in January and February, causing congestion and delays. Now freight is being delayed as importers try to discern what twist the tariffs might take next. Late Wednesday, for example, the White House announced that cars and trucks produced in Mexico and Canada would be exempt from the 25% tariffs for one month. That’s likely to lead to a surge in high-value automotive imports in March. High-value shipments from Mexico and Canada surged in February, pushing up spot-market truckload rates in lanes between Canada, Mexico and the US by double digits. “We’ve seen easily 50% to 75% spot rate increases for some hot must-have type items [from Canada],” Paul Brashier, vice president of global logistics at ITS Logistics, said Wednesday. “It’s almost been similar to what we saw during COVID when shippers would say, ‘just let us know what it costs’ if we could cover a load — they were more worried about getting the shipment than what it would cost them,” Brashier told the Journal of Commerce. Earlier this week, US spot market load board operator DAT Freight & Analytics reported surging spot rates and volumes in cross-border lanes connecting the US and Canada. 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. Dewart noted that President Donald Trump plans to speak with Mexican President Claudia Sheinbaum Thursday, raising hopes that some tariff pressure may be relieved. “Frankly, the only trading partner that we have that knows how to handle [Trump] is Mexico’s Sheinbaum. She’s been able to work with him,” Peter Friedmann, executive director of the Agriculture Transportation Coalition (AgTC), said at the Journal of Commerce’s TPM25 conference here Wednesday. Redesigning supply chains But the uncertainty is costing US importers millions of dollars not only in tariff duties but in delays and last-minute changes in supply chains, logistics providers said. “Pretty much when Trump was inaugurated, we started fielding a lot more requests for [supply chain] design work, for heavy volume flows inbound to the US from Mexico and Canada,” said Brashier. Now with many shipments stuck in transit, especially between Mexico and the US, it’s unclear what the impact will be on volumes and pricing in the days and weeks ahead — but costs aren’t likely to go down as long as the disruption persists. “Contract rates are in a holding pattern, I’d say, to see what happens next,” Dewart said. 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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