<div class="phx-topic abstract-wrapper"><p>Across-the-board gains in freight volumes and a strong peak shipping season drove FedEx profit skyward, lifting net income 53 percent year-over-year to $580 million in the fiscal quarter that ended Feb. 28, while total revenue rose 4 percent to $11.7 billion.</p></div>

Across-the-board gains in freight volumes and a strong peak shipping season drove FedEx profit skyward, lifting net income 53 percent year-over-year to $580 million in the fiscal quarter that ended Feb. 28, while total revenue rose 4 percent to $11.7 billion.

<div><p></p><p>Across-the-board gains in freight volumes and a strong peak shipping season drove FedEx profit skyward, lifting net income 53 percent year-over-year to $580 million in the fiscal quarter that ended Feb. 28, while total revenue rose 4 percent to $11.7 billion.</p><p>Neither winter weather, successive holiday peaks nor significant changes in distribution patterns caused by disruption at U.S. West Coast ports dampened profit for the second-largest U.S. and third-largest global transport operator. Higher base rates, yields and volumes and gains from lower fuel prices outweighed a drop in fuel surcharge revenue and the negative impact of a strong U.S. dollar on...

Across-the-board gains in freight volumes and a strong peak shipping season drove FedEx profit skyward, lifting net income 53 percent year-over-year to $580 million in the fiscal quarter that ended Feb. 28, while total revenue rose 4 percent to $11.7 billion. Neither winter weather, successive holiday peaks nor significant changes in distribution patterns caused by disruption at U.S. West Coast ports dampened profit for the second-largest U.S. and third-largest global transport operator. Higher base rates, yields and volumes and gains from lower fuel prices outweighed a drop in fuel surcharge revenue and the negative impact of a strong U.S. dollar on exports, company executives said Tuesday. In fact, congestion at West Coast ports locked in a labor dispute during the quarter led to a surge in profitable time-definite air freight business at core division FedEx Express. FedEx expects more lift this year from a stronger U.S. economy, which is anchoring the global economy and encouraging modest worldwide growth in 2015. In the U.S., improving “fundamentals” will support real gross domestic product growth of 3 percent or more for several quarters, Executive Vice President T. Michael Glenn told Wall Street analysts. “Our annual U.S. GDP forecast is 3.1 percent growth for calendar 2015 and 3.1 percent growth in calendar 2016,” Glenn said, according to a Seeking Alpha transcript of the March 18 earnings conference call. U.S. industrial production should grow 3.8 percent year-over-year in 2015 and 3.6 percent in 2016, fueling an increase in freight volumes. With the U.S. and other developed countries gaining economic traction after years of slower growth, the rest of the world should eventually pick up its pace, he said. FedEx expects global real GDP growth of 2.8 percent in 2015 and 3.1 percent next year, Glenn said. Operating profit soared 129 percent at air division FedEx Express to $384 million despite a $10 million decline in revenue to $6.66 billion. The division’s U.S. business was strong, with overnight package volume rising 5 percent and deferred packages up 4 percent. On the international side, currency exchanges rates hurt exports but helped imports as the value of the U.S. dollar increased. International economy volumes were up 4 percent, while priority volumes were flat with the year-ago quarter. International export package volumes picked up only 1 percent. Domestic volumes overseas, however, rose 7 percent. FedEx Ground led the company in revenue growth, increasing sales 12 percent to $3.4 billion, while the ground package division’s operating profit rose 14 percent to $558 million, making FedEx Ground the most profitable division in the $45.6 billion company. Average daily package volume rose 7 percent at FedEx Ground, thanks to growth in business-to-business and home delivery services as e-commerce sales increased. Base rate increases and higher dimensional weight charges boosted revenue per package 3 percent, though FedEx officials stressed dim-weight pricing had a minor effect. FedEx SmartPost volumes decreased 7 percent, because of the loss of a major customer for the service, which uses the U.S. Postal Service for final home delivery. However, consumers used SmartPost much further into the peak season than normal, company officials said. That indicates not just increased e-commerce, but the spread online sales over a longer period. FedEx Freight, the largest U.S. less-than-truckload company and the industrial arm of FedEx, increased operating profit 94 percent to $68 million, while revenue rose 6 percent to $1.4 billion. LTL shipment volume increased 3 percent. Revenue per shipment also rose 3 percent, despite lower fuel surcharge revenue, as a result of increased rates. Contact William B. Cassidy at wcassidy@joc.com and follow him on Twitter: @wbcassidy@joc.com .

Supply chain

FedEx profit soars as ‘modest’ global growth improves outlook

<div class="phx-topic abstract-wrapper"><p>With on-time performance close to the 90% target, Hapag-Lloyd has begun to remove the additional capacity initially built into the network to ensure 90% reliability, Rolf Habben Jansen told the TPM26 conference.   </p></div>

With on-time performance close to the 90% target, Hapag-Lloyd has begun to remove the additional capacity initially built into the network to ensure 90% reliability, Rolf Habben Jansen told the TPM26 conference.

Feature image

<div class="phx-topic"><p>Long Beach, California — Gemini Cooperation's steadily improving schedule reliability has enabled Hapag-Lloyd to take buffer capacity out of the network while maintaining reliable transit times, CEO Rolf Habben Jansen said Tuesday. </p><p>The additional capacity was built into schedules when Gemini launched in February 2025 because partners Hapag-Lloyd and Maersk wanted to ensure to 90% on-time arrivals “no matter what,” Habben Jansen told the <i>Journal of Commerce’s</i> TPM26 conference. </p><p>“If you look at the product that we're now launching in 2026 you will see that we have already taken some buffer capacity out here and there, and we will continue to do that because we want to be reliable, but we also want to have competitive transit times,” he said. </p><div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div><p>"You need to find a competitive transit time, very high predictability and low variability,” Habben Jansen added. “If you do that, it allows our customers to say, ‘okay, if I put the most valuable stuff on that service I can take out a week of inventory...It may only be a week of inventory, but a week is a lot.” </p><p>Data from Sea-Intelligence Maritime Analysis for December and January shows that Gemini had a global schedule reliability of 89.5%, despite congestion challenges at European and Asian ports and severe winter weather. </p><p>Chelsea Morris, vice president of global inbound transportation at Dollar General, said the discount retailer still needed to pressure-test the reliability in its supply chain, but the trends were positive. </p><p>"We've already seen a demonstrable dip in the standard deviation associated with our cargo,” she told the conference. "When we determine how much product we need in the pipeline, that's lead times. How much safety stock we need is variability. Anytime you can remove that variability, you don't need that extra inventory.” </p><h3>Reliability on ‘a massive scale’ </h3><p>Morris said that although Gemini was the most reliable alliance, on-time performance was improving across the industry. </p><p>"What’s really special about what is being done is that it is being done on a massive scale,” she added. “Often when working with carrier partners, it's singular and it's directional, but what we're doing here is really making a difference for the entire industry. It means that we're not flowing wasteful product through the supply chain that can then bottleneck and cause a lot of issues for all our customers.” </p><p>Rebecca Ziebarth, vice president of global trade management at Ashley Furniture, agreed that more reliability in ocean schedules improved inventory management. </p><p>”We want to be able to reduce how much we’re carrying and make sure that we can keep those costs in check, and being able to have the option to direct those raw materials to our manufacturing facility is a huge benefit,” she said.  </p><p>With Gemini’s schedule reliability remaining close to its 90% stated target since its launch early last year, Habben Jansen on Tuesday repeated a view he first expressed at TPM25 last year. </p><p>”Our objective is to create more value for customers, and I’m firmly convinced that if you create value for the customer, then in the end, you will find a way to share it,” he said. </p><p>“Whether and how that is then reflected, and how that comes about in the relationship, remains to be seen, but for sure, if we are consistent and always on time, for a lot of customers that has real value,” he added. </p><div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="4abe02d4-ed18-461a-ac0b-87ef52e3192b"></dynamic-object></div><p>Still, global ocean reliability has been on a steady decline since last October, according to data from eeSea, falling from 36.6% then to 25.4% in February. </p><p>Oscar de Bok, CEO of DHL Global Forwarding, agreed that consistent delivery of better services would over time translate into better pricing for service providers. </p><p>"In the end, customers will pay for value that you create,” he told the conference. "If you can benefit by $1,000, then you will probably be willing to pay $100 more in order to get $900 for yourself. Once it has proven itself, then the value is visible and a customer will not want to lose it.” </p><p><i>Contact Greg Knowler at </i><a href="https://www.joc.com/article/greg.knowler@spglobal.com"><i>greg.knowler@spglobal.com.</i></a></p></div>

Long Beach, California — Gemini Cooperation's steadily improving schedule reliability has enabled Hapag-Lloyd to take buffer capacity out of the network while maintaining reliable transit times, CEO Rolf Habben Jansen said Tuesday. The additional capacity was built into schedules when Gemini launched in February 2025 because partners Hapag-Lloyd and Maersk wanted to ensure to 90% on-time arrivals “no matter what,” Habben Jansen told the Journal of Commerce’s TPM26 conference. “If you look at the product that we're now launching in 2026 you will see that we have already taken some buffer capacity out here and there, and we will continue to do that because we want to be reliable, but we also want to have competitive transit times,” he said. "You need to find a competitive transit time, very high predictability and low variability,” Habben Jansen added. “If you do that, it allows our customers to say, ‘okay, if I put the most valuable stuff on that service I can take out a week of inventory...It may only be a week of inventory, but a week is a lot.” Data from Sea-Intelligence Maritime Analysis for December and January shows that Gemini had a global schedule reliability of 89.5%, despite congestion challenges at European and Asian ports and severe winter weather. Chelsea Morris, vice president of global inbound transportation at Dollar General, said the discount retailer still needed to pressure-test the reliability in its supply chain, but the trends were positive. "We've already seen a demonstrable dip in the standard deviation associated with our cargo,” she told the conference. "When we determine how much product we need in the pipeline, that's lead times. How much safety stock we need is variability. Anytime you can remove that variability, you don't need that extra inventory.” Reliability on ‘a massive scale’ Morris said that although Gemini was the most reliable alliance, on-time performance was improving across the industry. "What’s really special about what is being done is that it is being done on a massive scale,” she added. “Often when working with carrier partners, it's singular and it's directional, but what we're doing here is really making a difference for the entire industry. It means that we're not flowing wasteful product through the supply chain that can then bottleneck and cause a lot of issues for all our customers.” Rebecca Ziebarth, vice president of global trade management at Ashley Furniture, agreed that more reliability in ocean schedules improved inventory management. ”We want to be able to reduce how much we’re carrying and make sure that we can keep those costs in check, and being able to have the option to direct those raw materials to our manufacturing facility is a huge benefit,” she said. With Gemini’s schedule reliability remaining close to its 90% stated target since its launch early last year, Habben Jansen on Tuesday repeated a view he first expressed at TPM25 last year. ”Our objective is to create more value for customers, and I’m firmly convinced that if you create value for the customer, then in the end, you will find a way to share it,” he said. “Whether and how that is then reflected, and how that comes about in the relationship, remains to be seen, but for sure, if we are consistent and always on time, for a lot of customers that has real value,” he added. Still, global ocean reliability has been on a steady decline since last October, according to data from eeSea, falling from 36.6% then to 25.4% in February. Oscar de Bok, CEO of DHL Global Forwarding, agreed that consistent delivery of better services would over time translate into better pricing for service providers. "In the end, customers will pay for value that you create,” he told the conference. "If you can benefit by $1,000, then you will probably be willing to pay $100 more in order to get $900 for yourself. Once it has proven itself, then the value is visible and a customer will not want to lose it.” Contact Greg Knowler at greg.knowler@spglobal.com.

Container lines

Container Shipping News

Maritime

TPM26: Buffer capacity being taken out of Gemini network: Hapag-Lloyd CEO

<div class="phx-topic abstract-wrapper"><p>Ryan Petersen said his company went into “code red” last year in transitioning to AI, with the technology’s first benefits seen in customs compliance and auditing.</p></div>

Ryan Petersen said his company went into “code red” last year in transitioning to AI, with the technology’s first benefits seen in customs compliance and auditing.

<div class="phx-topic"><p>Long Beach, California — Flexport CEO Ryan Petersen said Tuesday recent advances in artificial intelligence (AI) can remove more of the friction involved in shipping, potentially shaving 10% off the back-office cost of ocean freight and allowing logistics companies to easily scale without adding employees.  </p><p>Speaking at the <i>Journal of Commerce’s</i> TPM26 conference, Petersen said Flexport went into “code red” and began a more urgent transition to using AI tools in its processes last November due to the better models and new capabilities available in the market. He said the company plans to use AI to “vibe code” half of its internal applications rather than using traditional programming tools.  </p><p>”I think the ability to build AI right now is phenomenal,” Petersen said. “You can just talk to Claude (AI) in English and get an application out in 30 minutes. So, there’s a huge amount of this that’s possible now that wasn’t possible even 90 days ago.” </p><div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div><p>AI has been especially helpful in Flexport’s customs business, he said, allowing the company to update its internal systems to reflect 53 changes to US Customs code last year to reflect the multiple changes to tariff and trade codes.  </p><p>Petersen said the adoption of AI has reduced the error rate on Flexport’s customs declarations to almost zero. The company also used AI to build its recently released “tariff simulator” to double-check customs duties and other fees. And he said the tool has been able to identify some $4 billion in overcharges on customs documents.  </p><p>“We are now able to do customs for some of the biggest companies in the world because our customs technology stack is really differentiated for very large enterprises,” Petersen said. “We can put things on autopilot with a very high degree of compliance accuracy.” </p><h3>Using AI to optimize ocean freight </h3><p>In its forwarding business, Flexport used AI to build an application for optimizing ocean freight by assigning shipments based on the lowest contract rate, sailing schedules, and vessel arrival dates. Many other forwarders are applying AI to ocean freight, which Petersen said is a “simple problem.” He said the real benefits of AI come from handling the industry’s complex problems, such as customs updates and optimizing less-than-container load and consolidated shipments. </p><p>“We want to be more about how do you bring AI to either do better, more compliant customs keeping track of all the tariff changes or freight consolidation, so being able to have an AI algorithm that takes freight and does Tetris inside the container,” Petersen said.  </p><p>AI is solving the problem of how a logistics company can serve more customers and markets without increasing headcount. Citing the example of DSV’s 2024 acquisition of Schenker that doubled its headcount to 150,000, Petersen said an organization that size can introduce more complexity into logistics that AI can eliminate.  </p><p>“I think you're going to see a really rapid ability to lower costs in logistics,” he said. “Our estimate is that a shipper can save about 10% on the price of shipping a container (compared to) the white-collar transactional labor to coordinate the shipments.” </p><p><i>Contact Michael Angell at </i><a href="mailto:michael.angell@spglobal.com"><i>michael.angell@spglobal.com</i></a></p></div>

Long Beach, California — Flexport CEO Ryan Petersen said Tuesday recent advances in artificial intelligence (AI) can remove more of the friction involved in shipping, potentially shaving 10% off the back-office cost of ocean freight and allowing logistics companies to easily scale without adding employees. Speaking at the Journal of Commerce’s TPM26 conference, Petersen said Flexport went into “code red” and began a more urgent transition to using AI tools in its processes last November due to the better models and new capabilities available in the market. He said the company plans to use AI to “vibe code” half of its internal applications rather than using traditional programming tools. ”I think the ability to build AI right now is phenomenal,” Petersen said. “You can just talk to Claude (AI) in English and get an application out in 30 minutes. So, there’s a huge amount of this that’s possible now that wasn’t possible even 90 days ago.” AI has been especially helpful in Flexport’s customs business, he said, allowing the company to update its internal systems to reflect 53 changes to US Customs code last year to reflect the multiple changes to tariff and trade codes. Petersen said the adoption of AI has reduced the error rate on Flexport’s customs declarations to almost zero. The company also used AI to build its recently released “tariff simulator” to double-check customs duties and other fees. And he said the tool has been able to identify some $4 billion in overcharges on customs documents. “We are now able to do customs for some of the biggest companies in the world because our customs technology stack is really differentiated for very large enterprises,” Petersen said. “We can put things on autopilot with a very high degree of compliance accuracy.” Using AI to optimize ocean freight In its forwarding business, Flexport used AI to build an application for optimizing ocean freight by assigning shipments based on the lowest contract rate, sailing schedules, and vessel arrival dates. Many other forwarders are applying AI to ocean freight, which Petersen said is a “simple problem.” He said the real benefits of AI come from handling the industry’s complex problems, such as customs updates and optimizing less-than-container load and consolidated shipments. “We want to be more about how do you bring AI to either do better, more compliant customs keeping track of all the tariff changes or freight consolidation, so being able to have an AI algorithm that takes freight and does Tetris inside the container,” Petersen said. AI is solving the problem of how a logistics company can serve more customers and markets without increasing headcount. Citing the example of DSV’s 2024 acquisition of Schenker that doubled its headcount to 150,000, Petersen said an organization that size can introduce more complexity into logistics that AI can eliminate. “I think you're going to see a really rapid ability to lower costs in logistics,” he said. “Our estimate is that a shipper can save about 10% on the price of shipping a container (compared to) the white-collar transactional labor to coordinate the shipments.” Contact Michael Angell at michael.angell@spglobal.com

Logistics Technology News

TPM26: Flexport CEO sees AI’s impact on logistics accelerating

<div class="phx-topic abstract-wrapper"><p>Amid trade tensions and other geopolitical challenges, ocean freight volumes should remain elevated, according to Jens Drewes.</p></div>

Amid trade tensions and other geopolitical challenges, ocean freight volumes should remain elevated, according to Jens Drewes.

<div class="phx-topic"><p>Long Beach, California — Global ocean freight volumes are expected to remain elevated despite geopolitical uncertainties that include ongoing trade tensions and now an expanding war in the Middle East.  </p><p>That’s according to Jens Drewes, CEO of forwarder Hellmann Worldwide Logistics, who spoke Tuesday at the <i>Journal of Commerce</i>’s TPM26 conference. </p><p>“Despite all of these uncertainties, about all of the risks that you see, and the topics that we talk about ... one thing is also very clear: Global trade is still very strong,” Drewes said, citing the potential for growth in nations including India and China.  </p><div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177003_0.1.jpg"></img></div><p>“There’s a lot of consumption demand in the future, so there’s also a lot of opportunity,” he said. “So, I believe globalization, in particular, global trade ... will be strong and fuel the world economy as well.” </p><p>With regards to the integration of AI at Hellmann, Drewes insisted that the technology will be a supplement and improve the overall customer experience. He believes it can be a tool that makes freight forwarding more efficient, without a substantial reduction in employees at the family-owned company that was founded in 1871. </p><p>“We want to have that human element,” Drewes said. </p><p>He added that during the COVID-19 pandemic, many company leaders who were successful learned the granular details of the supply chain and today, that attention to detail must be a part of a leader’s portfolio if the company is to maintain a high degree of success and customer satisfaction.  </p><p>“There will always be people involved,” he said. “Only the companies who are finding the right balance [by] having this human touch and the digital touch and new technologies combined ... they will be in the lead.” </p><p><i>Contact Dan Ronan at </i><a href="mailto:contactdanronan@gmail.com"><i>contactdanronan@gmail.com</i></a>.</p></div>

Long Beach, California — Global ocean freight volumes are expected to remain elevated despite geopolitical uncertainties that include ongoing trade tensions and now an expanding war in the Middle East. That’s according to Jens Drewes, CEO of forwarder Hellmann Worldwide Logistics, who spoke Tuesday at the Journal of Commerce’s TPM26 conference. “Despite all of these uncertainties, about all of the risks that you see, and the topics that we talk about ... one thing is also very clear: Global trade is still very strong,” Drewes said, citing the potential for growth in nations including India and China. “There’s a lot of consumption demand in the future, so there’s also a lot of opportunity,” he said. “So, I believe globalization, in particular, global trade ... will be strong and fuel the world economy as well.” With regards to the integration of AI at Hellmann, Drewes insisted that the technology will be a supplement and improve the overall customer experience. He believes it can be a tool that makes freight forwarding more efficient, without a substantial reduction in employees at the family-owned company that was founded in 1871. “We want to have that human element,” Drewes said. He added that during the COVID-19 pandemic, many company leaders who were successful learned the granular details of the supply chain and today, that attention to detail must be a part of a leader’s portfolio if the company is to maintain a high degree of success and customer satisfaction. “There will always be people involved,” he said. “Only the companies who are finding the right balance [by] having this human touch and the digital touch and new technologies combined ... they will be in the lead.” Contact Dan Ronan at contactdanronan@gmail.com .

TPM26: Global trade ‘still strong’ despite uncertainties: Hellmann CEO

<div class="phx-topic abstract-wrapper"><p>Stefan Paul said almost 20% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports are closed or flights have been otherwise canceled. </p></div>

Stefan Paul said almost 20% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports are closed or flights have been otherwise canceled.

<div class="phx-topic"><p>Air cargo originating in Asia and bound for the US and Europe will begin to stack up at airports in Asia within days because a significant amount of the capacity needed to move the freight has been grounded by the widening Middle East conflict,  the CEO of forwarder Kuehne + Nagel said Tuesday. </p><p>The backlogs are expected to be particularly acute at air freight hubs in China and Southeast Asia, K+N CEO Stefan Paul said during his company’s fourth-quarter online results briefing. </p><p>“By the end of the week [or] beginning of next week, we’ll see most probably certain backlogs arising in Southeast Asia and in China for the European and US marketplace,” Paul said. </p><p>He said about 18% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports, including the huge regional hub in Dubai, are closed or flights have been otherwise canceled. He said the forwarder would help exporters as much as it could by chartering additional capacity to fly directly “from the various origins into the destinations.” </p><p>Paul also said the mismatch in cargo demand and supply was similar to the COVID-19 pandemic, when there was a surge in demand for air freight due to port and other disruptions caused by lockdowns and related restrictions. He expected the Middle East crisis to benefit the air freight market via higher rates more so than the ocean sector due to the urgency in fulfilling demand.   </p><p>Kuehne + Nagel was already seeing a continuing rebound in air freight volumes in January and February that started in the fourth quarter. “I’m quite confident we’ll see the same pattern in terms of air freight growth,” Paul said. </p><h3>Profits down, job cuts accelerate </h3><p>The forwarder saw air cargo volumes in the fourth quarter climb 6% year over year to 595,000 tons, while full-year volumes grew 7% to 2.2 million tons. Paul said K+N is seeing strong demand from aerospace, pharma and semiconductor-related industries, including AI-focused hyperscalers such as Amazon AWS and Google Cloud. Demand from the automotive industry has also recovered in the first two months of 2026 after it declined last year, he said. </p><p>But K+N’s net profit in 2025 fell 26% to $1.1 billion, while turnover was unchanged at $31 billion. The figures included $156 million in one-off costs, of which 90% was due to staff redundancies and related costs. The company said more than 2,000 employees will be laid off by the end of this year, up from the 1,000 to 1,500 staff that were originally targeted when the cost-cutting program was unveiled in the fourth quarter. </p><p>K+N this year will target small and medium-sized enterprises in China to boost ocean freight volumes that were unchanged in 2025 at 4.3 million TEUs, Paul said. The company is also chasing acquisitions, including “smaller bolt-ons and higher-quality businesses,” CFO Markus Blanka-Graff said. </p><p><i>Contact Keith Wallis at </i><a href="mailto:keithwallis@hotmail.com"><i>keithwallis@hotmail.com</i></a><i>.</i> </p></div>

Air cargo originating in Asia and bound for the US and Europe will begin to stack up at airports in Asia within days because a significant amount of the capacity needed to move the freight has been grounded by the widening Middle East conflict, the CEO of forwarder Kuehne + Nagel said Tuesday. The backlogs are expected to be particularly acute at air freight hubs in China and Southeast Asia, K+N CEO Stefan Paul said during his company’s fourth-quarter online results briefing. “By the end of the week [or] beginning of next week, we’ll see most probably certain backlogs arising in Southeast Asia and in China for the European and US marketplace,” Paul said. He said about 18% of global air freight capacity from the belly hold of passenger aircraft and via freighter aircraft charters has been cut from the market because Middle East airports, including the huge regional hub in Dubai, are closed or flights have been otherwise canceled. He said the forwarder would help exporters as much as it could by chartering additional capacity to fly directly “from the various origins into the destinations.” Paul also said the mismatch in cargo demand and supply was similar to the COVID-19 pandemic, when there was a surge in demand for air freight due to port and other disruptions caused by lockdowns and related restrictions. He expected the Middle East crisis to benefit the air freight market via higher rates more so than the ocean sector due to the urgency in fulfilling demand. Kuehne + Nagel was already seeing a continuing rebound in air freight volumes in January and February that started in the fourth quarter. “I’m quite confident we’ll see the same pattern in terms of air freight growth,” Paul said. Profits down, job cuts accelerate The forwarder saw air cargo volumes in the fourth quarter climb 6% year over year to 595,000 tons, while full-year volumes grew 7% to 2.2 million tons. Paul said K+N is seeing strong demand from aerospace, pharma and semiconductor-related industries, including AI-focused hyperscalers such as Amazon AWS and Google Cloud. Demand from the automotive industry has also recovered in the first two months of 2026 after it declined last year, he said. But K+N’s net profit in 2025 fell 26% to $1.1 billion, while turnover was unchanged at $31 billion. The figures included $156 million in one-off costs, of which 90% was due to staff redundancies and related costs. The company said more than 2,000 employees will be laid off by the end of this year, up from the 1,000 to 1,500 staff that were originally targeted when the cost-cutting program was unveiled in the fourth quarter. K+N this year will target small and medium-sized enterprises in China to boost ocean freight volumes that were unchanged in 2025 at 4.3 million TEUs, Paul said. The company is also chasing acquisitions, including “smaller bolt-ons and higher-quality businesses,” CFO Markus Blanka-Graff said. Contact Keith Wallis at keithwallis@hotmail.com .

Air Cargo Carriers News

Asia-Europe

Trans-Pacific

Air Cargo

Air freight backlog set to gridlock Asia airports amid Middle East conflict: K+N CEO

<div class="phx-topic abstract-wrapper"><p>While reefer trade is at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have put a stop to all Middle East shipments until further notice. </p></div>

While reefer trade is at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have put a stop to all Middle East shipments until further notice.

<div class="phx-topic"><p>Supply chains between India and the Middle East have come to a standstill following the en masse suspension of services and cargo acceptance by ocean carriers serving the trade corridor amid the military conflict between Iran and the US and Israel. </p><p>The economic implications of the developing crisis are enormous for India as it is the second-largest trading partner for the United Arab Emirates (UAE). The two sides in 2022 signed a comprehensive trade pact aimed at pushing non-oil bilateral trade to $100 billion by 2030. </p><p>While reefer trade is seen to be at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have already put a stop to all kinds of Middle East shipments until further notice. </p><p>“Effective immediately, we are suspending all new bookings between the Indian Subcontinent [India, Pakistan, Bangladesh and Sri Lanka] and the Upper Gulf markets of the UAE, Bahrain, Qatar, Iraq, Kuwait, and Saudi Arabia [Dammam and Jubail only],” Maersk said in an operational update. </p><p>Mediterranean Shipping Co., Hapag-Lloyd and Ocean Network Express (ONE) have also halted all Middle East bookings.   </p><p>“For cargo currently in transit or planned shipments, we are closely assessing the situation voyage by voyage,” Singapore-based ONE said.  </p><p>Concurrently, lead mainline carriers on the trade lane have announced hefty war risk or emergency surcharges — ranging between $1,500 and $3,000 per standard container. </p><p>Maersk is the latest operator to have issued that advisory, slapping an “emergency freight increase” levy for the region of $1,800 per TEU, $3,000 per FEU, and $3,800 for reefer boxes. </p><h3>Exports ‘piling up’ on Indian docks </h3><p>Meanwhile, the abrupt cargo flow stoppage and service disruptions have left many Indian docks facing a buildup of containers, with the accumulation expected to aggravate as planned export containers continue to gate in. </p><p>“Cargo booked for Middle East destinations is piling up across Indian ports,” Sunil Vaswani, executive director of the Container Shipping Lines Association (India), told the <i>Journal of Commerce</i>. “If the crisis is not resolved quickly, it’s going to cause congestion troubles.” </p><p>The disruptive impact on Indian exports goes beyond the Middle East regional trade.  India’s seasonal grape shipments to Europe, which were picking up, now face longer or unpredictable transits due to vessel diversions around southern Africa for westbound services that recently resumed, and then halted, Red Sea/Suez Canal transits. </p><p><i>Contact Bency Mathew at </i><a href="mailto:bencyvmathew@gmail.com"><i>bencyvmathew@gmail.com</i></a><i>.</i> </p></div>

Supply chains between India and the Middle East have come to a standstill following the en masse suspension of services and cargo acceptance by ocean carriers serving the trade corridor amid the military conflict between Iran and the US and Israel. The economic implications of the developing crisis are enormous for India as it is the second-largest trading partner for the United Arab Emirates (UAE). The two sides in 2022 signed a comprehensive trade pact aimed at pushing non-oil bilateral trade to $100 billion by 2030. While reefer trade is seen to be at the center of carrier booking suspensions because of its time-sensitive nature, many mainline carriers have already put a stop to all kinds of Middle East shipments until further notice. “Effective immediately, we are suspending all new bookings between the Indian Subcontinent [India, Pakistan, Bangladesh and Sri Lanka] and the Upper Gulf markets of the UAE, Bahrain, Qatar, Iraq, Kuwait, and Saudi Arabia [Dammam and Jubail only],” Maersk said in an operational update. Mediterranean Shipping Co., Hapag-Lloyd and Ocean Network Express (ONE) have also halted all Middle East bookings. “For cargo currently in transit or planned shipments, we are closely assessing the situation voyage by voyage,” Singapore-based ONE said. Concurrently, lead mainline carriers on the trade lane have announced hefty war risk or emergency surcharges — ranging between $1,500 and $3,000 per standard container. Maersk is the latest operator to have issued that advisory, slapping an “emergency freight increase” levy for the region of $1,800 per TEU, $3,000 per FEU, and $3,800 for reefer boxes. Exports ‘piling up’ on Indian docks Meanwhile, the abrupt cargo flow stoppage and service disruptions have left many Indian docks facing a buildup of containers, with the accumulation expected to aggravate as planned export containers continue to gate in. “Cargo booked for Middle East destinations is piling up across Indian ports,” Sunil Vaswani, executive director of the Container Shipping Lines Association (India), told the Journal of Commerce. “If the crisis is not resolved quickly, it’s going to cause congestion troubles.” The disruptive impact on Indian exports goes beyond the Middle East regional trade. India’s seasonal grape shipments to Europe, which were picking up, now face longer or unpredictable transits due to vessel diversions around southern Africa for westbound services that recently resumed, and then halted, Red Sea/Suez Canal transits. Contact Bency Mathew at bencyvmathew@gmail.com .

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