<div class="phx-topic abstract-wrapper">North Yemeni Prime Minister Abdel-Aziz Abdel-Ghani said his country would start exporting oil befor</div>

North Yemeni Prime Minister Abdel-Aziz Abdel-Ghani said his country would start exporting oil befor

<div>North Yemeni Prime Minister Abdel-Aziz Abdel-Ghani said his country would start exporting oil before the end of the year.Mr. Abdel-Ghani, in an interview with the Saudi newspaper Arab News last week, did not give an export figure, but President Ali Abdullah Saleh told a Kuwaiti newspaper in April that exports of 200,000 barrels a day would start in November.The prime minister said a pipeline from the oil fields to an export terminal on the Red Sea would be completed in a few months. Industry sources said work was proceeding on the 150-mile long, 24-inch-diameter pipeline to the Salif terminal on...

North Yemeni Prime Minister Abdel-Aziz Abdel-Ghani said his country would start exporting oil before the end of the year. Mr. Abdel-Ghani, in an interview with the Saudi newspaper Arab News last week, did not give an export figure, but President Ali Abdullah Saleh told a Kuwaiti newspaper in April that exports of 200,000 barrels a day would start in November.The prime minister said a pipeline from the oil fields to an export terminal on the Red Sea would be completed in a few months. Industry sources said work was proceeding on the 150-mile long, 24-inch-diameter pipeline to the Salif terminal on the Red Sea. Mr. Abdel-Ghani said estimates have put the capacity of the Alif oil field at 500,000 b/d. Arab News quoted unidentified sources as expecting North Yemen's production to start at 180,000 b/d in October, and to reach 500,000 b/d by 1989.

NORTH YEMEN PLANS TO START EXPORTING OIL IN NOVEMBER

<div class="phx-topic abstract-wrapper">Still, analyst Larry Gross suspects that the early strength seen in the first half of the year is substantially composed of volume that has been “borrowed” from a peak season that will be “late and tepid” as a result.</div>

Still, analyst Larry Gross suspects that the early strength seen in the first half of the year is substantially composed of volume that has been “borrowed” from a peak season that will be “late and tepid” as a result.

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<div class="phx-topic">The numbers are in for the first half of 2025 from the Association of American Railroads (AAR). While the numbers lack the detail that can be gleaned from the Intermodal Association of North America’s (IANA’s) monthly data, the AAR numbers have the crucial advantage of timeliness. Despite all the trade turmoil, intermodal had a good first half of 2025. North American intermodal activity in the second quarter was up 1.4% versus the prior year and 3.6% higher for the first half. But intermodal was not fully immune from trade effects. North American volume over the past four weeks was down 2% from 2024 and US volume from the “Big Four” rails — BNSF, CSX, Norfolk Southern and UP — was down a bit more at 2.9%. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6041537_0.1.jpg"></img></div>The two charts attempt to put the current numbers in a longer-term context. The first chart shows all the reporting railroads, while the second isolates the Big Four. In each, the blue line represents what used to be “normal,” the average volume for each of the 52 weeks of the year for the 10 years from 2010 to 2019. This predates the disruptive elements of the pandemic and the precision scheduled railroading (PSR) reforms. Results for the years 2023 and 2024 are presented, along with year-to-date results for 2025. One interesting aspect is that both 2023 and 2024 saw volume staying stronger for longer than the previous norm. On average, week 39 marked the peak during the 2010–19 period. But in 2023, the peak was in Week 42 and Weeks 48-50 were just about as strong. In 2024, the two strongest weeks were Week 49 and 50. Does this mark a “new normal” or are we just seeing a couple of years with special situations? Too soon to tell. This year has seen the inverse of the normal pattern, in that volume peaked in Week 6 and has been declining since. This can be seen most clearly in the US-specific chart. Frontloading related to tariffs has been in play. The impact of the imposition of 145% China tariffs can plainly be seen in Week 20, five weeks after they were imposed. The rebound from the rollback to 30% can be seen most recently in Week 26, some six weeks after the rollback was announced. I infer it is easier or quicker to put a hold on shipments, but restarting them takes a bit longer. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="71a18721-0919-4ccd-b2fa-2c4c299e29b7"></dynamic-object></div>Week 27 will show the impacts of the Canada Day/July 4th holidays, so we won’t get a better picture of the size of the recovery until Week 28. Based on what ocean rates are doing, this “mini-surge” will be underwhelming in scope and duration. Conversely, the two Canadian railroads have been relatively strong of late. Canadian National has been up 3.3% over the past four weeks versus the prior year, and Canadian Pacific Kansas City was up 16.9% over the same period, albeit against particularly weak prior-year numbers. It certainly makes sense that we would not be seeing the same tariff-related gyrations north of the border. <h3>Peak season questions </h3>This leaves the question of peak season. Will we have one? And if we do, how strong will it be? Obviously, much depends on where tariffs land and the process by which the landing is achieved. This is, of course, unforecastable. The Trump administration has fulfilled my expectations in one sense by announcing that the 90-day tariff pause on essentially all trading partners has been extended to Aug 1. I would certainly not be surprised to see further slippage, but of course, I could just as easily be wrong about where our mercurial president takes us. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e92d2fdc-94d9-4806-9df7-bbbc2b6aed28"></dynamic-object></div>My sense is that importers are developing a certain level of fatigue with the constant drumbeat of new tariffs, rollbacks and extensions. Rather than taking costly actions to try and game the tariff timing, they are settling back and allowing things to unfold. I suspect that the early strength that we have seen in the first half is substantially composed of volume that has been “borrowed” from peak season. Therefore, my best guess is that if we have a peak, it will be late and tepid. Contact Larry Gross at <a href="mailto:lgross@intermodalindepth.com">lgross@intermodalindepth.com</a>.</div>

The numbers are in for the first half of 2025 from the Association of American Railroads (AAR). While the numbers lack the detail that can be gleaned from the Intermodal Association of North America’s (IANA’s) monthly data, the AAR numbers have the crucial advantage of timeliness. Despite all the trade turmoil, intermodal had a good first half of 2025. North American intermodal activity in the second quarter was up 1.4% versus the prior year and 3.6% higher for the first half. But intermodal was not fully immune from trade effects. North American volume over the past four weeks was down 2% from 2024 and US volume from the “Big Four” rails — BNSF, CSX, Norfolk Southern and UP — was down a bit more at 2.9%. The two charts attempt to put the current numbers in a longer-term context. The first chart shows all the reporting railroads, while the second isolates the Big Four. In each, the blue line represents what used to be “normal,” the average volume for each of the 52 weeks of the year for the 10 years from 2010 to 2019. This predates the disruptive elements of the pandemic and the precision scheduled railroading (PSR) reforms. Results for the years 2023 and 2024 are presented, along with year-to-date results for 2025. One interesting aspect is that both 2023 and 2024 saw volume staying stronger for longer than the previous norm. On average, week 39 marked the peak during the 2010–19 period. But in 2023, the peak was in Week 42 and Weeks 48-50 were just about as strong. In 2024, the two strongest weeks were Week 49 and 50. Does this mark a “new normal” or are we just seeing a couple of years with special situations? Too soon to tell. This year has seen the inverse of the normal pattern, in that volume peaked in Week 6 and has been declining since. This can be seen most clearly in the US-specific chart. Frontloading related to tariffs has been in play. The impact of the imposition of 145% China tariffs can plainly be seen in Week 20, five weeks after they were imposed. The rebound from the rollback to 30% can be seen most recently in Week 26, some six weeks after the rollback was announced. I infer it is easier or quicker to put a hold on shipments, but restarting them takes a bit longer. Week 27 will show the impacts of the Canada Day/July 4th holidays, so we won’t get a better picture of the size of the recovery until Week 28. Based on what ocean rates are doing, this “mini-surge” will be underwhelming in scope and duration. Conversely, the two Canadian railroads have been relatively strong of late. Canadian National has been up 3.3% over the past four weeks versus the prior year, and Canadian Pacific Kansas City was up 16.9% over the same period, albeit against particularly weak prior-year numbers. It certainly makes sense that we would not be seeing the same tariff-related gyrations north of the border. Peak season questions This leaves the question of peak season. Will we have one? And if we do, how strong will it be? Obviously, much depends on where tariffs land and the process by which the landing is achieved. This is, of course, unforecastable. The Trump administration has fulfilled my expectations in one sense by announcing that the 90-day tariff pause on essentially all trading partners has been extended to Aug 1. I would certainly not be surprised to see further slippage, but of course, I could just as easily be wrong about where our mercurial president takes us. My sense is that importers are developing a certain level of fatigue with the constant drumbeat of new tariffs, rollbacks and extensions. Rather than taking costly actions to try and game the tariff timing, they are settling back and allowing things to unfold. I suspect that the early strength that we have seen in the first half is substantially composed of volume that has been “borrowed” from peak season. Therefore, my best guess is that if we have a peak, it will be late and tepid. Contact Larry Gross at lgross@intermodalindepth.com .

North-American rail

Intermodal providers

Surface

North American intermodal notches solid first half despite trade turmoil

<div class="phx-topic abstract-wrapper">The tariff framework agreement between Washington and Hanoi, while still short on details, is expected to support Vietnam’s strong air cargo volume growth this year.</div>

The tariff framework agreement between Washington and Hanoi, while still short on details, is expected to support Vietnam’s strong air cargo volume growth this year.

<div class="phx-topic">Vietnam’s air cargo exports to the US are surging, with higher tariffs on China providing a powerful incentive for US importers to shift sourcing to the Southeast Asian manufacturing nation. Air cargo volumes generated by frontloading ahead of “reciprocal” tariffs in April and the subsequent 90-day pause on those tariffs in early May were piled on top of an already robust start to the year. Vietnam-US volumes out of Ho Chi Minh airport were up 62% through April compared with the same period last year, with 97,000 tons of cargo carried across the Pacific, according to data from air cargo analyst Rotate. Tim van Leeuwen, head of consulting at Rotate, said Vietnam was affected both by tariffs on its own imports as well those on other countries, notably China. The latest tariff framework agreement between the US and Vietnam, while still short on details, would likely result in Vietnam’s volume growth continuing. “As long as China’s tariffs remain higher than those in Vietnam, we expect ... an increase in new US imports from Vietnam that will replace current US imports from China,” van Leeuwen told the Journal of Commerce this week. “For instance, we may see a shipper who currently serves the US from China, and the Middle East/Europe from Vietnam, switch the two to optimize tariff impact,” he noted. Current US tariffs on Vietnam are 10%, but the recently announced framework agreement will increase tariffs to 20% on most Vietnamese exports. The deal <a href="https://www.joc.com/article/trumps-vietnam-transshipment-tariff-puzzles-us-trade-community-6041482">includes a 40% tariff rate on “transshipment” aimed at countering the routing of Chinese exports through Vietnam</a>, although no details regarding the definition and enforcement of that transshipment have been released. In return, Vietnam will impose zero tariffs on US imports and give preferential access to certain goods, such as large-engine automobiles. In contrast, the US and China have a tentative agreement that will see US tariffs of 55% on Chinese exports from Aug. 12, but the transshipment aspect of the US-Vietnam deal has again soured trade relations between Beijing and Washington, with retaliatory threats on both sides. Washington believes one-third of all Vietnamese exports to the US are actually Chinese products shipped through Vietnam. <h3>Capacity boost </h3>While its northern neighbor fights a trade war with the US, Vietnam’s air cargo business has been capitalizing on its relatively low tariff access to US markets. Van Leeuwen said current direct capacity between Vietnam and the US is equivalent to approximately one Boeing 777 freighter per day, a significant increase on the past three years when there was almost no direct capacity. “However, most capacity out of Vietnam towards the US will make an intermediate stop along the way, so in that sense the capacity growth of 15% to Northeast Asia — about 20 B777 freighters per day equivalent — is more indicative of current capacity growth out of the market,” he said. Air cargo rates from Ho Chi Minh to New York and Chicago have followed the upward trend of demand, remaining well above $6 per kilogram all year and rising as high as $6.72/kg in mid-June, according to Freightos Terminal air cargo rate data. Prices eased back to $6.00/kg to Chicago and $6.28/kg to New York this week, possibly reflecting capacity additions to the lane during a final push before the July 9 end of the 90-day pause on tariffs, said Levine. “A US-Vietnam trade agreement that sets tariffs at 20% could push some shippers to source elsewhere, but even at 20%, manufacturing would still be less expensive there compared to other countries like China,” he said. “With so much uncertainty about what tariffs will be for other countries, many shippers may be unlikely to shift sourcing elsewhere just yet,” Levine added. <h3>Fast-growing export business </h3>Dmitry Kulish, general manager for Asia-Pacific air cargo at Air Cargo Network Group (ACN), an association of air freight experts and logistics providers, said the Vietnamese export business was growing fast. “We see the global trend of shifting production across the Asia-Pacific region for some time now, and we definitely pay close attention to fast-growing markets, especially Vietnam,” Kulish told the Journal of Commerce. While confident of future growth in Vietnam, he said tariffs were injecting uncertainty into the market, with ACN “keeping a close eye” on the developing trade environment. “Tariffs and policy have a significant impact on the export business, and we are currently in a phase where political decisions can be unpredictable,” he said. The latest quarterly DHL Hong Kong Air Trade Leading Index survey released Thursday also found increasing interest in Southeast Asia by local air cargo traders, with almost 30% of local air traders reporting an increase in urgent orders following the 90-day suspension of US-China tariffs initiated on May 14. “As the trade landscape evolves, local air traders have identified Southeast Asia as the top market for trade potential,” DHL noted in a statement Thursday. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Vietnam’s air cargo exports to the US are surging, with higher tariffs on China providing a powerful incentive for US importers to shift sourcing to the Southeast Asian manufacturing nation. Air cargo volumes generated by frontloading ahead of “reciprocal” tariffs in April and the subsequent 90-day pause on those tariffs in early May were piled on top of an already robust start to the year. Vietnam-US volumes out of Ho Chi Minh airport were up 62% through April compared with the same period last year, with 97,000 tons of cargo carried across the Pacific, according to data from air cargo analyst Rotate. Tim van Leeuwen, head of consulting at Rotate, said Vietnam was affected both by tariffs on its own imports as well those on other countries, notably China. The latest tariff framework agreement between the US and Vietnam, while still short on details, would likely result in Vietnam’s volume growth continuing. “As long as China’s tariffs remain higher than those in Vietnam, we expect ... an increase in new US imports from Vietnam that will replace current US imports from China,” van Leeuwen told the Journal of Commerce this week. “For instance, we may see a shipper who currently serves the US from China, and the Middle East/Europe from Vietnam, switch the two to optimize tariff impact,” he noted. Current US tariffs on Vietnam are 10%, but the recently announced framework agreement will increase tariffs to 20% on most Vietnamese exports. The deal includes a 40% tariff rate on “transshipment” aimed at countering the routing of Chinese exports through Vietnam , although no details regarding the definition and enforcement of that transshipment have been released. In return, Vietnam will impose zero tariffs on US imports and give preferential access to certain goods, such as large-engine automobiles. In contrast, the US and China have a tentative agreement that will see US tariffs of 55% on Chinese exports from Aug. 12, but the transshipment aspect of the US-Vietnam deal has again soured trade relations between Beijing and Washington, with retaliatory threats on both sides. Washington believes one-third of all Vietnamese exports to the US are actually Chinese products shipped through Vietnam. Capacity boost While its northern neighbor fights a trade war with the US, Vietnam’s air cargo business has been capitalizing on its relatively low tariff access to US markets. Van Leeuwen said current direct capacity between Vietnam and the US is equivalent to approximately one Boeing 777 freighter per day, a significant increase on the past three years when there was almost no direct capacity. “However, most capacity out of Vietnam towards the US will make an intermediate stop along the way, so in that sense the capacity growth of 15% to Northeast Asia — about 20 B777 freighters per day equivalent — is more indicative of current capacity growth out of the market,” he said. Air cargo rates from Ho Chi Minh to New York and Chicago have followed the upward trend of demand, remaining well above $6 per kilogram all year and rising as high as $6.72/kg in mid-June, according to Freightos Terminal air cargo rate data. Prices eased back to $6.00/kg to Chicago and $6.28/kg to New York this week, possibly reflecting capacity additions to the lane during a final push before the July 9 end of the 90-day pause on tariffs, said Levine. “A US-Vietnam trade agreement that sets tariffs at 20% could push some shippers to source elsewhere, but even at 20%, manufacturing would still be less expensive there compared to other countries like China,” he said. “With so much uncertainty about what tariffs will be for other countries, many shippers may be unlikely to shift sourcing elsewhere just yet,” Levine added. Fast-growing export business Dmitry Kulish, general manager for Asia-Pacific air cargo at Air Cargo Network Group (ACN), an association of air freight experts and logistics providers, said the Vietnamese export business was growing fast. “We see the global trend of shifting production across the Asia-Pacific region for some time now, and we definitely pay close attention to fast-growing markets, especially Vietnam,” Kulish told the Journal of Commerce. While confident of future growth in Vietnam, he said tariffs were injecting uncertainty into the market, with ACN “keeping a close eye” on the developing trade environment. “Tariffs and policy have a significant impact on the export business, and we are currently in a phase where political decisions can be unpredictable,” he said. The latest quarterly DHL Hong Kong Air Trade Leading Index survey released Thursday also found increasing interest in Southeast Asia by local air cargo traders, with almost 30% of local air traders reporting an increase in urgent orders following the 90-day suspension of US-China tariffs initiated on May 14. “As the trade landscape evolves, local air traders have identified Southeast Asia as the top market for trade potential,” DHL noted in a statement Thursday. Contact Greg Knowler at greg.knowler@spglobal.com .

Air Cargo

Air Cargo Forwarder News

Transport, Trade and Regulation News

Tariff deal with US lifts high-flying Vietnamese air cargo demand

<div class="phx-topic abstract-wrapper">The uncertainty centers on what the White House considers transshipment and how US Customs and Border Protection officials would regulate goods moving from China to the US via Vietnam.</div>

The uncertainty centers on what the White House considers transshipment and how US Customs and Border Protection officials would regulate goods moving from China to the US via Vietnam.

<div class="phx-topic">How the Trump administration defines and regulates transshipment in the aftermath of a proposed trade deal with Vietnam will have major implications for the top Asia sourcing alternative to China. While President Donald Trump’s announcement on July 2 clarified new tariff levels of 20% on imports from Vietnam, his statements on applying a 40% tariff on goods that originate in China but are transshipped via Vietnam have confused some in the US trade community. The uncertainty centers on what Trump considers transshipment and how US Customs officials would crack down on violations. At issue is the extent to which goods with a Vietnam country of origin designation are actually just disguised China-origin goods. Most importers define transshipment as the process of a container connecting from the port of origin to the port of destination via a third port. But the Trump administration appears to be attaching a trade compliance element to transshipment that draws considerations such as country-of-origin determination, minimum local content, and substantial transformation, trade experts told the Journal of Commerce. “On the face of it, the transshipment tariff makes no sense,” said Robert Khachatryan, CEO of Southern California-based forwarder Freight Right Global Logistics, noting that the 40% rate is still lower than US tariffs of 55% on imports sent directly from China. “Which is why I think the language in the announcement is referring to something else.” <h3>Minimum input requirement </h3>One possibility is that the administration will deem that a minimum requirement of inputs into the shipped goods must come from Vietnam, said Paul Diedrich, compliance officer at Virginia-based forwarder Ardent Global Logistics. “While this hasn’t been clearly defined, it would make logical sense,” he said. The White House, the US Trade Representative (USTR), and US Customs and Border Protection (CBP) have yet to clarify how they define transshipment. Even CBP officials are struggling to understand what the new approach means for their monitoring and inspections and await text of the agreement rather than just the announced framework, said a trade compliance officer at a major forwarder who did not want to be identified. “We don’t know if there’s going to be a regional content component,” the source said. “Let’s say 100% of the product is manufactured in Vietnam, but 100% of the components come from China. Is that going to qualify for the agreement? In the framework, they’ve agreed to the level of the tariff, but not to the content. The short answer is no one has a clue how this is going to turn out.” <h3>Tariff games </h3>The source said it’s clear that the intention of the proposed deal with Vietnam is to disincentivize goods being manufactured in China and then moved across the land border to Vietnam to get a lower tariff treatment. It may end up being less costly to source in China and pay higher tariffs depending on the freight rate differential from China. “The framework adds scrutiny for goods with ambiguous or Chinese-origin inputs that most brands wouldn’t have visibility into without access to a product network connecting them with suppliers, regulators and customers,” Amy Morgan, head of trade compliance at supply chain software provider Altana AI, wrote in a blog Monday about the Vietnam tariffs. “Brands relying on Vietnam as a final assembly point for Chinese-made components may face 40% duties if they can’t substantiate that Vietnam is the country of origin.” Khachatryan said he expects the 40% tariff would apply to “Chinese components that undergo a substantial transformation and would hitherto be treated as Vietnamese-origin imports. “This is also evidenced by a sudden increase in export inspections in Vietnam where Vietnamese customs are reportedly scrutinizing ‘Made in Vietnam’ claims,” he added. How much of this transshipment is behind the rise of US imports from Vietnam is unclear. But the direction of trade, reflecting the conventional thinking that Vietnam was generally the best hedge against dependence on China sourcing, is clear. Imports from Vietnam a decade ago accounted for 3.9% of all US oceangoing laden imports; it was 9.9% in 2024, according to PIERS, a sister company of the Journal of Commerce within S&amp;P Global. On Monday, Trump made a similar threat against South Korea, warning that Chinese goods “transshipped” through South Korea would be subject to additional tariffs beyond the 25% level announced this week. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

How the Trump administration defines and regulates transshipment in the aftermath of a proposed trade deal with Vietnam will have major implications for the top Asia sourcing alternative to China. While President Donald Trump’s announcement on July 2 clarified new tariff levels of 20% on imports from Vietnam, his statements on applying a 40% tariff on goods that originate in China but are transshipped via Vietnam have confused some in the US trade community. The uncertainty centers on what Trump considers transshipment and how US Customs officials would crack down on violations. At issue is the extent to which goods with a Vietnam country of origin designation are actually just disguised China-origin goods. Most importers define transshipment as the process of a container connecting from the port of origin to the port of destination via a third port. But the Trump administration appears to be attaching a trade compliance element to transshipment that draws considerations such as country-of-origin determination, minimum local content, and substantial transformation, trade experts told the Journal of Commerce. “On the face of it, the transshipment tariff makes no sense,” said Robert Khachatryan, CEO of Southern California-based forwarder Freight Right Global Logistics, noting that the 40% rate is still lower than US tariffs of 55% on imports sent directly from China. “Which is why I think the language in the announcement is referring to something else.” Minimum input requirement One possibility is that the administration will deem that a minimum requirement of inputs into the shipped goods must come from Vietnam, said Paul Diedrich, compliance officer at Virginia-based forwarder Ardent Global Logistics. “While this hasn’t been clearly defined, it would make logical sense,” he said. The White House, the US Trade Representative (USTR), and US Customs and Border Protection (CBP) have yet to clarify how they define transshipment. Even CBP officials are struggling to understand what the new approach means for their monitoring and inspections and await text of the agreement rather than just the announced framework, said a trade compliance officer at a major forwarder who did not want to be identified. “We don’t know if there’s going to be a regional content component,” the source said. “Let’s say 100% of the product is manufactured in Vietnam, but 100% of the components come from China. Is that going to qualify for the agreement? In the framework, they’ve agreed to the level of the tariff, but not to the content. The short answer is no one has a clue how this is going to turn out.” Tariff games The source said it’s clear that the intention of the proposed deal with Vietnam is to disincentivize goods being manufactured in China and then moved across the land border to Vietnam to get a lower tariff treatment. It may end up being less costly to source in China and pay higher tariffs depending on the freight rate differential from China. “The framework adds scrutiny for goods with ambiguous or Chinese-origin inputs that most brands wouldn’t have visibility into without access to a product network connecting them with suppliers, regulators and customers,” Amy Morgan, head of trade compliance at supply chain software provider Altana AI, wrote in a blog Monday about the Vietnam tariffs. “Brands relying on Vietnam as a final assembly point for Chinese-made components may face 40% duties if they can’t substantiate that Vietnam is the country of origin.” Khachatryan said he expects the 40% tariff would apply to “Chinese components that undergo a substantial transformation and would hitherto be treated as Vietnamese-origin imports. “This is also evidenced by a sudden increase in export inspections in Vietnam where Vietnamese customs are reportedly scrutinizing ‘Made in Vietnam’ claims,” he added. How much of this transshipment is behind the rise of US imports from Vietnam is unclear. But the direction of trade, reflecting the conventional thinking that Vietnam was generally the best hedge against dependence on China sourcing, is clear. Imports from Vietnam a decade ago accounted for 3.9% of all US oceangoing laden imports; it was 9.9% in 2024, according to PIERS, a sister company of the Journal of Commerce within S&P Global. On Monday, Trump made a similar threat against South Korea, warning that Chinese goods “transshipped” through South Korea would be subject to additional tariffs beyond the 25% level announced this week. Contact Eric Johnson at eric.johnson@spglobal.com .

Supply chain

Trump’s Vietnam ‘transshipment’ tariff puzzles US trade community

<div class="phx-topic abstract-wrapper">With two attacks on commercial vessels in recent days, including one that killed three mariners, any thought that the risk in the Red Sea was easing to the point the Suez route might be restored in the near future has vanished.</div>

With two attacks on commercial vessels in recent days, including one that killed three mariners, any thought that the risk in the Red Sea was easing to the point the Suez route might be restored in the near future has vanished.

<div class="phx-topic">With no attacks on shipping off the Yemeni coast since December — that is, until two strikes over the past three days — a feeling was taking hold among some ocean carriers that the threat posed by Houthi militants was greatly diminished. And as the threat diminished it would become more difficult for carriers to justify the diversions around southern Africa, which for the past 18 months have absorbed an estimated 10% of global capacity, extending transit times and putting carriers in a stronger position to absorb an influx of new capacity. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6040921_0.1.jpg"></img></div>Now with two attacks in recent days, including one that killed three mariners, any thought that the risk was easing to the point the Suez route might be reopened in the near future has vanished. “The dynamic in the Red Sea has changed materially as compared to expectations roughly a month ago in which there had been a growing view that Red Sea transits would start to pick up following the US-Houthi agreement and the long period in which merchant ships had not been attacked,” Jefferies wrote on July 8. While the Houthi militia may have held fire for several months, the restraint should not be taken as a sign the group’s ability to strike is diminished. Although such a conclusion could be inferred from military setbacks experienced across the network of Iran-backed militia and states such as Syria, in reality, the Houthis remain a lethal force, as they showed this week, analysts say. “The most recent Houthi attacks … allow them to demonstrate that, unlike Iran and its other proxy groups in the region, they remain undeterred by the threat of US or Israeli military confrontation,” Jack Kennedy, head of Middle East and North Africa country risk at S&amp;P Global Market Intelligence, told the Journal of Commerce Wednesday. Israel and the US have upped their strikes on rebels in Yemen in recent months. But without troops on the ground to uproot the rebels, Kennedy has been saying for more than a year that it would be extremely difficult to eliminate the group as a danger to shipping through aerial military action alone. “Houthi missile attack capabilities are highly decentralized across the territory they control,” Kennedy said. “These are unlikely to be fully replenished to levels in place prior to US-led and Israeli airstrikes, but seizures of weapons shipments in the Red Sea and the Houthis’ own industrial manufacturing capacity suggest that they will have been able to partially rebuild weapons stockpiles.” Kennedy added that the original spark for Houthi attacks on shipping — Israeli operations in Gaza — remains a core rationale for their strikes. “It is highly likely that attack attempts on vessels will continue while Israeli military operations in Gaza are ongoing,” he said. The result is an extended timeline, quite possibly into 2026, for any large-scale return to Suez routings. “With the developments over the past few days there is not much chance of a reversal back to a Suez routing for the major container lines in the short to medium term,” shipping analyst and Journal of Commerce contributor Lars Jensen wrote on LinkedIn this week. Added Kennedy: “We expect that Houthi attack activity will continue through 2025 at least.” <h3>Ongoing disruption post-COVID </h3>For ocean carriers who didn’t create the crisis and yet are largely immune from criticism for continuing the longer routings around Africa to protect their crews, ships and cargo, the crisis is part of a larger narrative of ongoing post-COVID-19 disruption, alongside basic supply and demand, underpinning market dynamics. Carriers face intense profit pressures over the next few years, with Drewry last month saying it expects industry operating profit to fall to $20 billion this year, down from over $50 billion in 2024. But the pressure would be much greater without the absorption of capacity due to the Red Sea attacks and resultant diversions. Maersk in May ruled out a return to normal Suez routings this year despite US President Donald Trump on May 6 saying the Houthis “have capitulated” and agreed to stop attacks on commercial shipping in the region. But as the new attacks clearly showed, the Houthis were just lying low, meaning the status quo of limited container ship transits through the Suez remains as entrenched as ever. Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>.</div>

With no attacks on shipping off the Yemeni coast since December — that is, until two strikes over the past three days — a feeling was taking hold among some ocean carriers that the threat posed by Houthi militants was greatly diminished. And as the threat diminished it would become more difficult for carriers to justify the diversions around southern Africa, which for the past 18 months have absorbed an estimated 10% of global capacity, extending transit times and putting carriers in a stronger position to absorb an influx of new capacity. Now with two attacks in recent days, including one that killed three mariners, any thought that the risk was easing to the point the Suez route might be reopened in the near future has vanished. “The dynamic in the Red Sea has changed materially as compared to expectations roughly a month ago in which there had been a growing view that Red Sea transits would start to pick up following the US-Houthi agreement and the long period in which merchant ships had not been attacked,” Jefferies wrote on July 8. While the Houthi militia may have held fire for several months, the restraint should not be taken as a sign the group’s ability to strike is diminished. Although such a conclusion could be inferred from military setbacks experienced across the network of Iran-backed militia and states such as Syria, in reality, the Houthis remain a lethal force, as they showed this week, analysts say. “The most recent Houthi attacks … allow them to demonstrate that, unlike Iran and its other proxy groups in the region, they remain undeterred by the threat of US or Israeli military confrontation,” Jack Kennedy, head of Middle East and North Africa country risk at S&P Global Market Intelligence, told the Journal of Commerce Wednesday. Israel and the US have upped their strikes on rebels in Yemen in recent months. But without troops on the ground to uproot the rebels, Kennedy has been saying for more than a year that it would be extremely difficult to eliminate the group as a danger to shipping through aerial military action alone. “Houthi missile attack capabilities are highly decentralized across the territory they control,” Kennedy said. “These are unlikely to be fully replenished to levels in place prior to US-led and Israeli airstrikes, but seizures of weapons shipments in the Red Sea and the Houthis’ own industrial manufacturing capacity suggest that they will have been able to partially rebuild weapons stockpiles.” Kennedy added that the original spark for Houthi attacks on shipping — Israeli operations in Gaza — remains a core rationale for their strikes. “It is highly likely that attack attempts on vessels will continue while Israeli military operations in Gaza are ongoing,” he said. The result is an extended timeline, quite possibly into 2026, for any large-scale return to Suez routings. “With the developments over the past few days there is not much chance of a reversal back to a Suez routing for the major container lines in the short to medium term,” shipping analyst and Journal of Commerce contributor Lars Jensen wrote on LinkedIn this week. Added Kennedy: “We expect that Houthi attack activity will continue through 2025 at least.” Ongoing disruption post-COVID For ocean carriers who didn’t create the crisis and yet are largely immune from criticism for continuing the longer routings around Africa to protect their crews, ships and cargo, the crisis is part of a larger narrative of ongoing post-COVID-19 disruption, alongside basic supply and demand, underpinning market dynamics. Carriers face intense profit pressures over the next few years, with Drewry last month saying it expects industry operating profit to fall to $20 billion this year, down from over $50 billion in 2024. But the pressure would be much greater without the absorption of capacity due to the Red Sea attacks and resultant diversions. Maersk in May ruled out a return to normal Suez routings this year despite US President Donald Trump on May 6 saying the Houthis “have capitulated” and agreed to stop attacks on commercial shipping in the region. But as the new attacks clearly showed, the Houthis were just lying low, meaning the status quo of limited container ship transits through the Suez remains as entrenched as ever. Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

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Container lines

Maritime

New Houthi attacks likely kill hopes of shipping returning to Red Sea this year

<div class="phx-topic abstract-wrapper">Mediterranean Shipping Co. is furthering its lead in vessel tonnage so far this year as it absorbs more than double the amount of new capacity added by No. 2 carrier Maersk. </div>

Mediterranean Shipping Co. is furthering its lead in vessel tonnage so far this year as it absorbs more than double the amount of new capacity added by No. 2 carrier Maersk.

<div class="phx-topic">Mediterranean Shipping Co. widened its already leading market share among ocean carriers as its fleet added the most ships in the first half of 2025, according to Alphaliner. Many of those new ships, though, are entering non-US trades as trans-Pacific demand appears to be ebbing for the remainder of the year. MSC’s fleet grew 5.5% in the first half, Alphaliner said in its weekly newsletter Wednesday. Only Ocean Network Express (ONE) saw a higher growth rate during that period at 5.9%, but MSC outstripped others for the most new capacity, adding some 365,173 TEUs to its fleet, Alphaliner said. The additional capacity, a combination of newbuild deliveries and acquisitions of second-hand ships, brings MSC’s total fleet to over 6.6 million TEUs, Alphaliner said. It added that MSC’s “relentless pursuit of capacity” has widened the gap with its former 2M partner Maersk, which added 170,371 TEUs during the first half of 2025 and brought its capacity to 4.5 million TEUs. “To put this into perspective, this gap [between MSC and Maersk] is equal to the entire fleet of ONE,” Alphaliner said, adding MSC is expected to take delivery of another 380,000 TEUs of newbuild capacity during the second half of 2025. Alphaliner said Maersk’s goal is not to enlarge its fleet as much as it aims to replace older vessels and make its network more efficient. It added that CMA CGM, which has the second-largest order book of new ships at 1.5 million TEUs, is “set to overtake Maersk in the coming years” in terms of fleet size. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="00f898cc-0bf5-4e4d-80d3-6db9454b1165"></dynamic-object></div><h3>Ships head to non-US markets </h3>During a speech last month to agriculture shippers, MSC’s US president, Fabio Santucci, said that while the fleet buildup may look excessive, it will head off even worse delays for shippers. Port congestion ties up about 10% of the global feet, he said, while the ongoing diversions around southern Africa absorb another 6%. MSC’s additional tonnage “is being fully absorbed and utilized and we are able to move cargo at 65% schedule reliability,” Santucci said. “Had we been more responsible financially, we would have had fewer ships, but the challenge is 50% schedule reliability.” While Santucci noted that MSC’s trans-Pacific reliability is hovering near 80%, much of the new tonnage is not currently serving US markets. Of 25 post-Panamax vessels delivered to MSC in the first half of 2025, only one — the 8,496-TEU MSC Benin — has called the US West Coast, according to satellite data from Sea-web, a sister product of the Journal of Commerce within S&amp;P Global. Santucci said MSC is seeing the most cargo growth outside the US, with South America and Africa seeing respective growth of 10% and 12% during the first half of the year. Europe is also growing “well above average,” he said. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Mediterranean Shipping Co. widened its already leading market share among ocean carriers as its fleet added the most ships in the first half of 2025, according to Alphaliner. Many of those new ships, though, are entering non-US trades as trans-Pacific demand appears to be ebbing for the remainder of the year. MSC’s fleet grew 5.5% in the first half, Alphaliner said in its weekly newsletter Wednesday. Only Ocean Network Express (ONE) saw a higher growth rate during that period at 5.9%, but MSC outstripped others for the most new capacity, adding some 365,173 TEUs to its fleet, Alphaliner said. The additional capacity, a combination of newbuild deliveries and acquisitions of second-hand ships, brings MSC’s total fleet to over 6.6 million TEUs, Alphaliner said. It added that MSC’s “relentless pursuit of capacity” has widened the gap with its former 2M partner Maersk, which added 170,371 TEUs during the first half of 2025 and brought its capacity to 4.5 million TEUs. “To put this into perspective, this gap [between MSC and Maersk] is equal to the entire fleet of ONE,” Alphaliner said, adding MSC is expected to take delivery of another 380,000 TEUs of newbuild capacity during the second half of 2025. Alphaliner said Maersk’s goal is not to enlarge its fleet as much as it aims to replace older vessels and make its network more efficient. It added that CMA CGM, which has the second-largest order book of new ships at 1.5 million TEUs, is “set to overtake Maersk in the coming years” in terms of fleet size. Ships head to non-US markets During a speech last month to agriculture shippers, MSC’s US president, Fabio Santucci, said that while the fleet buildup may look excessive, it will head off even worse delays for shippers. Port congestion ties up about 10% of the global feet, he said, while the ongoing diversions around southern Africa absorb another 6%. MSC’s additional tonnage “is being fully absorbed and utilized and we are able to move cargo at 65% schedule reliability,” Santucci said. “Had we been more responsible financially, we would have had fewer ships, but the challenge is 50% schedule reliability.” While Santucci noted that MSC’s trans-Pacific reliability is hovering near 80%, much of the new tonnage is not currently serving US markets. Of 25 post-Panamax vessels delivered to MSC in the first half of 2025, only one — the 8,496-TEU MSC Benin — has called the US West Coast, according to satellite data from Sea-web, a sister product of the Journal of Commerce within S&P Global. Santucci said MSC is seeing the most cargo growth outside the US, with South America and Africa seeing respective growth of 10% and 12% during the first half of the year. Europe is also growing “well above average,” he said. Contact Michael Angell at michael.angell@spglobal.com .

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MSC outstripping rivals on new capacity for 2025: Alphaliner

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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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