<div class="phx-topic abstract-wrapper">Rainbow Cruises Inc. sweetened its buy-out offer for Regency Cruises Inc. by 15 cents a share, raisi</div>

Rainbow Cruises Inc. sweetened its buy-out offer for Regency Cruises Inc. by 15 cents a share, raisi

<div>Rainbow Cruises Inc. sweetened its buy-out offer for Regency Cruises Inc. by 15 cents a share, raising the total value to $2.30 a share, Regency announced last week.Regency has until Aug. 20 to respond to the revised offer of $1.50 in cash plus 80 cents in subordinated notes for each Regency share. The subordinated note portion of the offer was raised from 65 cents.Regency, active in the New England-Canada and Alaska markets, predicted it will enjoy a profitable third quarter after reporting a $240,000 loss for the second quarter ended June 30. Regency attributed the quarterly loss, compared with net...

Rainbow Cruises Inc. sweetened its buy-out offer for Regency Cruises Inc. by 15 cents a share, raising the total value to $2.30 a share, Regency announced last week. Regency has until Aug. 20 to respond to the revised offer of $1.50 in cash plus 80 cents in subordinated notes for each Regency share. The subordinated note portion of the offer was raised from 65 cents.Regency, active in the New England-Canada and Alaska markets, predicted it will enjoy a profitable third quarter after reporting a $240,000 loss for the second quarter ended June 30. Regency attributed the quarterly loss, compared with net income of $337,000 for the same quarter last year, to the effects of the Persian Gulf war. "The crisis in the Middle East precipitated a downturn in travel, which occurred during the prime booking period for our cruises in the second quarter," said William Schanz, chairman and chief executive officer, in a prepared statement. "Achieving reasonable load factors for these sailings then became difficult and costly, thereby inhibiting our financial performance for the three months ended June 30, 1991." But Mr. Schanz added that the end of the gulf war stimulated cruise sales, particularly for destinations close to the United States, such as Alaska and Canada. "We are very pleased with the progress our Alaska and New England-Canada cruises are making. Both programs, currently under way, are virtually sold out for the remainder of their schedules and should, therefore, generate a profitable third quarter." Regency claims to be the third largest cruise operator in the Alaska market. Second-quarter revenue was $30.7 million, compared with $29.6 million for the same period last year. For the first half of 1991, Regency posted a net loss of $3.3 million, compared with a net loss of $1.7 million for the year-earlier period.

Maritime

RAINBOW HIKES OFFER FOR REGENCY CRUISES

<div class="phx-topic abstract-wrapper">Global jet fuel prices have almost doubled since the Middle East war began on Feb. 28, piling additional expenses onto an operating component that before the conflict was already more than 30% of total costs.</div>

Global jet fuel prices have almost doubled since the Middle East war began on Feb. 28, piling additional expenses onto an operating component that before the conflict was already more than 30% of total costs.

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<div class="phx-topic">Rising energy prices are placing growing pressure on air freighter operators with the soaring cost of jet fuel eroding margins and pushing part of the global fleet closer toward economic unviability. Global jet fuel prices have almost doubled since the Middle East war began on Feb. 28, piling additional expenses onto an operating component that before the conflict was already more than 30% of total costs. “For less efficient aircraft like the B747-400F, the math is getting tight,” Rotate analyst Archisman Acharya noted in a report. “Global average profitability is approaching breakeven, and on lanes without strong yield growth, margins have already turned negative.” The B747-400 freighter accounts for a significant share of global freighter capacity, with the trans-Pacific the most exposed trade lane at 22%. During the last comparable fuel spike in 2022, Acharya said global B747-400F capacity declined 12%. While the price of jet fuel has risen sharply, concerns are now growing over its availability, particularly in Asia. China and Thailand have suspended their jet fuel exports, impacting neighbor Vietnam which imports two-thirds of its supply from the two countries. With its fuel spigot turned off, Vietnam’s aviation authority last week announced cuts in domestic flights and may suspend charters. Elsewhere, refueling restrictions are being imposed in South Korea, while the Philippines has declared a "national energy emergency" and may start grounding flights. Platts, a sister company of the Journal of Commerce within S&amp;P Global, pegged the flat price for jet fuel in Northwest Europe delivered via cargo at a record high of $1,842.50 per metric ton on Thursday, up $232.25 on the day. “Since the war broke out, jet fuel prices have been about twice last year's levels and have broken previous records multiple times,” Platts said in a commentary. <h3>Fast resolution to conflict needed </h3>Niall van de Wouw, chief air freight officer at rate benchmarking platform Xeneta, said in a market update Thursday that air cargo stakeholders were pinning their hopes on a fast resolution to the Middle East conflict. “Tariffs created uncertainty but the fallout here is bigger because of the cost of jet fuel, the potential energy crisis and inflation growth,” he said. “Right now, the air cargo market is suffering from a supply issue, and this will be resolved, but the longer this recovery takes is going to determine if it becomes a much bigger demand issue. “Whether air freight benefits or suffers in the longer-term is down to the length of the conflict and its outcomes,” van de Wouw added. He said cities like Dubai and Doha occupied strategic midpoints between the Americas, Asia and Europe, and have served as the growth engine behind the rise of super-connector airlines such as Emirates, Etihad and Qatar Airways. But their geographic advantage has now become a strategic vulnerability with hub airports in the war zone becoming victims of the conflict. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="9012e6fb-929b-4707-8282-a10521bcf60e"></dynamic-object></div>Five weeks into the war, air cargo capacity in the region remains roughly 30% below pre-conflict levels, and the squeeze in supply is showing up in rates. Global air cargo spot rates in March surpassed 2025 peak-season levels, reaching $2.86 per kilogram, their highest since December 2024, van de Wouw said. “Will the increase in fuel prices dampen demand for air freight? Not immediately, but if this conflict continues in the longer term, then definitely yes because the world would be facing a much broader economic issue,” he said. Data from Xeneta shows the rate impact has been sharpest on outbound corridors from South Asia and Southeast Asia to the Middle East. Spot rates surged 50% to 100% in the week ended March 29 compared to just four weeks prior. The spike reflected a convergence of pressures: severe capacity shortages from heavy reliance on Middle Eastern carriers, near-doubled jet fuel costs, and newly added war-risk surcharges. Spot rates from Southeast Asia and South Asia to Europe followed similar trajectories, given Middle Eastern carriers' dominance on those routes. By contrast, Northeast Asia-Europe lanes held up comparatively better as airlines deployed more direct flights to compensate. Rising fuel costs have pushed air freight rates from Northeast Asia and Southeast Asia to North America up by mid- to high double digits. South Asia-North America rates surged even higher, up approximately 75%, again driven by Middle Eastern carriers' significant share of that corridor, Xeneta data showed. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com.</a></div>

Rising energy prices are placing growing pressure on air freighter operators with the soaring cost of jet fuel eroding margins and pushing part of the global fleet closer toward economic unviability. Global jet fuel prices have almost doubled since the Middle East war began on Feb. 28, piling additional expenses onto an operating component that before the conflict was already more than 30% of total costs. “For less efficient aircraft like the B747-400F, the math is getting tight,” Rotate analyst Archisman Acharya noted in a report. “Global average profitability is approaching breakeven, and on lanes without strong yield growth, margins have already turned negative.” The B747-400 freighter accounts for a significant share of global freighter capacity, with the trans-Pacific the most exposed trade lane at 22%. During the last comparable fuel spike in 2022, Acharya said global B747-400F capacity declined 12%. While the price of jet fuel has risen sharply, concerns are now growing over its availability, particularly in Asia. China and Thailand have suspended their jet fuel exports, impacting neighbor Vietnam which imports two-thirds of its supply from the two countries. With its fuel spigot turned off, Vietnam’s aviation authority last week announced cuts in domestic flights and may suspend charters. Elsewhere, refueling restrictions are being imposed in South Korea, while the Philippines has declared a "national energy emergency" and may start grounding flights. Platts, a sister company of the Journal of Commerce within S&P Global, pegged the flat price for jet fuel in Northwest Europe delivered via cargo at a record high of $1,842.50 per metric ton on Thursday, up $232.25 on the day. “Since the war broke out, jet fuel prices have been about twice last year's levels and have broken previous records multiple times,” Platts said in a commentary. Fast resolution to conflict needed Niall van de Wouw, chief air freight officer at rate benchmarking platform Xeneta, said in a market update Thursday that air cargo stakeholders were pinning their hopes on a fast resolution to the Middle East conflict. “Tariffs created uncertainty but the fallout here is bigger because of the cost of jet fuel, the potential energy crisis and inflation growth,” he said. “Right now, the air cargo market is suffering from a supply issue, and this will be resolved, but the longer this recovery takes is going to determine if it becomes a much bigger demand issue. “Whether air freight benefits or suffers in the longer-term is down to the length of the conflict and its outcomes,” van de Wouw added. He said cities like Dubai and Doha occupied strategic midpoints between the Americas, Asia and Europe, and have served as the growth engine behind the rise of super-connector airlines such as Emirates, Etihad and Qatar Airways. But their geographic advantage has now become a strategic vulnerability with hub airports in the war zone becoming victims of the conflict. Five weeks into the war, air cargo capacity in the region remains roughly 30% below pre-conflict levels, and the squeeze in supply is showing up in rates. Global air cargo spot rates in March surpassed 2025 peak-season levels, reaching $2.86 per kilogram, their highest since December 2024, van de Wouw said. “Will the increase in fuel prices dampen demand for air freight? Not immediately, but if this conflict continues in the longer term, then definitely yes because the world would be facing a much broader economic issue,” he said. Data from Xeneta shows the rate impact has been sharpest on outbound corridors from South Asia and Southeast Asia to the Middle East. Spot rates surged 50% to 100% in the week ended March 29 compared to just four weeks prior. The spike reflected a convergence of pressures: severe capacity shortages from heavy reliance on Middle Eastern carriers, near-doubled jet fuel costs, and newly added war-risk surcharges. Spot rates from Southeast Asia and South Asia to Europe followed similar trajectories, given Middle Eastern carriers' dominance on those routes. By contrast, Northeast Asia-Europe lanes held up comparatively better as airlines deployed more direct flights to compensate. Rising fuel costs have pushed air freight rates from Northeast Asia and Southeast Asia to North America up by mid- to high double digits. South Asia-North America rates surged even higher, up approximately 75%, again driven by Middle Eastern carriers' significant share of that corridor, Xeneta data showed. Contact Greg Knowler at greg.knowler@spglobal.com.

Air Cargo Forwarder News

Air Cargo Carriers News

Air Cargo

Fast-rising jet fuel costs challenging freighter viability as war enters second month

<div class="phx-topic abstract-wrapper">That comes as the Singapore-based regional carrier outlined a strategic restructuring of its overall operations, including scaling down trade coverage across its key intra-Asia trade territories.</div>

That comes as the Singapore-based regional carrier outlined a strategic restructuring of its overall operations, including scaling down trade coverage across its key intra-Asia trade territories.

<div class="phx-topic">Singapore-based carrier SeaLead has acknowledged that its services calling at ports in the Middle East war zone were experiencing challenges and that it is assessing contingency measures for all cargo on board affected vessels. “The operational situation may result in broader disruptions, including potential equipment shortages and the use of alternative, more secure routing options,” the liner told customers in an advisory Thursday. As part of that strategy, the carrier is said to have already flushed out the inventory of empty equipment it was holding in India. “SeaLead is handling fewer fresh bookings, mostly for Jeddah [Saudi Arabia] port of discharge only,” a Mumbai-based freight forwarder told the Journal of Commerce. “The operations and customer service are presently in a sort of limbo.” <h3>‘Strategic restructuring’ </h3>That comes as SeaLead outlined a strategic restructuring of its overall operations, including scaling down trade coverage across its key intra-Asia trade territories. “In response to recent market developments and conditions, SeaLead will undertake strategic restructuring to streamline its operations,” it said in an internal communique viewed by the Journal of Commerce. “As part of this realignment, SeaLead will reduce its network coverage in Indonesia, Korea, Morocco, Thailand, Vietnam and selected locations in China.” The regional liner also said it will work through calibrated office transitions in those regions, while adding that honoring contractual commitments and maintaining service reliability will be a priority. “SeaLead values the continued support of its employees, customers, vendors and other stakeholders during this transition period,” it said. Speculation has been growing about the future of SeaLead after the heavy fleet blow it suffered last year due to the <a href="https://www.joc.com/article/new-us-sanctions-on-iran-cut-sealeads-vessel-fleet-by-one-third-6055714">abrupt termination of 16 of its vessel charterparties</a>, an issue linked to US sanctions on entities with connections to the Iranian government. The action effectively removed one-third of the 53 ships SeaLead had in its fleet, according to available data. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com.</a></div>

Singapore-based carrier SeaLead has acknowledged that its services calling at ports in the Middle East war zone were experiencing challenges and that it is assessing contingency measures for all cargo on board affected vessels. “The operational situation may result in broader disruptions, including potential equipment shortages and the use of alternative, more secure routing options,” the liner told customers in an advisory Thursday. As part of that strategy, the carrier is said to have already flushed out the inventory of empty equipment it was holding in India. “SeaLead is handling fewer fresh bookings, mostly for Jeddah [Saudi Arabia] port of discharge only,” a Mumbai-based freight forwarder told the Journal of Commerce. “The operations and customer service are presently in a sort of limbo.” ‘Strategic restructuring’ That comes as SeaLead outlined a strategic restructuring of its overall operations, including scaling down trade coverage across its key intra-Asia trade territories. “In response to recent market developments and conditions, SeaLead will undertake strategic restructuring to streamline its operations,” it said in an internal communique viewed by the Journal of Commerce. “As part of this realignment, SeaLead will reduce its network coverage in Indonesia, Korea, Morocco, Thailand, Vietnam and selected locations in China.” The regional liner also said it will work through calibrated office transitions in those regions, while adding that honoring contractual commitments and maintaining service reliability will be a priority. “SeaLead values the continued support of its employees, customers, vendors and other stakeholders during this transition period,” it said. Speculation has been growing about the future of SeaLead after the heavy fleet blow it suffered last year due to the abrupt termination of 16 of its vessel charterparties , an issue linked to US sanctions on entities with connections to the Iranian government. The action effectively removed one-third of the 53 ships SeaLead had in its fleet, according to available data. Contact Bency Mathew at bencyvmathew@gmail.com.

Port News

Container lines

International ports

Container Shipping News

SeaLead warns of network disruptions in Persian Gulf war zone

<div class="phx-topic abstract-wrapper">The comments by the US Secretary of State heighten the Trump administration’s involvement a week after the top federal maritime regulator flagged the ship detentions. </div>

The comments by the US Secretary of State heighten the Trump administration’s involvement a week after the top federal maritime regulator flagged the ship detentions.

<div class="phx-topic">The Trump administration Thursday escalated its concern over the recent detention of Panama-flagged vessels at Chinese ports, with Secretary of State Marco Rubio saying the practice, “raise(s) serious concerns about the use of economic tools to undermine the rule of law...” Rubio’s comments come a week after Laura DiBella, chairman of the Federal Maritime Commission, said the agency was “closely monitoring” an apparent “surge” in detentions of Panama-flag ships by Chinese port authorities and the effect it could have on US container trade. “Detentions, delays, or other impediments to the movement of vessels undermine the stability of global supply chains, increase costs for businesses and consumers, and erode confidence in the international trading system,” Rubio said in a statement. Similar to DiBella, Rubio linked the Chinese activity against the vessels to retaliation for the Panamanian Supreme Court recently nullifying the operating concessions at Panama’s Balboa and Cristóbal ports held by Panama Ports Company (PPC), which is 90% owned by Hong Kong-based conglomerate CK Hutchison Holdings. Hutchison held the operating concessions at the two ports for 28 years. Striking back after the ruling, Hutchison  filed an international arbitration claim against the Panamanian government and Panama Maritime Authority (PMA), seeking more than $2 billion in damages. China’s Cosco Shipping Lines earlier this month halted calls at Balboa, redirecting its services to Manzanillo on the Atlantic side of the canal. Cosco and Hong Kong-based OOCL operate nearly one-fifth of the trans-Pacific capacity that transits the canal, according to data from benchmarking platform Xeneta’s eeSea. Panama’s move against Hutchison came a year after US President Donald Trump threatened to take over the canal if Panama did not rid itself of Chinese influence. <a href="mailto:News@joc.com">News@joc.com.</a></div>

The Trump administration Thursday escalated its concern over the recent detention of Panama-flagged vessels at Chinese ports, with Secretary of State Marco Rubio saying the practice, “raise(s) serious concerns about the use of economic tools to undermine the rule of law...” Rubio’s comments come a week after Laura DiBella, chairman of the Federal Maritime Commission, said the agency was “closely monitoring” an apparent “surge” in detentions of Panama-flag ships by Chinese port authorities and the effect it could have on US container trade. “Detentions, delays, or other impediments to the movement of vessels undermine the stability of global supply chains, increase costs for businesses and consumers, and erode confidence in the international trading system,” Rubio said in a statement. Similar to DiBella, Rubio linked the Chinese activity against the vessels to retaliation for the Panamanian Supreme Court recently nullifying the operating concessions at Panama’s Balboa and Cristóbal ports held by Panama Ports Company (PPC), which is 90% owned by Hong Kong-based conglomerate CK Hutchison Holdings. Hutchison held the operating concessions at the two ports for 28 years. Striking back after the ruling, Hutchison  filed an international arbitration claim against the Panamanian government and Panama Maritime Authority (PMA), seeking more than $2 billion in damages. China’s Cosco Shipping Lines earlier this month halted calls at Balboa, redirecting its services to Manzanillo on the Atlantic side of the canal. Cosco and Hong Kong-based OOCL operate nearly one-fifth of the trans-Pacific capacity that transits the canal, according to data from benchmarking platform Xeneta’s eeSea. Panama’s move against Hutchison came a year after US President Donald Trump threatened to take over the canal if Panama did not rid itself of Chinese influence. News@joc.com.

Trans-Pacific

Rubio, in escalation, criticizes China for detaining Panama-flag ships

<div class="phx-topic abstract-wrapper">Kurt Slocombe will guide the Western Canadian port in completing a transload and logistics facility while attempting to create a boom in commodity exports and recover volume share lost during the COVID-19 pandemic. </div>

Kurt Slocombe will guide the Western Canadian port in completing a transload and logistics facility while attempting to create a boom in commodity exports and recover volume share lost during the COVID-19 pandemic.

<div class="phx-topic">The Prince Rupert Port Authority (PRPA) has promoted one of its executives to become the agency’s next president and CEO, it announced Thursday. Kurt Slocombe joined the PRPA in 2019 as vice president of operations, planning and infrastructure. But his ties to Prince Rupert go back to 2007, when he took on management roles at the then newly revamped Fairview Container Terminal. As head of the PRPA, Slocombe will guide the port in completing a transload and logistics facility, channeling a boom in commodity exports and recovering volume share lost during the COVID-19 pandemic. Slocombe has served as PRPA’s interim president since his predecessor, Shaun Stevenson, left at the end of 2025. “Kurt’s understanding of our operations and long-standing commitment to the Prince Rupert community qualify him to lead the team,” Peter Lantin, chairman of the PRPA’s board of directors, said in a statement. Container volumes, including empties, through Prince Rupert jumped 20% year over year in 2025 to 885,797 TEUs. Prince Rupert and Vancouver grew their combined volumes 19.8% year over year in the 2025 fourth quarter, while volumes through US West Coast ports fell 10.1% during the same period, according to a February analysis by Sea-Intelligence Maritime Analysis. “The recovery was led by Prince Rupert, which saw a 46.1% surge in Q4 volume,” Sea-Intelligence said. “The data suggests that the ‘reverse diversion’ trend of 2024 was a temporary risk-mitigation strategy; as US frontloaded demand cooled, shippers returned discretionary cargo to Canadian ports in (the fourth quarter).” <a href="mailto:News@joc.com">News@joc.com.</a></div>

The Prince Rupert Port Authority (PRPA) has promoted one of its executives to become the agency’s next president and CEO, it announced Thursday. Kurt Slocombe joined the PRPA in 2019 as vice president of operations, planning and infrastructure. But his ties to Prince Rupert go back to 2007, when he took on management roles at the then newly revamped Fairview Container Terminal. As head of the PRPA, Slocombe will guide the port in completing a transload and logistics facility, channeling a boom in commodity exports and recovering volume share lost during the COVID-19 pandemic. Slocombe has served as PRPA’s interim president since his predecessor, Shaun Stevenson, left at the end of 2025. “Kurt’s understanding of our operations and long-standing commitment to the Prince Rupert community qualify him to lead the team,” Peter Lantin, chairman of the PRPA’s board of directors, said in a statement. Container volumes, including empties, through Prince Rupert jumped 20% year over year in 2025 to 885,797 TEUs. Prince Rupert and Vancouver grew their combined volumes 19.8% year over year in the 2025 fourth quarter, while volumes through US West Coast ports fell 10.1% during the same period, according to a February analysis by Sea-Intelligence Maritime Analysis. “The recovery was led by Prince Rupert, which saw a 46.1% surge in Q4 volume,” Sea-Intelligence said. “The data suggests that the ‘reverse diversion’ trend of 2024 was a temporary risk-mitigation strategy; as US frontloaded demand cooled, shippers returned discretionary cargo to Canadian ports in (the fourth quarter).” News@joc.com.

North American ports

Marine terminals

Veteran PRPA, Fairview terminal executive to lead Prince Rupert port

<div class="phx-topic abstract-wrapper">While the price of fuel has historically served as a tailwind for modal conversion, in and of itself, it is insufficient to guarantee success, writes Ted Prince.</div>

While the price of fuel has historically served as a tailwind for modal conversion, in and of itself, it is insufficient to guarantee success, writes Ted Prince.

<div class="phx-topic">Rising diesel prices have given encouragement to intermodal enthusiasts who view this as preceding inevitable success. Yes, fuel disproportionately increases truck cost-per-mile more than rail; however, this optimism is not new — it has been extant since the fuel crises of 1973 and 1979. While the price of fuel has historically served as a tailwind for modal conversion, in and of itself, it is insufficient to guarantee success. Intermodal success ultimately depends less on fuel and more on demand patterns, balance, drayage dynamics and loading characteristics. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6198450_0.1.jpg"></img></div>Microeconomics states that substitute goods are perceived by consumers as similar. They have the same or similar performance characteristics, have the same or similar occasion for use, and they are sold in the same geographic area. Whereas trucks can go anywhere, intermodal cannot, so while truck can always substitute for intermodal, the converse is not true. Intermodal has a lower cost-per-mile than truck; however, it has a higher fixed cost. So a general rule-of-thumb is that intermodal is cheaper for long distances. This threshold frequently varies between 600 and 1,200 miles. Intermodal also results in lower emissions. Unfortunately, this aspect seems less important than in the past. (Most shippers’ sense of green is cost.) Intermodal, like truckload, has been subject to a number of inflationary pressures. And while many are similar, they vary in their materiality to delivered cost. Rather, when considering how intermodal competes with truckload, you need to consider the nature of the cargo, specifically: demand, balance and load configuration. Is volume the same day in and day out throughout the year? If so, it will be very attractive to truck that puts a premium on closely aligning supply and demand. The more asymmetrical the demand, the better it is for intermodal to absorb the surge and withstand the trough. The time frame can be anywhere from seasonal to day-of-the-week. Consider a shipper with 10 loads per week. Are there two loads every weekday or one on Wednesday, two on Thursday and seven on Friday? The latter is much more attractive to intermodal. Loaded vs. empty miles Traffic balance reflects the difference in loaded and empty miles over the portfolio of loads. Markets that are imbalanced command a pricing premium to compensate for evacuation of capacity to or from the next load. The greater the imbalance, the greater the premium charged on the loaded portion. Loaded miles generate revenue; empty miles do not. However, for trucks, empty miles cost almost as much as loaded miles. Traditionally, there is a much wider cost disparity in intermodal loaded and empty cost. This is attributable more to rail pricing. In an extreme case, intermodal can support 100% empty miles. Examples would include Chicago-Boston (load-empty) and Los Angeles-Chicago (empty-load). Although intermodal can withstand empty imbalance more effectively than truck, there is an additional balance issue for the intermodal drayage pickup/delivery. The same truck economics apply, so a drayage round trip with two loads will have a lower cost than one that is empty in one direction. Rail miles are usually greater than truck miles. This extra time and distance increases door-to-door transit times versus a more direct truck route, slowing intermodal shipments. Also, whereas truck is always a straight line, intermodal has three distinct segments. Terminal location and schedules determine the effective rail market area. Having to dray in the opposite direction of the freight is a challenge. (e.g., Cargo from Cedar Rapids trucked east to Chicago to go west to Los Angeles.) The final factor is how the load and customer interface are configured — and its impact on drayage. A 2,000-mile length of haul will entail 72 to 96 hours for a single driver, who may well be sleeping in their truck when hours of service expire. However, a drayage move is only three to five hours. When considered as a percentage of their transaction time, multiple hours spent at the dock may be acceptable to the truck driver but not the intermodal drayman. The same intermodal obstacle applies to multiple stops. And in some cases, the multiple stops may be extended over hundreds of miles. Intermodal’s sweet spot is a single-stop drop-and-hook move. Live loading (“stay with”) is more problematic for the drayage driver, and “first come-first served” is even more dreaded. This reduces the addressable market suitable for conversion. There is no doubt that fuel prices will help intermodal volume; however, the successful operators will be those that recognize intermodal’s strong suits and play to them. Customers looking for truck alternatives will find collaborative ways to make their cargo work for intermodal. That will ensure a growth future. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at <a href="mailto:ted@tricitiesintermodal.com">ted@tricitiesintermodal.com.</a></div>

Rising diesel prices have given encouragement to intermodal enthusiasts who view this as preceding inevitable success. Yes, fuel disproportionately increases truck cost-per-mile more than rail; however, this optimism is not new — it has been extant since the fuel crises of 1973 and 1979. While the price of fuel has historically served as a tailwind for modal conversion, in and of itself, it is insufficient to guarantee success. Intermodal success ultimately depends less on fuel and more on demand patterns, balance, drayage dynamics and loading characteristics. Microeconomics states that substitute goods are perceived by consumers as similar. They have the same or similar performance characteristics, have the same or similar occasion for use, and they are sold in the same geographic area. Whereas trucks can go anywhere, intermodal cannot, so while truck can always substitute for intermodal, the converse is not true. Intermodal has a lower cost-per-mile than truck; however, it has a higher fixed cost. So a general rule-of-thumb is that intermodal is cheaper for long distances. This threshold frequently varies between 600 and 1,200 miles. Intermodal also results in lower emissions. Unfortunately, this aspect seems less important than in the past. (Most shippers’ sense of green is cost.) Intermodal, like truckload, has been subject to a number of inflationary pressures. And while many are similar, they vary in their materiality to delivered cost. Rather, when considering how intermodal competes with truckload, you need to consider the nature of the cargo, specifically: demand, balance and load configuration. Is volume the same day in and day out throughout the year? If so, it will be very attractive to truck that puts a premium on closely aligning supply and demand. The more asymmetrical the demand, the better it is for intermodal to absorb the surge and withstand the trough. The time frame can be anywhere from seasonal to day-of-the-week. Consider a shipper with 10 loads per week. Are there two loads every weekday or one on Wednesday, two on Thursday and seven on Friday? The latter is much more attractive to intermodal. Loaded vs. empty miles Traffic balance reflects the difference in loaded and empty miles over the portfolio of loads. Markets that are imbalanced command a pricing premium to compensate for evacuation of capacity to or from the next load. The greater the imbalance, the greater the premium charged on the loaded portion. Loaded miles generate revenue; empty miles do not. However, for trucks, empty miles cost almost as much as loaded miles. Traditionally, there is a much wider cost disparity in intermodal loaded and empty cost. This is attributable more to rail pricing. In an extreme case, intermodal can support 100% empty miles. Examples would include Chicago-Boston (load-empty) and Los Angeles-Chicago (empty-load). Although intermodal can withstand empty imbalance more effectively than truck, there is an additional balance issue for the intermodal drayage pickup/delivery. The same truck economics apply, so a drayage round trip with two loads will have a lower cost than one that is empty in one direction. Rail miles are usually greater than truck miles. This extra time and distance increases door-to-door transit times versus a more direct truck route, slowing intermodal shipments. Also, whereas truck is always a straight line, intermodal has three distinct segments. Terminal location and schedules determine the effective rail market area. Having to dray in the opposite direction of the freight is a challenge. (e.g., Cargo from Cedar Rapids trucked east to Chicago to go west to Los Angeles.) The final factor is how the load and customer interface are configured — and its impact on drayage. A 2,000-mile length of haul will entail 72 to 96 hours for a single driver, who may well be sleeping in their truck when hours of service expire. However, a drayage move is only three to five hours. When considered as a percentage of their transaction time, multiple hours spent at the dock may be acceptable to the truck driver but not the intermodal drayman. The same intermodal obstacle applies to multiple stops. And in some cases, the multiple stops may be extended over hundreds of miles. Intermodal’s sweet spot is a single-stop drop-and-hook move. Live loading (“stay with”) is more problematic for the drayage driver, and “first come-first served” is even more dreaded. This reduces the addressable market suitable for conversion. There is no doubt that fuel prices will help intermodal volume; however, the successful operators will be those that recognize intermodal’s strong suits and play to them. Customers looking for truck alternatives will find collaborative ways to make their cargo work for intermodal. That will ensure a growth future. Ted Prince is founder and CEO of Tri-Cities Intermodal LLC. Contact him at ted@tricitiesintermodal.com.

Truckload

North-American rail

International rail

Surface

Jump in diesel prices alone not enough to boost intermodal fortunes – analyst

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Monthly publication providing an editorial deep dive into global supply chain news

Journal of Commerce Magazine - Rectangle Box

Journal of Commerce Magazine

A premium access index of savings using domestic intermodal vs. OTR 

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Intermodal Savings Index

An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

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Breakbulk Quarterly

An extensive dashboard of charts organized by trade lane, mode, and topic

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Gateway

Customers scoring their intermodal partners to identify the best service providers

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Intermodal Service Scorecard

A premium access outlook critical to shippers and transportation providers

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Quarterly Intelligence

The only editorially independent conference for the breakbulk & project cargo industry

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The Journal of Commerce is the industry’s source for maritime news and analysis about ocean container shipping, logistics, supply chains, global shipping ports, shipping technology solutions and end-to-end connectivity. Coverage tracks the movement of containerized cargo — from origin to destination — handled by marine terminals in the US and abroad, depots, container ports, container lines, drayage, consignees and shippers, forwarders, non-vessel operating common carriers (NVOs) and off-dock warehousing providers, as well as pricing, capacity, volume and reliability on the trans-Pacific, Asia–Europe, North America–Caribbean, Central and South American and intra-Asia trades.

Discover comprehensive trucking news and trends with Journal of Commerce - from trucking LTL to regulation and trucking supply and demand.

Breakbulk News shipping | Journal of Commerce

Breakbulk News

Container shipping news and analysis of ocean container shipping, logistics, supply chains, technology and end-to-end connectivity.

Container Shipping News | Journal of Commerce

Stay informed on port news worldwide with Journal of Commerce. From decarbonization to labor updates, get insights on global developments.

Port News | Journal of Commerce

News and analysis of ocean containerized cargo movement, logistics, supply chains, technology, and end-to-end connectivity. Maritime news and analysis of containerized ocean cargo movement, breakbulk and roll-on and roll-off shipping from origin to destination.

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