<div class="phx-topic abstract-wrapper">The verdict of Russian politicians and business leaders is already in: The new government, formed la</div>

The verdict of Russian politicians and business leaders is already in: The new government, formed la

<div>The verdict of Russian politicians and business leaders is already in: The new government, formed last week by President Boris Yeltsin and new Prime Minister Sergei Stepashin, is a collection of toadies whose dislike or fear of each other is topped only by their nervousness of Yeltsin and his family - and by their ambition to enrich themselves before their seat at the trough is taken away.''Russia is sick and tired of Yeltsin,'' editorialized one pro-business Moscow newspaper as national opinion polls reported that public approval of the president has sunk to 2 percent, with a 4 percent margin of...

The verdict of Russian politicians and business leaders is already in: The new government, formed last week by President Boris Yeltsin and new Prime Minister Sergei Stepashin, is a collection of toadies whose dislike or fear of each other is topped only by their nervousness of Yeltsin and his family - and by their ambition to enrich themselves before their seat at the trough is taken away. ''Russia is sick and tired of Yeltsin,'' editorialized one pro-business Moscow newspaper as national opinion polls reported that public approval of the president has sunk to 2 percent, with a 4 percent margin of error.''Yeltsin remains because he is convenient for everyone,'' said Alexander Lebed, the governor of Krasnoyarsk region, once a Yeltsin ally, and next year a potential presidential candidate. ''Those around him know that as long as they observe a few simple rules, they can steal everything they can.'' Yeltsin's sacking of Prime Minister Yevgeny Primakov on May 12 was opposed by more than 80 percent of Russian voters. Pollsters found that the dismissal pushed Primakov even further ahead of other candidates in next year's presidential election. But even Yeltsin allies, such as former Prime Minister Yegor Gaidar and campaign director Anatoly Chubais, have publicly expressed reservations about the quality of the men the president picked to run the Russian economy. ''It's very simple,'' a powerful metals exporter explained. ''The Yeltsin family is making sure they monopolize power over the state's cash sources and the economy's hard-currency revenues to ensure their candidate for president wins, and to protect and expand their own financial interests.'' He said it is certain Primakov's anti-corruption campaign will not be pursued, at least not in the direction of Yeltsin family members and cronies, where it was headed when Primakov was removed. The Russian press, which is owned by a handful of businessmen dubbed ''oligarchs,'' has portrayed the formation of the new government as a fierce contest between individual businessmen, such as Yeltsin-family financier Boris Berezovsky, and representatives of other interests, such as Mr. Chubais. This is an exaggeration, those engaged in the lobbying say. But they acknowledge that many signs point to a struggle for power and money that is likely to continue in Moscow for months. Most Russians and Americans in business in Moscow believe this creates a risky climate for starting up new investments, extending new trade credit, or making forward contractual commitments beyond a few months at a time. It will be almost impossible, American bankers and attorneys believe, to press effectively for collection of Russian debts. Foreign businessmen who have dealt in the past with the new interior minister, Gen. Vladimir Rushailo, say he has promised to help them when their investments have been targeted by extortion and other corruption. But they also admit he's done little yet. A Russian industry chief predicted that Rushailo may pursue corruption cases, but the targets will be political. Yeltsin challengers, especially Moscow Mayor Yury Luzhkov, will be targeted. The Kremlin's choice of Rail Minister Nikolai Aksyonenko as first deputy prime minister puts a family friend in position to oversee all policy decisions affecting import and export duties, transportation tariffs, corporate taxes, currency-export regulations, and the deposit of government cash in commercial bank accounts. This vast state cash flow is widely expected be milked. In a string of bumbling public statements, Aksyonenko has said he will follow the advice of the oligarchs, most especially Berezovsky, who arranged a lucrative job for his son. Berezovsky is using the Russian media to portray himself as the toll gate through which everyone seeking Kremlin favor should pass. Other powerful business interests in the country are opposed to Berezovsky and will compete for control of the assets and cash flow that are now up for grabs. They operate politically through regional politicians like Lebed; Luzhkov; Konstantin Titov, the governor of Samara; and Yegor Stroyev, the governor of Orel and speaker of the Russian Senate; and, of course, Chubais, mastermind of Russia's privatization schemes. Their personal feuding helped end the career of Georgy Gabounia as trade minister. He was assured by Prime Minister Stepashin that he would stay. Then Aksyonenko said he preferred Mikhail Fradkov, the former trade minister. The tax chief, Georgy Boos, was told he could keep his post, but only on condition that he severed his links with Mayor Luzhkov. He refused, and Alexander Pochinok, a former tax chief and head of the Kremlin's finance department, was appointed in his place. Control of customs revenue has also been the focus of fierce lobbying. So, too, are the posts in charge of the state stockpiles of diamonds and precious metals, of arms exports, and of state cash reserves at the Central Bank. Victor Gerashchenko, Primakov's appointee to run the Central Bank, sat down at the table for the prime minister's first Cabinet meeting last week. But he asked television cameramen not to take his picture. He can hardly remain invisible while governing Russia's international monetary policy. Berezovsky and the other oligarchs have their own candidates to replace him, so does Chubais. Gerashchenko is constitutionally protected by the Duma, the lower house of parliament, which must vote to accept his resignation and vote to approve his replacement. If and when the Yeltsin family decides it needs Central Bank cash flow, he will be forced out, even if the Duma rejects his replacement and the bank goes into temporary management. Central Bank staff are now so nervous, they will not agree to speak on the telephone. They schedule meetings away from their offices.

RUSSIA'S GOVERNMENT OF HUNGRY TOADIES

<div class="phx-topic abstract-wrapper">Fragmentation and systems that don’t “talk to each other” are holding back the effective use of data in the project cargo industry, stakeholders say.</div>

Fragmentation and systems that don’t “talk to each other” are holding back the effective use of data in the project cargo industry, stakeholders say.

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<div class="phx-topic">The slow pace of digitalization in the “super cautious” breakbulk and project logistics industry means engineering, procurement and construction (EPC) firms could be risking excess costs, more waste and less efficiency, according to EPC executives. A traditional mindset, difficulty gaining access to meaningful data and a lack of understanding around real-time large data transfers and analytics are among the factors holding back progress in a project logistics sector already heavy with fragmentation. “As an industry we don’t use data as effectively as we could do,” said Andy Young, corporate manager of logistics at Bechtel Global Logistics. Describing digitalization as a “risk topic,” he said the first challenge is getting the data from logistics services providers. “It’s better if you’re clear with them what you want the data for and how you intend to use it,” he said. Second is understanding how to handle real-time large data transfers – for example, what software and/or platform to use. “Also, integration with freight forwarders’ systems seems to be advanced, but not so with other logistics service providers,” said Young. “Being able to standardize and consolidate data across multiple logistics services providers, multiple projects, and modes of transport brings benefits.” Some project cargo forwarders allow portal access to their transportation management systems (TMSs), and some agree to data transfer. “Credit to them – they have been at the forefront of digitalization in logistics and their wider supply chain service offerings,” Young said. <h3>Fragmentation stymieing progress </h3>Brandy Aurich, vice president/global head of strategy at freight forwarder DHL Global Forwarding Industrial Projects, told the Journal of Commerce that industry fragmentation was one of the biggest challenges to digitalization. Early partnership is crucial, but shippers and forwarders are often at different stages of the digitalization journey. “If a shipper’s goal, focus, and stage in the digitalization journey are much further along than the forwarder or other suppliers, it becomes very difficult to get on the same page,” Aurich said. "On large projects, implementation moves quickly – so if you are not aligned as partners from the start, you may not have the time to get where you need to be.” Many systems don’t interact. “You have a variety of systems across the supply chain, but they don’t necessarily talk to each other,” she said. “Getting them to a point where they can communicate with each other takes significant investment, resources and time.” Aurich said there is a big gap between “wanting to be digital” and being ready and able to get there – “and that’s from both sides.” Another issue is data quality. “Is the data clean, where is that source of truth, can we trust the data?,” she said. “A shipper may provide a certain set of data, while the forwarder has another, and aligning those is critical.” A lack of expertise is also a factor. You can’t just hire a data analyst, she said; you need people who are experts in, or at least understand, project logistics and the complexities of the supply chain. Whether a company hires a project logistics specialist and trains them in data analytics, or does things the other way round, “either way it takes time, investment, and real commitment,” said Aurich. “First, look internally – do we already have people who understand project logistics and might be interested in moving into a data analyst’s role? If not, we need to be more open-minded when we are hiring data analysts or technology specialists,” she said. “Can they learn and grow in a project logistics environment? Are they willing to put in the time?” <h3>Relationships are key </h3>Young emphasized giving the right tools and support to logisticians who are being “turned into” data analysts. “You need to understand logistics, what you want to discover, what the trends are telling you,” he said. An effective strategy requires working with logistics service providers willing to partner on a digitalization journey – even if that might uncover some uncomfortable truths, Young added. “They must be willing to provide data even if it’s not ‘flattering’ to their own performance,” he said. “Fundamentally, it’s about honesty and trust, and the relationship you have with them.” The accumulation and analysis of data can drive business decisions and, more importantly, define strategy, said Young. Performance metrics can encompass areas such as container utilization, on-time status, detention, and damage ratios. Data can be used to measure logistics services providers’ performance in an ongoing project, to inform a new competitive bid, or to benchmark projects internally. Monitoring costs, volumes, locations and durations helps to identify trends and be more predictive. Consolidating data can enable accurate planning of site resources weeks in advance, including laydown allocation, labor and equipment – avoiding the scenario of having 20 people and six all-terrain cranes on site when 10 and two, respectively, would suffice. “A project trending the wrong way on pick-up times indicates a problem with the supplier, the logistics service provider or even our own project management,” Young said. “By tracking KPIs, we can see early on if there is a problem – and take action to fix it.” Contact Felicity Landon on <a href="mailto:felicity@felicitylandon.com">felicity@felicitylandon.com.</a></div>

The slow pace of digitalization in the “super cautious” breakbulk and project logistics industry means engineering, procurement and construction (EPC) firms could be risking excess costs, more waste and less efficiency, according to EPC executives. A traditional mindset, difficulty gaining access to meaningful data and a lack of understanding around real-time large data transfers and analytics are among the factors holding back progress in a project logistics sector already heavy with fragmentation. “As an industry we don’t use data as effectively as we could do,” said Andy Young, corporate manager of logistics at Bechtel Global Logistics. Describing digitalization as a “risk topic,” he said the first challenge is getting the data from logistics services providers. “It’s better if you’re clear with them what you want the data for and how you intend to use it,” he said. Second is understanding how to handle real-time large data transfers – for example, what software and/or platform to use. “Also, integration with freight forwarders’ systems seems to be advanced, but not so with other logistics service providers,” said Young. “Being able to standardize and consolidate data across multiple logistics services providers, multiple projects, and modes of transport brings benefits.” Some project cargo forwarders allow portal access to their transportation management systems (TMSs), and some agree to data transfer. “Credit to them – they have been at the forefront of digitalization in logistics and their wider supply chain service offerings,” Young said. Fragmentation stymieing progress Brandy Aurich, vice president/global head of strategy at freight forwarder DHL Global Forwarding Industrial Projects, told the Journal of Commerce that industry fragmentation was one of the biggest challenges to digitalization. Early partnership is crucial, but shippers and forwarders are often at different stages of the digitalization journey. “If a shipper’s goal, focus, and stage in the digitalization journey are much further along than the forwarder or other suppliers, it becomes very difficult to get on the same page,” Aurich said. "On large projects, implementation moves quickly – so if you are not aligned as partners from the start, you may not have the time to get where you need to be.” Many systems don’t interact. “You have a variety of systems across the supply chain, but they don’t necessarily talk to each other,” she said. “Getting them to a point where they can communicate with each other takes significant investment, resources and time.” Aurich said there is a big gap between “wanting to be digital” and being ready and able to get there – “and that’s from both sides.” Another issue is data quality. “Is the data clean, where is that source of truth, can we trust the data?,” she said. “A shipper may provide a certain set of data, while the forwarder has another, and aligning those is critical.” A lack of expertise is also a factor. You can’t just hire a data analyst, she said; you need people who are experts in, or at least understand, project logistics and the complexities of the supply chain. Whether a company hires a project logistics specialist and trains them in data analytics, or does things the other way round, “either way it takes time, investment, and real commitment,” said Aurich. “First, look internally – do we already have people who understand project logistics and might be interested in moving into a data analyst’s role? If not, we need to be more open-minded when we are hiring data analysts or technology specialists,” she said. “Can they learn and grow in a project logistics environment? Are they willing to put in the time?” Relationships are key Young emphasized giving the right tools and support to logisticians who are being “turned into” data analysts. “You need to understand logistics, what you want to discover, what the trends are telling you,” he said. An effective strategy requires working with logistics service providers willing to partner on a digitalization journey – even if that might uncover some uncomfortable truths, Young added. “They must be willing to provide data even if it’s not ‘flattering’ to their own performance,” he said. “Fundamentally, it’s about honesty and trust, and the relationship you have with them.” The accumulation and analysis of data can drive business decisions and, more importantly, define strategy, said Young. Performance metrics can encompass areas such as container utilization, on-time status, detention, and damage ratios. Data can be used to measure logistics services providers’ performance in an ongoing project, to inform a new competitive bid, or to benchmark projects internally. Monitoring costs, volumes, locations and durations helps to identify trends and be more predictive. Consolidating data can enable accurate planning of site resources weeks in advance, including laydown allocation, labor and equipment – avoiding the scenario of having 20 people and six all-terrain cranes on site when 10 and two, respectively, would suffice. “A project trending the wrong way on pick-up times indicates a problem with the supplier, the logistics service provider or even our own project management,” Young said. “By tracking KPIs, we can see early on if there is a problem – and take action to fix it.” Contact Felicity Landon on felicity@felicitylandon.com.

Breakbulk News

Logistics Technology News

Breakbulk carriers

Heavy-haul transport

Project cargo

Maritime

Slow-moving digitalization is threat to project sector progress, EPCs warn

<div class="phx-topic abstract-wrapper">The all-Scandinavian takeover will combine data sources in a move designed to bring transparency and efficiency to how ocean freight is bought and sold, Xeneta CEO Patrick Berglund says. </div>

The all-Scandinavian takeover will combine data sources in a move designed to bring transparency and efficiency to how ocean freight is bought and sold, Xeneta CEO Patrick Berglund says.

<div class="phx-topic">Rate benchmarking platform Xeneta said Monday it has acquired fellow maritime and supply chain data company eeSea, creating a combined data source meant to provide deeper insight into an increasingly disrupted container shipping market. Oslo-based Xeneta will add Copenhagen-headquartered eeSea’s global schedule, capacity, transit time and reliability data to its wide range of freight rate information and analysis across major trade lanes, Xeneta said in a statement. Financial details of the transaction were not disclosed. Xeneta CEO Patrik Berglund said the acquisition would further a shared mission by the two companies to bring transparency and efficiency to how ocean freight is bought and sold. “Our combined data sources and coverage will provide customers with more actionable intelligence to control freight spend, as well as delivery reliability,” Berglund said in the statement. Xeneta counts global shippers such as Nestlé, Volvo and Coca-Cola among the customers that use its platform. Simon Sundboell, eeSea’s founder and CEO, said he was fully onboard with Xeneta’s commitment to changing the way ocean freight is negotiated. “A true partnership between carriers and cargo owners relies not only on the freight rates paid, but also on the operational performance provided by the carrier, such as transit times, reliability, canceled sailings, weekly stability and schedule forecasting accuracy,” Sundboell said in the statement. Founded in 2015, eeSea offers insights and predictive analysis for the global container shipping industry. Combining multiple data sources and understanding historical patterns, the eeSea platform offers real-time vessel tracking and forecasting, reliability and transit time analytics and strategic insight into trade lane capacity, including canceled sailings. The Journal of Commerce has data usage deals with both Xeneta and eeSea. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Rate benchmarking platform Xeneta said Monday it has acquired fellow maritime and supply chain data company eeSea, creating a combined data source meant to provide deeper insight into an increasingly disrupted container shipping market. Oslo-based Xeneta will add Copenhagen-headquartered eeSea’s global schedule, capacity, transit time and reliability data to its wide range of freight rate information and analysis across major trade lanes, Xeneta said in a statement. Financial details of the transaction were not disclosed. Xeneta CEO Patrik Berglund said the acquisition would further a shared mission by the two companies to bring transparency and efficiency to how ocean freight is bought and sold. “Our combined data sources and coverage will provide customers with more actionable intelligence to control freight spend, as well as delivery reliability,” Berglund said in the statement. Xeneta counts global shippers such as Nestlé, Volvo and Coca-Cola among the customers that use its platform. Simon Sundboell, eeSea’s founder and CEO, said he was fully onboard with Xeneta’s commitment to changing the way ocean freight is negotiated. “A true partnership between carriers and cargo owners relies not only on the freight rates paid, but also on the operational performance provided by the carrier, such as transit times, reliability, canceled sailings, weekly stability and schedule forecasting accuracy,” Sundboell said in the statement. Founded in 2015, eeSea offers insights and predictive analysis for the global container shipping industry. Combining multiple data sources and understanding historical patterns, the eeSea platform offers real-time vessel tracking and forecasting, reliability and transit time analytics and strategic insight into trade lane capacity, including canceled sailings. The Journal of Commerce has data usage deals with both Xeneta and eeSea. Contact Greg Knowler at greg.knowler@spglobal.com .

Container Shipping News

Xeneta expands shipping data footprint with acquisition of eeSea

<div class="phx-topic abstract-wrapper">Outpost’s technology aims to answer key supply chain security questions and clarify visibility at terminal gates. </div>

Outpost’s technology aims to answer key supply chain security questions and clarify visibility at terminal gates.

<div class="phx-topic">A company building a network of <a href="https://www.joc.com/article/shipper-need-for-agility-fuels-growth-of-us-shared-terminal-trucking-network-6026788">shared terminals for trucking companies</a> and their customers is offering technology designed to overcome one of the main obstacles to supply chain visibility and security: the gate. Outpost, a company founded in 2021 to provide secure fleet yards for truck parking, on Thursday launched a gate automation platform based in part on AI. The technology is designed to identify trucks, tractors, drivers and trailer seals as a vehicle approaches the gate and then clear the vehicle to enter or decline entry. “The reality of a modern industrial gate is that it’s both a security point and an operational control point,” Greg Akselrod, chief technology officer for Outpost, told the Journal of Commerce. The security function is focused on the actual location and decides whether a tractor-trailer gets access to a facility. The operational function is more closely tied to overall supply chain visibility and integrated with Outpost’s network and the customer’s systems. “Tying all this information into one central management layer creates a level of coordination that’s an overlooked opportunity for visibility and control in the supply chain,” said Akselrod. “That creates a ton of ways to offer efficiencies and lower costs.” <h3>Working in a shared space </h3>Outpost isn’t alone in recognizing the problem with gates. Companies, including logistics provider C.H. Robinson Worldwide, are looking into ways to use AI to tackle security issues at terminal and warehouse gates and <a href="https://www.joc.com/article/ch-robinson-using-ai-to-advance-touchless-truck-scheduling-5214959">help speed truck appointments</a>. What differentiates Outpost is its terminal model, in which several trucking companies, shippers and logistics partners work together in a shared space. “We really see this as key to the fabric of interconnected terminals,” Akselrod said. However, the gate to a truck yard or distribution center or manufacturing plant often is the least automated part of a facility. The historical solution has been to put someone in a gatehouse, but that’s an increasingly inefficient solution, according to Outpost. “Our research shows that the average cost of having someone at a gate, 24/7, is about $25,000 a month,” he said, claiming automation can reduce that cost by 70%. Outpost is offering the technology to customers within its network and to those who want to install it at external facilities, Akselrod said. “We’ve had strong interest from motor carriers, shippers, distribution centers and even railroads,” he said. “The value is outsized when you have a network of facilities.” Contact William B. Cassidy at <a href="mailto://bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

A company building a network of shared terminals for trucking companies and their customers is offering technology designed to overcome one of the main obstacles to supply chain visibility and security: the gate. Outpost, a company founded in 2021 to provide secure fleet yards for truck parking, on Thursday launched a gate automation platform based in part on AI. The technology is designed to identify trucks, tractors, drivers and trailer seals as a vehicle approaches the gate and then clear the vehicle to enter or decline entry. “The reality of a modern industrial gate is that it’s both a security point and an operational control point,” Greg Akselrod, chief technology officer for Outpost, told the Journal of Commerce. The security function is focused on the actual location and decides whether a tractor-trailer gets access to a facility. The operational function is more closely tied to overall supply chain visibility and integrated with Outpost’s network and the customer’s systems. “Tying all this information into one central management layer creates a level of coordination that’s an overlooked opportunity for visibility and control in the supply chain,” said Akselrod. “That creates a ton of ways to offer efficiencies and lower costs.” Working in a shared space Outpost isn’t alone in recognizing the problem with gates. Companies, including logistics provider C.H. Robinson Worldwide, are looking into ways to use AI to tackle security issues at terminal and warehouse gates and help speed truck appointments . What differentiates Outpost is its terminal model, in which several trucking companies, shippers and logistics partners work together in a shared space. “We really see this as key to the fabric of interconnected terminals,” Akselrod said. However, the gate to a truck yard or distribution center or manufacturing plant often is the least automated part of a facility. The historical solution has been to put someone in a gatehouse, but that’s an increasingly inefficient solution, according to Outpost. “Our research shows that the average cost of having someone at a gate, 24/7, is about $25,000 a month,” he said, claiming automation can reduce that cost by 70%. Outpost is offering the technology to customers within its network and to those who want to install it at external facilities, Akselrod said. “We’ve had strong interest from motor carriers, shippers, distribution centers and even railroads,” he said. “The value is outsized when you have a network of facilities.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

Supply chain

Trucking News

Surface

Shared-terminal operator rolls out AI-based gate security platform

<div class="phx-topic abstract-wrapper">Less-than-truckload costs are up 7.3% year over year, according to the latest US data, but changes to the LTL classification system are adding little, if anything, to shipper rates. </div>

Less-than-truckload costs are up 7.3% year over year, according to the latest US data, but changes to the LTL classification system are adding little, if anything, to shipper rates.

<div class="phx-topic">Revisions to the US less-than-truckload (LTL) classification system that were expected to result in higher LTL costs have proven more of a damp squib than a high explosive. Almost a month after the <a href="https://www.joc.com/article/lack-of-accurate-data-a-threat-to-us-shippers-as-ltl-reclassification-nears-5990210">July 19 implementation</a> of the new National Motor Freight Classification (NMFC), shippers, carriers and logistics providers report little to no change in freight invoices. Carriers are reporting few complaints from customers, if any. LTL rates continue to rise, but little if any of that increase can be attributed to changes to the NMFC. The US long-distance LTL producer price index (PPI) — a measure of all-inclusive LTL costs — rose 1.7% from June to 265.45 in July, a 7.3% year-over-year gain, according to data released by the US Bureau of Labor Statistics (BLS) Thursday. LTL costs are now 15% higher than they were when the then third-largest provider Yellow collapsed in July 2023, according to the BLS PPI index, now at a record high. The fear was that the “reimagination” of the NMFC would push rates even higher. The changes to the NMFC shifted more than 2,000 products or commodities into classes determined by density alone, rather than other shipping characteristics. Although the NMFC does not set pricing, it helps determine how shipments are priced. In interviews over the past month, large shippers told the Journal of Commerce they either prepared for the revised NMFC ahead of time or that the revisions didn’t affect their freight or their business. Many used FAK (freight-all-kinds) pricing methods for LTL freight. That’s not what LTL executives expected from the biggest overhaul to the NMFC — a system of classifying commodities used to create LTL pricing structures — in its 90-year history. “Leading up to [the revisions], about two months prior, we got a lot of questions,” National Motor Freight Traffic Association (NMFTA) COO Joe Ohr told the Journal of Commerce. “But the level of preparation the industry did was amazing.” (The NMFTA oversees the NMFC).“We’re pleasantly surprised,” said Geoff Muessig, chief marketing officer at Pitt Ohio, a multi-regional LTL provider based in Pittsburgh. Pitt Ohio spent several months prepping its customers for classification changes, and Muessig expected some pricing shock. However, in the past month, “I have not seen any significant change in invoice amounts,” Muessig told the Journal of Commerce. “Customer acceptance [of the revisions] has been solid. We’ve had very few requests to make changes to price structures.” “We expected pricing adjustments, calls and complaints, but it’s been quiet for us, and many of the carriers we work with have said it’s been quite quiet,” said Mich Fabriga, vice president of LTL pricing for AFS Logistics, a third-party logistics provider. AFS Logistics handles freight bill auditing for shipper customers. Fabriga told the Journal of Commerce he has seen minor changes to billing caused by the NMFC revisions. “We’re not seeing the big uproar we were expecting” in the wake of NMFC revisions, he said. “It’s almost like a Y2K moment,” he added, referring to the much-predicted computer apocalypse that failed to materialize when 1999 ended and 2000 began. <h3>A muted marketplace </h3>There are several possible reasons why the impact of the NMFC revisions has been muted. One is that many shippers, especially large-volume shippers, did indeed prepare. “Many customers certainly did the research, they made the changes” needed to avoid price increases, said Muessig, namely providing their LTL carriers with accurate information on shipment dimensions and weight to determine density. “My take is the marketplace has absorbed the change,” he said. It’s also early in the data collection process, AFS’ Fabriga said. “It’s probably too early” to make definitive statements about the impact of the classification changes, he acknowledged. Larger shippers are also more likely to use FAK pricing embedded in their contracts to avoid relying on class-based rates, Muessig noted. The impact of the NMFC revisions may become more apparent as annual contracts come up for negotiation. FedEx Freight, the largest US LTL provider, <a href="https://www.joc.com/article/fedex-freight-delays-enforcement-of-ltl-re-classification-6047284">delayed implementing the NMFC revisions</a> until Dec. 1, giving thousands of shippers a 150-day reprieve. FedEx Freight said shippers needed more time to get ready for the new classifications. But the rest of the LTL sector did not automatically follow suit. “In terms of the [NMFC] changes, look, we’re not backing down on the implementation,” Matthew Batteh, CFO at Saia, told Wall Street analysts during a July 25 earnings call. Saia runs 75% of its freight through equipment that captures shipment dimensions every day, Batteh said. “We sell space on our trailers, and this aligns more of the book to be density-based,” he said. “We’ve invested heavily in dimensioners for that exact reason.” <h3>Absorbing change </h3>Others have questioned whether LTL carriers would enforce changes that could raise rates in a soft LTL freight market. “Carriers aren’t being very strict about it,” said Satish Jindel, president of SJ Consulting Group, a transportation research firm. “Many carriers aren’t set up to capture dimensions and shippers aren’t set up to supply dimensions,” Jindel said. “They both are not letting go of the old system.” It’s also not clear that carriers have much to gain by pushing shippers — especially large customers that provide high volumes of freight in critical lanes. Smaller shippers with low LTL volumes and irregular shipping are most likely absorbing higher costs, but as they deal with increased costs related to higher US tariffs, the NMFC revisions may be the least of their worries. “When we say improve your packaging to improve density, that sounds like an easy ask, but it’s actually not,” Fabriga said. “You often simply can’t add or subtract product to adjust the size of your shipment,” he added. “The cost of offsetting the change can be higher than the revised rate itself.” Contact William B. Cassidy at <a href="mailto://bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

Revisions to the US less-than-truckload (LTL) classification system that were expected to result in higher LTL costs have proven more of a damp squib than a high explosive. Almost a month after the July 19 implementation of the new National Motor Freight Classification (NMFC), shippers, carriers and logistics providers report little to no change in freight invoices. Carriers are reporting few complaints from customers, if any. LTL rates continue to rise, but little if any of that increase can be attributed to changes to the NMFC. The US long-distance LTL producer price index (PPI) — a measure of all-inclusive LTL costs — rose 1.7% from June to 265.45 in July, a 7.3% year-over-year gain, according to data released by the US Bureau of Labor Statistics (BLS) Thursday. LTL costs are now 15% higher than they were when the then third-largest provider Yellow collapsed in July 2023, according to the BLS PPI index, now at a record high. The fear was that the “reimagination” of the NMFC would push rates even higher. The changes to the NMFC shifted more than 2,000 products or commodities into classes determined by density alone, rather than other shipping characteristics. Although the NMFC does not set pricing, it helps determine how shipments are priced. In interviews over the past month, large shippers told the Journal of Commerce they either prepared for the revised NMFC ahead of time or that the revisions didn’t affect their freight or their business. Many used FAK (freight-all-kinds) pricing methods for LTL freight. That’s not what LTL executives expected from the biggest overhaul to the NMFC — a system of classifying commodities used to create LTL pricing structures — in its 90-year history. “Leading up to [the revisions], about two months prior, we got a lot of questions,” National Motor Freight Traffic Association (NMFTA) COO Joe Ohr told the Journal of Commerce. “But the level of preparation the industry did was amazing.” (The NMFTA oversees the NMFC). “We’re pleasantly surprised,” said Geoff Muessig, chief marketing officer at Pitt Ohio, a multi-regional LTL provider based in Pittsburgh. Pitt Ohio spent several months prepping its customers for classification changes, and Muessig expected some pricing shock. However, in the past month, “I have not seen any significant change in invoice amounts,” Muessig told the Journal of Commerce. “Customer acceptance [of the revisions] has been solid. We’ve had very few requests to make changes to price structures.” “We expected pricing adjustments, calls and complaints, but it’s been quiet for us, and many of the carriers we work with have said it’s been quite quiet,” said Mich Fabriga, vice president of LTL pricing for AFS Logistics, a third-party logistics provider. AFS Logistics handles freight bill auditing for shipper customers. Fabriga told the Journal of Commerce he has seen minor changes to billing caused by the NMFC revisions. “We’re not seeing the big uproar we were expecting” in the wake of NMFC revisions, he said. “It’s almost like a Y2K moment,” he added, referring to the much-predicted computer apocalypse that failed to materialize when 1999 ended and 2000 began. A muted marketplace There are several possible reasons why the impact of the NMFC revisions has been muted. One is that many shippers, especially large-volume shippers, did indeed prepare. “Many customers certainly did the research, they made the changes” needed to avoid price increases, said Muessig, namely providing their LTL carriers with accurate information on shipment dimensions and weight to determine density. “My take is the marketplace has absorbed the change,” he said. It’s also early in the data collection process, AFS’ Fabriga said. “It’s probably too early” to make definitive statements about the impact of the classification changes, he acknowledged. Larger shippers are also more likely to use FAK pricing embedded in their contracts to avoid relying on class-based rates, Muessig noted. The impact of the NMFC revisions may become more apparent as annual contracts come up for negotiation. FedEx Freight, the largest US LTL provider, delayed implementing the NMFC revisions until Dec. 1, giving thousands of shippers a 150-day reprieve. FedEx Freight said shippers needed more time to get ready for the new classifications. But the rest of the LTL sector did not automatically follow suit. “In terms of the [NMFC] changes, look, we’re not backing down on the implementation,” Matthew Batteh, CFO at Saia, told Wall Street analysts during a July 25 earnings call. Saia runs 75% of its freight through equipment that captures shipment dimensions every day, Batteh said. “We sell space on our trailers, and this aligns more of the book to be density-based,” he said. “We’ve invested heavily in dimensioners for that exact reason.” Absorbing change Others have questioned whether LTL carriers would enforce changes that could raise rates in a soft LTL freight market. “Carriers aren’t being very strict about it,” said Satish Jindel, president of SJ Consulting Group, a transportation research firm. “Many carriers aren’t set up to capture dimensions and shippers aren’t set up to supply dimensions,” Jindel said. “They both are not letting go of the old system.” It’s also not clear that carriers have much to gain by pushing shippers — especially large customers that provide high volumes of freight in critical lanes. Smaller shippers with low LTL volumes and irregular shipping are most likely absorbing higher costs, but as they deal with increased costs related to higher US tariffs, the NMFC revisions may be the least of their worries. “When we say improve your packaging to improve density, that sounds like an easy ask, but it’s actually not,” Fabriga said. “You often simply can’t add or subtract product to adjust the size of your shipment,” he added. “The cost of offsetting the change can be higher than the revised rate itself.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

US LTL rates still rising after muted response to shipment reclassification

<div class="phx-topic abstract-wrapper">Mediterranean Shipping Co. is adding new calls to West Africa on its South Africa service as former alliance partner Maersk pulls out of direct services from the continent.</div>

Mediterranean Shipping Co. is adding new calls to West Africa on its South Africa service as former alliance partner Maersk pulls out of direct services from the continent.

<div class="phx-topic">Mediterranean Shipping Co. is expanding its South Africa-US East Coast service to cover some West African ports, a move that comes as Maersk plans to vacate its direct Africa service and the continent faces new US tariffs.MSC said this week the South Africa direct service it announced in May would now include a northbound call at the Ivory Coast’s Port of San-Pedro, while the southbound rotation would include a call at Togo’s Port of Lomé starting Oct. 1. The US rotation would include the ports of New York and New Jersey, Baltimore and Savannah, along with a seasonal call at Philadelphia and transshipment at Freeport in the Bahamas. The service will use a rotation of eight ships, along with four additional ships available to ensure schedule consistency. MSC’s expansion of direct call services from Africa to the US comes as one-time alliance partner Maersk plans to discontinue its Amex service between South Africa and the US East Coast in October. Amex’s end will leave transshipping African goods through Europe as the only option on Maersk services. The service expansion also leverages MSC’s terminal network throughout Africa, which expanded with the 2021 purchase of the <a href="https://www.joc.com/article/msc-offers-6-billion-for-bollors-african-terminal-assets-5228988">Bollore Group’s portfolio of 16 marine terminals on the continent</a>. MSC’s Terminal Investment Ltd. (TiL) runs Lomé’s largest marine terminal and operates the main cocoa export terminal in the Ivory Coast.<h3>MSC leads US-Africa market share </h3>The container trade between Africa and North America is still small, with only 120,972 TEUs of imports from Africa to the US for all of 2024, according to PIERS, a sister product of the Journal of Commerce within S&amp;P Global. MSC vessels handled 48% of that volume, while Maersk was second at 38%. US exports to Africa totaled 280,097 TEUs last year, with MSC handling 37% of that share and Maersk 33%. Those market shares have become even more lopsided this year due to frontloading. Through Aug. 15, MSC handled 54% of African exports to the US, while Maersk had a 34% share. The second quarter saw volumes from Africa jump 24% from the first quarter, according to PIERS data. The Trump administration has targeted South Africa with a 30% tariff rate that began Aug. 7. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Mediterranean Shipping Co. is expanding its South Africa-US East Coast service to cover some West African ports, a move that comes as Maersk plans to vacate its direct Africa service and the continent faces new US tariffs. MSC said this week the South Africa direct service it announced in May would now include a northbound call at the Ivory Coast’s Port of San-Pedro, while the southbound rotation would include a call at Togo’s Port of Lomé starting Oct. 1. The US rotation would include the ports of New York and New Jersey, Baltimore and Savannah, along with a seasonal call at Philadelphia and transshipment at Freeport in the Bahamas. The service will use a rotation of eight ships, along with four additional ships available to ensure schedule consistency. MSC’s expansion of direct call services from Africa to the US comes as one-time alliance partner Maersk plans to discontinue its Amex service between South Africa and the US East Coast in October. Amex’s end will leave transshipping African goods through Europe as the only option on Maersk services. The service expansion also leverages MSC’s terminal network throughout Africa, which expanded with the 2021 purchase of the Bollore Group’s portfolio of 16 marine terminals on the continent . MSC’s Terminal Investment Ltd. (TiL) runs Lomé’s largest marine terminal and operates the main cocoa export terminal in the Ivory Coast. MSC leads US-Africa market share The container trade between Africa and North America is still small, with only 120,972 TEUs of imports from Africa to the US for all of 2024, according to PIERS, a sister product of the Journal of Commerce within S&P Global. MSC vessels handled 48% of that volume, while Maersk was second at 38%. US exports to Africa totaled 280,097 TEUs last year, with MSC handling 37% of that share and Maersk 33%. Those market shares have become even more lopsided this year due to frontloading. Through Aug. 15, MSC handled 54% of African exports to the US, while Maersk had a 34% share. The second quarter saw volumes from Africa jump 24% from the first quarter, according to PIERS data. The Trump administration has targeted South Africa with a 30% tariff rate that began Aug. 7. Contact Michael Angell at michael.angell@spglobal.com .

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At SSA Marine Mexico, we firmly believe that business development must go hand in hand with social and environmental well-being. Our vision is not solely focused on operating efficiently, but also on creating a meaningful and positive impact in the communities where we are present. Since 1995, we have reaffirmed this commitment through tangible actions that reflect our core values of responsibility, solidarity, and sustainability. <span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-3_2 joc_admin__inline-image-position-left joc_admin__inline-image-size-medium" data-figure-size="medium" data-figure-position="left" data-figure-aspect-ratio="3:2"><img src="/content-assets/1752584535914_Photo%201.jpg" alt="" class="joc_admin__inline-image-inherit"> A Year of Major Achievements Over the past year, we allocated more than $107,000 USD to the implementation of 60 social and environmental projects, positively impacting over 7,800 people across various regions of Mexico. Each initiative was designed with a holistic approach, addressing key areas that contribute to long-term community development. Education: Laying the Foundation for the Future Education is one of the most powerful tools to promote social mobility and equitable development. At SSA Marine Mexico, we support academic initiatives that inspire and empower the next generation of leaders. One of our most impactful partnerships was with the University of Colima, where we sponsored the “Reto Camp” program. This initiative encourages university students to develop innovative solutions in the fields of sustainability, logistics, and port operations, offering them mentorship, tools, and real-world challenges to solve. In addition, we donated microscopes, school supplies, and educational materials to institutions in underserved communities, helping to improve the learning environment and provide students with the resources they need to succeed. Health and Sports: Promoting Wellness We believe that healthy communities are strong communities. We have supported several local sporting events and provided direct assistance to talented athletes, enabling them to pursue their passions and represent their regions with pride. Beyond sports, we also strengthened our collaboration with critical emergency response organizations such as the Mexican Red Cross and Civil Protection. Our contributions helped enhance their readiness and capabilities in times of crisis, ensuring better outcomes for those affected by emergencies. Supporting Vulnerable Groups: Reaching Those Who Need It Most A core part of our social responsibility efforts is directed toward supporting vulnerable populations. We have contributed to a range of initiatives focused on children, migrants, and at-risk families. These efforts included donations to orphanages and shelters, as well as support for the National Institute of Migration and grassroots organizations dedicated to protecting and empowering people facing adversity. By standing with those in need, we reinforce our commitment to inclusion and social justice, values that are central to our identity as a responsible company. <span class="joc_admin__inline-image joc_admin__inline-image-aspect-ratio-3_2 joc_admin__inline-image-position-left joc_admin__inline-image-size-medium" data-figure-size="medium" data-figure-position="left" data-figure-aspect-ratio="3:2"><img src="/content-assets/1752584944645_Photo%202.png" alt="" class="joc_admin__inline-image-inherit">Culture: Strengthening Community Identity Cultural identity is a key element in building resilient and united communities. At SSA Marine Mexico, we actively participate in the organization and sponsorship of cultural events that celebrate local traditions and foster civic pride. Working alongside port authorities and municipal governments, we helped bring music, art, and heritage to the forefront, creating spaces for community engagement and intercultural dialogue. Environment: Investing in the Planet Our commitment to sustainability goes beyond operations—it’s a philosophy that drives every decision we make. We have partnered with environmental institutions to carry out reforestation campaigns, beach cleanups, and conservation efforts. In collaboration with the Institute for the Environment, we supported initiatives aimed at decarbonization, biodiversity protection, and environmental education. By involving our employees and local volunteers in these actions, we also foster a culture of environmental stewardship throughout our organization and our surrounding communities. Innovation for a Sustainable Future Sustainability is not just about doing good—it’s also about doing things better. In 2024, we invested $22 million USD in the acquisition of 11 state-of-the-art E-RTG cranes. These electric rubber-tired gantry cranes represent a significant technological advancement in port equipment. Seven of them are already operating on clean electric energy, resulting in a reduction of nearly 4,000 tons of CO₂ emissions and improving operational efficiency by 7%. The remaining four cranes are fully compatible with future electrification, underscoring our long-term strategy to modernize our operations in an environmentally responsible way. This investment is part of a broader innovation roadmap that includes digitalization, automation, and cleaner energy sources—all designed to ensure that our ports continue to grow without compromising the health of our planet. Building a Better Tomorrow, Together At SSA Marine Mexico, we understand that sustainability is a shared and ongoing responsibility. True impact requires collaboration across sectors, long-term vision, and unwavering commitment. That is why we continue to work hand-in-hand with local authorities, non-profit organizations, universities, and our own employees to create solutions that are both scalable and sustainable. Our journey is far from over. In the years ahead, we will continue to deepen our community engagement, explore cleaner technologies, and strengthen the social fabric of the regions where we operate. Each initiative, no matter the size, is a step toward building a future where business success goes hand-in-hand with human and environmental prosperity. We are proud of what we have achieved in 2024, but we are even more excited about what lies ahead. SSA Marine Mexico — Moving the World, Caring for People and Planet. LINK: https://www.ssamarine.mx/

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