<div class="phx-topic abstract-wrapper">SOMETIMES IT SEEMS THE GOVERNMENT and industries pepper us with more economic statistics than we kno</div>

SOMETIMES IT SEEMS THE GOVERNMENT and industries pepper us with more economic statistics than we kno

<div>SOMETIMES IT SEEMS THE GOVERNMENT and industries pepper us with more economic statistics than we know what to do with. Each quarter, the gross national product statistics are upgraded three times as new data come in. The estimates usually change only fractionally, but fractions of trillions of dollars can be billions of dollars.Meanwhile, the two major monthly reports on retail sales, one from retailers, the other from the government, are confusing. The large department store chains report their retail sales shortly after each month's end. They compare them with their sales of the same month a year earlier.A week or...

SOMETIMES IT SEEMS THE GOVERNMENT and industries pepper us with more economic statistics than we know what to do with. Each quarter, the gross national product statistics are upgraded three times as new data come in. The estimates usually change only fractionally, but fractions of trillions of dollars can be billions of dollars. Meanwhile, the two major monthly reports on retail sales, one from retailers, the other from the government, are confusing. The large department store chains report their retail sales shortly after each month's end. They compare them with their sales of the same month a year earlier.A week or so after the retailers report their sales, the government estimates the same month's retail sales but compares them with those of the month before. These figures include auto sales and are seasonally adjusted. Just to complicate matters, the automakers report their sales three times a month and compare them with sales in the similar period a year earlier. Confusing as this information may be, it all has a purpose. These statistics tell investors, economists, businessmen, government officials and the public something they want to know. But they all have their limitations. Some statistics give a better picture of what happened most recently; others are better for tracking longer-term trends or forecasting. These statistics are an economist's bread and butter. Economists look for the reasons behind any revisions and change their own forecasts accordingly. Lacy Hunt, economist at Philadelphia-based investment advisers CM&M Group Inc., saw a silver lining when the government lowered its estimate of the GNP for the fourth quarter of 1986. A plunge in business inventories played a large part in the government's 0.4 percentage point cut in its estimate of the growth rate for the fourth quarter. Mr. Hunt says the inventory reduction means businesses can increase production and hire new employees in response to any pickup in underlying demand, particularly to any improvement in the international trade flows." For its part, Columbia University's Center for International Business Cycle Research produces four different leading indexes of economic activity while the U.S. Department of Commerce issues only one, Dr. Geoffrey H. Moore, director, points out. The different retail sales figures are useful, he says. If they're seasonally adjusted, as the government's are, it's less necessary to compare them with sales of a year before. The retailers look at their own individual sales, so they don't adjust them for seasonal variations. The month-to-month retail sales figures are the most up-to-date, Mr. Moore notes. Those compared with a year before are sometimes at a disadvantage if important changes have occurred over a year that make the earlier figures less relevant. Columbia's center uses a six-month smoothed rate of retail sales, comparing the latest month's sales with the average for the preceding 12 months. "This irons out a lot of irregularities," Mr. Moore says. That's also the principle behind The Journal of Commerce's daily industrial materials price index. The JofC's smoothed percentage change is an annual rate based on the ratio of the current day's index to the average over the preceding 250 working days, or roughly a calendar year. Mr. Moore helped in the preparation of the JofC's index. That's all the explanation required. To keep investors and economists ahead of the game, the government and industries should keep sending everything they've got.

SORTING ECONOMIC DATA

<div class="phx-topic abstract-wrapper">Lower LTL volumes are likely in the coming months, but pricing remains elevated, according to producer price index data. </div>

Lower LTL volumes are likely in the coming months, but pricing remains elevated, according to producer price index data.

Feature image

<div class="phx-topic">Soft demand for less-than-truckload (LTL) freight and service in the US appears poised to get even softer, as publicly owned LTL providers prepare to release mid-quarter market reports. Shippers should expect volumes to vary across carriers, but pricing is likely to stay at its current elevated levels, with the US long-distance LTL producer price index (PPI) at 259 for the past three months, a record high and about 5% higher than a year ago. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="9014abeb-369b-4328-97ae-ee1793647b6e"></dynamic-object></div>Shipments and tonnage both decreased year over year in May at Old Dominion Freight Line (ODFL), the <a href="https://www.joc.com/article/journal-of-commerce-rankings-us-ltl-sector-defies-soft-demand-regains-traction-6010008">second-largest US LTL trucking company</a>, ODFL said Wednesday. ODFL reported an 8.4% decrease in LTL tonnage and a 6.8% drop in LTL shipments per day Revenue fell 5.8% year over year in May, but LTL revenue per hundredweight, excluding fuel surcharges, rose 5.6%. ODFL remains one of the most disciplined LTL carriers when it comes to pricing, and its operating ratio — a measure of profitability — is in the 70s. A drop in LTL revenue, or shipments, may not point to a broader market slump, but may reflect a carrier’s refusal to lower rates to get freight at the expense of profitability. Last year, the aggregate LTL shipment count among the Top 25 LTL Carriers rose 2.5%. The drop in demand ODFL saw in May comes as US manufacturers cope with high input inventories and fluctuations in orders as vendors frontload freight to avoid high US tariffs. Industrial manufacturing makes up the bulk of LTL freight in the US. The S&amp;P Global Purchasing Managers’ Index (PMI) rose to 52 in May, up from 50.2 in April and the fifth straight month the PMI has been above 50, the breaking point dividing expansion from contraction. But that’s not necessarily a sign of industrial health. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="56be088e-5b54-4d09-add3-f841e65711ec"></dynamic-object></div>“The rise in the PMI during May masks worrying developments under the hood of the US manufacturing economy,” said Chris Williamson, S&amp;P Global’s chief business economist. “While growth of new orders picked up and suppliers were reportedly busier as companies built up their inventory levels at an unprecedented rate, the common theme was a temporary surge in demand as manufacturers and their customers worry about supply issues and rising prices,” Williamson said in a statement this week. That surge in demand and inventories also coincides with frontloading of goods from China and elsewhere during a pair of 90-day pauses on higher US tariffs, pauses that will expire in July and August, barring further extensions or the successful negotiation of trade deals. While the S&amp;P Global monthly US Manufacturing PMI has shown tepid expansion in 2025, the Institute for Supply Management (ISM) PMI has been in contraction for four months, dropping 0.2 percentage point in May to 48.5. The ISM inventories index dropped into contraction after three positive months as businesses completed frontloading of goods ahead of tariffs, ISM said. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

Soft demand for less-than-truckload (LTL) freight and service in the US appears poised to get even softer, as publicly owned LTL providers prepare to release mid-quarter market reports. Shippers should expect volumes to vary across carriers, but pricing is likely to stay at its current elevated levels, with the US long-distance LTL producer price index (PPI) at 259 for the past three months, a record high and about 5% higher than a year ago. Shipments and tonnage both decreased year over year in May at Old Dominion Freight Line (ODFL), the second-largest US LTL trucking company , ODFL said Wednesday. ODFL reported an 8.4% decrease in LTL tonnage and a 6.8% drop in LTL shipments per day Revenue fell 5.8% year over year in May, but LTL revenue per hundredweight, excluding fuel surcharges, rose 5.6%. ODFL remains one of the most disciplined LTL carriers when it comes to pricing, and its operating ratio — a measure of profitability — is in the 70s. A drop in LTL revenue, or shipments, may not point to a broader market slump, but may reflect a carrier’s refusal to lower rates to get freight at the expense of profitability. Last year, the aggregate LTL shipment count among the Top 25 LTL Carriers rose 2.5%. The drop in demand ODFL saw in May comes as US manufacturers cope with high input inventories and fluctuations in orders as vendors frontload freight to avoid high US tariffs. Industrial manufacturing makes up the bulk of LTL freight in the US. The S&P Global Purchasing Managers’ Index (PMI) rose to 52 in May, up from 50.2 in April and the fifth straight month the PMI has been above 50, the breaking point dividing expansion from contraction. But that’s not necessarily a sign of industrial health. “The rise in the PMI during May masks worrying developments under the hood of the US manufacturing economy,” said Chris Williamson, S&P Global’s chief business economist. “While growth of new orders picked up and suppliers were reportedly busier as companies built up their inventory levels at an unprecedented rate, the common theme was a temporary surge in demand as manufacturers and their customers worry about supply issues and rising prices,” Williamson said in a statement this week. That surge in demand and inventories also coincides with frontloading of goods from China and elsewhere during a pair of 90-day pauses on higher US tariffs, pauses that will expire in July and August, barring further extensions or the successful negotiation of trade deals. While the S&P Global monthly US Manufacturing PMI has shown tepid expansion in 2025, the Institute for Supply Management (ISM) PMI has been in contraction for four months, dropping 0.2 percentage point in May to 48.5. The ISM inventories index dropped into contraction after three positive months as businesses completed frontloading of goods ahead of tariffs, ISM said. Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Surface

Weak US industrial activity casts cold light on LTL demand outlook

<div class="phx-topic abstract-wrapper">Larger components are pushing handling boundaries with an increasing number of locations too small to accommodate growing cargo sizes.</div>

Larger components are pushing handling boundaries with an increasing number of locations too small to accommodate growing cargo sizes.

<div class="phx-topic">The increasing size and complexity of project cargoes are demanding increasingly sophisticated engineering solutions and pushing the boundaries of transport capabilities, project cargo experts say.Speaking to the Journal of Commerce, Hagen Hennig, technical director at dteq Transport Engineering Solutions, described project cargo as “getting more engineering-heavy.” Where dteq only needed two engineers to support the group at start up, the company now counts 50-plus engineers. “That’s a good indication of how the cargo and the project requirements have evolved,” Hennig said. He also noted the impact of that growth on multipurpose vessel capabilities. “Vessels need to be stronger to accommodate these larger cargoes, which can be seen in the increase in crane capacities and the growing fleet of deck carriers,” Hennig said.Cosmatos Group last year moved the largest cargo it had moved in its 53-year history, handling a 690-ton, nine-meter-high component. Elisabeth Cosmatos, CEO of Cosmatos Group and president of The Heavy Lift Group (THLG), described the move as a “milestone,” but also a challenge. There is also a growing emphasis on technical know-how, with Hennig noting the transport engineering mindset in clients is increasing. “It is not only about having the best product, it is also about being able to transport that product safely and cost efficiently to its destination,” he said.Hennig stressed the role of engineering in expanding possibilities. “With engineering you can always push boundaries further,” he said, giving the example of regular transportation of 1000-plus-ton nacelles for the wind energy market that were unimaginable previously. <h3>Infrastructure limitations pose challenges</h3>Still, both Hennig and colleague Boris Dykiert, commercial director with dteq Transport Engineering Solutions, acknowledged inherent limitations. “It’s important to consider the existing infrastructure and environment too,” Dykiert said. “For example, it is already very difficult to get out of some ports in Europe to [the] site with the latest generation of wind blades due to tight turns.” Hennig added that there is a limit to maximum size depending on available infrastructure.“If the project is next to the port and that port is deep with good moorings, that helps,” he said. “But the last mile needs to be there, too. That will determine the maximum cargo envelope.”Speaking on a panel at Breakbulk Europe in mid-May, Richard Kaladji, head of the project logistics department at Air Liquide, affirmed the trend of increasing cargo sizes and underlined the heightened risks involved. “Today, the challenge is greater as you cannot mess up,” he said. “You have to validate the solution many times as the stakes are higher with larger cargoes.”Contact Carly Fields at <a href="mailto:carly.fields@spglobal.com">carly.fields@spglobal.com</a>.</div>

The increasing size and complexity of project cargoes are demanding increasingly sophisticated engineering solutions and pushing the boundaries of transport capabilities, project cargo experts say. Speaking to the Journal of Commerce, Hagen Hennig, technical director at dteq Transport Engineering Solutions, described project cargo as “getting more engineering-heavy.” Where dteq only needed two engineers to support the group at start up, the company now counts 50-plus engineers. “That’s a good indication of how the cargo and the project requirements have evolved,” Hennig said. He also noted the impact of that growth on multipurpose vessel capabilities. “Vessels need to be stronger to accommodate these larger cargoes, which can be seen in the increase in crane capacities and the growing fleet of deck carriers,” Hennig said. Cosmatos Group last year moved the largest cargo it had moved in its 53-year history, handling a 690-ton, nine-meter-high component. Elisabeth Cosmatos, CEO of Cosmatos Group and president of The Heavy Lift Group (THLG), described the move as a “milestone,” but also a challenge. There is also a growing emphasis on technical know-how, with Hennig noting the transport engineering mindset in clients is increasing. “It is not only about having the best product, it is also about being able to transport that product safely and cost efficiently to its destination,” he said. Hennig stressed the role of engineering in expanding possibilities. “With engineering you can always push boundaries further,” he said, giving the example of regular transportation of 1000-plus-ton nacelles for the wind energy market that were unimaginable previously. Infrastructure limitations pose challenges Still, both Hennig and colleague Boris Dykiert, commercial director with dteq Transport Engineering Solutions, acknowledged inherent limitations. “It’s important to consider the existing infrastructure and environment too,” Dykiert said. “For example, it is already very difficult to get out of some ports in Europe to [the] site with the latest generation of wind blades due to tight turns.” Hennig added that there is a limit to maximum size depending on available infrastructure. “If the project is next to the port and that port is deep with good moorings, that helps,” he said. “But the last mile needs to be there, too. That will determine the maximum cargo envelope.” Speaking on a panel at Breakbulk Europe in mid-May, Richard Kaladji, head of the project logistics department at Air Liquide, affirmed the trend of increasing cargo sizes and underlined the heightened risks involved. “Today, the challenge is greater as you cannot mess up,” he said. “You have to validate the solution many times as the stakes are higher with larger cargoes.” Contact Carly Fields at carly.fields@spglobal.com .

Energy projects

Project cargo

Breakbulk News

Growing project cargo scale testing transport limitations, but driving innovation

<div class="phx-topic abstract-wrapper">The carrier continues to ramp up its non-ocean businesses that were acquired from Performance Team with the lease of a new warehouse located about 10 miles from the Port of Philadelphia.</div>

The carrier continues to ramp up its non-ocean businesses that were acquired from Performance Team with the lease of a new warehouse located about 10 miles from the Port of Philadelphia.

<div class="phx-topic">Maersk has added to its North American portfolio with the lease of one of the largest warehouses in southern New Jersey. The move comes as Maersk flagged better growth in its warehousing and related businesses during its most recent earnings release. Maersk confirmed media reports that it leased the 1.2 million-square-foot Box Park Logistics Center, located about 10 miles from the Port of Philadelphia and approximately 80 miles from the Port of New York and New Jersey. The facility, built in 2023, has 215 dock doors and can be expanded by another 300,000 square feet. The region where the warehouse is located has seen new construction plummet amid increasing industrial property vacancies in the Northeast US. Commercial realtor CBRE said in May that new warehouse construction in the south New Jersey-Philadelphia metro region totaled 11.6 million square feet in the first quarter of 2025, down 25.3% from the fourth quarter of 2024. Vacancy rates for warehouses in the Northeast reached 7.6% in the first quarter, compared with about 3% in 2022, marking 12 quarters of increasing vacancy rates. Maersk said in its first-quarter earnings release that it expects vacancy rates to remain close to the long-term 7% average as new construction better matches demand. Maersk’s fulfillment business, comprised mostly of the <a href="https://www.joc.com/article/maersk-acquisition-deepens-north-american-warehouse-reach-5213428">former Performance Team business</a>, saw first-quarter revenue fall 7% to $1.32 billion as it reorganized its last-mile and middle-mile business in North America. However, Maersk Chief Executive Vincent Clerc said the company’s warehousing and e-commerce fulfillment “increased in volumes with growth in new customers.” Maersk’s contract logistics business was also more profitable in the 2025 first quarter, with operating profit margin reaching 4.1% from 1.5% a year earlier. Clerc said warehousing and e-commerce fulfillment helped drive the better results. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Maersk has added to its North American portfolio with the lease of one of the largest warehouses in southern New Jersey. The move comes as Maersk flagged better growth in its warehousing and related businesses during its most recent earnings release. Maersk confirmed media reports that it leased the 1.2 million-square-foot Box Park Logistics Center, located about 10 miles from the Port of Philadelphia and approximately 80 miles from the Port of New York and New Jersey. The facility, built in 2023, has 215 dock doors and can be expanded by another 300,000 square feet. The region where the warehouse is located has seen new construction plummet amid increasing industrial property vacancies in the Northeast US. Commercial realtor CBRE said in May that new warehouse construction in the south New Jersey-Philadelphia metro region totaled 11.6 million square feet in the first quarter of 2025, down 25.3% from the fourth quarter of 2024. Vacancy rates for warehouses in the Northeast reached 7.6% in the first quarter, compared with about 3% in 2022, marking 12 quarters of increasing vacancy rates. Maersk said in its first-quarter earnings release that it expects vacancy rates to remain close to the long-term 7% average as new construction better matches demand. Maersk’s fulfillment business, comprised mostly of the former Performance Team business , saw first-quarter revenue fall 7% to $1.32 billion as it reorganized its last-mile and middle-mile business in North America. However, Maersk Chief Executive Vincent Clerc said the company’s warehousing and e-commerce fulfillment “increased in volumes with growth in new customers.” Maersk’s contract logistics business was also more profitable in the 2025 first quarter, with operating profit margin reaching 4.1% from 1.5% a year earlier. Clerc said warehousing and e-commerce fulfillment helped drive the better results. Contact Michael Angell at michael.angell@spglobal.com .

Maritime

Container Shipping News

Port News

Port infrastructure

Container lines

Maersk’s contract logistics business adds New Jersey warehouse

<div class="phx-topic abstract-wrapper">Adding to recent capacity cutbacks, the carrier has redeployed vessels serving its premier Himalaya Express service between India, Europe and the Mediterranean onto Asian trades.</div>

Adding to recent capacity cutbacks, the carrier has redeployed vessels serving its premier Himalaya Express service between India, Europe and the Mediterranean onto Asian trades.

<div class="phx-topic">More signs are emerging of mainline operators with larger Indian market share strategically adjusting their networks amid a rush of cargo bookings out of China that is already testing supply chains at many Asian hub ports. Adding to recent capacity cutbacks on the India-US East Coast trade, Mediterranean Shipping Co. has redeployed vessels serving its premier Himalaya Express (HEX) service between India, Europe and the Mediterranean onto Asian trades, updated schedule data obtained by the Journal of Commerce shows. Out of five upcoming HEX sailings already declared for berthing at India’s Nhava Sheva Port through early July, four vessels have their origin load ports in China, reflecting large-scale cargo relay plans. For example, the MSC Sindy, due to dock at Nhava Sheva on June 5, has made calls to Shanghai, Ningbo and Singapore in what is evidently an ad-hoc rotation. “We are now seeing a lot of impromptu changes for MSC services out of India, with vessels swapped out and port calls rejigged,” a Mumbai-based freight forwarder who did not want to be identified told the Journal of Commerce. “The Asia surge seems to be driving that capacity shakeup.” Sources also noted that the Geneva-based liner is considering adding Vizhinjam Port in southern India to the HEX rotation, likely for the interim to support resurgent transshipment volumes, beginning with the MSC Nairobi X due to arrive in Nhava Sheva on June 9. With multiple changes in the cards, the service will now cover Nhava Sheva, Mundra, Vizhinjam, Sines, Valencia, Gioia Tauro, Genoa, Barcelona and Malaga, the sources said. The weekly HEX has long used a fleet of large-size vessels — averaging 15,000 TEUs in capacity — with a strong schedule reliability track record. MSC recently reset the HEX berthing window in Nhava Sheva by shifting calls from the DP World terminal to PSA International’s facility for greater operational flexibility. Additionally, MSC’s IPAK service (India-Europe) has no sailing in the current week, port berthing data indicates. Sliding vessel schedules extend to other Indian networks. A South India/North Europe/Mediterranean/Oceania loop run jointly by MSC and CMA CGM, branded as the Australia Express and NEWMO, respectively, has voided direct calls to Ennore Port (Chennai) in late May, tightening capacity out of the region that has fewer long-haul network options. “Space issues have started for bookings to Europe and we expect westbound rates to move up,” a Chennai-based forwarder said. MSC and CMA CGM have already rolled $800 per container into West India-Europe spot pricing from this week, sources said. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>.</div>

More signs are emerging of mainline operators with larger Indian market share strategically adjusting their networks amid a rush of cargo bookings out of China that is already testing supply chains at many Asian hub ports. Adding to recent capacity cutbacks on the India-US East Coast trade, Mediterranean Shipping Co. has redeployed vessels serving its premier Himalaya Express (HEX) service between India, Europe and the Mediterranean onto Asian trades, updated schedule data obtained by the Journal of Commerce shows. Out of five upcoming HEX sailings already declared for berthing at India’s Nhava Sheva Port through early July, four vessels have their origin load ports in China, reflecting large-scale cargo relay plans. For example, the MSC Sindy, due to dock at Nhava Sheva on June 5, has made calls to Shanghai, Ningbo and Singapore in what is evidently an ad-hoc rotation. “We are now seeing a lot of impromptu changes for MSC services out of India, with vessels swapped out and port calls rejigged,” a Mumbai-based freight forwarder who did not want to be identified told the Journal of Commerce. “The Asia surge seems to be driving that capacity shakeup.” Sources also noted that the Geneva-based liner is considering adding Vizhinjam Port in southern India to the HEX rotation, likely for the interim to support resurgent transshipment volumes, beginning with the MSC Nairobi X due to arrive in Nhava Sheva on June 9. With multiple changes in the cards, the service will now cover Nhava Sheva, Mundra, Vizhinjam, Sines, Valencia, Gioia Tauro, Genoa, Barcelona and Malaga, the sources said. The weekly HEX has long used a fleet of large-size vessels — averaging 15,000 TEUs in capacity — with a strong schedule reliability track record. MSC recently reset the HEX berthing window in Nhava Sheva by shifting calls from the DP World terminal to PSA International’s facility for greater operational flexibility. Additionally, MSC’s IPAK service (India-Europe) has no sailing in the current week, port berthing data indicates. Sliding vessel schedules extend to other Indian networks. A South India/North Europe/Mediterranean/Oceania loop run jointly by MSC and CMA CGM, branded as the Australia Express and NEWMO, respectively, has voided direct calls to Ennore Port (Chennai) in late May, tightening capacity out of the region that has fewer long-haul network options. “Space issues have started for bookings to Europe and we expect westbound rates to move up,” a Chennai-based forwarder said. MSC and CMA CGM have already rolled $800 per container into West India-Europe spot pricing from this week, sources said. Contact Bency Mathew at bencyvmathew@gmail.com .

Asia-Europe

MSC juggles India-Europe network rotations amid Asia cargo rush

<div class="phx-topic abstract-wrapper">Carriers are looking to ride the higher rates as long as they can before the fresh vessel capacity that is making its way to the trans-Pacific begins to dull the momentum.</div>

Carriers are looking to ride the higher rates as long as they can before the fresh vessel capacity that is making its way to the trans-Pacific begins to dull the momentum.

<div class="phx-topic">Trans-Pacific spot rates are rising at a faster clip than the pandemic-linked boom in the spring of 2021 amid a spike in imports from Asia driven by the temporary pause in tariff hikes put in place by the Trump administration. An ocean carrier executive said liners are being “very aggressive on spot rates” to capitalize on the cargo surge, with so-called general rate increases (GRIs) implemented on June 1 and two other price hikes planned for mid-June and July 1. A half-dozen forwarders told the Journal of Commerce that spot rates this week are in the low $6,000s per FEU to the US West Coast and low $7,000s to the East Coast. Rate indexes, which take a week or two to capture the full rate gains, still showed a big jump this week. Platts, a sister company of the Journal of Commerce within S&amp;P Global, listed the spot rate from Asia to the West Coast as of Monday at $5,600 per FEU, up 33% from just last week. The East Coast rate was $6,500 per FEU, up 25%. Platts data shows the West Coast spot rate has rocketed 173% higher since mid-April, with the East Coast rate doubling over that time. By comparison, as US imports from Asia began to climb in May 2021 following the COVID-related slump, spot rates to the US rose about 20% from mid-April. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e8c13a3e-9f5a-412f-8741-adbf5e1a7779"></dynamic-object></div>Carriers are looking to ride the higher rates as long as they can before the fresh vessel capacity that is making its way to the trans-Pacific in the form of extra-loaders and new services begins to dull the momentum. “It seems like the next [rate] increase or two will be the last ones,” said Jason Cook, CEO of Ardent Global Logistics. “I’m getting the impression that this capacity is already finding its way into the trade.” The new capacity is especially significant on the trade lanes from Asia to the West Coast. Carriers in June have increased capacity by 12.8% and plan another 16.5% hike in July, Alan Murphy, CEO of Sea-Intelligence Maritime Analysis, said in his Sunday Spotlight newsletter. “In total, this is an injection of 397,000 TEUs of capacity in June/July compared to the situation just three weeks ago,” Murphy said. <h3>Import surge coming to Southern California </h3>The surge in imports from Asia is tied to the Trump administration’s time-limited pause in higher tariffs. The pauses are expiring over the next two months — one on July 9 on imports from most nations except for China, and another in mid-August on the huge <a href="https://www.joc.com/article/federal-court-ruling-blocking-tariffs-resets-shipping-outlook-6013402">145% tariff on imports from China that has been reduced to 30%</a>. The White House says it is busy negotiating new trade deals in the meantime. As those deadlines approach, the import spike is manifesting itself in the Los Angeles-Long Beach port complex, which handles about 50% of US imports from Asia. According to data from both ports, the Southern California complex is projecting a huge volume of imports over the next few weeks. Los Angeles, which this week will handle about 92,000 TEUs of laden imports, is forecasting more than 103,000 TEUs next week and 112,000 TEUs in the week of June 15. Long Beach, which will handle about 75,000 import TEUs next week, is projecting imports of more than 90,000 TEUs per week during the last three weeks of June. “Clearly shippers are trying to catch up on lost time out of China,” one forwarder said. Bookings out of Southeast Asia are quite strong, while bookings from China, which spiked after the May 12 “pause” announcement, are now “slightly weaker, but nothing that will throw the trade off,” said James Caradonna, executive vice president of the forwarder Spedag America. <h3>Short, but intense, peak season expected </h3>Based on the significant level of frontloading that has already taken place from Southeast Asia and China, forwarders say this year’s peak shipping season will start earlier and be noticeably shorter than typical peak seasons, which run from August through October. “The peak season has already started,” said Christian Sur, executive vice president of ocean freight contract logistics at the forwarder Unique Logistics International. “The peak of the peak will be in the second half of June.” For that reason, carriers are attempting to maintain cargo flow and bookings from their core customers so that when imports fall off, liners will maintain what business is left for the remainder of the year, the carrier executive said. Carriers right now are slow-walking peak season surcharges (PSSs), which are applied to cargo owners’ service contracts and forwarders’ named-account (NAC) rates, even while they announce additional spot rate increases, the executive said. “The lines are very cautious about PSSs...,” the source said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. Contact Laura Robb at <a href="mailto:laura.robb@spglobal.com">laura.robb@spglobal.com</a>. </div>

Trans-Pacific spot rates are rising at a faster clip than the pandemic-linked boom in the spring of 2021 amid a spike in imports from Asia driven by the temporary pause in tariff hikes put in place by the Trump administration. An ocean carrier executive said liners are being “very aggressive on spot rates” to capitalize on the cargo surge, with so-called general rate increases (GRIs) implemented on June 1 and two other price hikes planned for mid-June and July 1. A half-dozen forwarders told the Journal of Commerce that spot rates this week are in the low $6,000s per FEU to the US West Coast and low $7,000s to the East Coast. Rate indexes, which take a week or two to capture the full rate gains, still showed a big jump this week. Platts, a sister company of the Journal of Commerce within S&P Global, listed the spot rate from Asia to the West Coast as of Monday at $5,600 per FEU, up 33% from just last week. The East Coast rate was $6,500 per FEU, up 25%. Platts data shows the West Coast spot rate has rocketed 173% higher since mid-April, with the East Coast rate doubling over that time. By comparison, as US imports from Asia began to climb in May 2021 following the COVID-related slump, spot rates to the US rose about 20% from mid-April. Carriers are looking to ride the higher rates as long as they can before the fresh vessel capacity that is making its way to the trans-Pacific in the form of extra-loaders and new services begins to dull the momentum. “It seems like the next [rate] increase or two will be the last ones,” said Jason Cook, CEO of Ardent Global Logistics. “I’m getting the impression that this capacity is already finding its way into the trade.” The new capacity is especially significant on the trade lanes from Asia to the West Coast. Carriers in June have increased capacity by 12.8% and plan another 16.5% hike in July, Alan Murphy, CEO of Sea-Intelligence Maritime Analysis, said in his Sunday Spotlight newsletter. “In total, this is an injection of 397,000 TEUs of capacity in June/July compared to the situation just three weeks ago,” Murphy said. Import surge coming to Southern California The surge in imports from Asia is tied to the Trump administration’s time-limited pause in higher tariffs. The pauses are expiring over the next two months — one on July 9 on imports from most nations except for China, and another in mid-August on the huge 145% tariff on imports from China that has been reduced to 30% . The White House says it is busy negotiating new trade deals in the meantime. As those deadlines approach, the import spike is manifesting itself in the Los Angeles-Long Beach port complex, which handles about 50% of US imports from Asia. According to data from both ports, the Southern California complex is projecting a huge volume of imports over the next few weeks. Los Angeles, which this week will handle about 92,000 TEUs of laden imports, is forecasting more than 103,000 TEUs next week and 112,000 TEUs in the week of June 15. Long Beach, which will handle about 75,000 import TEUs next week, is projecting imports of more than 90,000 TEUs per week during the last three weeks of June. “Clearly shippers are trying to catch up on lost time out of China,” one forwarder said. Bookings out of Southeast Asia are quite strong, while bookings from China, which spiked after the May 12 “pause” announcement, are now “slightly weaker, but nothing that will throw the trade off,” said James Caradonna, executive vice president of the forwarder Spedag America. Short, but intense, peak season expected Based on the significant level of frontloading that has already taken place from Southeast Asia and China, forwarders say this year’s peak shipping season will start earlier and be noticeably shorter than typical peak seasons, which run from August through October. “The peak season has already started,” said Christian Sur, executive vice president of ocean freight contract logistics at the forwarder Unique Logistics International. “The peak of the peak will be in the second half of June.” For that reason, carriers are attempting to maintain cargo flow and bookings from their core customers so that when imports fall off, liners will maintain what business is left for the remainder of the year, the carrier executive said. Carriers right now are slow-walking peak season surcharges (PSSs), which are applied to cargo owners’ service contracts and forwarders’ named-account (NAC) rates, even while they announce additional spot rate increases, the executive said. “The lines are very cautious about PSSs...,” the source said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com . Contact Laura Robb at laura.robb@spglobal.com .

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Pause in tariff hikes drives big gains in trans-Pacific spot rates

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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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Filling the Supply Chain Education Gap with LTL Education Courses

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