Jaguar Freight | Protecting America’s Surf and Turf

In this week’s Roar: Asia-U.S. ocean rates are up, a new world order for supply chains, getting the U.S. and Mexico aligned on China tariffs, the latest on the UP and NS merger, and a U.S.-backed container shipping line.

It’s not just fuel costs. The impact of geopolitics on Asia-U.S. ocean shipping rates has been harsh, too. Rates have surged by 234% since February, largely thanks to the Iran conflict and new tariffs. Even though some rates appear to be slightly softening, down 1% to the West Coast, they’re still elevated while carriers try to manage capacity and shippers’ reactions to what feels like constant market tension and uncertainty.

One could say that Iran got the idea to ‘close’ the Strait of Hormuz by learning from a Houthi tactic that’s been employed for several years. Iran’s drone and missile threats in the Strait have proven that intimidation, not just strikes, is enough to disrupt shipping traffic. With about 80% of global trade moving by sea, this kind of chokepoint risk ripples into energy, food, and consumer goods prices worldwide. Importers are now rerouting cargo globally, paying higher insurance costs, and building larger inventory buffers as once-reliable trade corridors have turned into active frontlines.

The U.S. is hoping to create a unified North American front that would limit China’s access to the market by urging Mexico to match U.S. Section 232 tariffs on Chinese steel and aluminum. Mexico is open to aligning tariffs while in the midst of ongoing USMCA trade talks, although specific rates and what products might be covered are still under discussion.

Union Pacific and Norfolk Southern have revised their merger application, adding customer protections so that they can win regulatory approval for their $72 billion deal. Some of the new commitments include enhanced oversight, temporary alternate rail service during disruptions, and broader gateway pricing. Their revision addresses questions raised by the U.S. Surface Transportation Board about competition and public benefits. They’re hoping to secure the largest rail merger in the industry’s history.

A new report from the Open Markets Institute wants the U.S. to establish a publicly backed container shipping line to help reduce reliance on foreign-owned carriers that control over 90% of U.S. trade on key routes. They’re calling for tighter regulation, more U.S. flagships, and greater support for the local maritime industry.

For the rest of the week’s top shipping news, check out the article highlights here.

Compliments of Jaguar Freight – a member of the EACCNY