Episode Transcript
[00:00:00] Speaker A: Hello and welcome to the Lodestar podcast News in Brief, where we recap last week's supply chain news and flag all the important stuff that's coming up next week.
Coming up, in today's episode, we are going to be looking at investment into CMA CGM terminals, weather disruption across ports in Europe, a Red Sea risk signal, earnings notes, and of course, where ocean freight spot rates went last week. And if you stick around to the end of the episode, we are joined by an extra special guest, head of Lonestar Premium, Ali Pasetti.
This episode is sponsored by Port Everglades. With direct shipping routes to Central and South America, the Caribbean and Europe, South Florida's Port Everglades is your leading container port. Bulk break, bulk, perishable and containerized cargo can go from ship to shore quickly and efficiently by road or rail. To learn how Port Everglades is perfectly positioned to move your goods, visit port everglades.net now, before we get into the news, of course, I need to introduce this week's guest. So joining me, I have Gavin Van Mul. Hello, Gav.
[00:01:16] Speaker B: Hello, Charlotte.
[00:01:17] Speaker A: And Alex Lenane. Hello, Alex.
[00:01:20] Speaker C: Hi, Charlotte.
[00:01:22] Speaker A: To start the episode, Gav, I believe you've got something to clear up from last week.
[00:01:26] Speaker B: Yeah, quick bit of housekeeping.
I erroneously claim that Gothenburg and Gandansk were being dropped from the Ocean Alliance's NEU4 Asia North Europe String. And I've since been advised by Gothenburg that these calls will continue, although they're. They're private CMA CGM calls.
The French carrier provides all the tonnage on that service, so Swedish and Polish shippers can continue to book on it, but only through CMA CGM rather than the other Ocean alliance partners whose Pacific. Whose past, whose participation, why, whose participation ends at Dunkirk? So apologies to the port, apologies to CMA CGM for that error and hope we've cleared all of that up nicely.
[00:02:15] Speaker A: Well, while we're Talking about CMA CGM, you wrote last week that they got investment into 10 of their terminals. So what are the details and what impact is this going to have?
[00:02:24] Speaker B: Yeah. So US private private equity fund Stone Peak plowed $2.4 billion into a new joint venture with CMA CGM called Union Ports LLC.
Stone Peak takes 25% stake. CMA holds the remaining 75. Bit of background.
Like other carriers, CMA CGM has expanded its terminal portfolio for the last few years, but more unusually, actually has two port companies. Terminal Link, which is 49% owned by China merchants in a sale that took place a few years ago as a sort of fundraising exercise. And then there is CMA terminals, fully owned by the French carrier and from which it has taken 10 of these facilities and place them into this new joint venture. And there are actually quite a few rather attractive assets there. It's terminal in la, there's two terminals in New York, there's Santos, there's Narbosheva and Chimeps. There's some big gateway facilities as well as four Spanish terminals of varying size.
A couple of takeaways.
Stone Peak has also earmarked 3.6 billion. So the overall thing is a $5 billion deal for future investment into the company. So I think that makes it a pretty safe bet the United Ports will be the carrier, sort of preferred vehicle for many future port investments, particularly in the US and Altar and in the Americas.
And secondly, I mean, it's interesting that it's Stone Peak. It's certainly like a sort of statement of intent from them because over the last few years it's spent, I think it's nearing $9 billion on acquiring a number of contained leasing companies and building a platform in that part of the sector.
And then more recently it's been linked with a possible 12 billion purchase of Atlas Air Company that Alex knows very well. So you're kind of thinking that plus the ports, the PE fund very much moving into our sector that there's probably going to be a few other investment opportunities for, for the two partners in sort of other supply chain sectors. Charlotte?
[00:04:42] Speaker A: Well, while we're also talking about this kind of ports and terminal investment, you had some big news from Panama, so.
[00:04:49] Speaker B: Sorry. Yes, Charlotte, Breaking news.
So very late last week the Panamanian. The Supreme Court in Panama declared that the operating concession of Panama Ports Company is unconstitutional and so very much touched. Hutchison is sort of on the verge of losing its Panama business there.
Hutchison denies that it, or rather Panama Port Company denies that it's unconstitutional. You know, it's talking about legal recourse through the international courts and so on. But then literally just before we started doing this, this, this broadcast, I had a message from APM Terminals quite out of the blue. Well, not out of the blue, but in connection with this and I'll just, I'll read this right. So the APM terminals confirms its willingness to assume the temporary operation of both of Panama ports companies terminals.
This aims to mitigate any risks that could impact essential services for regional global trade. Because we've got to remember that the PPC does hold a significant market share in Panama in Panama's port system.
So there we are right. We've now got APM terminals coming in and saying, look, while all this legal battle is going on, we're perfectly happy to undertake the operations of Balboa and Cristobal. It's fascinating, it's a very interesting turn in a story that has now been going on for over a year.
[00:06:20] Speaker A: Yeah, the saga continues.
Perhaps the biggest news story from last week, the Houthis are back. I mean, we've been speaking about this possible return to the Suez Canal. Maersk seemed like they were doing it, cma, CGM seemed like they were doing it. But now last week seems like this might be a bit further away than first thought. So what's the latest?
[00:06:42] Speaker B: I mean they, so the latest is that they, they, they released a video, a sort of AI generated video at the beginning of last week showing them blowing up a merchant ship or a merchant ship being blown up.
And come on, I mean this, this, this is not unexpected. Trump wants to put pressure on Iran and Houthi attacks are one of the few remaining ways that Iran can hit back. You know, that's it.
And I just, I can't see this threat in reality being lifted, a threat of Hootie attacks, that is, while, you know, the wider situation remains so tense and so unpredictable, that's the really difficult thing for carriers to juggle. So for the foreseeable future, it seems to me that it's just Cape of Good Hope all the way.
[00:07:29] Speaker A: Yeah, this is going to be a huge factor going into this year. We had an Alpha liner report from last week that vessel scrapping in 2025 was at its lowest level for 20 years.
And they said that this year probably wouldn't see much more scrapping if the Cape diversions continue because obviously it increases the ton mile demand.
So carriers might defer this scrapping to 27 or 28 when obviously that huge wave of new building comes through.
So this over capacity might be, might be on the horizon a little bit longer.
We will have to see. But yeah, that is definitely going to be a big factor going into this year.
Like any good news show, we're going to have a weather segment and last week saw some adverse weather affecting ports in north and South Europe and along the east coast of the us.
So Alex, do you have any details here? When can we expect this to return to normal?
[00:08:28] Speaker C: Well, as you know, Charlotte, I am completely out of my comfort zone here, but you know, Jack of all trades and all that.
Yes, I wrote a story on port closures in the West Med where the weather has been brutal. Apparently with large swells and really unpleasant conditions on the sea.
So Gibraltar, Tangier, Ahmed, Aldasiris have all had moments where they've closed sometimes for more than a day.
And so at the end of last week, I think There were about 30 ships waiting to go in.
Now the port was, the ports were sort of variously opening and closing at different times. But the difficulty is that next week the weather looks appalling as well.
So it looks likely that there may be more photos. And then of course that has a knock on effect on schedules and congestion in Northern Europe, which I believe is still a little bit there. That's not going to help.
So yeah, it's nasty around the West Med. That's my weather report. Oh, and possibly the English Channel as well.
[00:09:28] Speaker A: Thanks, Alex. I know you prefer to stay on the air side of things, so I appreciate you picking that one up.
Speaking of, it is earnings season and you did the report for UPS's Q4. It had some additional info on its MD11 fleet. So what's the latest here?
[00:09:43] Speaker C: Well, in a set of sort of fairly mixed results that, yeah, most people said were a bit disappointing, really the most interesting thing was that it's going to withdraw its MD11s. Well, they'll never come back to service after the grounding, which was obviously because of the tragic crash that UPS had. Interestingly though, FedEx has said that it's going to keep its MD11Fs going. I think they will be back in the air from May or the end of May.
So it's interesting to see the two different strategies there.
UPS also said it was drawing back on its Amazon contracts and it announced job cuts, another 30,000 job cuts, which I think it brings it to ups to 80,000 job cuts in two years. And Amazon as well announced job cuts. So it was a, it was a kind of a sad day for many in logistics, I guess, continuing on this.
[00:10:32] Speaker A: Kind of earnings season streak. Gav, you reported that Chinese Intra Asian shipping line SITC had a very good year in 2025. What was their results saying?
[00:10:43] Speaker B: Well, it's not, it's a pretty. They issued what, you know, a preliminary profit forecast to the Hong Kong Stock Exchange. It's listed in Hong Kong, which was predicting 1.2 billion profits for 2025. That's around sort of 16 to 18% increase over 24.
You looked at their volume data, their pricing data, their average rate per TEU that they reported.
Compare that to the CTS data that we had for the first 11 months of the year on the Intra Asia trade and the CTS pricing index and all the indications are that SICT is considerably outperformed the market, that Intra Asian market anyhow. Yeah, so yeah, good year for them.
[00:11:30] Speaker A: Yeah. I did the earnings report for Ocean Network Express and that was kind of on the other side of the coin. Their liftings were flat, flat for the year even though CTS showed a demand growth of 5%. So they well underperformed. But they did say that they were expecting a slight recovery next quarter.
[00:11:47] Speaker B: Yeah, it does. I mean I think this just underlines the effect that all the geopolitical stuff has had over the last year. You know and someone like sict, they're insulated from this. Right? They, the tariff stuff. I mean it affects them indirectly but it doesn't affect them directly. They're not on the front line of carrying products across the Trans Pacific that might be subject to the tariffs, you know and as, as the sort of the trade diversification story that we talked about last year.
One of the chief beneficiaries of that has been the Intra Asia trade.
So what might be interesting to see is whether some of these deep sea carriers such as one decide to put much more of a focus on the inter Asia traffic and you know, in the forthcoming period.
[00:12:37] Speaker A: Yeah, for sure. They did say in their results that it was probably a lot to do with the challenging environment on the major east west trades.
So yeah, perhaps one to watch. Great Gav, Continuing on the streak of talking about numbers. Where did the rates go last week?
[00:12:53] Speaker B: More declines this week. Slightly, slightly flatter, slightly less steep declines than we had the week before. They were 5% down on Asia Europe, Asia North Europe, 6% down to the medium 4 and 7% down to the US East coast, sorry US West coast and US East coast respectively.
There is.
Sorry, can I, can you just. Sorry guys, just one sec, I just need to check my notes on this. Very sorry Tom.
Yeah, so they're all down. I mean basically the pre Chinese New Year rushes over.
Forwarders in Europe are readying for steeper declines once the actual holidays themselves are over.
WCI spot rate to north Europe is at 2,379 per 40 foot at the moment.
And most of my contacts expect that to dip below the 2000 mark in the second half of February.
On the Trans Pacific demand appears to really shrinking. I mean one forward a good describe volumes as breadcrumbs.
The WCI at the moment stands at around 2,400 per 40 foot but forward is reporting rates of around 1,600. So there's a lot of discounting going on and I think, you know, capacity is starting to be curtailed now. But once Chinese New Year is over, I mean, you're sort of looking at the perfect conditions for a rate war to break out, really. So it's been a tough week.
[00:14:32] Speaker C: Charlotte, can I just interject here? I know we're not really covering air rates this session. I just wanted to say that they too have got a bit softer. The pre Chinese New Year lift has not come in and may not come in at all according to some sources.
So yeah, it's looking pretty soft in air as well.
[00:14:48] Speaker A: Thanks, Alex. And while I have you here, I noticed last week on the load start that you've launched a new style of column. This is the Lodestar Diary. So what are the details? What can our readers expect from this?
[00:15:02] Speaker C: Well, we realize that we get an awful lot of interesting snippets. They don't really make news stories as such, but they're still interesting nonetheless. We're hoping it'll be a selection of funny things, positive stories, bit of gossip, things that have, yeah, sort of cuttings from the shop floor really, which is what we're calling it.
So definitely well worth a read. It'll be our thoughts on conferences, on what's being said at events, anything that comes up that's not quite a news story, but I really think our readers will find interesting nonetheless.
[00:15:32] Speaker A: Yet another great reason to subscribe to the Lodestar. And if you are subscribed to the Lodestar but you are not subscribed to Lodestar Premium, I am bringing in an extra special guest, head of Lodestar Premium, Alessandro Passetti. He basically is Lodestar Premium and he's going to give us a rundown of what has been on Premium last week. Hello, Ali, thank you so much for joining me on the podcast.
[00:15:53] Speaker D: Thank you so much for having me here. Yeah. So 60 seconds or so very quickly, New year, same old stories with kind of a bit of a twist from kind of the companies we look at. So Ch Robinson 200. Now, I don't know if it is like 70 or 80 or 90% more than the last time I checked it worth Q2 and Q3, but it looks like Dave Bosman is doing a fantastic job, although he says that account is not a KPI when essentially the value riven story is driven by account.
And then we have UPS probably not that interesting. So we have heard about UPS several times in 2024 and 2025, say, oh, first half earnings not good, second half earnings good. Same story this year. But supply chain solutions would be the B2B side of a business that we really look into because we think is going to go on the market at some point.
FC Logistics is doing incredibly well offsetting weakness in air and ocean. And then you know, as you know, the headline story, new year old story, DSV insurance, some issues where DSV saying, well you know guys, no issues at all. We are kind of the same narrative with the cyber attack at the end of last year and essentially we are looking Forward really to February 1st next week to see how the synergy driven story with Shenker is going.
Side stories.
Well, Geneviena of Union Pacific, the smart executives ever when there's M and A involved, essentially you really love to run the STB to give a green light to the deal and you would also like to be running Norfolk without owning it. But he clearly said, clearly reminded us that it's illegal. So he's not going to do that until the deal is probably done in 2028 or 2029 and we'll see how it goes. So this is kind of a snapshot.
[00:17:55] Speaker A: For me and how many different contributors are there on Lodestar Premium at the moment?
[00:18:00] Speaker D: Yeah, I keep counting. So we lost Mr. Joey, but it looks like that the very talented people not even wanted to be paid properly are really eager to rack for us, which is fantastic. So margins are going up, growth rate is there.
Adam Clermont nearly making a massive impact in the way we are looking at legal things.
So in fact we added this premium legal insight tag to our stories where you can find all the insight from Adam.
Absolutely fantastic. I can also mention Gila. Gila, she joined a couple of weeks ago, is now looking at airfreight compliance, something I know absolutely nothing about. So it's great deal for Premium as well as for, for me and then usually Ruben Gavin, Daleks, they quickly put their effort in and it could be in writing that is published or it could be just massive insight that we get on some stories. There's a very interesting story about Maersk. So Maersk in Italy as, as attracted a few headlines and so this guy is a very senior engineer, a very smart guy. We met in Genova some time ago and then we we're gonna meet again probably soon because I was planning to take a bit of time off in Sicily and there's a kind of a national emergency year because of the floodings and all of that. So I'm probably going to Genova and see what's the next update on how we are using public funds essentially in Vado Ligure. That's the story that has been going on. And Andrea Gozzi has done an amazing job in getting essentially his own lawyers to try and figure out whether his own rights as a, as an Italian citizen can be preserved. So funny enough, his lawyer was kind of interested in the kind of reply they got because he said, I've never seen anybody not willing to share some documentation with me, which is kind of some basic. So we are, we are, we're getting. There is a, is a, is a long term story. But yeah, great story.
[00:20:08] Speaker B: It's great. I mean it's a fact. It's, it's, it's this, it's a, it's a new build a greenfield port place called Vardo Ligure that APM invested in. I don't know what originally eight years ago or something like that they've received.
I think Andrea said it was something like 300 million in public funds.
[00:20:29] Speaker D: And.
[00:20:32] Speaker B: It'S not doing very well, is it? I don't know. It's got nowhere near the amount of services it had. I think one of the most recent communications was that the Gemini services which had been expecting to use Vardo Ligure as their gateway were being transferred over to Geneva.
So it's a really interesting story and I think the writer who's been reporting as a really, you know, it's a very personal story to him as well. You know, he grew up, he grew up basically swimming on the shoreline where they've now built a port.
[00:21:03] Speaker D: Yeah, and one other side of a story which I didn't mention, but early earlier on, like I think it was towards October, November he wrote because his wife was essentially pushed. So there was some negotiation there, there's still some negotiation, but it's not really a story we are interested in.
But what it didn't really, what he didn't really think is fair is that if there's a commitment, there should be results and if there is no results, people should be held accountable. And few politicians in Italy, in Liguria have been held accountable for several wrongdoings in the last. Since the summer of 2024.
And well, they've settled, they probably managed to get away with it.
But interestingly, it looks like Andrea found some other similar stories in other ports. So stay tuned.
[00:21:55] Speaker A: And you've got the details of this over on Lodestar Premium.
[00:21:58] Speaker D: Yeah, we had it on on the day Veloster crew came over to Italy and we spent a couple of days doing what Gene Venus suggested Enjoy whiskey and few other drinks.
[00:22:11] Speaker A: Thank you so much for joining me, Ali. I'm sure you've got your hands very full this earnings season, so I look forward to seeing more of your reports on that. And before you go, we just want to note the passing of a favorite in the industry last week. It's very sudden. Hans Henrik Nielsen, who was the director of Cargo Golf. Ali, I believe you knew him quite well.
[00:22:35] Speaker D: Yeah, he wasn't. It wasn't that kind of marketplace guy on the premium side of things as an investor, but he was a very, very interesting human being in the kind of. It was so lively and every. Every. Every quarterly report, particularly with the camp, a couple of companies I will not mention. He was really looking forward to, you know, the nitty gritty details of the numbers and all of that. And his post will. Will be missed. I mean, but he as a person, I think is a difficult time. So that's all I say. And condolences to the family.
[00:23:15] Speaker B: Yeah, absolutely. Yeah. Life is cruel.
[00:23:18] Speaker C: I just wanted to add that with news like this, you kind of realize that the freight industry is so very big and yet we're all so very connected and we talk to each other all the time and you sort of forget that all these people become friends to some degree. And it's sort of shocking and sad, but it also makes me feel kind of warm towards the freight industry, really, how many connections we all have with each other.
And as Ali said, condolences to his family and friends and the wider freight industry.
[00:23:50] Speaker A: Very well put.
[00:23:51] Speaker D: Sorry, but it's just one little thing I wanted to say, which he was working on a story with another contributor that we disclosed later. And so there will be a bit of him probably coming in future on how to make different industry better. That's the main goal of that kind of paper that is being written at the moment. With his insight.
[00:24:15] Speaker A: Definitely something to look forward to from him then. And yes, as you said, our thoughts are with his friends, family and everyone in the industry that knew him. He really was a wonderful man.
To finish the episode with some good news amongst all the protectionism and fragmented trade measures that we have seen last year and already this year. Last week saw the announcement of the EU India trade deal. This is yet to be ratified, but the Free Trade Agreement agreement is expected to significantly reduce tariffs for both India and the eu.
So this week we might start to get more of an idea of what this means for stakeholders and hopefully we'll see more of these trade agreements pop up around the world. Gav, Alex. Do either of you have anything on your radar for next week?
[00:24:56] Speaker C: I weren't surprised. Know that I have more on TMS and freight tech, but actually there is also something completely new coming to the market which may interest some readers and you'll find more on that on the livestock.com this week. Oh also we have the Air Cargo 2026 market forecast from Avian Consultancy, I hope.
[00:25:20] Speaker A: And Gav, what about you? Do you have anything on your radar for this coming week?
[00:25:24] Speaker B: Well Charlotte, it's earnings season so you know, I'm just going to be given a list of commands from Ali and I will follow them dutifully as ever.
[00:25:32] Speaker A: Wonderful. Well, we will wrap up the episode there.
Thank you all so much for joining me. It has been a wonderful episode.
[00:25:40] Speaker B: Thank you Charlotte.
[00:25:44] Speaker A: And thank you all for listening and watching. If you are on YouTube, please like subscribe, comment, share all of that. And finally, thank you so much to this episode sponsor, Port Everglades. To find out how Port Everglades is perfectly positioned to move your goods, visit portevaglades.net thank you so much for joining me and we will see you next week.
