Featured Headlines:
When the Cargo Goes Bye Bye, the Service is Bone Dry
Upside Down You’re Turning Me: Airfreight Rates Down with Jet Fuel Up
Following Trump's Tariff Letters OF the Law TO the Law
Section 232 Products: The Lowdown on Downlow Additions
Freight Potpourri: A Little Labor, a Lotta Logistics, and a Dash of Digital Drama
When the Cargo Goes Bye Bye, the Service is Bone Dry
- Spot rates to the U.S. West Coast have dropped below $2,000/FEU, officially entering a global game of limbo! “How low can you go?” A word that rhymes with “limbo” may describe an industry that tried hard to cash in on expected Trump’s tariff surge(s) only to find shippers refusing to play, pay or dance that limbo.
- Container volumes from the Far East to North America dropped 14.8% year-over-year (YoY) in May. The expected spike in the punch bowl for June is compellingly low proof, an increase below 2% from May (and well below June 2024).
- MSC became the first major carrier to cut transpacific capacity, suspending its Pearl service to Long Beach. The last sailing? MSC Elodie on July 13—mark your calendars and pour one out for those 8,000–9,400 TEU workhorses. Maybe this time we’ll all note where those vessels go… we hear that blank sailings and service suspensions are costly; yet, they occur as often as that limbo stick is knocked loose by a bloated belly.
- Hong Kong’s TS Lines quietly removed its AWC2 service, and China United Lines has also hit pause on its Transpacific run to Los Angeles. How do we politely express that vultures do not return to places without dead prey without sounding grotesque? Send us your ideas, intelligent readers!
- Even with these withdrawals, 23 operators remain active on Transpac routes. What a bunch of malarky, and we apologize for trying to sell issues of ShapTalk with such rubbish! We all know there are essentially 10 carriers, and the rest is hooey.
- Is it a coincidence that the words “malarky” and “hooey” have mysterious origins? Well, is it?? “Malarkey” is thought to be an Irish last name… must have been a colorful family! “Hooey” is just “phooey” with garlic on it. We think this coincidence is meaningful.
- While Transpacific volumes shriveled, Far East–Europe head-haul surged 16.1% YoY in May, hitting a record 1.81M TEUs. This has NOTHING to do with the Transpacific realities, but it sure is interesting!
- Europe’s total imports rose 10%, and north-south trades like the Indian Subcontinent, Middle East, and Sub-Saharan Africa posted 9% YoY gains. For those of you franticly storing canned goods in your cellar, this sounds like the globe getting more and more comfy with less US trade… though we may be influenced by TikTok and Meta (and large quantities of malarky with a side of hooey).
Upside Down You’re Turning Me: Airfreight Rates Down with Jet Fuel Up
- In June, airfreight rates out of Hong Kong and China took a gentle dip, with North American destined cargo hitting $4.99/kg, down from $5.08 in May. Not exactly inside out and round and round—more of a soft landing.
- Yet respectfully we say to thee, airlines, you’re giving signs instinctively, around and round you’re turning us! Is De Minimis cargo more dead than tariff surging is alive? Boy, you turn us round and round on the real story!
- Yes, the dip is typical for the (Donna) summer period when belly-hold capacity rises (thanks, vacationers!). Yet, as we hinted, U.S. tariffs and the end of the de minimis e-commerce exemption are adding headwinds, especially on shipments from China and Hong Kong. Hey, Diana Ross is the reference, inside and out (not Donna Summer!).
- Rates to North America are 13.2% lower than June 2023, while Hong Kong-Europe lanes are down 4.4% YoY. That is just down with no upside.
- Last year’s spike was driven by modal shifts (thanks, Red Sea crisis) and red-hot e-commerce. As long as the sun continues to shine, there’s a place in our hearts for you, air cargo, that’s the bottom line!
- Despite IDF airstrikes and airspace disruptions, global rates barely flinched, dropping just 1.1% in June. The Middle East is upside down, but Middle Eastern air carriers continue to give that love instinctively (largely by shifting to new air hubs as needed).
- Additionally, jet fuel prices surged nearly 20% month-over-month (MoM) by mid-June but fell sharply after the Middle East ceasefire on June 24. Still, the volatility didn’t translate to higher freight rates…yet… respectfully we say to thee (don’t forget).
- While some widebody freighters are being pulled amid the tariff standoff between the U.S. and China, capacity is still adjusting to demand like the guy Diana is singing to…talk about a spike in demand!
- However, we find it slightly hopeful that “airfreight markets remained remarkably stable” in June, despite the geopolitical chaos and overuse of disco songs as metaphor.
Following Trump's Tariff Letters OF the Law TO the Law
- Independence Day fireworks went off with a bang this weekend—but the show hasn’t stopped just yet! Here’s a day-by-day recap of this week’s biggest tariff announcements to bring you back up to speed.
- Monday, 7/7/25: Additional Tariffs to Be Imposed If No Deal Is Agreed by August 1
- President Trump has authorized letters to be sent to multiple countries warning that if acceptable trade agreements are not reached by August 1, additional tariffs will be imposed on their exports to the United States.
- This action follows an Executive Order issued on April 2 that defined the pause for the reciprocal tariffs.
- The White House is now signaling that enforcement could resume and escalate beyond the original April 2nd levels, if negotiations fail.
- According to letters posted by President Trump, the proposed tariff rates by country are as follows:
- Japan: 25%
- South Korea: 25%
- Malaysia: 25%
- Kazakhstan: 25%
- South Africa: 25%
- Laos: 25%
- Tunisia: 25%
- Bosnia: 30%
- Indonesia: 32%
- Bangladesh: 35%
- Serbia: 35%
- Cambodia: 36%
- Thailand: 36%
- Myanmar: 40%
- The letters also indicate that the U.S. would consider reducing tariffs if companies in the affected countries agree to manufacture or build facilities within the United States.
- Additionally, if any of the named countries increase their own tariffs on U.S. goods, the United States will respond with a reciprocal increase in tariffs of equal value.
- Tuesday, 7/8/25: Trump Delays Tariffs to August 1, Hints at New Pharmaceutical & Copper Tariffs
- President Trump has officially postponed the start date of the country-specific reciprocal tariffs from July 9 to August 1 via a new Executive Order.
- Originally announced on April 2 and paused for 90 days on April 9, these tariffs are now set to take effect at 12:01 A.M. ET on August 1, 2025—unless trade negotiations show meaningful progress.
- The move comes as the Administration evaluates ongoing discussions with key trading partners.
- Notably, this delay does not affect tariffs related to China, which remain governed by a separate Executive Order from May.
- The Harmonized Tariff Schedule (HTSUS) will be modified accordingly to reflect the extension.
- Trump also unveiled a 50% tariff on copper and threatened to impose 200% duties on pharmaceuticals.
- Wednesday, 7/9/25: Trump Sends More Tariff Letters, Says They’re In Lieu of Negotiating Deals
- In a Cabinet meeting Tuesday, Trump told the reporters his tariff-setting letters were in lieu of negotiating deals with many countries. “I just want you to know a letter means a deal.” President Trump has shared seven more letters addressed to U.S. trading partners:
- Philippines: 20%
- Moldova: 25%
- Brunei: 25%
- Iraq: 30%
- Sri Lanka: 30%
- Algeria: 30%
- Libya: 30%
- In a Cabinet meeting Tuesday, Trump told the reporters his tariff-setting letters were in lieu of negotiating deals with many countries. “I just want you to know a letter means a deal.” President Trump has shared seven more letters addressed to U.S. trading partners:
- Don’t let another update pass you by! Sign-up to receive our complimentary Shap Flash alerts in real-time–or bookmark our Trump’s Trade Tariff Updates page.
Section 232 Products: The Lowdown on Downlow Additions
- With the status of Trump’s reciprocal tariffs dominating the regulatory newsroom in recent weeks, you may have missed the lowdown on a couple of downlow changes to the list of products subject to Section 232. Let’s take a brief look at two such examples.
- #1: New Guidance Issued for Section 232 Steel Derivative Products
- Last month, the Commerce Department released an updated list of steel products subject to Section 232 tariffs in the Federal Register.
- The duties apply to products such as combined refrigerator-freezers, small and large dryers, washing machines, dishwashers, freezers, cooking stoves, ranges and ovens, food waste disposals and welded wire racks starting June 23, 2025.
- Ad valorem duties are applied to the value of the steel content. Most countries will be assessed a rate of 50%; however, the United Kingdom (UK) will enjoy a lower rate of 25%.
- For more details, please refer to CSMS # 65405824 – GUIDANCE: Section 232 Additional Steel Derivative Products.
- #2: Unknown Country of Smelt Change
- Importers of aluminum from Russia will now be required to pay a duty rate of 200% when reporting “unknown” for the country of smelt and/or cast for imports of derivative aluminum products subject to Section 232 measures.
- This clause went into effect on June 28, 2025.
- Additional information can be found here: CSMS # 65340246 – GUIDANCE: Section 232 Aluminum Import Instructions for Reporting Unknown for the Country of Smelt and Cast
Red Sea on Fire…Again
- Within 48 hours, the Red Sea security landscape went from tense to terrifying, as the region endured back-to-back vessel attacks and Israeli airstrikes on Yemeni ports.
- A Liberian-flagged bulk carrier was attacked by drones, speedboats, and small arms fire, leaving it disabled and adrift near Hodeidah. The ship has reportedly faced four attacks in total—can you even imagine being on that boat? Where is SOMEBODY’s Navy?
- Initial reports cited three dead, one injured. Skiffs with RPGs still surround the vessel. Maritime advisories are urging crews to minimize deck movement and stay above the waterline. Since all seafarers are trained as elite Marines, this should be easy to manage.
- A separate Red Sea attack the day prior targeted another merchant vessel. The Houthis claim they sank it—though that’s unverified (and hopefully just propaganda).
- In response to the escalating Houthi aggression, the IDF struck key ports—Hodeidah, Ras Isa, and Saleef—targeting logistics and infrastructure. The Saleef power station, critical for grain and flour unloading, was reportedly destroyed.
- Two Barbados-flagged bulkers were likely damaged in the Israeli strikes.
- Secretary-General Arsenio Dominguez blasted the renewed violence as a violation of international law and a direct threat to seafarers, calling for diplomacy to replace drone strikes. Does everyone remember that we declared victory over the Houthis? Anyone?!
- To add some good news from the region, over 150 Indian seafarers held at Ras Isa since December have been released. All 11 detained vessels have departed, ending a month’s-long cargo blockade triggered by April strikes.
Freight Potpourri: A Little Labor, a Lotta Logistics, and a Dash of Digital Drama
- Canada’s DHL detour might be ending soon: DHL Express Canada and union Unifor reached a tentative deal to end the contract dispute that paused operations late last week.
- Over 2,100 affected workers will vote on the agreement this weekend. Terms are still under wraps—but fingers crossed that your parcel’s back on track.
- Truck terminals go communal: Move over, multi-client warehouses—shared-use truck terminals are the new kid on the logistics block.
- Companies like Outpost are leading the charge, turning yard space into full-service hubs complete with cross-docks, maintenance, and parking at sites in Dallas, Las Vegas, Savannah, and Fontana (CA).
- The goal? Speed, flexibility, and no need to break ground.
- Cargo crime goes cyber—and the industry strikes back: The National Motor Freight Traffic Association has rolled out a Cybersecurity Cargo Crime Reduction Framework (yes, it’s a mouthful), packed with best practices to detect fake carriers, spoofed dispatches, and other digital red flags.
- UP makes a transloading power play: Loup Logistics, a Union Pacific subsidiary, just dropped a “port-to-door” service that gives shippers direct access to UP’s massive fleet of 53’ rail-owned containers—nearly 80,000 of them.
- It’s a bold move against rivals like BNSF, whose partner J.B. Hunt has been bulking up in Los Angeles and Seattle/Tacoma ahead of Barstow Gateway’s 2027 launch.
