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October 29 2018

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6 The Journal of Commerce | October 29 2018 www.joc.com Spotlight tougher. Spot rates held in September but did drop in the first week of October, although they're still higher than they were at the same time last year, during the initial price surge. "The decline in load posting volume in the DAT load board marketplace actually signals a return to stability, as third-party logistics providers (3PLs) and freight brokers are able to find trucks more quickly," DAT market analyst Peggy Dorf explained. "Volume can be expected to increase in the fourth quarter, although year-over-year increases may be muted due to the strength of comparable months in 2017." Falling spot truck rates have compounded fears among some Wall Street analysts that the US trucking market, and public trucking company earnings, may US truck market stabilizes The first signs of moderation in US truck pricing in a year emerged in September, as an annualized drop in freight volume restored some balance to the spot truckload market. According to load board operator DAT Solutions, spot truck freight volumes declined 30 percent year over year in September, compared to last year's frenzied hurricane-related surge in spot shipments. Hurricanes Florence and Michael also hit the US a few weeks later than hurricanes Harvey and Irma in 2017, depressing freight flow in the Southeast and making the year-over-year comparison even Slow-steaming ahead Shippers already grappling with unreliability in container shipping service should expect even longer transits come 2020 when carriers work to mitigate the higher fuel costs of a pending low-sulfur mandate via slow-steaming, forcing beneficial cargo owners (BCOs) to increase lead times and carry more inventory. APL confirmed at the TPM Asia Conference in Shenzhen, China, this month that it would slow down ships to cope with the cost of using a fuel that is expected to be 50 percent more expensive than the current high-sulfur variant. The carrier joins Maersk Line, which in September told JOC's Container Trade Europe Conference in Hamburg that it also would put slow-steaming back on the menu. "The reality is that we are being suddenly exposed to $15 billion in additional spend, so we have to reduce consumption and try to convince customers to pay more," APL CEO Nicolas Sartini told The Journal of Commerce. "There is a lot of uncertainty, but when we talk to our oil vendors, they tell us we have to be prepared for an additional cost of between $250 and $350 per ton above the $500 per ton we pay today. So, faced with such a situation, the first thing is to work out how to reduce the fuel consumption. Option One is to spend less time in port to increase the operating time and the other option is to reduce speed. Once we have done that, we will try to share the additional costs with our customers." One of the first indications that slow-steaming would make a comeback camein Hamburg in September, where Maersk Line Europe CEO Karsten Kildahl said slowing ships would help the carrier manage the estimated $2 billion that low-sulfur fuel would add to its annual costs. "With low sulfur, you're back to [the] trigger point of slow-steaming," he told the Hamburg event. "It completely changes the math of what it takes to consider slow-steaming. There's no way we can foot a $2 billion bill. But we can't ignore that slow-steaming comes completely back into play now." Kidahl said there was no slow- steaming going on today. "A 19,000-TEU vessel spends one week more in port than a 12,000-TEU vessel, therefore every ship is going full speed." The rule, imposed by the International Maritime Organization, will reduce permissible sulfur emissions from vessels to 0.5 percent from 3.5 percent beginning on Jan. 1, 2020. The Journal of Commerce Executive Editor, The Journal of Commerce and JOC Events: Chris Brooks 609 649 2181, chris.brooks@ihsmarkit.com Executive Editor, The Journal of Commerce and JOC.com: Mark Szakonyi 202 872 1234, mark.szakonyi@ihsmarkit.com Managing Editor: Barbara Wyker 908 507 4802, barbara.wyker@ihsmarkit.com Senior Editors: William B. Cassidy Trucking and Domestic Transportation 202 872 1228, bill.cassidy@ihsmarkit.com Bill Mongelluzzo West Coast 562 428 5999, bill.mongelluzzo@ihsmarkit.com Hugh Morley Northeast, Mexico 646 679 3475, hugh.morley@ihsmarkit.com Eric Johnson Technology 213 444 9326, eric.johnson@ihsmarkit.com Janet Nodar Breakbulk and Heavy Li 251 473 2742, janet.nodar@ihsmarkit.com Greg Knowler Europe +44 7976798770, greg.knowler@ihsmarkit.com Turloch Mooney Global Ports +852 9011 9109, turloch.mooney@ihsmarkit.com Associate Editor: Ari Ashe Southeast Ports, Intermodal Rail 202 548 7895, ari.ashe@ihsmarkit.com Web Editor: Joseph Lazzaro 917 309 0148, joseph.lazzaro@ihsmarkit.com Data Analyst: Marcin Lejk +44 58 741 62 70, marcin.lejk@ihsmarkit.com Shipper Engagement Manager: Dustin Braden 646 679 3450, dustin.braden@ihsmarkit.com Senior Content Editor: Alessandra Gregory Barrett, 860 248 5238 alessandra.barrett@ihsmarkit.com Senior Designer: Sue Abt, 862 371 3534, sue.abt@ihsmarkit.com Designer: Bryan Boyd, 908 910 7849, bryan.boyd@ihsmarkit.com Publisher: Tony Stein, 770 295 8809, tony.stein@ihsmarkit.com Sales: Cindy Cronin, Strategic Account Manager Southeast, Gulf, Canada sales, 954 551 8305 Jean Gibbons, Senior Sales Executive West Coast, Midwest sales, 706 469 7160 Ria Van den Bogaert, Sales Representative Europe, Middle East sales, +32 2 569 8905 Alex Remstein, Associate Sales Specialist Reprints/Classifieds/Copyrights, 646 679 3418 For Magazine Subscription Customer Service: www.joc.com/help 450 West 33rd St., 5th Floor, New York, N.Y. 10001 800 952 3839 Executive Director, Editorial Content, Maritime & Trade, IHS Markit, Peter Tirschwell Executive Director, Media & Events, Maritime & Trade, IHS Markit, Amy Middlebrook Manager, Production, Carmen Verenna Product Manager, JOC, Jesse Case ©2018 The Journal of Commerce — All Rights Reserved For more information, visit our website, www.joc.com. 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