UPS vs. Amazon: The Breakup That’s Been a Long Time Coming

UPS has finally decided it’s time to stop playing second fiddle to Amazon. The global logistics giant announced that it will slash the volume of parcels it handles for Amazon by a staggering 50% going into the second half of next year. This move is part of a $1 billion cost-cutting initiative, targeting reductions in air, labour, and road costs, along with closing several facilities.

Why the drastic shift? Amazon may be UPS’ largest customer, but it’s not its most profitable. UPS chief executive Carol Tomé made it clear: “Amazon is our largest customer, but not our most profitable,” calling out the “dilutive” impact Amazon has had on UPS’ margins. And despite the ecommerce giant accounting for just under 12% of UPS’ 2024 revenues, this breakup has already sent shockwaves through the market, with UPS’ stock plummeting 15% on the news.UPS has had a rough few years, losing a third of its value post-pandemic, as ecommerce demand normalised. And if that wasn’t enough, Q4 2024 revenues hit $24.3 billion, falling short of the forecasted $25.42 billion, with full-year 2025 revenue expectations sitting at $89 billion.

From Amazon’s Backseat to Owning the RoadBut this isn’t a white-flag moment. Instead, UPS is shifting gears. Rather than relying on Amazon’s volume, it’s pivoting toward the small parcel sector—an area it previously shunted to the US Postal Service. UPS is also making moves to capitalise on new ecommerce heavyweights, securing deals with Shein and Temu—two ultra-fast fashion juggernauts with massive logistics needs.This shift signals a more strategic, long-term play. Why continue running on Amazon’s treadmill when you can build a more profitable route?

The Bigger Picture: Visibility, Resilience & Climate Impact

What does this mean for the supply chain? Simple uncertainty. Whenever major shifts like this occur, businesses that depend on stable logistics networks suddenly face disruptions that can cripple operations.This is why implementing supply chain and climate impact visibility software is no longer a luxury—it’s a necessity. Real-time data insights empower BCOs and Logistics Service Providers (LSPs) to make business-critical decisions, mitigate risks, and navigate supply chain shocks.UPS’ pivot underscores the reality: supply chains are volatile, and those without visibility are flying blind. If your business isn’t leveraging real-time insights to anticipate shifts, you’re not steering your ship—you’re waiting to get hit by the next wave.The industry is changing. Adapt, or be disrupted.

The Perfect Storm: Global Container Congestion, China’s New Year Rush, and Why Visibility is Key

It’s the logistics equivalent of the perfect storm: Chinese factories are racing to ship goods before the New Year holiday. Add in the looming spectre of US import tariffs and some nasty winter weather, and you’ve got container ports across Asia, Europe, and North America at a breaking point.

According to Linerlytica, global port congestion has hit a three-month high, with an estimated 3.3 million TEU – nearly 11% of the global container fleet – stuck at ports. China’s Yangtze River and Pearl River Delta ports are experiencing unprecedented congestion. Why? A surge of cargo trying to beat the holiday lull and potential tariffs on Chinese imports to the US.

Take Yantian, for example. This southern port, responsible for a third of Guangdong’s international trade and 25% of China’s exports to the US, has increased its daily cap on container handling by 15%, up to 15,000 units per day. In 2024, Yantian hit record volumes of 17.37 million TEU, reflecting a 7% year-on-year increase, while neighbouring Shenzhen saw exports climb 15% to a staggering CNY2.81 trillion (£303 billion).

But it’s not just China. Severe weather across the US Atlantic coast and English Channel is delaying vessels. UK ports like Felixstowe, Southampton, and London Gateway have all faced closures, while industrial action in French ports and at ECT Rotterdam is adding to the chaos.

The Bigger Picture: Visibility and the Climate Connection

Here’s the kicker: this isn’t just a logistical headache; it’s a data problem. Businesses – especially BCOs (Beneficial Cargo Owners) and LSPs (Logistics Service Providers) – are flying blind without real-time supply chain visibility. The lack of accurate data means critical decisions are being made in the dark.

Imagine the power of a dashboard that not only tracks shipments in real time but also layers in climate impact insights. How would that change your strategy? What if you could anticipate disruptions like pre-holiday rushes, tariffs, or weather delays, and proactively re-route cargo or manage inventory?

This isn’t a fantasy. Supply chain visibility software is the next frontier for logistics, helping businesses not only adapt to disruptions but also minimise their environmental impact. With container fleets jammed at ports and emissions ticking up, the need for actionable data has never been clearer.

The takeaway? The supply chain industry is overdue for a digital transformation. Those who embrace it will thrive. Those who don’t? They’ll drown in the perfect storm.

France’s Port Strikes: A Slow Burn to Supply Chain Chaos

The Normandy gateway, Le Havre—France’s biggest container port—is bracing for a storm. Dockers and port workers, rallying against state pension reforms, have kicked off a programme of industrial action. Think walkouts, strikes, and a ripple effect that’s already starting to spread.

The plan? Four-hour walkouts on 13 specific days, stretching from yesterday to 28 February, and a series of 48-hour strikes. Mark your calendars: 27, 29, 30, and 31 January, along with 4, 6, 10, 12, 14, 18, 20, 24, 26, and 28 February, will see disruptions at Le Havre. And it doesn’t stop there.

Evidence of contagion came immediately. Yesterday, 80 workers at the port of Calais downed tools between midday and 4 pm, leaving passengers and freight stranded. Crossings? Cancelled. P&O and DFDS ships? Dead in the water.

This isn’t new. The dispute over raising France’s statutory retirement age has been brewing for over a year. Last June, a 24-hour stoppage led by the militant CGT union federation paralysed Le Havre’s terminals—ro-ro, bulk, and container. Ship calls were cancelled, vessel schedules derailed, and Marseille-Fos, the second-largest box port, wasn’t spared. There, 600 dockers blocked access, creating a logistical nightmare: delays of up to a week for hauliers, immobilised goods, and sky-high costs for logistics providers forced to divert flows to other European ports.

So why does this matter? Because this isn’t just a port problem; it’s a global problem. Every walkout, every cancelled ferry, every delayed container creates a ripple effect that hits businesses and consumers worldwide.

Here’s the kicker: we’ve been here before. Last summer, the strikes paused due to political chaos when President Macron dissolved Parliament. Two new governments later, the unions are back, ready to strike harder and longer.

For Beneficial Cargo Owners (BCOs) and Logistics Service Providers (LSPs), this is a wake-up call. Supply chains are delicate ecosystems—one strike in Le Havre, and suddenly goods meant for Manchester, Madrid, or Munich are sitting idle. Firms need visibility tools that provide real-time data insights, enabling critical decisions to counteract these disruptions. Climate impact visibility software adds another layer—helping businesses reroute freight with an eye on sustainability, cost, and customer expectations.

The bottom line? If your supply chain strategy doesn’t include robust visibility, you’re playing roulette with your business. Le Havre isn’t just a French story—it’s a lesson for us all.

Freight Markets in Flux: Why Excess Inventory Could Be Your Opportunity

Retail inventories are soaring, freight markets are softening, and it’s a perfect storm for supply chains. If you’re not paying attention, the next few months could wreak havoc on your logistics, profitability, and sustainability goals. But with the right tools and insights, this challenge can be turned into an opportunity.

The Numbers Don’t Lie

Retail inventories in the US are breaking records. According to Sea-Intelligence, November 2024 inventory levels were $30.2 billion higher than the norm. Alan Murphy, CEO of Sea-Intelligence, called it “the largest upwards deviation we have seen since the financial crisis.” Inventories peaked in September, exceeding the long-term trend by 3.1%, and while there was a slight dip to 3% by November, the excess remains significant.

What’s causing this? It’s a cocktail of factors. Retailers are hedging against potential tariffs, managing disruptions like the ILA strike, and overcorrecting after pandemic-era shortages. Philip Damas of Drewry pinpointed three culprits: Chinese New Year, pre-strike cargo rushes, and sky-high inventory levels compared to last year.

And the costs are piling up. Target’s 2022 initiative to “right-size” inventory is still falling short. Jefferies noted that early inventory build-ups, aimed at mitigating East Coast port disruptions, shaved nearly one percentage point off its holiday profit margins. Meanwhile, Alix Partners warned that average “days on hand” for US retailers have risen by 12% since 2021.

A Vicious Cycle or a Strategic Opening?

Excess inventory doesn’t just dent profits; it ties up capital, increases holding costs, and inflates the carbon footprint of supply chains. Alix Partners cautioned that many companies underestimate these holding costs because decision-making is siloed between inventory planners and financial managers.

But let’s flip the script: this isn’t just a crisis—it’s a wake-up call for smarter supply chains. Imagine having real-time data insights that enable Beneficial Cargo Owners (BCOs) and Logistics Service Providers (LSPs) to anticipate disruptions, optimise routes, and fine-tune inventory decisions.

The Case for Visibility Software

Visibility software is no longer optional; it’s mission-critical. With tools that integrate real-time supply chain and climate impact data, businesses can assess the full cost of inventory decisions. This empowers leaders to counteract challenges like tariff impacts, inventory build-ups, and market softness, making business-critical decisions with confidence.

This isn’t just about saving money. It’s about future-proofing. Smarter supply chains mean fewer carbon emissions, better margins, and happier customers. The alternative? More missed earnings reports, like Target’s, and a higher environmental toll.

The message is clear: the time to act is now. Visibility, agility, and sustainability aren’t just buzzwords; they’re the foundations of a thriving supply chain in 2024 and beyond.

The Suez Conundrum – Navigating the Future of Shipping Amid Overcapacity and Uncertainty

The maritime industry is bracing for a seismic shift as carriers weigh the decision to revert to the Suez Canal after months of Cape of Good Hope diversions. This seemingly simple change has profound implications, not just for freight rates but for the entire global supply chain.

Why? Because when the Suez becomes the norm again, the reduction in voyage tonne-miles will expose the glaring overcapacity in the market, driving freight rates down—particularly on the Asia-Europe trades. According to Drewry, rerouting via the Cape reduced effective capacity by approximately 9%, a key factor in carriers posting robust quarterly profits over the past year. But now, the industry stands on the brink of a sharp correction.

Redefining the Market: Overcapacity and Pricing Challenges

The Global Shipper’s Forum (GSF) and MDS Transmodal estimate that if Red Sea transits resume, 70 ships with around 500,000 TEU capacity will become surplus. This surplus creates a new headache for shippers and carriers alike, as freight rates plummet and market volatility takes centre stage.

Matthew Gore, partner at HFW, underscores the dilemma shippers face in navigating contract negotiations. A “wait-and-see” approach sounds safe but leaves businesses vulnerable. Spot rates, predicted to trend downward but remain volatile, provide little reassurance. Gore’s advice? Consider index-linked contracts or innovative agreements like “twin-rate contracts”—a Cape rate for the longer route and a reduced Red Sea rate once services resume.

James Hookham of GSF calls twin-rate contracts a bold but necessary innovation, reflecting resilience planning seen in other sectors. Yet even he acknowledges the challenge of securing commitments in an environment as turbulent as 2025’s freight market is predicted to be.

The Critical Role of Real-Time Supply Chain Visibility

Here’s the truth: regardless of Cape or Suez, shippers and Logistics Service Providers (LSPs) need more than rate flexibility to thrive—they need visibility. Implementing supply chain and climate-impact visibility software isn’t just a nice-to-have; it’s a survival tool.

Such software provides real-time data insights, enabling Beneficial Cargo Owners (BCOs) and LSPs to make business-critical decisions amid unpredictable shifts in routes, rates, and capacity. It allows businesses to map out the full scope of their supply chains, anticipate bottlenecks, and adapt to sudden disruptions. Whether it’s gauging the impact of returning to Suez or managing overcapacity, having a clear view of the numbers is no longer optional—it’s mission-critical.

As Hookham aptly puts it, “resilience planning” isn’t just for major crises; it’s for anticipating and navigating the small, compounding challenges that define modern shipping. If transparency and data-driven decisions can protect supply chains from the ripple effects of Suez shifts, the industry has no excuse to hold back.

Final Thoughts: Innovate or Be Left Behind

The future of shipping contracts, from twin-rate deals to index-linked agreements, will be defined by innovation and transparency. But to make these strategies work, the foundation must be a visible, measurable, and data-driven supply chain. Companies that embrace real-time insights will lead; those that cling to traditional models will struggle to keep up.

As 2025 looms, the industry’s leaders won’t just be those offering lower rates. They’ll be the ones offering certainty in an uncertain world.

The Ceasefire Mirage – Shipping, Strategy, and the Critical Need for Supply Chain Visibility

The world of logistics is no stranger to disruption, and the Red Sea’s troubled waters are no exception. As reports emerge of a potential ceasefire in Gaza, speculation mounts that the Red Sea and Suez Canal routes may soon reopen for global shipping. But let’s not be hasty. A lull in Houthi attacks is just that – a lull. Experts caution against overconfidence, pointing out that the Houthis’ disruptive leverage over global trade might be too tempting for the group to relinquish.

A Fragile Path to Peace

Houthi spokesperson Mohammed Abdul Salam made waves on X, framing the ceasefire as a potential turning point. Yet, his declaration also highlighted the group’s broader regional aspirations, leaving many to wonder if hostilities in the Red Sea are truly over. Lars Jensen, CEO of Vespucci Maritime, offered cautious optimism, suggesting Suez Canal transits might resume as early as February, with sporadic crossings before that. However, industry veterans like Michael Yarwood of TT Club remind us that shipping companies may be in no rush. His reasoning? A cautious market and slow-moving insurance adjustments.

Lessons from the Suez Blockage

Yarwood’s point holds weight. The six-day Suez Canal blockage of 2021 saw shipping routes bounce back with surprising speed. But this is different. After 15 months of disrupted Red Sea routes, the logistical, economic, and psychological toll on shippers and cargo owners alike won’t dissipate overnight. Building confidence takes time, especially when the stakes involve insurance premiums, geopolitical tensions, and the broader supply chain.

The Tech Imperative: Real-Time Visibility

What’s the takeaway for Beneficial Cargo Owners (BCOs) and Logistics Service Providers (LSPs)? Two words: data visibility. In a world where geopolitical instability can upend routes overnight, the ability to see and act on real-time supply chain data is non-negotiable. Climate impact, freight delays, and rerouting costs can no longer be reactive challenges – they require proactive solutions. Advanced supply chain software is the strategic advantage here, equipping businesses with the insights needed to make critical, time-sensitive decisions.

The numbers don’t lie. DP World’s Modal Shift Programme reduced carbon emissions by 4,500 tonnes through better rail freight utilisation. Now imagine that same strategic insight applied across disrupted shipping lanes. Real-time visibility software doesn’t just safeguard supply chains – it creates opportunities for resilience, efficiency, and sustainability.

The Bigger Picture

Let’s not overlook the broader implications. This ceasefire – if formalised – would represent a remarkable shift in Israeli policy, one met with internal political resistance. But even then, a peaceful Red Sea remains speculative. For BCOs and LSPs, the real victory lies in building resilient, adaptable systems that thrive despite disruption. Visibility is no longer optional; it’s existential.

As the Red Sea drama continues, remember: a calm sea today doesn’t mean smooth sailing tomorrow. For the logistics industry, the focus must shift from reacting to anticipating – and that begins with the right tools.

Embracing Volatility – How Data Is Revolutionising Freight Procurement

Market volatility has flipped the logistics script. Shippers have been forced to rethink how they procure ocean and air freight, moving towards greater flexibility, resilience, and—most importantly—data-driven decision-making. This isn’t just a tweak to existing strategies; it’s a full-blown reimagining of freight procurement in an era of disruption.

Let’s face it: we’re navigating uncharted waters. Rate fluctuations, capacity squeezes, and ever-shifting demand patterns mean business-as-usual is no longer an option. Real-time freight intelligence is the superpower shippers—and their Logistics Service Providers (LSPs)—need to thrive, not just survive. It’s not just about rates and spreadsheets; it’s about building resilient supply chains that can weather any storm while maximising ROI.

1. Negotiating with Precision: Smarter, Data-Driven Decisions

ROI Impact: Competitive rates. No overpayments.

Real-time freight intelligence keeps you informed about rate trends, capacity, and carrier pricing tactics. Armed with data, shippers can challenge inflated premiums and negotiate from a position of strength. The result? Big savings and smarter partnerships, with cost reductions of up to 30% reported in certain cases, equating to millions saved annually on key shipping lanes.

2. Forecasting: Protecting Your Budget (and Your Sanity)

ROI Impact: 50% better budget accuracy, as reported by a Fortune 500 company.

Cost forecasting isn’t glamorous, but it’s critical. Freight data gives you visibility into surcharges, spot rates, long-term agreements, and market trends, helping you plan with laser-sharp accuracy. This isn’t just saving pennies—it’s about sidestepping financial landmines that blow up your P&L.

3. Benchmarking: The Confidence to Demand Better

ROI Impact: Better service. Better terms.

Comparing your performance and costs against market benchmarks ensures you’re not leaving money on the table or settling for subpar service. Tools that aggregate hundreds of millions of rates empower shippers and LSPs to push for better service guarantees, lower surcharges, or contractual improvements. With this collective intelligence, negotiation is no longer a guessing game; it’s a precise, data-driven process.

4. Reacting in Real Time: Stay Agile in Chaos

ROI Impact: Losses minimised, decisions aligned.

In logistics, chaos is inevitable. But reacting to it doesn’t have to be. When capacity dries up or rates spike, real-time intelligence lets you pivot on a dime—securing alternative carriers or adjusting strategies while keeping costs in check.

This level of visibility aligns teams across finance, operations, and procurement, ensuring everyone is on the same page when the heat’s on. Quick decisions, fewer silos, smoother operations.

5. Better Relationships: Collaboration That Works

ROI Impact: Long-term savings, future-proof supply chains.

Freight procurement is still a relationship game, but volatility strains even the strongest ties. Real-time data can shift the dynamic by providing transparency, neutrality, and shared insights. This fosters trust, enabling innovative collaborations like capacity-sharing agreements, dynamic pricing, or joint sustainability initiatives.

Instead of fighting over margins, shippers and LSPs can work together to tackle the big stuff—like reducing emissions or designing supply chains that can withstand future shocks.

Why Real-Time Freight Intelligence Is Non-Negotiable

For most shippers, data has historically been a pre-tender tool. But in today’s climate, relying on static benchmarks is like navigating a storm with last week’s weather report. From 2019 to 2024, we’ve seen how rapidly markets can shift. Waiting until the next contract cycle to adjust is a recipe for disaster.

Data is the compass shippers and LSPs need—not just during tender negotiations, but as a constant tool for building resilient, sustainable supply chains. It’s time to integrate real-time freight intelligence into every aspect of your strategy. With dynamic insights, you can outmanoeuvre uncertainty, build flexibility, and create lasting value for your business.

E-commerce Drives Two-Thirds of Airfreight from China as Rates Surge Amid Capacity Crunch

Ecommerce is reshaping the air cargo landscape, now accounting for an estimated two-thirds of airfreight originating from China. As demand soars, freighter operators are leveraging the momentum to increase contract rates for 2024, making this peak season pivotal for the logistics industry.

A Shanghai-based logistics provider remarked:

“The rates this week to Europe and the US exceed the highest recorded last year. Ecommerce is the key driver, with volumes making up a significant portion of overall cargo.”

Rates on the Rise: A Data-Driven Snapshot

According to WorldACD, global air cargo rates rose by 2% week-on-week, hitting $2.84 per kg as of 1 December—the highest this year. Spot rates saw a 3% increase, driven by a 4% jump from Asia Pacific and a 3% rise from North America. The statistics tell a compelling story:

  • China: $5.10 per kg (+7%)
  • Hong Kong: $6.25 (+9%)
  • Japan: $4.97 (+6%)
  • South Korea: $5.49 (+6%)
  • Taiwan: $4.07 (+5%)
  • Vietnam: $4.88 (+3%)

Year-on-year, rates surged over 30% from Japan and Vietnam, and 46% from Taiwan, underlining the immense growth in demand from these markets.

Ecommerce, Congestion, and a Growing Need for Data Visibility

While ecommerce is driving demand, capacity constraints and airport congestion remain pressing challenges. The seasonal peak is expected to ease temporarily during Christmas but will ramp up again ahead of Chinese New Year on 28 January. The situation is further compounded by a pre-tariff rush ahead of potential US import tariffs in early 2025, prompting businesses to stockpile goods.

Freighter operators are already responding with record-high proposed rates for 2024, with increases of over £1.10 per kgto Europe, compared to the prior year. This trend emphasises the growing complexity of managing supply chains amid volatile market conditions.

As demand continues to outpace supply, the industry faces mounting pressure to adopt advanced supply chain visibility and climate impact software. These tools can provide real-time data insights, empowering BCOs and Logistics Service Providers (LSPs) to make data-driven decisions and counteract supply chain disruptions effectively. Such visibility is no longer optional—it’s critical for navigating the complexities of modern logistics.

Industry Insights: A Maturing Air Cargo Market

Despite these challenges, experts note that the industry is demonstrating newfound maturity. Niall van de Wouw, Chief Airfreight Officer at Xeneta, stated:

“We’re witnessing a more grown-up air cargo market, with better resource allocation and improved terms for all parties involved. The industry is firing on all cylinders, but it’s under control—unlike the chaos of prior peaks.”

This level-headed approach is key to maintaining stability as markets evolve. However, with shifting trade routes driven by the relocation of manufacturing to Southeast Asia, businesses must adapt their strategies to remain competitive.

Looking Ahead

The air cargo market is evolving rapidly, driven by ecommerce demand, trade policy shifts, and capacity challenges. To stay ahead, LSPs and BCOs must adopt real-time supply chain visibility solutions. These tools will empower them to make informed, critical decisions, ensuring they remain resilient in a dynamic global market.

Asia’s Rising Stars: Vietnam, Thailand, and South Korea Ride the Wave of US Trade Policy Shifts

The planned tariffs on Chinese products by US president-elect Donald Trump are reshaping global trade flows, boosting containerised imports from Vietnam, Thailand, and South Korea. These nations have experienced remarkable growth in exports to the US since 2017, presenting both opportunities and challenges for supply chain resilience and climate-conscious operations.

According to a Linerlytica report, Vietnam’s container exports to the US exceeded 2 million TEU in the first 10 months of 2024, more than double the volumes of 2017. Notably, Q2 2024 saw a 41% year-on-year increase in exports, primarily manufactured goods, as businesses continued to diversify supply chains away from China. Vietnam’s appeal lies in its educated workforce, low operational costs, and improving US diplomatic relations.

Thailand has also emerged as a significant player, tripling its exports to the US since 2017. The first 10 months of 2024 recorded approximately 900,000 TEU, with October alone showing a 25% year-on-year increase. Driven by farm and food products, Thailand’s trade policies have further cemented its position as a key exporter, with domestic partnerships benefitting US firms operating in the country.

South Korea’s containerised exports to the US exceeded 1 million TEU between January and October 2024, compared to around 600,000 TEU in 2017. Electrical appliances, machinery, and equipment drove this growth, according to analyst Tan Hua Joo.

Meanwhile, China’s share of US imports from Asia has dropped from 70.4% in 2017 to 58.9% in 2024, reflecting a significant shift. Yet, China remains the largest origin country for containerised imports, even as Vietnam, South Korea, and Thailand take the lead in volume and market share gains.

The Role of Visibility in Supply Chain Management

This rapid shift in trade dynamics underscores the growing need for supply chain visibility and climate impact software. As Beneficial Cargo Owners (BCOs) and Logistics Service Providers (LSPs) navigate complex, shifting trade patterns, real-time data insights are becoming indispensable. These tools enable stakeholders to make business-critical decisions, mitigating risks such as tariff impositions and environmental impacts, while optimising the supply chain for efficiency and sustainability.

For instance, Vietnam’s efforts to avoid trade sanctions, such as importing US soybeans and aircraft, highlight how trade policy volatility can impact supply chains. With visibility tools, LSPs can respond to such challenges by forecasting disruptions and adapting their logistics strategies.

Linerlytica notes that while the proposed 10% tariff on Chinese goods is less severe than the 60% initially suggested, the policy still has cascading effects. Vietnam, South Korea, and Thailand, as the fastest-growing exporters, stand to gain. However, the unpredictability of these trade measures emphasises the importance of advanced analytics to support resilient, climate-conscious supply chains.

Hapag-Lloyd Doubles Down on Green Methanol for a Decarbonised Future

German shipping giant Hapag-Lloyd has signed a ground-breaking agreement with China’s Goldwind to secure 250,000 tonnes of green methanol annually, adding a significant boost to the 500,000-tonne Maersk agreement made in late 2023. This commitment reinforces Hapag-Lloyd’s position at the forefront of sustainable shipping and builds momentum for decarbonisation efforts across the maritime industry.

The agreement, spanning more than a decade, will see supplies of green methanol begin in 2026. The initiative forms part of Hapag-Lloyd’s Strategy 2030, a comprehensive plan to meet the Paris Agreement’s 1.5-degree climate target. CEO Rolf Habben Jansen emphasised the company’s commitment to sustainable investments, stating:

“With the agreement, we are securing a significant proportion of our requirements for green fuels. This is a critical step toward our ultimate goal of achieving net-zero fleet operations by 2045.”

Hapag-Lloyd’s strategy includes retrofitting methanol dual-fuel capabilities to five vessels, funded by green-insetting premiums paid by environmentally-conscious customers. This move not only aligns with global decarbonisation goals but also positions Hapag-Lloyd to adapt to future EU renewable fuel quotas, known as RFNBO obligations, under the FuelEU Maritime framework.

A Balancing Act in Maritime Fuels

While LNG continues to gain traction among top competitors like Maersk and CMA CGM, Hapag-Lloyd’s pivot to green methanol signals a calculated hedging strategy. The flexibility to retrofit LNG-fuelled vessels to methanol provides a future-proof option should market dynamics or regulatory landscapes shift.

The challenges of retrofitting were exemplified by Maersk’s Halifax project, which took eight months of off-hire time and a dramatic 15-metre vessel extension. Despite these complexities, methanol retrofits could offer smoother transitions compared to conventional ships.

Hapag-Lloyd’s investments come amid concerns about green methanol’s long-term scalability due to limited biogenic CO2 feedstocks. However, these constraints are dwarfed by the immediate issue of securing start-up capital to scale production capacity.

Real-Time Insights for Smarter Supply Chains

The shift towards alternative fuels highlights an emerging need: real-time visibility into supply chain emissions and climate impacts. As companies like Hapag-Lloyd blaze trails in decarbonisation, Beneficial Cargo Owners (BCOs) and Logistics Service Providers (LSPs) must adapt quickly. Visibility software can empower stakeholders with real-time data insights to make critical decisions, from route optimisation to fuel choice, mitigating disruptions and aligning supply chain operations with sustainability targets.

Hapag-Lloyd’s dual-fuel strategy is not just about compliance; it represents a blueprint for how liner shipping can transform through technology and collaboration. The adoption of visibility tools will ensure that as fuel technologies evolve, supply chains remain resilient, transparent, and aligned with global decarbonisation goals.

Rolf Habben Jansen summed it up best:

“It is and remains our ambition to play a leading role in the transformation of the liner shipping industry.”