Good morning,

Rivers have always been the cheapest way to move bulk cargo. But when the water disappears, so does that advantage.

A severe heatwave across Western Europe has pushed water levels on Germany's Rhine River to near-critical levels, forcing cargo vessels to sail with as little as 20% of their normal capacity.

The disruption is raising freight costs, slowing deliveries of steel, chemicals, and fuel, and threatening Germany's industrial recovery. As climate extremes become more frequent, one of Europe's most important freight corridors is becoming increasingly unreliable, and supply chains are paying the price.

Let's dive into today's edition.

For the past few months, we've been speaking directly with small and mid-sized 3PL operators across the United States to understand what it's really like to run a logistics business in today's market.

Through first-hand accounts, conversations with logistics leaders, and extensive research, we've uncovered what's happening to small and mid-sized 3PLs, why some are struggling while others continue to grow, and the strategies helping operators navigate one of the toughest markets in years.

The result is The State of Small & Mid-Sized 3PLs Report 2026.

It will be released in July and will be available to all CrossDock paid members as part of their subscription.

If you value original reporting, exclusive research, and deeper insights into the supply chain and logistics industry, consider becoming a CrossDock paid member.

The Trump administration said its trade enforcement task force has uncovered more than $1 billion in trade fraud through recovered funds and alleged losses less than a year after its launch.

What’s Happening? The task force, led by the Department of Justice and the Department of Homeland Security, was established to strengthen enforcement against companies accused of evading U.S. tariffs and customs rules.

The crackdown comes as the administration seeks to boost tariff collections amid sweeping new trade measures.

Shady Routes: Higher tariff rates have increased incentives for importers to lower duty costs through both legal strategies — such as tariff reclassification and bonded warehouses — and illegal methods, including misreporting product values, falsifying countries of origin, and routing goods through third countries to avoid higher duties.

Costly Affair: A previous Goldman Sachs analysis estimated that tariff evasion could eventually affect more than $200 billion in U.S. imports and reduce tariff revenue by roughly $40 billion over the long term.

J.B. Hunt Transport Services reported stronger second-quarter results, with net income rising to $181 million, or $1.91 per share, compared with $128.6 million, or $1.31 per share, a year earlier. Quarterly revenue increased 19.5% to $3.5 billion, up from $2.93 billion last year, surpassing analyst expectations of $3.26 billion in revenue and $1.74 earnings per share.

Key Performers: J.B. Hunt's intermodal business, its largest segment, generated $1.75 billion in revenue, up 22% year over year, while shipment volume increased 10%. The company's Integrated Capacity Solutions (ICS) brokerage business recorded the strongest growth, with revenue surging 49% to $388 million.

Dedicated Contract Services (DCS) revenue increased 9% to $921 million, while truckload revenue rose 35% to $240 million, reflecting stronger demand across multiple freight segments.

Weak Spot: The only weak spot was the Final Mile Services business, where revenue declined 6% to $198 million. J.B. Hunt said the decline was the result of planned customer exits and ongoing efforts to improve revenue quality and profitability rather than weakening market demand.

A.P. Moller–Maersk is expanding its U.S. contract logistics network with a $100 million fulfillment center in Hopedale, Massachusetts, scheduled to open in late August.

Northeast Expansion: The 617,000-square-foot facility will strengthen Maersk's logistics footprint in the Northeast, create approximately 1,000 jobs, and support a single large-scale e-commerce customer.

Designed for high-volume operations, the facility will be capable of processing up to 330,000 units per day during peak periods using advanced conveyor and sortation technology. The new site is intended to improve fulfillment speed and delivery reliability for consumers across the Northeast.

Big Picture: Maersk said the investment reflects growing customer demand for integrated logistics services that combine transportation, warehousing, fulfillment, and distribution within a single network.

By expanding its regional fulfillment capacity, Maersk aims to help customers meet rising e-commerce delivery expectations while improving scalability during peak shopping seasons.

The Port of Los Angeles (POLA) and the Port of Long Beach (POLB) posted another month of strong cargo growth in June as retailers and manufacturers accelerated imports ahead of evolving trade policies and ongoing global supply chain uncertainty.

Key Numbers: The Port of Los Angeles handled 1,002,734 TEUs, up 12% year over year, marking the busiest June in the port's history and only the third time it has surpassed the 1 million TEU milestone in a single month.

Imports rose 13% to 530,538 TEUs, exports were flat at 128,365 TEUs, and empty container volumes increased 17% to 345,811 TEUs. Through the first half of 2026, Los Angeles processed 5.12 million TEUs, up 3% from a year earlier and 4% above its five-year average

The Port of Long Beach also reported a strong month, handling 779,331 TEUs in June, up 10.6% year over year, making it the third-highest June on record for the port.

Imports increased 11% to 387,025 TEUs, exports rose 1.3% to 86,446 TEUs, and empty containers climbed 14.1% to 305,860 TEUs. Year-to-date throughput reached 4.83 million TEUs, 1.7% higher than the record pace set in 2025.

U.S. warehouse developers are ramping up construction after a two-year slowdown, with more than 305 million square feet of industrial real estate under construction in the second quarter of 2026, up 18% year over year, according to Cushman & Wakefield.

Recovery Time: It marks the second consecutive quarter of annual growth, signaling renewed confidence that industrial real estate demand is recovering.
Warehouse leasing also reached its highest level since mid-2022 during the quarter, giving developers greater confidence to launch new projects.
The rebound follows several years of weak leasing activity and elevated vacancy rates that prompted many developers to pause construction.

Key Details: Despite the recovery, construction activity remains well below the pandemic peak, when more than 725 million square feet were under construction in the third quarter of 2022. Developers are now focusing on demand-driven projects rather than speculative expansion.

Prologis plans to begin $4.5 billion to $5.5 billion of new developments in 2026, up from $3.1 billion in 2025, with roughly 40% of new starts expected to be data centers. Meanwhile, Panattoni plans to increase new warehouse construction by 62% this year compared with 2025.

Demand Drivers: Demand is increasingly being driven by suppliers serving the fast-growing data center sector, along with retailers building inventory ahead of potential tariff changes, manufacturers reshoring production, and third-party logistics providers expanding fulfillment capacity.

Supply chain technology company project44 has split into two standalone businesses, creating LSP44, a new AI-native infrastructure platform built specifically for third-party logistics providers (3PLs), freight forwarders, and brokers.

Key Details: The original project44 business will continue to focus on enterprise shippers as a decision-intelligence platform, while LSP44 will provide embedded AI agents, APIs, and carrier connectivity for logistics service providers.

What is LSP44: LSP44 is built on project44's logistics data network, which spans more than 280,000 carriers, 1.5 billion shipments annually, and processes 706 million carrier events every day across North America, Europe, Asia-Pacific, and Latin America.

Why the split? The company said the separation reflects the differing technology needs of shippers and logistics providers, with LSPs increasingly seeking infrastructure they can embed directly into their own transportation management systems and customer portals.

Global air cargo rates fell for the third consecutive week, with the Baltic Air Freight Index (BAI00) declining 2.5% in the week ending July 13, according to TAC Index. Despite the weekly decline, global rates remained 20.4% higher year over year, reflecting the lingering impact of the Gulf conflict on air freight markets.

What’s Happening? The market eased as lower jet fuel prices filtered through and demand weakened during the seasonal summer slowdown, although analysts said geopolitical tensions continue to leave rates vulnerable to sudden spikes.
Major outbound markets across Asia recorded broad declines, while parts of Northern Asia and India showed pockets of strength.

Key Numbers: Air freight rates from Hong Kong fell 3.0% week over week but remained 23.9% higher than a year earlier, while Shanghai declined 1.8% week over week and stayed 20.5% above last year's levels. Rates also weakened from Southeast Asia, including Bangkok and Vietnam.

Rates from the U.S. declined on routes to Europe and South America, while some lanes to China and Malaysia strengthened.

What’s Next? TAC Index said the market remains highly sensitive to geopolitical developments, with the potential for renewed disruptions to quickly reverse the recent easing in air cargo prices.

The United States, the Eurozone, and the United Kingdom would need to invest an additional $23.6 trillion by 2050 to eliminate dependence on China across critical manufacturing and technology supply chains, according to an EY-Parthenon analysis.

Key Details: The study estimates the U.S. would require $13.7 trillion in additional investment, the Eurozone $9.1 trillion, and the U.K. $800 billion over the next 25 years. That equates to roughly $940 billion in extra investment annually, including about $550 billion a year in the United States alone. Researchers said the spending would come on top of existing investments in energy, defense, infrastructure, and technology.

Why does this matter? The report highlights the scale of the challenge facing Western governments as they seek to reduce dependence on Chinese-controlled supply chains following recent geopolitical tensions.

China is projected to supply more than 60% of the world's refined lithium and cobalt and around 80% of battery-grade graphite and rare earth elements by 2035, according to the International Energy Agency.

U.S. President Donald Trump withdrew plans to impose a 20% fee on cargo transiting the Strait of Hormuz, saying the proposal would instead be replaced by trade and investment agreements with Gulf states.

What Happened: President Donald Trump abandoned a proposed 20% levy on cargo passing through a vital oil route following warnings from shipping companies about increased costs and disrupted global trade. The decision was reversed after Middle Eastern leaders instead promised significant, direct investments in the United States.

Current Status: The announcement came as the U.S. prepared to reinstate a blockade on Iranian ports following renewed hostilities between Washington and Tehran. Trump said the Strait would remain open to international shipping except for vessels calling at Iranian ports or carrying Iranian cargo.

Big Picture: Gulf governments opposed transit fees, warning they could set a precedent for similar charges in other strategic waterways despite international maritime law. If implemented, the proposed fee would have added roughly $30 million to the cost of a fully loaded oil supertanker.