Good morning.

America's effort to break China's grip on rare earths has hit an unexpected obstacle: the competitors meant to rebuild a domestic supply chain are now fighting each other in court.

MP Materials has sued rival USA Rare Earth, accusing it of stealing proprietary magnet technology through a former employee. Both companies have received significant backing from the Trump administration as Washington races to build a U.S.-based rare earth supply chain for EVs, electronics, and defense systems.

Let’s dive into today’s edition.

U.S. Customs and Border Protection has cleared $20.6 billion in tariff refunds for importers as Washington continues unwinding duties struck down by the Supreme Court, marking one of the largest trade-related repayment efforts in U.S. history.

Refund Process: The agency said roughly $85 billion in potential and certified refunds have now entered the processing system, while total repayments could eventually reach as much as $166 billion across more than 53 million import entries.

Data Error: The update also revealed that customs officials previously overstated refund claims by about $10 billion due to a data query error. Earlier reports suggested $35.5 billion in claims were being processed, but the actual figure was closer to $25 billion.

Big Picture: Thousands of payments remain delayed because some importers have not yet established digital payment capabilities, while millions of entries are still being reprocessed. The refund program is being overseen by the U.S. Court of International Trade, which has requested regular updates on repayment progress.

A new $200 million venture capital fund is betting that rebuilding America’s maritime industry could become one of the biggest infrastructure opportunities of the decade.

Parties Involved: Backed by Prologis and the American Bureau of Shipping, TMV Logistics plans to invest in early-stage startups focused on shipbuilding, ports, maritime technology, robotics, operational AI, and next-generation fuels. The move comes as Washington intensifies efforts to reduce dependence on China, which currently dominates global shipbuilding.

Why Now? According to the Center for Strategic and International Studies, a single Chinese state-owned shipbuilder produced more commercial tonnage in 2024 than the United States has built since the end of World War II. The fund's launch follows a broader push by the Trump administration, including a proposed $65.8 billion U.S. Navy budget and growing investment aimed at rebuilding domestic maritime capacity.

Big Picture: Shipbuilding may be the headline, but the broader goal is strengthening America's logistics backbone as ports and freight networks come under increasing pressure from global trade disruptions and capacity bottlenecks.

Logistics technology startup Stord has raised $250 million in fresh funding as it looks to help brands compete with Amazon's fast-delivery infrastructure, which has become its biggest competitive advantage.

Key Numbers: The funding round values Stord at $3 billion and includes backing from investors such as Kleiner Perkins, Founders Fund, and Strike Capital. The company plans to use the capital to expand its network of nearly 100 warehouses and accelerate investments in AI and robotics.

Background: Founded in 2015, Stord provides fulfillment, inventory management, checkout, and delivery services for retailers seeking Amazon-like logistics capabilities without relying on Amazon's ecosystem. CEO Sean Henry said Amazon’s real advantage isn't product selection or payments, but the consumer expectation that an order placed today will arrive tomorrow.

Stord currently processes more than $15 billion in annual gross merchandise value across over 1,000 customers and has completed eight acquisitions to date. Alongside the funding, the company also launched Stord Labs, a new facility designed to test robotics technologies before deploying them across its fulfillment network.

The United States Postal Service has signed a $10 billion agreement with DHL eCommerce to provide last-mile delivery services, marking one of the largest commercial partnerships in the postal service’s history.

What’s the deal? The multi-year deal will see USPS handle the final leg of package deliveries across its network of 170 million addresses, leveraging a reach that Postmaster General David Steiner described as unmatched. The agreement follows USPS’s recent push to expand its last-mile delivery business beyond existing partnerships with Amazon and UPS.

Why this matters: Last-mile delivery is widely considered the most expensive and labor-intensive part of e-commerce logistics. By tapping USPS’s nationwide network, DHL said it can expand U.S. coverage more efficiently while reducing the need for additional delivery vehicles.

Advantage USPS: The deal comes as USPS searches for new revenue streams amid ongoing financial pressures. Earlier this year, Steiner warned that the 250-year-old agency could run out of cash within a year unless Congress expands its borrowing authority, making large commercial partnerships increasingly important to its long-term turnaround strategy.

U.S. rail giants Union Pacific and Norfolk Southern have hit another hurdle in their proposed $85 billion merger after federal regulators paused their review and demanded additional information from both companies.

Merge Paused: The Surface Transportation Board accepted the railroads’ revised merger application but immediately suspended proceedings, citing gaps in the filing regarding competition, market-share projections, and the broader impact of combining the two networks. The companies have until July 27 to submit supplemental materials.

Big Entity: If approved, the deal would create the first coast-to-coast freight railroad in U.S. history, linking more than 50,000 miles of track across 43 states. The companies argue the merger would reduce interchange delays, improve service, and open new routes, while critics warn it could reduce competition and raise transportation costs for shippers.

CMA CGM reported a sharp drop in first-quarter earnings as lower freight rates continued to weigh on ocean carriers following the record profits seen during the post-pandemic shipping boom.

Free Fall: Net income plunged 77.7% year over year to roughly $250 million, while EBITDA fell 31.6% to $2.1 billion. Revenue from the company's core maritime division declined 8.5% to $8 billion as average revenue per container dropped nearly 10% to $1,351 per TEU amid a weaker freight market.

Lost Share: The carrier transported 5.9 million TEUs during the quarter, up 1.5% from a year earlier. However, that lagged global container trade growth of 4.4%, suggesting CMA CGM lost market share as rivals such as Maersk posted stronger volume growth.

Silver Lining: One bright spot came from logistics subsidiary CEVA Logistics, where revenue rose 6.6% to $4.6 billion. The company's terminals and air cargo operations also delivered strong growth, helping offset weakness in its container shipping business as freight markets continue adjusting to post-boom conditions.

The Trump administration said tariffs on imports from Canada and Mexico will remain in place as Washington begins negotiations to overhaul the United States-Mexico-Canada Agreement, signaling a major shift away from the tariff-free framework that has defined North American trade for decades.

Tariffs to Stay: U.S. Trade Representative Jamieson Greer said the U.S. will continue using tariffs to address trade deficits, arguing that even close regional partners should not be exempt. He also indicated that auto and steel tariffs are likely to remain in place under a revamped trade agreement.

Key Details: U.S. and Mexican officials are set to begin formal talks on new rules of origin and economic security measures, with Washington pushing for higher North American content requirements and stronger regional supply chains. The administration also wants Mexico to raise tariffs on imports from outside the region to reduce dependence on overseas suppliers.

Big Picture: Greer reserved some of his sharpest criticism for Canada, pointing to Ottawa’s retaliatory tariffs against U.S. measures. His comments suggest Canada could face a more difficult path in upcoming negotiations than Mexico.

Global container shipping rates continued their upward climb in late May as early peak-season demand and tighter vessel capacity pushed freight prices higher across major trade lanes.

Rising Costs: Drewry’s World Container Index rose 3% to $2,800 per 40-foot container during the week ending May 28, marking its fourth consecutive weekly increase. Asia-Europe routes saw Shanghai-to-Rotterdam rates rise 3% to $2,861 per container, while Shanghai-to-Genoa shipments climbed 4% to $4,253.

Transpacific routes also strengthened, with Shanghai-to-New York rates jumping 6% to $4,597 and Shanghai-to-Los Angeles rising 3% to $3,473. Drewry said additional blank sailings, peak-season surcharges, and limited capacity growth are helping support higher freight rates.

The Trump administration said it will soon begin the process of establishing a new U.S.-China “Board of Trade,” a mechanism designed to oversee tariff reductions and manage trade flows between the world’s two largest economies.

Public Comment: U.S. Trade Representative Jamieson Greer said Washington will seek public input on which Chinese goods should qualify for lower tariffs under the new framework. The board is expected to initially oversee roughly $30 billion worth of non-strategic goods that could see tariffs reduced or eliminated.

Back Story: The initiative emerged from recent talks between President Donald Trump and Chinese President Xi Jinping as both sides pursue a more structured “managed trade” approach rather than broader economic reforms. Officials have indicated the framework could focus on areas such as agriculture, energy, consumer goods, and aviation while maintaining higher tariffs on strategically sensitive sectors.