Freight Monday! 🚚 We’re starting the week with a look at the challenges facing U.S.-Canada-Mexico rail trade, valued at over $200 billion. With the implementation of new tariffs, the rail sector, critical for goods like automotive parts and oil, faces additional strain.

In 2024, U.S. freight rail handled $203.1 billion in cross-border trade, but these new tariffs could further impact trade flows and jobs in the industry. More on what’s ahead 👇

💬 More in Freight:

⚫️ U.S. Food Imports Skyrocket

⚫️ Yeti Moves Production

⚫️ State of Emergency: South Carolina Wildfires

⚫️ Reviewing The Supply Chain of Wood

U.S. Food Imports 🚀

The U.S. is facing a record agricultural trade deficit, with imports of products like avocados, coffee, and sugar pushing the deficit to $49 billion this year, according to the U.S. Department of Agriculture. While U.S. agriculture once thrived as a global tool, it now imports more food than it exports, a trend that started in 2023. Prior deficits occurred only during Trump’s trade war and a few years before 1960.

The USDA projects imports will rise 6.5% to $219.5 billion, driven by strong demand for avocados, orange juice, and coffee. Exports are expected to decline 2.2% to $170.5 billion. Additionally, tariffs on Mexico, Canada, and China could increase the cost of imports if retaliations occur, worsening the trade imbalance.

Yellow Settles For $12.3 Million 🏛️

Yellow Corp. has settled WARN Act claims with nonunion employees for a total of $12.3 million. The Moore class, consisting of about 3,200 employees, will receive $8.75 million, while the Coughlen class, which includes 492 mostly union employees, will get $3.55 million. Attorneys for both classes will receive a portion of the settlements.

The court ruled Yellow was not liable for WARN claims from 22,000 union employees, as it was considered a "liquidating fiduciary" when layoffs occurred. However, the company was found liable for the 3,500 nonunion employees let go earlier, with the court noting that Yellow acted in good faith when preparing the WARN notices.

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What Else is Moving 🚚

Cross-Border Rail Trade 🚂

U.S.-Canada-Mexico rail trade, valued at over $200 billion, faces new challenges as President Trump prepares to implement additional tariffs. In 2024, U.S. freight rail handled approximately $203.1 billion in cross-border trade with these two countries, with trade split nearly evenly between the U.S.-Canada ($104.8 billion) and U.S.-Mexico ($98.3 billion).

The rail sector, vital for moving goods like automotive parts, oil, and chemicals, has been significantly impacted by tariffs. According to the Association of American Railroads (AAR), while the industry has experienced strong growth—generating $233.4 billion in output and supporting over 740,000 jobs—the upcoming tariffs could further strain the industry.

AAR CEO Ian Jefferies highlighted the importance of trade to the U.S. economy, noting that railroads invested nearly $27 billion in infrastructure last year, with major projects such as the CPKC Laredo Bridge and Union Pacific’s intermodal ramps helping to facilitate international trade. The cross-border rail system plays a critical role in moving goods, with Illinois and California serving as key hubs for trade with North America and global markets.

Despite challenges, Jefferies emphasized that railroads have made significant investments to ensure U.S. global competitiveness. However, with tariffs looming, the sector’s ability to maintain growth and efficiency could be tested as trade dynamics shift.

FREIGHT SNIPPETS ✂️

🇨🇳 Yeti's Production | Yeti plans to shift 80% of its global drinkware production away from China by the end of 2025, up from the original target of 50%. CEO Matt Reintjes shared this update during the company’s February 13 earnings call, noting the move is part of broader diversification efforts. This strategy aims to reduce the impact of the 10% tariff on Chinese goods, which is expected to cost the company less than $10 million in 2025, according to CFO Mike McMullen. Read more.

💰 Chinese Ships | The U.S. is proposing significant new port fees on Chinese-owned and Chinese-built vessels, a move that could have major implications for global shipping. Under the U.S. Trade Representative's (USTR) proposal, Chinese-owned ships would face fees of up to $1 million per port call, while Chinese-built vessels could be charged as much as $1.5 million. Read more.

8️⃣0️⃣ Trucking at 80 | At over 80 years old, Mary “Candy” Bass is still going strong after more than 50 years in trucking and 6 million accident-free miles. Candy, who was awarded Driver of the Year by the Women in Trucking Association in 2023 for her dedication to safety, was recently spotted in a viral video. The simple clip, showing her closing the door to her trailer, has resonated with truck drivers and others alike. Read more.

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🚛 Angie Stone | Grammy-nominated R&B singer Angie Stone, best known for her hit "Wish I Didn’t Miss You" and as a member of The Sequence, tragically died in a car crash early Saturday at 63. Stone was traveling in a van back to Atlanta from Alabama when the vehicle overturned on Interstate 65 around 4:25 a.m. The van, a 2021 Mercedes-Benz Sprinter, was then struck by a 2021 Freightliner Cascadia semi-truck driven by a 33-year-old man from Texas. Read more.

🔥 South Carolina Wildfires | South Carolina Governor Henry McMaster declared a state of emergency on Sunday as wildfires burned thousands of acres, forcing evacuations. This morning 163 fires were active, burning over 5,400 acres. Dry conditions and strong winds fueled the flames, but rain is expected by tomorrow, according to the National Weather Service. Forestry Chief Russell Hubright described the fires as "very erratic." Read more.

✂️ Volvo Layoffs | Between 250 and 350 workers at the New River Valley Volvo truck assembly plant in Dublin, Virginia, are set to be laid off by the end of March 2025. The layoffs, which will be based on seniority, may not be permanent. The reductions are attributed to the completion of the manufacturing phase for the new Volvo VNL truck, as well as expected impacts from tariffs on imported goods. Read more.

Pallets of News 🚛

Review of Wood Supply Chain 👓

President Donald Trump has ordered a review of the U.S. wood supply chain to strengthen domestic production for national security. Two executive orders focus on lumber, timber, and related products. One directs the Commerce Secretary to review trade practices and production capabilities, while the other asks the Interior and Agriculture Secretaries to assess policies to boost wood production.

I-40 Reopens 🚧

Interstate 40 between North Carolina and Tennessee reopened this weekend after Hurricane Helene caused closures in October. The section from Exit 7 in North Carolina to Exit 447 in Tennessee will have one lane open in each direction, with some restrictions, including a 35 mph speed limit and narrower lanes. Eastbound lanes are still under repair with an emergency-only lane. The full restoration of the highway will take years, and North Carolina has hired Ames Construction for the permanent rebuild.

MEME OF THE DAY 😂