Your Couch Helped Break The Supply Chain, Remember?

Rates may be easing, but the real story is reliability. We open with a change at the Port of New York and New Jersey, where a long-running absenteeism problem finally meets stricter rules—small news on the surface, big implications for crane productivity, truck turns, and vessel planning. Predictable people make predictable ports, and that consistency is the backbone of schedule integrity shippers depend on.

From there, we widen the lens to India’s plan for a state-backed container carrier and what that triggers in U.S. oversight. The Federal Maritime Commission’s controlled carrier rules exist to keep state-supported pricing aligned with commercial reality, protecting fair competition while allowing new capacity to enter the market. We explain how those guardrails work, why rate-change notice periods matter, and what shippers should expect if India’s line touches U.S. trades.

We also track the capacity story: Gemini’s tighter network is lifting reliability while newbuilds arrive and services start threading the Suez again. Shorter voyages free vessel days and effectively add space—classic conditions for rate pressure. That’s good for budgets, but we caution against celebrating unsustainably low prices. Carriers face higher operating costs than a decade ago, and history shows that fragile balance sheets lead to fragile schedules. Reliability beats cheap when your inventory strategy is on the line.

Finally, we break down Panama’s Supreme Court decision voiding long-standing port concessions, the geopolitical backlash, and APM Terminals stepping in to stabilize operations. Against the backdrop of the FMC’s Maritime Chokepoints Investigation, we connect how canal policies, flags of convenience, and corrective authorities can shape access and costs for U.S.-bound cargo. The throughline is simple: labor, law, and lanes are converging to reset the risk map for global ocean shipping.

If you found this breakdown useful, follow the show, share it with your team, and leave a quick review. Got a take on rates versus reliability? Drop us a note and join the conversation.

Chapters

• 0:00 Welcome And Agenda
• 1:19 NYC–NJ Absenteeism And New Rules
• 7:16 Why Reliability At Ports Matters
• 12:24 India’s State-Backed Carrier And FMC Oversight
• 20:26 Controlled Carrier Rules And Market Fairness
• 24:06 Alliances, Gemini, And Capacity Signals
• 33:30 Suez Return, Faster Turns, Rate Pressure

Transcript

SPEAKER_00: 0:12

Welcome to By Land and by Sea, powered by the Maritime Professor. Panama, China, rates, routing, and labor. Oh my. And let's throw in India today for good measure, right? And then beyond that, we're gonna get into seeing we're gonna talk a little bit about why seeing prices fall for ocean freight rates isn't always the win it might look like. Look, let's get into it a little bit further. Hi, welcome back to Byland and by C, an attorney breaking down the weekend supply chain, presented by the Maritime Professor. Me. I'm Lauren Beegan, founder of the Maritime Professor. I'm a former FMC International Affairs attorney and founder of Skull Strategies. By Land and by C is your go-to resource for navigating the regulatory side of global ocean shipping. And well, me, I'm your favorite maritime attorney, aren't I? As always, this podcast is for educational purposes only and should not be considered legal advice. There's no attorney client proof that's created by this video or this podcast. If you need an attorney, contact an attorney. All right, well, let's go ahead and get into it because as you know, ocean shipping moves the world. All right. Story number one, we're gonna start actually New York, New Jersey. We're gonna start domestically and on the East Coast. So this I almost missed, and it isn't a big story in itself. So five longshore workers were fired under a new absentee policy. But this isn't about the five people, and I think the total workforce of the ILA for New York, New Jersey is like, oh, I got I might be getting this wrong. I thought I read 4,000 or something like that. It was thousands. And so five workers getting fired. But here's why I wanted to bring it up. So New York and New Jersey has struggled with absenteeism for years, and I didn't know that. I didn't know that. And that's not me editorializing it. It's something that was actually in some articles that I was reading on this. Compared to other East Coast ports, New York, New Jersey has had a harder time predicting who's actually going to show up on any given day. And this isn't like their management, this isn't their staff, this is the ILA workforce showing up or not showing up for the jobs that they've claimed that they've called. And it's that unpredictability that obviously, obviously makes it hard to plan vessel operations, manage crane productivity, keep truck turn times consistent, right? You need reliability, and if people are signing up for jobs. And so I don't think we have to go into that because I think that's just it, right? Ports run on people, ports run on cargo, but they also run on people. And so something changed here recently, and I also didn't realize this, right? We were covering the ILA contract from kind of a larger perspective when we were having the ILA contract negotiations play out in real time. It was about a year ago, a year, two years ago. Now, what changed is that local ILA contract. Now, in the most recent agreement, the employers finally got clearer authority to address the chronic unexcused absenteeism. And for the first time, it seems that they're actually using it. Now, this is not a story about anti-labor. This is not trying to pile onto that. This is just a story. I'm just wanting to talk about this because it comes down to the reliability of having predictable people and a problem that I didn't realize was actually happening. And I think that it's always important to kind of know all sides, all stories about what's going on in the operations of ocean shipping, particularly as it relates to U.S. ports. So I think it was the JOC article. Actually, it was. It was a JOC article right written by Michael Angel. He discussed how sometimes the problem was that an ILA worker would work for one and a half time on the weekends. So they get their regular rate plus 0.5, right? So it's a weekend, it's a weekend rate. The problem was, it was identified in the article, and that was kind of explained to him, was that then that worker might not show up on Monday for a shift that they had actually committed to. In part, maybe the weekend was too strong, but in part, maybe it was the regular time. Well, or I should say, right, if the if they were working one and a half time on the weekend, then they were showing up to just want regular time on that Monday. Right? Mondays are tough for everybody. So from that article, he actually quoted John Nardi. He's president of the shipping association of New York, New Jersey, which represents maritime employers at the port. So the quote from John Nardi that Michael Angel from JOC used was you can take a couple days off for unanticipated reasons, but if you leave yourself in the system and accept a job, you need to take that job, is what Nardy said. They continue on with the quote: you can't just not show up without repercussions. Okay, well, that I mean that that kind of makes some sense. So the article kind of continues to talk about this new policy. The longshore workers are allowed three days of unexcused absences per month, which actually was shortened from now. I don't want to go into all of the details, but but basically they're saying it used to be seven days. Now it's down to four, maybe three days per month. Unexcused absences counted on the day following a weekend or a holiday now count as one and a half of those days. So essentially, you have these unexcused absences. You had workers who were signing up to take jobs, not showing up. And the article also kind of talks about how under the old contract, you would just be perhaps moved down into a lower paying dispatch job at one of the other terminals and with the potential of not making as much money as kind of your, you know, kind of trying to make up for the fact that you had done this, right? My the Mayacopa, the the, you know, I I I didn't show up. And so here's your performance plan that you need to now go down to these lower-paying jobs instead of continuing this to operate. So that's what was happening, right? So that under the old system, you would kind of go down this relegation period, and then you might have a suspension period, and then you would be fired. Now this is stricter. So now they're saying that you might still be able to go through a relegation period, one relegation period, followed by a shorter two-week suspension and then a firing. So it might have been that you had a few more relegations previously. Look, I don't really want to go into all the details because while it is very interesting, I'm not here to break down the contract or go into who was right or who was wrong. I just find it interesting that now there are five employees that have been fired under this, under this new system. And look, ports have a big mandate. There's more attention on ports. We are seeing some records on imports coming in, anyways, throughout the past year or two. This is all, everybody is trying to figure out how to make velocity, predictability, schedule integrity, and all the pieces need to be working together. And if this has been a problem for a while, like I said, I didn't even know that. If this has been a problem for a while, this absenteeism, it's kind of interesting to see that now there is recourse for the port. Look, I don't think that this is a shockwave. I don't think that this is a major thing, but I do think that it's something that perhaps other ports are watching. Perhaps it's something that other ports that also have perhaps problems with absenteeism. This might be something that can help, or maybe perhaps a model that we'll see in other local contracts. Just something interesting to note. All right, story number two. Now let's zoom out. Let's hop on over to India. This is an interesting story, partly because of what they're doing over there, but partly because I wanted to kind of explain a little bit about how the FMC works and some of the things that we don't get to talk about as often on the FMC authorities. So India is moving forward with plans to launch a state-backed container shipping line. Okay, state-backed container shipping line. No big deal. Actually, that's no big deal. There's quite a few of them out there. And if you have been following this show for a while, you know that they're called controlled carriers. We've talked about them every once in a while. This isn't unusual historically. Sometimes countries cycle in and out of national carrier models. I I've talked about how national carrier preference or cabotage laws are pretty normal. We talk a lot of people talk about the Jones Act and how it might be a little bit too restrictive and you know it requires only U.S. flag for port-to-port. Those are cabotage laws. Those things happen all over the world. That's not just a US thing. This is a little bit different than that. So it's not necessarily that cabotage law of moving port to port, but this is, and perhaps that's folded into it, but this is kind of a state-backed container shipping line. So perhaps akin to Costco, right? Kind of that's that's one of the largest, most notable controlled carrier lines out there. So that's what India's trying to do here is create a state-backed container shipping line. And like I said, this is where the FMC kind of light bulb went off. And what I wanted to explain to you. So when a government steps in and backs a national carrier, the FMC has specific oversight over carriers that are government-owned or controlled. And you might ask, well, why? What does that have to do with anything? Well, the U.S. wants to ensure that these carriers don't use these state subsidies to offer non-commercial, perhaps predatory rates that distort the market, right? If it is purely capitalism, if it's purely competition, then rates are for the most part going to flow up and down kind of collectively as a market. If it is a state-based or state-backed or government-controlled carrier, then even though the market might be fluctuating, there might be some extra cash that now that country might prop up so that the rates can be even more competitive, so that they can kind of undercut the competition. You see what I mean? So that's why controlled carriers needed to be something that the US was watching. And so if India through this national container line enters US trades, they won't just be competing on service, but they're also going to be under this microscope to ensure that the pricing reflects commercial reality and not just a national policy move. And that's why these controlled carrier lists, while they're not as interesting or as headline-invoking as many of the other things that the FMC has been covering in the past few years, controlled carriers are the controlled carrier list, is still a major jurisdictional authority that the FMC carries. Congress created specific oversight tools because government backing can distort the competition if it's used to support non-commercial pricing. So basically, what that is, if the government of whatever this controlled carrier is or whatever this carrier that has most control over government, mostly controlled by government is, they want to make sure that the market stays true and honest and that, like I said, it's not just extra cash being sent around. So if India's state backed carrier ever does enter the US trades, and I think it's still getting started, the FMC would ultimately be caring about who is controlling the carrier, by how much, whether the rate rates are reflecting commercial reality. And again, the FMC doesn't get into specific rates, they just, as a kind of general statement, get into the reasonableness, the unreasonableness, the fairness, the kind of competition of rates. So they're not setting rates, they're not getting into the specific of rates, but they want to review rates versus a commercial reality. And then they're also going to be looking for whether state support is influencing market behavior. So I wanted to bring up that India is looking into this and creating this national carrier, this container ship line, something to watch in case we see them get larger and start servicing the U.S. trades. And it really is the control carrier is is not much of a big deal being on the control carrier list. It just means that you can't change your rates. And I believe it was lower your rates with less than 30 days' notice, unless you get some sort of a variance for it. I think those actually came up when the Red Sea was a discussion and rates were kind of bopping all over the place. I want to say there were some variances filed, but I have to go check there. But yeah, something to watch just to bring to your attention. All right, story number three. Let's talk about Gemini a little bit and let's talk a little bit about kind of the overall ocean shipping world and kind of how capacity issues are changing because I want to talk about the market conditions that I'm kind of watching here, right? So uh Gemini, fantastic, right? Marisk has been very clear in its public statements of the Gemini cooperation with Hop like Lloyd. Both of them have said this is performing wonderfully, it's performing as intended, it's successful, fantastic, right? Reliability is up. The network design is for improving operational efficiencies, tightening service structures, and generating meaningful cost savings, right? It was it was created to be more efficient. And and all reports that I'm reading, anyways, are that it's doing that. It's it's really kind of hitting its marks. Now I want to zoom out a little bit, which is great, which is great. Now I want to zoom out a little bit though, because we're also seeing overall market conditions, right? Shipping networks don't operate in isolation, they operate in a broader supply and demand environment, and the entire environment is shifting a little bit. Now we're entering a period where additional vessel capacity is coming online. So what does that mean? More vessels, which means there's more space. And one of the reasons why I think that COVID congestion prices were going up, and I mean, I'm not an economist, which is why I probably put that qualifier of like I think we were having it's the same 20-foot box or it's the same 40-foot box, but we were having not only demand go through the roof, but people were ordering giant couches and giant rugs and giant TVs and giant things. Now, 20 feet in a container box and 40 feet in a container box, they don't change. It's not a giant 40-foot container box, it just is a 40-foot container box. So the more bulky the goods that were being ordered, the less space you had, the less availability of just spots in that container. But then also that made it so that the boxes were filling up faster. And so then it was more boxes on the ship. And so the ship then therefore had less space on the ship. And so you had these one-off e-commerce orders of giant couches, while also regular supply and demand, regular things were happening. So we saw$20,000, we saw$20,000 freight rates, ocean shipping freight rates move from Asia to the US West Coast. Now, that's a supply and demand thing, right? That's what I'm kind of saying here. What I'm seeing is perhaps the opposite happening. We're seeing more vessels come online, which means there's more space for cargo. We don't have that COVID congestion situation happening. And again, I'm not an economist, I'm not giving anybody any sort of economical advice here. I'm just seeing some signals. And I keep hearing we're entering into a world perhaps of overcapacity. Now, overcapacity, right? We have too many vessels coming online. Maybe not even too many. We just have more vessels coming online, so more space. At the same time, we're also seeing vessels start to move back through the Suez Canal. Great. That's great. I I'm and I'm also appreciative that they took their time there because the mariners, I mean, they're risking their lives to go through the Suez Canal. And I appreciate that the ocean carriers made sure that that risk was significantly mitigated, if not eliminated, to go through there. Because going through the Suez Canal rather than going through Cape of Good Hope is a lot faster. It is a lot faster to go through Suez. And Cape of Good Hope has a lot of dangerous weather. You know, you have to, it's different routing. There's there's all sorts of complications that happen from having to go around Africa instead of being able to go through the Suez Canal. But the biggest point, I guess, that I'm trying to make here, though, is there are a few lines that are kind of testing it out. And even this week, we're hearing are actually planning to be going through the Suez Canal again. Okay, Suez shortens voyage times. Great. What that means and how this ties into this kind of long-winded, windy conversation is that it also means that vessels are tied up for less time in their transit, right? So if they're not as busy, that also frees up capacity. So you see, we have more vessels coming out and we have capacity starting to increase because the vessel routing is shorter. And so the vessels can now get to the ports faster and drop and pick up and flip and turn and go faster, right? So now there's that kind of throughput of the containers are getting faster, which is going to make more space available. Now, from a purely operational standpoint, that change reduces transit times and improves that schedule efficiency. But from this market standpoint, with the faster turns, it could potentially mean more capacity in what is the opposite of less capacity and higher prices, more capacity, lower prices. Now, look, great news for shippers. Great, great news for shippers as a general statement. But the key point for shippers is understanding how these dynamics interact. As networks become more efficient, more capacity enters the system. I want to remind everybody that this cycle of high ocean freight rates is unusual. Now, we're certainly not in this COVID congestion$20,000 per box world anymore. But that was incredibly unusual. In the 2010s, we saw rates as low as$1,200,$1,200,$1,500 for an Asia to West Coast service for one of these boxes. You could order an entire container box full of stuff from Asia and have it shipped in a giant box for$1,500,$1,500 in the 2010s. Same box in 2020,$20,000. Right? I mean, it was it was insane going up to$20,000. But having this$1,500 as the benchmark, we're no longer down at the$1,500 mark. But what I want to remind everybody, especially the people who weren't maybe perhaps watching the market in the 2010s, that was a very difficult time for ocean carriers. Look, we even saw an ocean carrier go out of business. Hangin went out of business. And it was a true testament of too big to fail actually going out. Now, I don't think all of that is soon forgotten, right? And I definitely want to caution shippers relishing too quickly in lower rates, enjoy lower rates. If we go there and if that's where they're moving, enjoy them. But I think that we also need to be careful because carriers have to have a healthy business model to survive these rate drops, right? Ocean carriers going out of business isn't a good thing. And I don't think we're there. I don't think we're in the world of ocean carriers going out of business, right? But I guess my point is we need to caution. We can't cheer the pain shift from shipper to carrier without keeping that in mind. Ocean carriers are being strapped with more and more surcharges, more and more requirements, whether they're environmental, fuel, et cetera, et cetera. All of these things cost money. And so the operational cost of running ocean carriers these days is higher, likely, than it was in the 2010s when an actual ocean carrier went bankrupt. Now, look, one of the ideas behind alliances was to help carriers manage assets more efficiently and provide more stable service structures. I've talked about this before. So my example, right, is an ocean carrier, or let's say that you're trying to fly from Boston to Denver, right? Under the Alliance model, and we also have air alliances. If you book with Delta, you will be flying Boston to Denver. If you book with a non-Alliance member, I'm not going to name anybody, but if you book with a non-Alliance member, you might be stopping over in Kansas City. You didn't want to go to Kansas City, that's not on your route. It's the same plane, you don't even get off. But now you're stopping in Kansas City. That's not what you wanted. You just wanted to fly Boston to Denver. Little did you know that when you booked with Delta, you were actually riding with Regional Eagle Air. Doesn't matter to you. You don't care. You're just trying to go Boston to Denver. Same situation for ocean carriers, right? You might book with one of, you might book with one of the ocean carriers that's in one of these alliances. Your cargo might actually be on a different ship. It doesn't actually really matter. It's making the route that you booked. And your points, so to speak, right? Your points, your lounge access, all of that stuff that you enjoy about flying with Delta or whatever the company is, or or whatever the ocean carrier is, all that kind of good relational competitive stuff that you like is still there, but your cargo might be on a different ocean carrier's vessel. Now that's what this vessel sharing agreement was. This is what the idea of an alliance was, right? More routing options because they're not a bunch of half full vessels or a bunch of third full vessels doing the same route, but it is it is just kind of making it so that they can be more efficient. Now, that was also partly they had to do it because rates were so low and they had to figure out a way of helping to mitigate some of those costs, but then also providing a better experience. Now, look, alliances are not designed to control market demand. They can't override basic supply and demand fundamentals, and we have more and more vessels coming online, like I said. And so in supply, where the availability of space goes up, the overall rate is likely to go down. It would be expected to go down. Look, something many shippers like to see. Of course, right? Lower freight rates. And honestly, end consumers like to see lower freight rates too, because part of what the inflation I think was driven by when we were coming a few months past COVID congestion, when we had those$20,000 rates, is because the more expensive a good is to ship, the more expensive that good needs to be priced to recoup that cost at the end of it, right? So of course, shippers and consumers like to see lower ocean freight rates and just lower rates in general. But my point today is that I want it, I want you to understand the full picture too, because lower rates are a welcome thing, right? But the ocean carriers still have a business to run and we still need ocean carriers to move the goods. And so it's a little bit of a balance. And look, what I'm going to be watching, and many shippers are going to be watching, is how carriers start to manage these networks as the conditions evolve, right? They might be around capacity deployment, service frequency, maintaining schedule reliability in a softer market, how schedules might be changing a little bit. But I just want you to be noticing these little things that might not be giant. I want you to notice vessels coming online. It's wonderful to see a brand new vessel, but I think we also need to kind of keep that in mind for how it how it will look overall and what that means for you. And that's partly why you watch this podcast, right? That you listen to this podcast so that you can kind of hear some of these signals or hear some of these things that I'm noticing, and just something for you to consider. Again, none of this was financial, economical, legal advice. None of this is. This is just things that I'm watching and I don't know, things that I'm I'm paying attention to. All right, story number four. Now let's get over to Panama. Now, I think this one really does need a little bit more background to make sense. We haven't really gone too far into the Panama discussion. Uh, we've talked about it from the maritime choke points investigation that the FMC is doing, but we haven't gone too far into the details. And again, I won't be going too far into the details here, but I do want to point out a few things that have recently happened and kind of how I see a few other signals. So for decades, Panama Ports Company, a subsidiary of CK Hutchinson, which is a large Hong Kong-based global port operator. We heard about Hutchinson during kind of the China conversation and Panama and China-owned terminals and all sorts of things, right? So forever, not forever, Panama Ports Company for quite a long time has operated the Balboa and Cristobal container terminals on either end of the Panama Canal. Now, these control agreements date back to the 1990s. Now, that was a time when Panama was modernizing its port system and kind of inviting foreign operators to invest and trying to kind of uh, I don't know, get get their ports up and running, right? Get their ports with with more capital and and more infrastructure. Now that worked for a long time, right? It's no longer 1999, excuse me, 1990s. Although, doesn't it feel like it? It's not 1990s anymore. But over the past several years, the political and legal environment in Panama, as we know, in and around Panama, has been shifting, particularly over the past year and a half. There's been increased scrutiny of long-standing agreements, right? Questions about whether they align, even within Panama, whether these constitution whether these agreements are in line with constitutional requirements, uh, and broader public interest concerns about how critical infrastructure is governed. Now, all of that came to a head recently because Panama Supreme Court ruled that the legal framework underlying these agreements, underlying these concessions, underlying these port operational agreements was actually unconstitutional. Now, the court found fundamental legal defects in how the contracts were actually structured under Panamanian law. Now, this is a legal determination, not a commercial one, but it effectively voided the concessions. As I understand it. Now, I haven't pulled the actual text of the Supreme Court ruling on this, so I'm relying on reputable news sources to kind of explain what's happening here. If I have any reason to believe that I need to dive into it further, I certainly will. But I don't want to go too far into the geopolitics and the Supreme Court regulatory authority of the Panama Supreme Court. Now, look, Panama isn't saying we don't like the operator anymore. That's not what's happening. Although that might be part of the subtext that people are going to kind of talk about, that's not necessarily what's happening. This is just a court saying these contracts never should have existed in this form. Now, Panama Ports Company is now seeking extensive damages and pursuing international arbitration. We've also had a lot of conversations or a lot of remarks coming out of the Chinese government. It's something to amplify the story. So it's a reaction from China's Hong Kong and Macau Affairs office. After the court ruling, Beijing warns that Panama would pay heavy prices if the decision is upheld, calling the ruling absurd, shameful, and pathetic, and vowing to defend the interests of Chinese firms. Now look, that kind of language makes it clear that this isn't just a domestic legal dispute anymore. Once you're talking about the Panama Canal, you're automatically in geopolitics territory, right? It's a critical trade route, and the companies involved operate on a global scale, including out of Hong Kong, right? I mean, that's CK Hutchinson. Now look, Panama still has to keep the ports running. That's where APM terminals come in as the interim operator, a transitional step to ensure continuity and stability because operational uncertainty in the entrances to the Panama Canal is not something anybody wants to see. We've had enough uncertainty, I think, to last a lifetime for all of us. But certainly trade, ocean shipping, trade, and the movement of goods loves reliability, loves predictability, right? That's why it's the liner service. That's why there are these dedicated trade routes. But beyond that, we need to have stability in these ports. And so APM terminals coming in as the interim operator is something that honestly had to happen. Not necessarily APM directly, but they had to have an interim operator if the contracts were negated. So I think what I also want to mention here is anytime we start talking about CK Hutchinson and these Hong Kong, Chinese, adjacent related ports, I can't help but think about the Maritime Choke Points Investigation. The FMC's Maritime Choke Points Investigation, right? They've been actively examining how choke points and foreign government actions can affect U.S. Ocean commerce, including through its maritime choke points investigation. Now that investigation looks at ports and canals and other strategic nodes that can influence access, pricing, or service in U.S. trades. And I've mentioned this a few times, and I actually have a training, a class, an online course at the maritimeprofessor.com. If you want to learn more about what this investigation actually does and is looking at, it's ongoing. Even though the comment period has closed up, this investigation is still open. Now, the investigation was not the only factor here, right? And certainly not determinative. It's part of the broader backdrop. I think, and it's important to mention regulatory scrutiny around choke points, market access, and foreign control has increased, not decreased. Now, look, why is this important? Why is this something that I'm bringing up? Why should we even be worried about the FMC and a maritime choke points when we're talking about the ports? Panama Canal, during this time, excuse me, during COVID congestion, there was some, and maybe even beyond, right? But there's some questions about how they assess transit fees and perhaps even port fees, but how they assess these fees in a fair and favorable manner. Because the opposite of that is unfavorable shipping conditions and unfair. Now, if you have watched this show, I often bring up the Foreign Shipping Practices Act or Section 19 of the Merchant Marine Act of 1920. Both are authorities and kind of comboed are authorities that make it so that the FMC can take corrective action when they find unfavorable shipping conditions happening out there. And what that means is when countries or carriers, but when countries take unfavorable shipping conditions and are prejudicial or discriminatory, the FMC can take corrective action. One of the tools that they have is they can turn away flags of the country that they find unfavorable shipping conditions. Now, Panama has 18% of the world's flag fleet. What does that mean? 18% of the vessels out there are flying a Panamanian flag. Talking about flags of convenience is another, another topic, but 18% of the world's flag fleet. Panama is a flag of convenience, meaning that there are lesser thresholds to maintain, to get and to maintain the Panamanian flag. There are other flags of convenience out there, and it kind of at some point might even turn into like a paperwork thing. I mean, I don't I don't all I want to say is that Panama didn't want to lose. I can only imagine. Panama probably didn't want to lose that 18%. And so all of this together, right? All of this together. Now it doesn't necessarily mean that one means the other. I'm just saying the total picture of what was happening and the pressure being put on Panama. I'm not surprised to see that this was reviewed with a closer eye and that it needed a little bit more. I think an outcome like this was probably always on the table, I guess is what I'm trying to say, right? As ports and trade corridors become more strategically important, governments are taking a closer look at legacy agreements that were negotiated. And I think that this was this was brought to their attention, perhaps faster than maybe just a regular routine review. But I also think that this is interesting, right? The message coming out of Panama is clear that port agreements aren't just commercial arrangements, but they kind of are national exercises in national authority. And so it's interesting to see where we are here. I'm going to continue to watch it. Again, this might have been overly simplistic on what's happening here, but I wanted to just kind of bring you into my like matrix of what I'm thinking about here. I'll be interested to see where this goes because, like China said, that they're going to be bringing this for international arbitration. I want to see what that turns into and how that will be continued. Now, look, this space is moving fast, right? That's why you turn in. So whether you're a shipper, a carrier, a port, or somewhere in between, staying grounded in the rules, the markets, and the infrastructure really matters right now. A lot of decisions are being made, both quietly, but also are tending to show up in operations before they ever really make headlines that they are ending up in operations. Excuse me. That's why I'll keep breaking these developments down in plain language so you can stay ahead of them, right? Not react after the fact, because when you understand the rules, you make better decisions. All right, if you like this episode, be sure to follow, subscribe, and leave a review. Want to go deeper on these topics or bring this kind of insight to your team, visit the maritimeprofessor.com to explore corporate trainings, tailored briefings, and on-demand webinars, all designed to make complex maritime regulations practical and easy to understand. And if your organization needs help navigating the legal or strategic side of ocean shipping, head over to Swell Strategies. That's where I provide consulting services, regulatory guidance, and policy support. As always, this podcast for educational purposes only and not legal advice. If you need an attorney, contact an attorney. I hope to see you all at Manifest next week. I am so excited. I'm heading over to Manifest. We're going to be in Vegas for the week. Future of supply chain. I believe it's sold out. I think that means that there are over 7,000 people going. I am so excited. Hopefully, I'll see it at Manifest. If not, I'll see you right back here on Fridays. Until next time, I'm Lauren Vegan, the Maritime Professor, and you've just listened to my land and by C. See you next time.