🚚 Foreign Trade Zones
Freight Wednesday! 👋 Today we're diving into an interesting shift in how companies are managing tariffs. As trade tensions rise and tariffs climb, businesses are turning to foreign trade zones (FTZs) and bonded warehouses to protect their margins.
FTZs, often located near ports or logistics hubs, offer a “tariff-neutral” space where goods can be stored, modified, or assembled without paying duties upfront. Duties are only paid if goods enter U.S. commerce, and if they’re re-exported, no duties are owed.
💬 More In Freight:
⚫️ J.B. Hunt Awaits Market Turnaround
⚫️ Thermal Drone Technology Used During Blitz Week
⚫️ Port of Los Angeles Sees Record June
⚫️ Fraudulent Fuel Purchases
J.B. Hunt Awaits Market Turnaround 🥲
J.B. Hunt Transport Services is staying focused on streamlining operations and improving margins as it waits for demand to rebound.
The company reported Q2 earnings of $1.31 per share, flat year-over-year and in line with expectations. Revenue held steady at $2.93 billion, while operating income dipped 4% to $197 million. Despite the decline, margins have stabilized, and the company has outlined $100 million in cost reductions, with most savings expected in 2025.
Intermodal:
Revenue rose 2% to $1.44 billion, with a 6% increase in load volume offset by a 3% drop in revenue per load. Growth in shorter-haul Eastern loads contributed to the yield decline.
Dedicated:
Revenue slipped less than 1% to $847 million, as truck count fell 3% but was offset by a 3% increase in weekly revenue per truck. The company expects to return to net fleet growth in the second half of the year and remains committed to adding 800–1,000 trucks annually. The unit’s OR rose slightly to 88.9%.
Brokerage:
The segment posted its 10th consecutive loss—$3.6 million—though that was a $10 million improvement year-over-year. Revenue declined 4% to $260 million, with fewer loads but higher revenue per load. Headcount is down 21% year-over-year, while productivity and gross profit per employee have improved.
Thermal Drone Technology During Operation Safe Driver Week 👀
The New York State Department of Transportation (NYSDOT) is deploying thermal drones to help identify unsafe commercial vehicles during Operation Safe Driver Week.
In a July 15 announcement, NYSDOT said it’s partnering with the Commercial Vehicle Safety Alliance and other law enforcement groups for the annual safety blitz. The drones are being used to detect issues like faulty brakes and flat tires before they pose serious hazards.
NYSDOT shared thermal images of trucks in motion as part of its enforcement efforts. Operation Safe Driver Week runs July 13–19 across the U.S., Canada, and Mexico.
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What Else Is Moving 🚚
Foreign Trade Zones (FTZ) 📦
As trade tensions heat up and tariffs climb, companies are turning to a lesser-known but highly effective tool to protect their margins: foreign trade zones (FTZs) and bonded warehouses.
Think of FTZs as “tariff-neutral” zones inside the U.S. — usually located near ports or major logistics hubs — where imported goods can be stored, modified, or assembled without paying duties upfront. Duties are only paid if and when those goods enter U.S. commerce. If they’re re-exported? No duties at all.
Bonded warehouses offer similar benefits but with a five-year storage limit and more flexibility: if tariff rates drop while goods are stored, companies can release the product and pay the lower rate.
These zones are officially sanctioned by U.S. Customs and trace their roots back to the Great Depression. They were designed to encourage trade during periods of economic turbulence — much like today.
“For companies importing parts or raw materials, FTZs and bonded warehouses are essential tools,” said Jason Strickland, director of sales at Givens Logistics. “They let importers delay duty payments, free up cash flow, and avoid overpaying in a volatile tariff environment.”
Before 2025, companies operating in FTZs could also benefit from the “inverted tariff” rule — paying a lower rate on a finished product than on individual components. But that option was recently scrapped under a Trump executive order, triggering a rush toward bonded warehouses as an alternative.
“It’s all about flexibility,” said Strickland. “With so much uncertainty, these tools help businesses stay agile without locking up capital.”
Today, there are more than 2,200 FTZs across all 50 states, used by everyone from automakers and electronics manufacturers to pharmaceutical giants. In a trade war, they’ve become a strategic lifeline.
FREIGHT SNIPPETS ✂️
🏗️ Port of Los Angeles Sees Record June | Container volumes at the Port of Los Angeles surged in June after a sharp drop in May, as importers adjusted to trade volatility stemming from President Donald Trump’s escalating tariff policies. The port processed 892,000 twenty-foot-equivalent units (TEUs) in June — a record for the month and up 32% from May, Executive Director Gene Seroka said. Total volume for the first half of 2025 is up 5% from the same period last year. Read more.
🎖️ FreightTech 2026 Awards | FreightWaves is now accepting nominations for the 2026 FreightTech Awards, honoring the most innovative companies in freight tech and transportation. As the industry emerges from a prolonged downturn, this year’s list could highlight the next wave of market leaders. Read more.
🚨 Fraudulent Fuel Purchases | A New York trucking company employee has been arrested for allegedly using a company fuel card to make thousands of dollars in unauthorized purchases over several years. John C. Bowman, 36, was charged with third-degree grand larceny, a Class D felony. The investigation began in May after Pennsylvania’s Bradford County Sheriff’s Office contacted CCSO about suspicious fuel card activity tied to Moore Trucking. Authorities say Bowman used the card to make personal fuel purchases between July 2020 and May 2025 at various locations across Chemung County. The total fraud amounted to $15,778, officials said. Read more.
TOGETHER WITH CARRIERSOURCE.
Fr8topia: Brokerage Review of The Week 🏆
This week, we spotlight Fr8topia, a full-service logistics provider headquartered in Valencia, CA. Specializing in truckload, refrigerated, warehousing, and cross-docking services, Fr8topia delivers reliable freight solutions across the U.S., Mexico, Canada, and Hawaii.
Whether managing complex supply chains or moving a single pallet, Fr8topia’s mission is simple: protect your freight, provide real-time visibility, and be a trusted partner.
Name: Fr8topia
DOT Number: 3211305
Headquarters: Valencia, CA
📈 Inflation Rises In June | Inflation rose to 2.7% in June, its highest level since February, driven in part by President Donald Trump’s new tariffs, which are increasing costs on items like furniture, clothing, and appliances. The Labor Department reported that prices rose 0.3% from May to June, up from a 0.1% increase the previous month. Year-over-year inflation climbed from 2.4% in May. Read more.
🍅 Mexican Tomato Imports | The U.S. is withdrawing from the 1996 Tomato Suspension Agreement with Mexico, reinstating tariffs of 17% to 21% on most Mexican tomato imports starting Monday. The Commerce Department said the deal failed to protect U.S. growers from unfair pricing, citing heavy pressure from farmers to end it. Mexican tomatoes make up nearly 70% of the U.S. market, with imports totaling $3.12 billion in 2024, most of which enter through South Texas and Arizona. Read more.
🚛 Switching Seats | A July 13 commercial vehicle stop in Marathon, Ontario, resulted in 15 charges after officers saw two individuals attempting to switch seats—allegedly to conceal that the driver wasn’t properly licensed. According to Ontario Provincial Police, neither person could provide valid insurance, logs, or inspection reports. The 18-year-old driver was cited for improper licensing, lack of an ELD, air brake violations, and missing documentation. Read more.
Pallets of News 🚛
FMC Investigating Port Houston 🏗️
The Federal Maritime Commission (FMC) has launched a nonadjudicatory investigation into Terminal Service Agreements (TSAs) between Port Houston and major ocean carriers.
In a July 11 filing, the FMC said it will examine whether these agreements require carriers to route a set percentage of loaded containers through Port Houston, potentially limiting access to competing Gulf Coast ports.
TSAs outline the terms for carriers’ use of port facilities, and the FMC is focusing on specific “Commitment Clause” and “Shortfall Amount” provisions in contracts with CMA CGM, Evergreen, Hapag-Lloyd, Maersk, MSC, and Zim.
The FMC’s Bureau of Enforcement, Investigations, and Compliance will review how these clauses were formed and enforced. Port Houston moved a record 4.12 million TEUs in 2024, up 8% year-over-year.
Ammonia Fueled Ships & Data Centers ⛽️
Brooklyn-based startup Amogy is sidestepping U.S. political headwinds by focusing on Asian markets for its ammonia-to-power tech — and just raised $23 million, bringing its total to $80 million and its valuation to $700 million.
Led by Korea Development Bank and others, the funding reflects strong demand in Japan and South Korea, where limited renewable and nuclear options are pushing innovation in alternative fuels. These countries are blending ammonia — typically used in fertilizer — into power generation and shipping to cut carbon emissions.
Unlike traditional ammonia combustion, which still requires fossil fuels, Amogy’s system cracks ammonia into hydrogen to power a fuel cell, emitting only water vapor and nitrogen — no NOx pollution. The company has already demonstrated the tech in a tugboat and aims to deploy it in ships and small-scale power plants (500 kW to 1 MW) within a few years.
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