Technology

Transportation Management | Compliance | Visibility | Procurement

New product allows shippers to flex MQC volumes on weekly basis

By Peter Tirschwell

A new venture launched by a former US Department of Transportation( USDOT) official is trying to create an alternative for container shippers and carriers to avoid the spot market when market conditions disincentivize shipping under contracts.

Shippers typically are forced into the spot market in when their actual volume exceeds weekly contracted allocations known as minimum quantity commitments( MQCs), a scenario many would prefer to avoid. Carriers, meanwhile, must turn to the spot market to fill their ships when booked cargo fails to show up at the port, known as downfalls.

But Andrew Petrisin, a former USDOT deputy assistant secretary for multimodal freight who led the Freight Logistics Optimization Works( FLOW) project under the Biden administration, says tradable, guaranteed slot reservations would enable greater efficiencies for both shippers and carriers. He’ s created an online platform called Laneway that attempts to achieve exactly that.

Tradable reservations, or“ Allocation Equivalent Units,” would enable shippers to stay under carrier contracts, supporting carrier relationships without having to direct cargo through third parties when their volumes exceed MQCs. Shippers wouldn’ t need to go to the spot market given the uncertain costs and the need to juggle various spot quotes.

By using the system, shippers can acquire or dispose of weekly allocations in the frequent scenario when their weekly volume diverges from their weekly allocation due to the vagaries of manufacturing output and other factors.

In turn, carriers would reduce downfalls, which can exceed 30 % on certain sailings, retaining business and margins that would otherwise be captured in the spot market.

For both shippers and carriers, these outcomes would be the result of guaranteed slot reservations sold by carriers to shippers and then traded freely thereafter, whether among shippers or between shippers and non-vessel-operating common carriers( NVOs) for use by the NVOs’ named accounts.

“ It’ s a market that allows the reservation to be tradable,” Petrisin said.“ The carrier sets the initial price; the shipper pays at the point of sale, and then after that it trades freely.”

Laneway is addressing one facet of risk management in a chaotic container shipping environment, where shippers see their cargo shut out from capacity.

Others are trying to solve the same problem in different ways, such as container freight futures. Under that scenario, the shipper signs an index-linked contract that avoids their rates becoming unappealing to the carrier, and then hedges adverse price movements using container freight futures.

Laneway’ s tradable reservations, the price of which would fluctuate on the free market, are not derivatives but rather the guaranteed right to capacity under shippers’ existing contracts.

“ Laneway doesn’ t dictate the price, but I imagine the price will fluctuate based on the week of the year, overall market conditions, and other factors,” Petrisin said.

While at USDOT, Petrisin led development of FLOW, a well-regarded initiative kept active by the Trump administration that enables players to monitor capacity and enable them to proactively identify and respond to delays.

By being tied to contracts, Laneway contrasts with a number of carrier spot market products that offer both quotes and guaranteed space. These include Maersk Spot, Hapag-Lloyd’ s Quick Quotes Spot, Evergreen’ s GreenX, and Ocean Network Express’ s ONE Quote. Other carrier spot products allow for quotes, but without space confirmation.

The ability to access guaranteed space in the contract domain has been lacking, Petrisin said.“ While some contract products now offer guaranteed space, you can’ t flexibly manage that guaranteed space as your volume changes,” he said.

According to Petrisin, creating fungible contract allocations through tradable slot capacity could shrink the spot market without eliminating or threatening the forwarder; while their traditional NVOCC business may decrease, forwarders can facilitate capacity trades for shippers as order managers and receive a cut of the market commission.

Petrisin is building a pipeline of carriers, forwarders and shippers to begin listing and trading reservations, encouraging shippers to reach out to the carriers to indicate their interest in buying this new product.

Petrisin said a system of tradable reservations would help reduce no-shows, which force carriers onto the spot market to fill ships at the last minute, or sail underutilized.

“ Much of the current spot market is‘ spillover’ from the contract market,” he said.“ There will always be a true spot market for shippers who need one-off bookings on a given lane, but by eliminating the‘ spillover’ market we will cut costs for shippers, increase profits for carriers, and provide forwarders more reliable revenue.

“ Carriers care about rate then service, and shippers care about service then rate,” he added.“ A tradable reservation enables both parties to hedge what they care about most.”

email: peter. tirschwell @ spglobal. com

Tradable reservations would reduce the likelihood of cargo no-shows, which can exceed 30 % on certain sailings. Shutterstock. com www. joc. com February 2, 2026 | Journal of Commerce 29