Military aid is coming to the commercial vessels in the increasingly dangerous waters heading into the Suez Canal. The U.S. is establishing a multinational naval force to protect merchant ships in the Red Sea after Houthi rebel attacks threatened the Suez Canal’s central role in global trade. The WSJ’s Costas Paris and Joe Wallace report the security operation, called Operation Prosperity Guardian, will include the U.K., Bahrain, France, Norway and other countries. The effort comes as Suez Canal has become a new front in the Israel-Hamas conflict, with global shipping companies the main targets. Many of the world’s biggest shipping lines, oil producers and other cargo owners are diverting vessels from transiting through the crucial trade corridor. Energy giant BP is the latest company to pull its tankers from the region, joining a slew of containership operators now taking longer voyages around Africa’s Cape of Good Hope.

• Analysts say liner companies could need additional capacity equivalent to 1.7 million boxes to make up for longer routes to avoid the Red Sea. (Lloyd’s List)

Nippon Steel is about to take a major role in U.S. industrial supply chains. The Japanese behemoth is acquiring U.S. Steel in a $14.1 billion deal that would end the independence of the 122-year-old icon of American industry that was created by J.P. Morgan, Andrew Carnegie and others. The WSJ’s Bob Tita and River Davis report the agreement would make Nippon Steel, already one of the world’s largest steelmakers, one of the top suppliers to the American auto industry and give it access in the U.S. to specialized steel used in electric vehicles. Acquiring U.S. Steel, which has annual production capacity for 20 million metric tons of steel, would make Nippon Steel the world’s second-biggest steel producer behind China Baowu Steel Group. U.S. Steel in August rejected an acquisition offer from rival Cleveland-Cliffs. Both companies are considered higher-cost producers, with older steel mills that are relatively expensive to operate.

• Chinese steel production looks set for its first annual gain in three years. (Bloomberg) 
• The U.K. plans to impose a carbon tax on imported raw materials such as steel starting in 2027. (The Guardian)

The great American warehouse building boom is over. Higher interest rates are choking off construction of industrial facilities, the WSJ’s Konrad Putzier reports, putting an end to the construction frenzy that has remade the landscape across vast swaths of the country. Industrial property construction starts tumbled 48% in the first nine months of the year compared with the same period in 2022, according to CoStar. That was the largest drop for that period since 2009, as higher debt costs and slowing leasing demand take a toll. The rates on many types of commercial mortgages have roughly doubled over the past year, and land prices haven’t fallen enough to make up for that. Still, the WSJ Logistics Report’s Liz Young writes that construction remains high while vacancy rates are low and rental rates high by historical standards. Industrial tenants signed leases for 90.1 million square feet in the past quarter, according to JLL, the lowest quarterly figure since 2015.

A measure of confidence in the U.S. construction sector rose in December for the first time in five months. (MarketWatch)

Apple is set to halt sales of its smartwatch to comply with a U.S. import ban after regulators found the company violated patents of a competitor. (WSJ)

Nikola founder Trevor Milton was sentenced to four years in prison for defrauding investors. (WSJ)

Southwest Airlines faces $140 million in penalties for violating consumer protection laws during its holiday meltdown last year. (WSJ)

U.S. authorities suspended railway crossings at the U.S.-Mexico border at El Paso, Texas, because of a surge of migrants. (El Paso Times)

Singapore’s non-oil exports expanded in November for the first time in more than a year. (Straits Times)

South Korean e-commerce leader Coupang is buying troubled luxury marketplace Farfetch. (Reuters)

Chinese shipbuilders now produce just over half of new commercial vessel tonnage. (Maritime Executive)

Liberia deflagged seven tankers sanctioned by the U.S. over Russian crude shipments. (TradeWinds)

C.H. Robinson Worldwide CEO Dave Bozeman says overcapacity is still weighing on the U.S. trucking market. (Dow Jones Newswires)

Lufthansa Cargo is facing severe delays through the end of the year over staff shortages and bad weather at its German operations. (The Loadstar)

Japan Post plans to raise prices for standard letters for the first time in 30 years. (Japan Times)

Honda began production of electric SUVs in Thailand. (Nikkei Asia)

Gucci named former Prada COO Massimo Vian chief industrial and supply chain officer. (WWD)

Paul Page is editor of WSJ Logistics Report. Reach him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @bylizyoung and @pdberger. Follow the WSJ Logistics Report on X at @WSJLogistics.