Chaotic trans-Pacific shipping disruptions continue
The familiar levers for logistics managers to manage shipping disruptions, such as alternative port routing and front-loading inventory, provide little relief in this chaotic trans-Pacific trade, reported the Journal of Commerce on Sept. 30. Container lines and analysts expect congestion to drag well into 2022, with the likes of Peter Sand, chief shipping analyst at BIMCO, noting on a IHS Markit webinar on Sept. 16 that some in the industry do not expect relief until Chinese New Year 2023, approximately 15 months from now.
That is forcing U.S. importers to take bolder action to guarantee capacity in ways that would have been unimaginable in years past.
The ongoing shock to the containerized supply chain—resulting in lost sales and production—is driving the C-suite to pay much closer attention to their logistics teams. It is now increasingly common for CEOs, CFOs and COOs to join calls with container lines or supply chain briefings.
The degree to which these new capacity levers are still used when Asia import-driven disruption eases will give a sense of whether the COVID-19 pandemic has permanently changed how shippers manage supply chains. Just as many shippers are reconsidering sourcing, there is a growing sense that importers must ship differently.
Chartering out of chaos?
The C-suite is driving the chartering of vessels by major U.S. retailers, Joshua Bowen, senior vice president of ocean product North America at CEVA Logistics, said during the Council of Supply Chain Management Professionals’ (CSCMP) EDGE conference on Sept. 13. Costco Wholesale, Home Depot, IKEA and Walmart have all told investors they are chartering ships.
“There is a large number of companies that have gotten to the point where they say, ‘I want the guarantee, and if I charter a vessel, the only person that can roll me is me,’” said Bowen.
The chartered transits are generally longer than those of already unreliable liner services, in part because one-off arrivals tend to have lower priority for berth space at ports such as Los Angeles-Long Beach. That put off one importer, who told JOC.com they jumped on the chartering bandwagon, but “never again.” That is despite trans-Pacific ocean carrier reliability falling to just 9.9 percent in August.
At the ports of Long Beach and Los Angeles, longshore workers move 25 to 30 containers per hour. When unloading a breakbulk ship that has been outfitted for cellular transport, it is more like five to six moves per hour.
“We’re reading about it every day,” Richard Galanti, CFO at Costco, said during a recent call with Wall Street analysts. “Containers, trucks and drivers are all impacting the timing of deliveries and higher freight costs.”
With intermodal rail systems overwhelmed, the practice of transloading ocean containers into domestic equipment has become critical for many importers to secure land-side transport capacity. Logistics providers are getting creative. Cargomatic, for example, is transloading cargo from 40-foot containers into 60-foot boxcars, giving importers another option as Union Pacific Railroad meters domestic cargo and outbound truckload rates. Beyond securing land-side capacity, the boxcars can be railed closer to the cargo’s final destination—sometimes even straight to the distribution center, if it has a rail spur. That is attractive, considering the tightness in last-mile truck capacity.
Severe service valves are offered in several standard designs, including non-return, isolation and control types.
Here’s what you need to now about the multi-billion-dollar funding designated for the water and wastewater markets as part of the American Jobs Plan.
When selecting control valves, be sure to properly evaluate the process conditions to identify potential issues and select the proper management techniques.