Ocean shipping lines and trucking companies must cooperate more closely to move freight efficiently through their customers' integrated global supply chains, a maritime industry leader told trucking executives Wednesday.
"We are going to have to take a much longer term view and form a much closer partnership," said Peter I. Keller, the principal of Keller and Associates and former executive vice president and chief operating officer of NYK Group Americas.
The alternative is increasingly volatile pricing and unreliable service, he said, a premise that Keller called unacceptable. "The volatility in this industry absolutely has to change," Keller said at the SMC3 2010 Conference in West Palm Beach, Fla.
Rising international trade will force the issue as the global economy recovers, he said, putting more pressure on carrier productivity on land and sea.
"We're going to see a major change in how we all do business through the ports and how we reach the ultimate destination" to deliver cargo, Keller told an audience primarily composed of less-than-truckload motor carrier and logistics executives.
He said better forecasting by carriers and shippers through greater use of sophisticated technology will be key to smoother roads and sailings.
"Supply and demand are still poorly forecast," said Keller, noting that hundreds of ships are still laid up while containers sit in Asian ports waiting for a ship.
"We need to ask how can we develop data systems that give us better information, so we can all properly plan supply chains," Keller said. Better demand forecasting also would help reduce spikes and plunges in ocean carrier pricing, he said.
"The roller coaster ride of rates is unacceptable, it's ridiculous, it's crazy and it has no rhyme or reason," said Keller, noting that container rates from Asia to the U.S. West Coast have doubled since the beginning of the year after plummeting in 2009.
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