<div class="phx-topic abstract-wrapper">Despite a loss at the World Trade Organization last fall, China isn’t prepared to give in on a dispute over U.S. poultry that has exposed U.S. producers to steep anti-dumping and countervailing duties in what was once their largest overseas market.</div>

Despite a loss at the World Trade Organization last fall, China isn’t prepared to give in on a dispute over U.S. poultry that has exposed U.S. producers to steep anti-dumping and countervailing duties in what was once their largest overseas market.

<div><div><img></div>Despite a loss at the World Trade Organization last fall, China isn’t prepared to give in on a dispute over U.S. poultry that has exposed U.S. producers to steep anti-dumping and countervailing duties in what was once their largest overseas market.The WTO ruled last September that China used an invalid method to determine U.S. chicken was being sold at prices below those in the U.S. market. China in 2010 imposed a pair of duties that stretched as high as 105 percent for some U.S. exporters, using the theory that all parts of a chicken were equally valuable.“If you’ve been in...

Despite a loss at the World Trade Organization last fall, China isn’t prepared to give in on a dispute over U.S. poultry that has exposed U.S. producers to steep anti-dumping and countervailing duties in what was once their largest overseas market. The WTO ruled last September that China used an invalid method to determine U.S. chicken was being sold at prices below those in the U.S. market. China in 2010 imposed a pair of duties that stretched as high as 105 percent for some U.S. exporters, using the theory that all parts of a chicken were equally valuable. “If you’ve been in a grocery store, you know skinless, boneless chicken breast meat is more expensive than other parts, especially chicken paws,” said Gary Horlick, a Washington-based lawyer representing the U.S. industry in disputes with China and Mexico. “Here the most you can get for chicken paws is 4 cents a pound for a rendering plant. In China, paws are a delicacy and sell for up to 80 cents a pound. Clearly, breast meat and chicken paws aren’t the same thing.” In July, China lowered the anti-dumping duty slightly on two of the three companies it originally targeted, but raised the duty on the third. It also raised the duties imposed on companies not originally named in the complaint but that agreed to cooperate by giving cost and pricing information to Beijing. The announcement of the new duty levels doesn’t address why China continues to use the average-cost-per-pound method. “They are dragging their feet on this by not dropping the duties right now,” Horlick said. “We have heard they are doing that because the U.S. is dragging its feet and not abiding by a WTO ruling on Chinese poultry. The WTO determined that we were wrong in refusing to allow chicken processed in China to enter the country. We haven’t lifted that ban yet.” Horlick, who represents the U.S.A. Poultry and Egg Export Council, said the group has asked the U.S. Trade Representative to request that the WTO take action against China. “At the end of the day, they will comply.” The delay in regaining competitive access to the Chinese market is frustrating, but the U.S. industry is pleased the WTO rejected the methodology. “The USTR did a good job in going to the WTO and getting this ruling,” Horlick said. “It is valuable because it keeps other nations from doing the same thing.” He said South Africa first imposed anti-dumping duties on U.S. chicken in 2000 using the average weight method. “At that time, the USTR did not challenge the action at the WTO, which allowed China to take the same action,” Horlick said. China was the largest foreign market for U.S. broiler meat in 2009, buying 613,000 metric tons of chicken. After China imposed the duties, Mexico became the top export market for U.S. poultry. A Mexican government agency in 2012 made a similar dumping ruling against U.S. producers. U.S. officials, like with China, argued that Mexico didn’t differentiate between different parts of the chicken, and said the U.S. market is dominated by the more costly breast meat. The U.S. industry, through USAPEEC, has filed a challenge under the North American Free Trade Agreement. A hearing was expected last September, but NAFTA has yet to seat a panel of experts to hear the case. Although one Mexican agency voted to impose steep duties on U.S. poultry, another set the duties aside, saying food inflation was already too high. A panel was expected to start in July, 22 months after USAPEEC filed its challenge, but was postponed again after a panel member resigned. “Under NAFTA rules, a panel is supposed to be seated within a 61-day deadline,” Horlick said. “We’ve gone past that.” Mexico remains the top customer for U.S. broiler meat because the duties aren’t being collected. Shipments to Mexico for January through May rose 5.5 percent to 284,342 metric tons, compared to the same period in 2013, but the industry doesn’t want the trade decision to remain on the books. “We want it gone for two reasons,” Horlick said. “We don’t want Mexico to start collecting the duties, and we don’t want other countries getting bad ideas.” Contact Stephanie Nall at stephnalljoc@gmail.com .

Transport, Trade and Regulation News

US, China spar over WTO poultry rulings

<div class="phx-topic abstract-wrapper">The overhaul marks the latest in a series of network shakeups among North American railroads competing for international intermodal freight. </div>

The overhaul marks the latest in a series of network shakeups among North American railroads competing for international intermodal freight.

Feature image

<div class="phx-topic">Norfolk Southern Railway (NS) is reshaping its international intermodal network, consolidating and reducing service between the US West Coast and several Midwest markets while expanding train capacity from East Coast ports into the Midwest. The most significant changes affect Ohio and the Upper Midwest, where the railroad will consolidate all Cincinnati-area traffic into a single large terminal in Sharonville, just north of the city. Under the new plan, international trains will interchange in Chicago and terminate in Cincinnati, no longer continuing to Cleveland or Detroit. The changes take effect Oct. 20. The decision was made to consolidate into a single terminal in Cincinnati to put ocean containers into stacks, following similar NS projects in Atlanta, Memphis and Chicago in the last two years. In the long term, ground stacking will allow Norfolk Southern to be better equipped for import surges. Meanwhile, the railroad’s decision to cancel international trains from Chicago to Cleveland and Detroit reflects low volume. Most cargo destined for Cleveland arrives at East Coast ports, or in the case of Detroit, the East Coast and Canadian ports. “We’re not trying to consolidate international traffic from [Cleveland and Detroit] through Sharonville,” Norfolk Southern said in a statement to the Journal of Commerce. “For the limited international volumes moving to/from Cleveland and Detroit, Sharonville may occasionally serve as a routing option, but it’s not being positioned as a hub for those markets.” The overhaul by NS marks the latest in a series of network shakeups among North American railroads competing for international intermodal freight. In April, BNSF Railway introduced a joint service with Norfolk Southern to move import containers from <a href="https://www.joc.com/article/bnsfs-new-seattle-to-ohio-service-avoids-chicago-dray-5203416">Seattle and Tacoma to the Ohio Valley</a> with a quick crew change in Chicago, eliminating the need to truck cargo across the city. BNSF added another inland service in July, linking Los Angeles, Long Beach and Oakland with <a href="https://www.joc.com/article/bnsf-to-use-southern-route-to-salt-lake-city-under-up-intermodal-deal-6045357">Salt Lake City</a>. In July, Union Pacific Railroad also opened a new terminal in <a href="https://www.joc.com/article/ups-kc-terminal-will-change-approach-on-ocean-cargo-6013727">Kansas City</a> and reconfigured its intermodal network to accelerate domestic and international trains from Southern California in a bid to better compete against BNSF. In September, Canadian National Railway and CSX Transportation unveiled a joint service to move containers from Western Canada <a href="https://www.joc.com/article/cn-csx-joint-service-to-connect-west-canada-and-nashville-6077903">directly to Nashville</a>, rather than depositing the cargo in Memphis and trucking it across Tennessee. <h3>Adjustment for NS shippers </h3>Cargo owners in Cleveland and Detroit will lose access to major West Coast ports unless they are willing to truck containers to Chicago or Cincinnati, but alternative options are available. Detroit shippers can redirect international volumes to the East Coast ports of New York-New Jersey and Virginia, where CSX and Norfolk Southern already operate frequent service. They can also route freight through Vancouver using Canadian National Railway, which maintains a large terminal in Detroit. Norfolk Southern, meanwhile, will replace West Coast options for those in Cleveland with new departures from the Port of New York and New Jersey. A new thrice weekly train from Port Liberty Bayonne will launch Oct. 21, the railroad announced, supplementing its existing daily train from APM’s Elizabeth Marine Terminal. Shippers in Kansas City will also see adjustments on Oct. 21. The current daily train from Elizabeth Marine Terminal will be replaced by a three-day-per-week schedule but originate from Elizabeth, Port Liberty Bayonne, and Port Liberty New York on Staten Island, offering service from more terminals despite fewer weekly departures. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>. </div>

Norfolk Southern Railway (NS) is reshaping its international intermodal network, consolidating and reducing service between the US West Coast and several Midwest markets while expanding train capacity from East Coast ports into the Midwest. The most significant changes affect Ohio and the Upper Midwest, where the railroad will consolidate all Cincinnati-area traffic into a single large terminal in Sharonville, just north of the city. Under the new plan, international trains will interchange in Chicago and terminate in Cincinnati, no longer continuing to Cleveland or Detroit. The changes take effect Oct. 20. The decision was made to consolidate into a single terminal in Cincinnati to put ocean containers into stacks, following similar NS projects in Atlanta, Memphis and Chicago in the last two years. In the long term, ground stacking will allow Norfolk Southern to be better equipped for import surges. Meanwhile, the railroad’s decision to cancel international trains from Chicago to Cleveland and Detroit reflects low volume. Most cargo destined for Cleveland arrives at East Coast ports, or in the case of Detroit, the East Coast and Canadian ports. “We’re not trying to consolidate international traffic from [Cleveland and Detroit] through Sharonville,” Norfolk Southern said in a statement to the Journal of Commerce. “For the limited international volumes moving to/from Cleveland and Detroit, Sharonville may occasionally serve as a routing option, but it’s not being positioned as a hub for those markets.” The overhaul by NS marks the latest in a series of network shakeups among North American railroads competing for international intermodal freight. In April, BNSF Railway introduced a joint service with Norfolk Southern to move import containers from Seattle and Tacoma to the Ohio Valley with a quick crew change in Chicago, eliminating the need to truck cargo across the city. BNSF added another inland service in July, linking Los Angeles, Long Beach and Oakland with Salt Lake City . In July, Union Pacific Railroad also opened a new terminal in Kansas City and reconfigured its intermodal network to accelerate domestic and international trains from Southern California in a bid to better compete against BNSF. In September, Canadian National Railway and CSX Transportation unveiled a joint service to move containers from Western Canada directly to Nashville , rather than depositing the cargo in Memphis and trucking it across Tennessee. Adjustment for NS shippers Cargo owners in Cleveland and Detroit will lose access to major West Coast ports unless they are willing to truck containers to Chicago or Cincinnati, but alternative options are available. Detroit shippers can redirect international volumes to the East Coast ports of New York-New Jersey and Virginia, where CSX and Norfolk Southern already operate frequent service. They can also route freight through Vancouver using Canadian National Railway, which maintains a large terminal in Detroit. Norfolk Southern, meanwhile, will replace West Coast options for those in Cleveland with new departures from the Port of New York and New Jersey. A new thrice weekly train from Port Liberty Bayonne will launch Oct. 21, the railroad announced, supplementing its existing daily train from APM’s Elizabeth Marine Terminal. Shippers in Kansas City will also see adjustments on Oct. 21. The current daily train from Elizabeth Marine Terminal will be replaced by a three-day-per-week schedule but originate from Elizabeth, Port Liberty Bayonne, and Port Liberty New York on Staten Island, offering service from more terminals despite fewer weekly departures. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

North-American rail

Intermodal providers

Surface

Norfolk Southern tweaks international services from West, East coasts

<div class="phx-topic abstract-wrapper">The carrier’s operational update did not provide profit and loss figures, but the declining revenue is an indication of tough times ahead as liners sail into their financial reporting season.</div>

The carrier’s operational update did not provide profit and loss figures, but the declining revenue is an indication of tough times ahead as liners sail into their financial reporting season.

<div class="phx-topic">Hong Kong-based ocean carrier OOCL on Thursday reported a significant drop in third-quarter revenue as fast-declining rates on the trans-Pacific and Asia-Europe trades dragged down its top-line earnings. The operational update did not provide profit and loss figures, but the declining revenue is an indication of tough times ahead as carriers sail into their financial reporting season. The Cosco Shipping Holdings subsidiary ended the third quarter with total revenue of $2.26 billion, down 25.9% year over year, as the average revenue per TEU dropped 26%. The two east-west routes out of Asia were mainly responsible for the declining revenue. Frontloading on both the trans-Pacific and Asia-Europe led to an early end to the peak season, which was evident in the drop in OOCL’s revenue on the two trade lanes as falling demand and excess capacity dragged down rates. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="e8c13a3e-9f5a-412f-8741-adbf5e1a7779"></dynamic-object></div>Historically, the trans-Pacific is the largest earner among OOCL’s trade lanes, but third-quarter revenue on the route was down 33.2% at $837 million. On Asia-Europe, revenue fell 38.3% to $479 million, while intra-Asia/Australasia revenue was down 12.9% at $766 million. The trans-Atlantic, the smallest of OOCL’s main trades, was the only lane where third-quarter revenue growth was recorded, increasing 25.4% to $180 million. <h3>Flat volume across trade lanes </h3>Third-quarter volume across all four trade lanes was almost flat, increasing 0.7% year over year to 1.9 million TEUs, while the total available capacity rose 4.2%. From a trade lane perspective, the trans-Pacific recorded volume of 526,032 TEUs, a decline of 4.7%, while Asia-Europe volume was flat at 346,001 TEUs. Intra-Asia/Australasia volume was up 1.7% at 938,090 TEUs, with the trans-Atlantic recording a sharp 22.8% increase to 137,016 TEUs. Over the first nine months of the year, OOCL’s total revenue fell 8.3% year over year to $6.9 billion, dragged down by average revenue per TEU that fell 12.4%. Trans-Pacific revenue declined 14.6% to $2.5 billion, while Asia-Europe revenue was down 20.3% at $1.4 billion. Nine-month intra-Asia/Australasia revenue rose 4.2% to $2.2 billion, with trans-Atlantic revenue up 20.3% at $544 million. Volume handled by OOCL in the first nine months was up 4.7% at 5.8 million TEUs. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Hong Kong-based ocean carrier OOCL on Thursday reported a significant drop in third-quarter revenue as fast-declining rates on the trans-Pacific and Asia-Europe trades dragged down its top-line earnings. The operational update did not provide profit and loss figures, but the declining revenue is an indication of tough times ahead as carriers sail into their financial reporting season. The Cosco Shipping Holdings subsidiary ended the third quarter with total revenue of $2.26 billion, down 25.9% year over year, as the average revenue per TEU dropped 26%. The two east-west routes out of Asia were mainly responsible for the declining revenue. Frontloading on both the trans-Pacific and Asia-Europe led to an early end to the peak season, which was evident in the drop in OOCL’s revenue on the two trade lanes as falling demand and excess capacity dragged down rates. Historically, the trans-Pacific is the largest earner among OOCL’s trade lanes, but third-quarter revenue on the route was down 33.2% at $837 million. On Asia-Europe, revenue fell 38.3% to $479 million, while intra-Asia/Australasia revenue was down 12.9% at $766 million. The trans-Atlantic, the smallest of OOCL’s main trades, was the only lane where third-quarter revenue growth was recorded, increasing 25.4% to $180 million. Flat volume across trade lanes Third-quarter volume across all four trade lanes was almost flat, increasing 0.7% year over year to 1.9 million TEUs, while the total available capacity rose 4.2%. From a trade lane perspective, the trans-Pacific recorded volume of 526,032 TEUs, a decline of 4.7%, while Asia-Europe volume was flat at 346,001 TEUs. Intra-Asia/Australasia volume was up 1.7% at 938,090 TEUs, with the trans-Atlantic recording a sharp 22.8% increase to 137,016 TEUs. Over the first nine months of the year, OOCL’s total revenue fell 8.3% year over year to $6.9 billion, dragged down by average revenue per TEU that fell 12.4%. Trans-Pacific revenue declined 14.6% to $2.5 billion, while Asia-Europe revenue was down 20.3% at $1.4 billion. Nine-month intra-Asia/Australasia revenue rose 4.2% to $2.2 billion, with trans-Atlantic revenue up 20.3% at $544 million. Volume handled by OOCL in the first nine months was up 4.7% at 5.8 million TEUs. Contact Greg Knowler at greg.knowler@spglobal.com .

Container lines

Asia-Europe

Trans-Pacific

Container Shipping News

Maritime

Tumbling rates on trans-Pacific, Asia-Europe drag down OOCL Q3 revenue

<div class="phx-topic abstract-wrapper">A lack of transparency in carbon pricing from carriers is frustrating breakbulk shippers, while the industry must strike a balance that supports environmental goals without undermining the sector’s ability to function.</div>

A lack of transparency in carbon pricing from carriers is frustrating breakbulk shippers, while the industry must strike a balance that supports environmental goals without undermining the sector’s ability to function.

<div class="phx-topic">Project cargo shippers are demanding greater visibility and clear, uniform pricing for carbon mitigation measures undertaken by carriers, arguing that carbon levies should be integrated directly into freight rates. “Carriers need to be way more forthcoming with charges, even if two years out,” a shipper told the Journal of Commerce. “Volume is volume.” Another shipper added that carbon costs should “be part of the freight rate, not a handshake fee at the end.” Current practices mean that while “some carriers disclose, some just give us an $80,000 bill after the fact,” the source said. Project cargo shippers also called for a global carbon pricing standard to level the competitive playing field. “We need a cost of carbon for everyone across the world,” said a third shipper. “It is a disadvantage to certain sectors if we are not going to play in the same space.” The source added that inconsistent regulation creates unfair burdens for compliant regions or companies. <h3>Need to balance environmental goals </h3>Shippers said that “flow down” environmental processes now reach deep into the project cargo supply chain. Increased environmental reporting demands from downstream come from freight forwarders, carriers and trucking companies who are often mandated to report carbon and offsets for carbon emissions. “We have a responsibility to have these discussions with our vendors,” said one shipper. “But it comes at a cost and there is a balance to play,” which highlights the trade-off between sustainability and financial viability. Another shipper said the industry must strike a balance that supports environmental goals without undermining the sector’s ability to function. “We need to think about whether we want a voice about regulations that are responsible but don’t destroy the business,” the sources said. From a carrier perspective, the technological hurdles to decarbonization remain immense. “One of the biggest challenges [to decarbonization] is scalability and availability of fuels,” Ben Collins, global project cargo manager at Mediterranean Shipping Co., told a Breakbulk Americas panel last week. “There is a lot of work still to be done on this.” Collins also posed the question of whether customers are willing to pay for decarbonization. “There is a long way to go before this nut can be cracked, but cracked it will be,” he said. Despite the challenges, the adoption of green initiatives appears to be gaining momentum in the sector. Vedran Muratbegovic, senior vice president/industrial at carrier Wallenius Wilhelmsen, noted the level of uptake was “increasing among customers.” For carriers such as Wallenius, achieving ambitious decarbonization targets means “partnerships have become increasingly important,” Muratbegovic said at Breakbulk Americas. Contact Carly Fields at <a href="mailto:carly.fields@spglobal.com">carly.fields@spglobal.com</a>.</div>

Project cargo shippers are demanding greater visibility and clear, uniform pricing for carbon mitigation measures undertaken by carriers, arguing that carbon levies should be integrated directly into freight rates. “Carriers need to be way more forthcoming with charges, even if two years out,” a shipper told the Journal of Commerce. “Volume is volume.” Another shipper added that carbon costs should “be part of the freight rate, not a handshake fee at the end.” Current practices mean that while “some carriers disclose, some just give us an $80,000 bill after the fact,” the source said. Project cargo shippers also called for a global carbon pricing standard to level the competitive playing field. “We need a cost of carbon for everyone across the world,” said a third shipper. “It is a disadvantage to certain sectors if we are not going to play in the same space.” The source added that inconsistent regulation creates unfair burdens for compliant regions or companies. Need to balance environmental goals Shippers said that “flow down” environmental processes now reach deep into the project cargo supply chain. Increased environmental reporting demands from downstream come from freight forwarders, carriers and trucking companies who are often mandated to report carbon and offsets for carbon emissions. “We have a responsibility to have these discussions with our vendors,” said one shipper. “But it comes at a cost and there is a balance to play,” which highlights the trade-off between sustainability and financial viability. Another shipper said the industry must strike a balance that supports environmental goals without undermining the sector’s ability to function. “We need to think about whether we want a voice about regulations that are responsible but don’t destroy the business,” the sources said. From a carrier perspective, the technological hurdles to decarbonization remain immense. “One of the biggest challenges [to decarbonization] is scalability and availability of fuels,” Ben Collins, global project cargo manager at Mediterranean Shipping Co., told a Breakbulk Americas panel last week. “There is a lot of work still to be done on this.” Collins also posed the question of whether customers are willing to pay for decarbonization. “There is a long way to go before this nut can be cracked, but cracked it will be,” he said. Despite the challenges, the adoption of green initiatives appears to be gaining momentum in the sector. Vedran Muratbegovic, senior vice president/industrial at carrier Wallenius Wilhelmsen, noted the level of uptake was “increasing among customers.” For carriers such as Wallenius, achieving ambitious decarbonization targets means “partnerships have become increasingly important,” Muratbegovic said at Breakbulk Americas. Contact Carly Fields at carly.fields@spglobal.com .

Heavy-haul transport

Project cargo

Project cargo shippers urge shakeup for inconsistent carbon costs

<div class="phx-topic abstract-wrapper">A range of vendors have emerged in recent years with a singular focus on improving coordination of truckload arrivals, keying on load prioritization and performance metrics.</div>

A range of vendors have emerged in recent years with a singular focus on improving coordination of truckload arrivals, keying on load prioritization and performance metrics.

<div class="phx-topic">Fragmentation in the truckload market is behind many of the challenges that have prevented shippers, brokers and carriers from coordinating more effectively on appointment scheduling. But technology that assists all three parties, especially software focused on system connectivity and appointment performance, is driving progress in this long-neglected corner of the industry. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6094563_0.1.jpg"></img></div>In particular, software is aiming to help receivers coordinate with carriers by pulling data from their respective backbone systems, whether it’s a purchase order management system or warehouse management system used by a shipper or a transportation management system used by a carrier. Because more than one in five truckloads is brokered, technology is also geared toward letting the broker manage appointment coordination. “Connectivity is really the solution to that problem, not necessarily saying one specific group has to own it,” Tom Curee, president of appointment scheduling software vendor Qued, said at the Journal of Commerce’s Inland Distribution Conference in Chicago last week. “Because then you’ve got two other groups that are pointing the fingers at one group, and I just don’t think that ever ends.” Taking responsibility for the challenges of appointment scheduling remains an issue, largely because of the inherent fragmentation of the industry. That manifests itself in a lack of clarity over who takes the lead in setting up the appointment, and who invests in technology to improve the process. “It is a challenge for everyone, but it impacts different parties to different degrees,” Jesse Buckingham, CEO of truckload automation vendor Vooma, said at the Inland conference. “If you’re running a warehouse, you’re really thinking about the optimization of your labor, and that might actually mean having a bunch of trucks stacked up outside. You want to be a good shipper, but being a good shipper might not actually matter quite as much to your bottom line.” A carrier, meanwhile, will focus on whether a driver is waiting at a facility. “That can really destroy the utilization of that driver’s time and that asset,” Buckingham said. “If you’re a broker, you know the difference between scheduling a really good appointment and a bad one can be $100 or $200 of margin.” <h3>Proper incentives </h3>For Buckingham, that is a matter of incentive structure, and his assertion is that the newer, technology-focused approaches to the appointment scheduling problem are best aimed at brokers, “who, frankly, care a little bit more.” But Tony Botos, vice president of operations at Capstone Logistics and a former shipper, said at the conference that shippers have a huge incentive to invest in scheduling technology. He said a former shipper where we he worked “saw over a million dollars in labor savings” by being able to reduce the number of customer service representatives responsible for coordinating carrier arrivals at receiving facilities.“And it’s not too capital intensive,” Botos said. “You can quickly establish this type of software in your environment and get the systems to talk to the TMS. The [return on investment] on this is less than six months in most cases.” One way he navigated those competing priorities was to focus on appointment performance. “That’s maybe adjusting that appointment from 60 minutes to 65 minutes to 67 minutes,” Botos said. Deema Adama, CEO of scheduling software company Bigger Picture, said a platform should be able to gauge not just how an appointment is scheduled but also the effectiveness of those appointments. “Are we making the right decisions when we’re setting those target times based off of performance that we’re learning from these interactions?” Adama said at the Inland conference. “And the warehouse can judge how they are allocating labor based off of the trends of capacity coming in and out of their warehouse.” <h3>Prioritization problem </h3>One other element that vendors are focused on is allowing shippers to prioritize appointment-setting based on the demands of individual shipments. For instance, if an appointment is available at 9 a.m., it’s likely that a shipper or broker will grab a time slot regardless of how important it is for that load to use that appointment. “There may be an inbound load of Styrofoam material that isn’t going to actually halt production for something that you’re doing,” Curee said. “Meanwhile, that buffalo seasoning actually has to be here at 9 a.m. because the buffalo seasoning is going to stop the line. And the receiver doesn’t have an appointment until 3 p.m. Well, we would have taken 9 a.m. if we would have had access to it, but appointment scheduling is nothing more than a glorified ‘first-come, first-served.’” Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>.</div>

Fragmentation in the truckload market is behind many of the challenges that have prevented shippers, brokers and carriers from coordinating more effectively on appointment scheduling. But technology that assists all three parties, especially software focused on system connectivity and appointment performance, is driving progress in this long-neglected corner of the industry. In particular, software is aiming to help receivers coordinate with carriers by pulling data from their respective backbone systems, whether it’s a purchase order management system or warehouse management system used by a shipper or a transportation management system used by a carrier. Because more than one in five truckloads is brokered, technology is also geared toward letting the broker manage appointment coordination. “Connectivity is really the solution to that problem, not necessarily saying one specific group has to own it,” Tom Curee, president of appointment scheduling software vendor Qued, said at the Journal of Commerce’s Inland Distribution Conference in Chicago last week. “Because then you’ve got two other groups that are pointing the fingers at one group, and I just don’t think that ever ends.” Taking responsibility for the challenges of appointment scheduling remains an issue, largely because of the inherent fragmentation of the industry. That manifests itself in a lack of clarity over who takes the lead in setting up the appointment, and who invests in technology to improve the process. “It is a challenge for everyone, but it impacts different parties to different degrees,” Jesse Buckingham, CEO of truckload automation vendor Vooma, said at the Inland conference. “If you’re running a warehouse, you’re really thinking about the optimization of your labor, and that might actually mean having a bunch of trucks stacked up outside. You want to be a good shipper, but being a good shipper might not actually matter quite as much to your bottom line.” A carrier, meanwhile, will focus on whether a driver is waiting at a facility. “That can really destroy the utilization of that driver’s time and that asset,” Buckingham said. “If you’re a broker, you know the difference between scheduling a really good appointment and a bad one can be $100 or $200 of margin.” Proper incentives For Buckingham, that is a matter of incentive structure, and his assertion is that the newer, technology-focused approaches to the appointment scheduling problem are best aimed at brokers, “who, frankly, care a little bit more.” But Tony Botos, vice president of operations at Capstone Logistics and a former shipper, said at the conference that shippers have a huge incentive to invest in scheduling technology. He said a former shipper where we he worked “saw over a million dollars in labor savings” by being able to reduce the number of customer service representatives responsible for coordinating carrier arrivals at receiving facilities. “And it’s not too capital intensive,” Botos said. “You can quickly establish this type of software in your environment and get the systems to talk to the TMS. The [return on investment] on this is less than six months in most cases.” One way he navigated those competing priorities was to focus on appointment performance. “That’s maybe adjusting that appointment from 60 minutes to 65 minutes to 67 minutes,” Botos said. Deema Adama, CEO of scheduling software company Bigger Picture, said a platform should be able to gauge not just how an appointment is scheduled but also the effectiveness of those appointments. “Are we making the right decisions when we’re setting those target times based off of performance that we’re learning from these interactions?” Adama said at the Inland conference. “And the warehouse can judge how they are allocating labor based off of the trends of capacity coming in and out of their warehouse.” Prioritization problem One other element that vendors are focused on is allowing shippers to prioritize appointment-setting based on the demands of individual shipments. For instance, if an appointment is available at 9 a.m., it’s likely that a shipper or broker will grab a time slot regardless of how important it is for that load to use that appointment. “There may be an inbound load of Styrofoam material that isn’t going to actually halt production for something that you’re doing,” Curee said. “Meanwhile, that buffalo seasoning actually has to be here at 9 a.m. because the buffalo seasoning is going to stop the line. And the receiver doesn’t have an appointment until 3 p.m. Well, we would have taken 9 a.m. if we would have had access to it, but appointment scheduling is nothing more than a glorified ‘first-come, first-served.’” Contact Eric Johnson at eric.johnson@spglobal.com .

Logistics Technology News

Truckload

Truck brokers

Supply chain

Connectivity the key to bypassing hurdles in truckload appointment scheduling

<div class="phx-topic abstract-wrapper">Gov. Gavin Newsom has until Sunday to sign or veto a bill that ocean carriers and terminal operators say would derail current and future attempts to automate cargo-handling operations in the name of reducing stress on the state’s power grid. </div>

Gov. Gavin Newsom has until Sunday to sign or veto a bill that ocean carriers and terminal operators say would derail current and future attempts to automate cargo-handling operations in the name of reducing stress on the state’s power grid.

<div class="phx-topic">Whether or not ports in California can continue to automate seemingly hinges on whether Gov. Gavin Newsom signs legislation that would, in effect, render the equipment unusable. SB 34 is a state bill that would ban current and future automated or remotely operated technology used at California ports from plugging into the state’s power grid. The legislation, which is supported primarily by dockworkers, has already been approved by both houses of the California Legislature and awaits action by Newsom, who has until Sunday to sign or veto the bill. But terminal operators and shipping lines say the bill would undermine the billions of dollars already invested in marine terminal automation and likely threaten future investment in cargo-handling efficiency. Mike Jacob, president of the Pacific Merchant Shipping Association (PMSA), which represents terminal operators and container lines that call at West Coast ports, told the Journal of Commerce Wednesday the bill’s supporters are pitching it as an environmental effort to reduce demand on the power grid, when in reality it is intended to block any automation that labor interests see as threatening to dockworker jobs. “This is ILWU’s priority bill,” Jacob said of the International Longshore and Warehouse Union (ILWU). Jacob also said the bill is vague and its language is so expansive that it could impact present and future funding from local, state and federal sources for port-related equipment, including charging infrastructure for zero-emission cargo-handling equipment and battery-electric trucks. Long Beach Container Terminal and TraPac in Los Angeles are the West Coast’s only fully automated container terminals. The APM terminal in Los Angeles is partially automated. So far, more than $2 billion has been invested in developing automated facilities, zero-emission cargo handling equipment and charging infrastructure in Southern California. The ports of Los Angeles and Long Beach did not respond to requests for comment. <h3>Bill ‘undermines’ labor agreement </h3>The Pacific Maritime Association (PMA), which represents terminal operators and shipping lines in negotiating coastwide labor contracts with the ILWU, emphasized in a Sept. 18 letter to Newsom that SB 34 “directly undermines the collective bargaining agreement between PMA and the ILWU.” PMA noted that dating back to the 2008 coastwide contract, the labor agreements “explicitly permitted automation in exchange for steep wage hikes, $100,000 pensions and fully employer-paid healthcare.” “...Any proposed changes should be addressed through the collective bargaining process, not through legislation that circumvents the contract,” PMA said. The presidents of ILWU Locals 13, 63 and 94 in Southern California recently distributed an “Urgent: Call to Action” flyer to union membership to publicly push labor’s support for SB 34 and to urge Newsom to sign the bill. “Protect good union jobs, strengthen our ports, keep California competitive,” the flyer read. An ILWU spokesman said Wednesday union leaders were not available for comment. SB 34 also comes at an inopportune time in that the ports and port stakeholders in Southern California last month reached an agreement with the South Coast Air Quality Management District (AQMD) to work cooperatively in the coming months to develop a plan to further reduce port-related emissions. The agreement would replace the <a href="https://www.joc.com/article/la-lb-likely-to-work-with-regulator-on-emissions-cutting-plan-for-ports-6084550">port Indirect Source Rule (ISR)</a> that the AQMD had originally proposed. Meanwhile, Jacob said it is difficult to gauge Newsom’s position on SB 34. “There’s still no clear indication as to where it is going,” Jacob said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. </div>

Whether or not ports in California can continue to automate seemingly hinges on whether Gov. Gavin Newsom signs legislation that would, in effect, render the equipment unusable. SB 34 is a state bill that would ban current and future automated or remotely operated technology used at California ports from plugging into the state’s power grid. The legislation, which is supported primarily by dockworkers, has already been approved by both houses of the California Legislature and awaits action by Newsom, who has until Sunday to sign or veto the bill. But terminal operators and shipping lines say the bill would undermine the billions of dollars already invested in marine terminal automation and likely threaten future investment in cargo-handling efficiency. Mike Jacob, president of the Pacific Merchant Shipping Association (PMSA), which represents terminal operators and container lines that call at West Coast ports, told the Journal of Commerce Wednesday the bill’s supporters are pitching it as an environmental effort to reduce demand on the power grid, when in reality it is intended to block any automation that labor interests see as threatening to dockworker jobs. “This is ILWU’s priority bill,” Jacob said of the International Longshore and Warehouse Union (ILWU). Jacob also said the bill is vague and its language is so expansive that it could impact present and future funding from local, state and federal sources for port-related equipment, including charging infrastructure for zero-emission cargo-handling equipment and battery-electric trucks. Long Beach Container Terminal and TraPac in Los Angeles are the West Coast’s only fully automated container terminals. The APM terminal in Los Angeles is partially automated. So far, more than $2 billion has been invested in developing automated facilities, zero-emission cargo handling equipment and charging infrastructure in Southern California. The ports of Los Angeles and Long Beach did not respond to requests for comment. Bill ‘undermines’ labor agreement The Pacific Maritime Association (PMA), which represents terminal operators and shipping lines in negotiating coastwide labor contracts with the ILWU, emphasized in a Sept. 18 letter to Newsom that SB 34 “directly undermines the collective bargaining agreement between PMA and the ILWU.” PMA noted that dating back to the 2008 coastwide contract, the labor agreements “explicitly permitted automation in exchange for steep wage hikes, $100,000 pensions and fully employer-paid healthcare.” “...Any proposed changes should be addressed through the collective bargaining process, not through legislation that circumvents the contract,” PMA said. The presidents of ILWU Locals 13, 63 and 94 in Southern California recently distributed an “Urgent: Call to Action” flyer to union membership to publicly push labor’s support for SB 34 and to urge Newsom to sign the bill. “Protect good union jobs, strengthen our ports, keep California competitive,” the flyer read. An ILWU spokesman said Wednesday union leaders were not available for comment. SB 34 also comes at an inopportune time in that the ports and port stakeholders in Southern California last month reached an agreement with the South Coast Air Quality Management District (AQMD) to work cooperatively in the coming months to develop a plan to further reduce port-related emissions. The agreement would replace the port Indirect Source Rule (ISR) that the AQMD had originally proposed. Meanwhile, Jacob said it is difficult to gauge Newsom’s position on SB 34. “There’s still no clear indication as to where it is going,” Jacob said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Port News

North American ports

Longshore labor

Fate of future automation at California ports in governor’s hands

Use code GTW595 at checkout and save $900 on first year of an annual Gold subscription!

Upgrade Subscription - Gold Trials

Become a Gold Subscriber and Save!

Arm your team with the most trusted information portal for the international container shipping industry.

Group Subscriptions - Wide Box

Get into a group subscription today

Use code STSW20 at checkout to save 20% on a Silver or Silver Plus annual subscription! 

Subscribe Now - FT/Anonymous to S/SP - Wide Box

SUBSCRIBE TODAY AND SAVE!

Upgrade to Gold using code TPMGW595 to save $900 on first year of a Gold subscription and 20% on a TPM26 registration!

Upgrade Subscription - S/SP to Gold - Wide Box

SAVE MORE WITH GOLD

Access Journal of Commerce content for 30 days

Free Trial - Wide Box

START A FREE TRIAL TODAY

Use code TPM26GW995 at checkout to save $500 on first year of a Gold subscription and 20% on a TPM26 registration!

Subscribe Now - FT/Anonymous to Gold - Wide Box

The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

SMC3rates_shutterstock_5247046.jpg

Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

SMC3rates_shutterstock_5247046 (1).jpg

Filling the Supply Chain Education Gap with LTL Education Courses

START A FREE TRIAL: Access Journal of Commerce content for 30 days

Free Trial - Offer Box

Free Trial

SUBSCRIBE AND SAVE: Use code STSW20 to save 20% on first year of a Silver or Silver Plus annual subscription!


Subscribe Now - FT/Anonymous to S/SP - Offer Box

SUBSCRIBE AND SAVE

GET INTO A GROUP SUBSCRIPTION: Arm your team with unlimited Journal of Commerce content

Group Subscriptions - Offer Box

Group Subscriptions

UPGRADE TO GOLD AND SAVE: Use code GTW595 at checkout and save $900 on first year of a Gold subscription!

Upgrade Subscription

SAVE MORE WITH GOLD: Upgrade to Gold using code TPMGW595 to save $900 on first year of a Gold subscription and 20% on TPM26! 

Upgrade Subscription - S/SP to Gold - Offer Box

SAVE MORE WITH GOLD: Use code TPM26GW995 at checkout to save $500 on a Gold subscription and 20% on a TPM26 registration!

Subscribe Now - FT/Anonymous to Gold - Offer Box

Monthly publication providing an editorial deep dive into global supply chain news

Journal of Commerce Magazine - Rectangle Box

Journal of Commerce Magazine

A premium access index of savings using domestic intermodal vs. OTR 

ISI Report - Rectangle Box

Intermodal Savings Index

An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

Breakbulk Report - Rectangle Box

Breakbulk Quarterly

An extensive dashboard of charts organized by trade lane, mode, and topic

Gateway - Rectangle Box

Gateway

Customers scoring their intermodal partners to identify the best service providers

Intermodal Service Scorecard - Rectangle Box

Intermodal Service Scorecard

A premium access outlook critical to shippers and transportation providers

QI Report - Rectangle Box

Quarterly Intelligence

The premier conference for the global container shipping and supply chain community

TPM Conference - Rectangle Box

Attend TPM26

Discover the news and analysis of supply chain strategies, sourcing and trends covered by the Journal of Commerce. Comprehensive coverage includes customs, trade news, transport news and the latest information about trade regulations.

Stay informed with the latest regulation news and trade updates. Explore comprehensive transportation news and trade regulations today.

Transport, Trade and Regulation News | Journal of Commerce

The Journal of Commerce’s supply chain news and analysis impacting the management of end-to-end supply chains reports on supply chain strategies, cargo visibility, inventory trends, sourcing, customs certification and contract logistics. Supply chain news coverage also delves into refrigerated shipping advancements and management of inventory status, regulatory updates and government funding projects.

Our logistics technology news include logistics technology startups, solutions, and the impact of technology on logistics and supply chain management.

Logistics Technology News | Journal of Commerce

A thorough cool cargoes news by Journal of Commerce. Learn about the latest trends in refrigerated cargo transportation, weight capacity, technology, and more.

Cool Cargo News | Journal of Commerce

Cool Cargo News

Journal of Commerce keeps you informed on the latest last mile news with comprehensive coverage of carriers, logistics, and last mile transportation solutions.

Last Mile News | Journal of Commerce

Last Mile News

Discover the latest industrial real estate news and trends. Covering projects, real estate supply chain, logistics, pricing, cross dock facilities, and more.

Industrial Real Estate News | Journal of Commerce

Industrial Real Estate News

Stay updated on supply chain strategies, cargo visibility, inventory trends and more with our comprehensive supply chain news and analysis.

Latest News

More News & Analysis

Norfolk Southern tweaks international services from West, East coasts

Tumbling rates on trans-Pacific, Asia-Europe drag down OOCL Q3 revenue

Project cargo shippers urge shakeup for inconsistent carbon costs