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A Weekly Look at Some Stories from the Freight Forwarding, Logistics and Road Haulage Sectors

What is Happening Along the Links of the Global Supply Chain UK – We start the week’s journey through some of the stories from freight and logistics which didn’t quite make the headlines with a reaction from the Road Haulage Association (RHA[1]) to the announcement from Leeds City Council[2] that, after a recent public consultation[3], as from January 2020, any pre-Euro VI lorries entering the city’s Clean Air Zone will be liable to a toll of GBP50.

This represents a reduction from the original proposal of GBP100 per truck with the Council seeking help from the government’s Clean Air Fund[4]. Whilst accepting the need for clean air the RHA says it is ‘outraged’ by the plan with chief executive, Richard Burnett, calling for an intelligent, phased approach to support local business, saying: “These plans will be disastrous for the many operators who are unable to absorb or recover the costs of entering the zone.

This is an industry that has to make every penny count. GBP50 per day equates to an additional annual cost of GBP13,000 which will inevitably place many operators in an untenable situation. “Road hauliers play a key role in delivering and maintaining the Leeds economy.

The City Council should support them with measures which give them time to upgrade their trucks so they can keep delivering the goods the city relies on. These charges will make vehicle replacement almost impossible.” Since drafting this item the RHA has taken a similar line regarding the proposed Low Emission Zone (LEZ) for Glasgow which will see pre-Euro VI lorries banned from the city centre by the end of 2022.

The RHA says such cut-off date will be ‘disastrous’ and has called for more clarity of what is proposed saying the timescale is ‘completely unrealistic’. UK – The problems experienced[5] at the Port of Felixstowe[6] last week after the new port management system software was introduced, have largely subsided. Certainly the long queues and extreme waiting times have disappeared but our contacts within the port report that some drivers are still experiencing lengthy delays and extra time should be allowed, with customers informed of potential problems.

Reaction to the delays however included container line Hamburg Sud switching ports on some services to Southampton, reportedly for a five week stint whilst the situation is resolved. Some vessels were forced to discharge then leave without reloading in order to stay on schedule, doubtless adding to the problems for shippers. Similar actions to depart without reloading were announced by Seago a feeder line, and like Hamburg Sud a Maersk subsidiary.

UK – Most companies selling, importing or manufacturing goods find at some stage the need to promote them at trade shows and the like. So how does one go about it when one has little or no experience? This was the question which prompted Berkshire-based Walker Logistics[7] to investigate extending its services into the events field, supporting its clients that take part in trade shows and other temporary promotional events with a new bespoke point-of-sale fulfilment service.

Sales Director William Walker, explains: “Throughout the year a number of our clients take stands at events such as the Hampton Court Flower show and other high profile sports and music festivals and sell their products directly to the public. We can help them by not only picking, packing and delivering the stock that they need for a temporary sales outlet, but also by providing, for example, assistance with building the stand, general set-up and on-demand replenishment if they want us to.

“Of course, at the end of an event we’ll take any unsold goods back in to stock, break down the stand and dispose of any rubbish in any environmentally-friendly way. There are many ways in which logistics service providers can create extra value for a client and we see this as one of them. There is no such thing as a ‘normal contract’ any more.

You simply have to offer more than simple warehousing and distribution if you want to have an edge in this business.” UK – Nestle[8], the world’s largest food and drink company, and XPO Logistics[9], are co-creating a 638,000 square foot distribution centre at the new SEGRO East Midlands Gateway Logistics Park[10] in Leicestershire, UK. The facility, a digital warehouse of the future, will be occupied predominantly by Nestle for its consumer packaged goods and will function as a test bed environment for XPO technology prototypes prior to global release.

The custom-designed distribution centre, scheduled to complete in 2020, will feature advanced sorting systems and robotics alongside state-of-the-art automation co-developed with Swisslog Logistics Automation[11]. The site’s digital ecosystem will integrate predictive data and intelligent machines with the intention of giving consumers faster, more efficient access to Nestle products. UK – PIE[12], which produces mapping aids for the disabled, motorcyclists and truckers, has released an app to guide lorry drivers around London, ensuring they do not transgress the new wave of parking and navigational restrictions.

PIE says the LLRA app is the only HGV route planning & navigation service compliant with the strict requirements of the London Lorry Control Scheme. The app can be used as evidence to London Councils’ Lorry Control proving a route was authorised prior to the journey. The routing calculations consider a number of factors including vehicle dimensions, London Lorry Control Scheme etc. with integrated turn by turn instructions.

Details can be found here[13]. UK – Contact Attachments[14], which designs and manufactures an extensive range of forklift attachments from its base in Mid Wales, is helping customers to handle long and/or awkward loads through providing additional reach to their existing equipment with a range of jibs to fit fork lifts, telehandlers and loaders. The jibs also support users in effectively lifting loads which are unable to be palletised.

Dave Manuel, Technical Sales Director at Contact Attachments, explained: “Our range of jibs includes fixed length, raised-height and articulating jibs, as well as telescopic jibs for even greater height. Each of our jibs can be supplied as either fork-mounted or carriage-mounted, depending on the precise handling requirements.

In addition to our standard range, we can also custom-design jibs to a customer’s precise specification if required, and recently produced a 12 metre long jib designed to handle 10,000kgs for use within a marine environment. “Ensuring optimum handling safety is always paramount, and using our special jib rating chart, we’re able to rate each of our jibs in line with the capacity of the forklift being used – ensuring a precise match each and every time, and offering peace of mind to the operator that they’ll never overload their equipment. All the jibs in our range have been fully tested and adhere to the strictest health and safety guidelines, as well as ISO 9001 quality procedures.”

US – Crowley Maritime Corporation[15] recently received a Humanitarian Award from Seamen’s Church Institute (SCI[16]) for its relief efforts in Puerto Rico following Hurricane Maria. The award, which was accepted on the behalf of the company’s Puerto Rico employees by Tom Crowley, chairman and CEO, and Jose Nazario, director of finance in San Juan, was presented during the 41st annual Silver Bell Awards Dinner, which is attended by over 700 members from the shipping industry and associated companies. In the aftermath of the September storm, Crowley’s liner services and logistics teams, working with government and commercial customers, played an integral role in the recovery.

The company’s more than 300 union and administrative employees resumed services and reopened company facilities, including a warehouse and the Isla Grande terminal, just two days after the storm passed, and began discharging government and commercial cargo from vessels to support relief efforts on the island within hours of the US Coast Guard reopening the harbour in San Juan. ITALY – Freight forwarder Bollore Logistics[17], which has six facilities across the country, has been awarded TAPA FSR A certification for its Milan-Pantigliate logistics platform. The Transport Asset Protection Association (TAPA) FSR Level A is awarded to sites with the highest degree of security requirements in storage services.

The site, which specialises in fashion and luxury sectors, has therefore satisfied the requirements and now meets all the conditions of protection of goods against acts of theft and crime related to freight. To achieve the standard required a security cage was constructed within the warehouse and a guard post now provides access control. Identification passes with nominated individual access rights are also supported by enhanced video protection and anti-intrusion technology.

WORLDWIDE – The dangers posed by the seemingly inevitable spread of plastics around the globe and putting life itself at risk are finally becoming more widely acknowledged and have been highlighted throughout the press[18] of late. Whilst inevitably a marketing tool for its ‘sustainable swimwear’, SLO Active[19] has recently published a comprehensive review[20] of the horrendous impact of the insidious spread of plastics throughout our oceans, outlined what we might consider doing about it and provided a variety of sources and links which will help those committed to changing the way we shape the future. SPAIN – Following on from last week’s demonstrations[21] across Europe and at the XPO Logistics[22] European AGM in France, the International Transport Workers’ Federation (ITF) has issued a report supporting its previous allegations of gender bias at the company’s Alovera II warehouse, Guadalajara, Spain which handles goods for distribution on behalf of ecommerce giant Amazon.

The report can be seen in full here[23] and is based on a variety of sources, principally evidence from the trade union representing the majority of XPO Logistics workers at the facility, the Federacion de Servicios para la Movilidad y el Consumo (FeSMC) of the Union General de Trabajadores (UGT). The company conducts the majority of its European operations through its subsidiary, XPO Logistics Europe SA, in which it holds an 86.25% controlling interest. YEMEN – Latest reports we have from the country indicate that, despite local forces backed by the Saudi led coalition taking Hodeidah airport en route to the city’s port, this vital maritime artery for food and supplies entering the country still remains open for business and under the control of opposing forces.

Despite the Houthi backed opposition coming under attack at the port, reportedly by land, sea and air in the ‘Battle of Al Hudaydah[24]‘ , they have stated they are confident they will maintain control of facilities which handle 70+% of the country’s vital imports. Lisa Grande, UN Humanitarian Coordinator for Yemen said this week there is no other option to maintain the flow of essential aid entering Yemen saying ‘everything depends on that port’. Three years of war have put upward of 3 million people at risk of starvation if the food supplies dry up for only a few days.

Photo: Hodeidah receives the bulk of the country’s food stocks.

A Weekly Look at Some Stories from the Freight Forwarding, Logistics and Road Haulage SectorsA Weekly Look at Some Stories from the Freight Forwarding, Logistics and Road Haulage Sectors

References

  1. ^ RHA (www.rha.uk.net)
  2. ^ Leeds City Council (www.leeds.gov.uk)
  3. ^ recent public consultation (www.leeds.gov.uk)
  4. ^ Clean Air Fund (www.gov.uk)
  5. ^ problems experienced (www.handyshippingguide.com)
  6. ^ Port of Felixstowe (www.portoffelixstowe.co.uk)
  7. ^ Walker Logistics (www.walkerlogistics.com)
  8. ^ Nestle (www.nestle.co.uk)
  9. ^ XPO Logistics (www.xpo.com)
  10. ^ SEGRO East Midlands Gateway Logistics Park (slp-emg.com)
  11. ^ Swisslog Logistics Automation (www.swisslog.com)
  12. ^ PIE (www.thepieguide.com)
  13. ^ can be found here (www.londonlorryrouteapprover.com)
  14. ^ Contact Attachments (www.forklift-attachments.co.uk)
  15. ^ Crowley Maritime Corporation (www.crowley.com)
  16. ^ SCI (seamenschurch.org)
  17. ^ Bollore Logistics (www.bollore-logistics.com)
  18. ^ throughout the press (www.handyshippingguide.com)
  19. ^ SLO Active (sloactive.com)
  20. ^ comprehensive review (sloactive.com)
  21. ^ last week’s demonstrations (www.handyshippingguide.com)
  22. ^ XPO Logistics (www.xpo.com)
  23. ^ seen in full here (www.itfglobal.org)
  24. ^ Battle of Al Hudaydah (en.wikipedia.org)

Maritime cargo preferences only waste American taxpayer dollars

In a recent column in The Hill, the authors contend that preserving and bolstering cargo preference requirements — the law requiring U.S. shippers to use U.S. flagged vessels to transport “government-impelled ocean-borne cargo” — is crucial to maintaining America’s standing in international trade, carrying out the nation’s humanitarian agenda, and projecting U.S. military power overseas.[1] Our findings and those of others, including Christopher Barrett of Cornell University and Vincent Smith of the American Enterprise Institute and Montana State University, suggest otherwise. First, there is little to no evidence that the cargo preference requirement on U.S. food aid shipments does anything to augment the readiness of today’s U.S. armed forces.

The Defense Department maintains that it receives benefits from paying higher prices to ship military goods on U.S. flagged ships, but the consensus view of three 2015 studies is that the limited number of cargo ships in the U.S. flagged fleet would not affect a military surge.[2][3][4] ADVERTISEMENT

The issue is the number of trained U.S. mariners available to crew existing vessels in Military Sealift Command and the Ready Reserve Fleet. In the more than 60 years since the Cargo Preference Act was enacted, the government has never mobilized an agricultural cargo preference vessel and crew, unless they were also part of the Maritime Support Program, which is a completely separate subsidy program that only includes vessels deemed to be suited for military use by Pentagon.

Many U.S. flagged ships carrying substantial amounts of U.S. food aid are not eligible for the program.

Second, food aid cargo preference does nothing for the U.S. humanitarian agenda. The mandate that almost all food aid be sourced in America, plus the cargo preference requirement, imposes substantial additional shipping costs of at least £300 million per year. As a result, U.S. humanitarian aid serves at least four million fewer people every year.

Third, the food aid cargo preference does nothing to maintain the U.S. maritime industry’s competitiveness in the global shipping services market. The old, slow, technologically antiquated U.S. flagged ships carrying most cargo preference food aid are uncompetitive. The authors of the column also imply that the 2012 decision to reduce the food aid cargo preference requirement from 75 percent to 50 percent resulted in the loss of one quarter of the U.S. flagged fleet.

This is inaccurate. The size of the U.S. flagged fleet has steadily declined despite the protection provided by the 1954 cargo preference statute and other federal programs such as the Marine Support Program. Between 1947 and 2010, the number of U.S. flagged ships decreased from 980 to 115 vessels.

As of January, there were only 82. The longer-term reduction in fleet size has occurred because U.S. flagged ships find it difficult to compete for commercial cargo on the open market. A 2011 survey conducted by the Maritime Administration (MARAD) found that the annual operating costs of an average U.S. flagged vessel were 2.7 times higher than a comparable foreign flagged vessel.

Part of the gap is due to the higher wages received by American mariners over their counterparts on foreign-flagged ships. Though, as reported in several Government Accountability Office reports, many U.S. flagged vessels require more crew per ship because they are older, and less automated than foreign flagged ships. It is also simply not credible to argue that the 2012 statutory change to food aid cargo preference could have caused the U.S. flagged fleet to shrink so severely.

In fact, the 1985 increase in the use of cargo preference from 50 percent to 75 percent did nothing to stem the fleet’s shrinkage. As global trade volumes have grown steadily, the effect of food aid cargo preference on the maritime industry has been shrinking because the total volume of shipped U.S. food aid has been declining steadily for decades. Most U.S. food aid transported under cargo preferences moves on only a few vessels, suggesting that U.S. cargo preferences, while expensive, only supports a handful of shippers. According to federal data for 2016, five U.S. flagged ships accounted for 56 percent of all cargo preference U.S. food aid shipments.

While cargo preference law requires that eligible U.S. flagged ships be owned by American companies, a large share of the vessels are actually operated by U.S. divisions of foreign shipping lines. Between 2012 and 2015, U.S. flagged ships owned by A.P. Moller Maersk Group, headquartered in Denmark, the American President Lines, owned by a company based in Singapore, and Hapag Lloyd, owned by a German company, carried 45 percent of U.S. food aid shipments by volume.

So much for food aid cargo preference being necessary to maintain an American-owned maritime fleet responsive to U.S. government needs. In sum, the U.S. maritime lobby seeks to divert taxpayer dollars to American and foreign shipping companies instead of spending it on U.S. humanitarian aid urgently needed to save the lives of millions of people. U.S. voters and legislators should protest against the profligate waste of resources that is food aid cargo preference.

Stephanie Mercier, Ph.D., is a retired former staff senior economist on Senate Agriculture Committee.

Erin Lentz, Ph.D., is assistant professor at the Johnson School of Public Affairs at the University of Texas at Austin.[5][6]

References

  1. ^ column (thehill.com)
  2. ^ findings (www.aei.org)
  3. ^ Christopher Barrett (academic.oup.com)
  4. ^ Vincent Smith (www.aei.org)
  5. ^ Senate Agriculture Committee (www.agriculture.senate.gov)
  6. ^ University of Texas (www.utexas.edu)

AIA joins Mercy Ships’ Cargo Day as first air cargo partner

Airbridge International Agencies CEO, Mark Andrew

Airbridge International Agencies has become the first UK-based air cargo company to partner with Mercy Ships for the charity’s annual Cargo Day initiative. Mercy Ships Cargo Day has been running for two years and is a fundraising campaign that asks the shipping industry to unite on 3 October to donate cargo, commissions, address commissions and individual pledges to Mercy Ships, raising money for medical programmes in countries that the Africa Mercy hospital ship visits. Last year ship owners, charterers, brokers, port agents and inspection companies united to donate more than GBP500,000 to the charity and Mercy Ships is calling on the air cargo industry to help smash that target in 2018.

Airbridge International Agencies (AIA) chief executive officer, Mark Andrew says: “For AIA it just looked like a perfect match to find a charity that is involved in logistics like us. With Mercy Ships, you are giving to an organisation that is actively going out to different places to heal people – be it children or adults – so every day is different.” Andrew says as one of the largest independent cargo GSAs, it represents a number of airlines that can potentially offer airfreight capacity for urgent shipments, and he intends to get the airfreight industry involved in Mercy Ships Cargo Day.

Mercy Ships UK corporate partnership manager, Charlene Cree says: “We are thrilled to have AIA onboard for Cargo Day this year, and we hope that other air cargo companies will follow their example and join our campaign too. “Two out of every three people in the world cannot access the safe surgery they desperately need, and Mercy Ships thinks this is unacceptable. Together we can change the odds for these people.”

Mercy Ships operates the largest charity-run hospital ship in the world, delivering free, safe medical care to some of the world’s poorest countries, treating conditions including dental and eye problems, cleft lips and palates, tumours, club feet, childbirth injuries and burns.

Since 1978, Mercy Ships has visited more than 70 countries, providing services worth more than GBP1 billion that have directly helped more than 2.5 million people.

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