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Larger ships carry more shipments of export cargo and import cargo in international trade.


Navigating the waters of international shipping can be quite complex. While working through a 3PL may reduce complexities in the decision-making process, shippers should still have an understanding of how their freight moves overseas.

By educating themselves on ocean carrier options and staying up to date on performance and operations, shippers can ensure they’re using the best carrier to suit their needs.

The Right Line at the Right Speed for the Right Cost

With dozens of ocean carrier lines plying multiple shipping lanes, the choices can seem abundant. Yuriy Ostapyak, director of Global Operations at Logistics Plus, says shippers should start by narrowing down their potential routes and equipment required, and by identifying their most important priorities, whether that be time or cost. “Right off the bat, depending on route and time, you can take many carriers out of the equation and narrow your choices down to two or three,” Ostapyak says.

Slower-moving ships typically save on fuel and can offer lower costs, but they come with longer transit times. Ocean carriers usually price by the size of the shipment, by container loads or less than container loads (LCL), which are measured in cubic meters. Shippers should consider if they’re shipping Freight on Board (FOB) or Cost, Insurance and Freight (CIF) and whether they may also face additional charges such as general rate increases and customs fees.

Tony Nuzio, CEO of ICC Logistics, says it helps if shippers are flexible and willing to stagger and break up their shipments. Whereas a segment of cargo that isn’t needed for 45 days can be transported in a slower and less expensive fashion, time-sensitive cargo may best be shipped to a different port then transported overland. “You may want to use a combination of ocean carriers and land bridges to find the best options. It’s key that you never take a one-size-fits all approach,” Nuzio says.

Delays and Operations

In today’s environment, it’s worth considering a company’s financials. While the industry is starting to emerge from some bad years, most ocean carriers are still not profitable. The last Container Forecaster report by Drewry maritime research consultancy found only five in a sample of 13 carriers were producing a profit. Drewry also said there was a wide gap between the best performing and worst performing lines, noting “significant differences between companies in terms of scale, cost, trade coverage, customer base and spot-contract ratios.”

Ostapyak says shippers should be cognizant of any financial problems a carrier could have. Korean-based Hanjin Shipping Co, which was one of the world’s top 10 container lines in terms of capacity, ran into financial troubles in 2016 and at one point left $14 billion worth of cargo stranded at sea. There are constant debt reconciliations and debt restructure deals between some ocean carriers, Ostapyak says.

From our standpoint, we’ve watched this very closely as we’d hate to have our customers’ containers being stuck, arrested at port, because their line didn’t pay a bill or is having some sort of bankruptcy situation,” he says.

Many 3PLs and 4PLs are consolidating the carriers they use in the market, aiming to develop relationships with a select few rather than juggle a dozen carriers. Currently, three ocean carrier alliances, Ocean Alliance, The Alliance and 2M Alliance, represent the majority of global container trade.

Then there are the alliances formed from within. In June, Wallenius and Wilhelmsen merged with EUKOR Car Carriers and American Roll-on Roll-off Carrier, and now all of them operate as Wallenius Wilhelmsen Logistics ASA. The global logistics player has 130 vessels serving more than 15 trade routes across six continents, with most customers being manufacturers of vehicles, mining and construction equipment and machinery.

Shippers should stay informed of changing conditions, services and how carriers are performing relative to key performance indicators. They should also consider the ports their cargo will move through. Okstapyak says ports such as Shuwaikh, Jebel Ali and other Middle Eastern and Indian ports can tend to be more “unpredictable.” Even in the U.S., labor issues can cause tremendous disruptions, such as when disputes led to shutdowns and backlogs on the West Coast in 2015. “You almost need to have a sixth sense about labor issues at ports,” Nuzio says.

Certain carriers that are “notoriously slow,” and some carriers can outperform on some routes while lagging on others, Ostapyak says. Shippers also have to consider weather, which can add predictable delays in certain locations during certain times of the year. “With autopilot and computers, many of the carriers do give a pretty accurate description of the transit itself, and they have the capabilities of going faster or slower, depending on if they need to make up ground,” Okstapyak says.

Saving Greenbacks by Going Green

Environmental records and sustainable operating practices have become a critical component of transoceanic shipping in the past decade. And there’s often a direct correlation between green practices and monetary performance, Ostapyak says. Newer ships are significantly more efficient, use less fuel and operate with smaller crews. “These issues go hand-in-hand in the way they operate and they have lower operating costs that can translate into lower freight costs,” Ostapyak says.

As a general rule of thumb, larger and more profitable carriers with money to invest in new ships and equipment tend to be more efficient. These ocean carriers are using new ship designs, upgrading propellers and engines to boost fuel economy and using IoT devices and software to more efficiently transfer cargo. They’re also boosting their economies of scale. Mitsui O.S.K. Lines, Ltd. announced in November the delivery of the MOL Truth, a 20,000-TEU containership that will ply the Asia-Northern Europe trade as part of The Alliance. MOL Truth features low-friction hull paint, a high efficiency propeller and PBCF, engine plant and optimized hull space.

Most modern ocean carriers offer a high level of visibility into their location, transit times and forecasts, he says. Ostapyak says big carriers like Maersk and MSC use sophisticated systems that offer live feeds and live updates of ETDs and ETAs. New IoT devices, software and communications equipment now enable shippers to have detailed views of their cargo in real-time. Many ocean carriers are also integrating with industry specific sales and logistics programs. In September, Maersk expanded its use of Salesforce so shippers can integrate global transport and logistics in the entire customer journey and create a seamless experience in the lifecycle.

Shippers should also consider the safety records and insurance coverage of their carriers. One of the major causes of major shipboard fires is non-compliance of restricted commodities and dangerous goods. Hapag Lloyd’s Cargo Patrol Team has been hailed as an innovative risk-reduction and compliance team that identifies roughly 1,250 potential undeclared or misdeclared bookings each day.

Finally, Nuzio says shippers should keep an eye on invoicing. Faced with tightening margins, many carriers have outsourced and offshored their invoicing, something experts say is leading to more inaccuracies. “It’s something to be on the lookout for. We’ve seen instances of double billing,” Nuzio says.


As global trade and manufacturing continue to expand, US states that have port access, skilled talent and industrial space are poised to thrive. Home to one of the fastest-growing economies and some of the fastest-growing cities in the nation, Florida is experiencing a rise in manufacturing activity in many areas of the state.

Florida’s growing manufacturing base is being fueled by thriving ports, high population growth rates, a strong education system and what many say is one of the best business environments in the nation. New manufacturing tax credits, port infrastructure investments and the expansion of the Panama Canal are likely to contribute to growth.

A Fast-Growing Economy

With a GDP growth rate of 3 percent in 2016, Florida retains one of the fastest-growing economies in the nation. Just ahead of California, it has the fifth-highest rate of economic expansion in the country and is well ahead of the average
US growth rate of 2.1 percent.

While Florida may not rank near the top for manufacturing jobs and share of state GDP, things are on the rise. Mike Grissom, interim president and CEO of Enterprise Florida, says the state passed a permanent sales tax exemption on manufacturing machinery and equipment. He says investment has also been driven by Florida’s highly ranked business climate and the fact that it is one of only seven states with no personal income tax. There are currently more than 19,000 manufacturing businesses operating in Florida employing more than 330,000 workers.

The biggest industry subsectors in 2016 were fabricated metal product manufacturing, chemical manufacturing and transportation equipment manufacturing. Much of the job growth has been in the boat-building industry, aerospace and motor vehicle parts. Bertram Yachts recently announced a new headquarters in Tampa, and aviation manufacturer HAECO Americas announced an expansion of 400 more jobs in Lake City. Other manufacturers with a big presence include Frito Lay, American Elite Molding and Conergy.

An analysis by PwC recognized Florida as the second best state in the country for aerospace and manufacturing attractiveness. The aviation and aerospace sector alone has 2,000 companies operating in the state with more than 80,000 workers. Partners in the aerospace industry include Northrop, Lockheed Martin, Mitsubishi Hitachi and GKN.

The opening of the Panama Canal expansion last year has also fueled more growth in trade and shipping at many Florida ports. Port Everglades is preparing to invest in three Super-Post-Panamax gantry cranes to access containers on taller and wider cargo ships. The Port of Jacksonville is also deepening its shipping channels, and Port Canaveral recently announced a $301 million capital expansion.

Larger ships arriving at Florida ports are opening new trade opportunities and supporting the region as a manufacturing and logistics hub, according to Jaap Donath, senior vice president of Research and Strategic Planning at The Beacon Council (Miami-Dade County’s economic development partnership). PortMiami recently completed $1 billion in capital improvements by deepening its channel to a 52-foot depth, installing new Super-Post-Panamax cranes and improving rail and road access. In early June, the port welcomed the 1,063-foot-long, 10,081-TEU Maersk Shanghai, the largest ship to ever call at a Florida port.

While Miami has long served as a gateway to the Americas, Donath says more companies are now positioning themselves in the city as a hub between North and South America. Greater access to Asia has also grown by 11 percent in the past year and has driven manufacturing activity. “We’re seeing the benefits of larger ships and more companies are coming to Miami as a platform for all of the Americas. Asia as a manufacturing hub is now looking more at Miami as a location for the whole region,” Donath says.

Central Florida

The manufacturing sector is also seeing strong growth in Central Florida between Orlando and Tampa. Dave Porter, senior vice president at the Orlando Economic Development Commission, says while Orlando is often thought of as a tourism-oriented city, that sector only represents one third of the economy. He says there has been significant manufacturing growth in the region in recent years. Aerospace and defense manufacturers also have a strong presence in the region, and Lockheed Martin now has two campuses and 7,000 employees there building F-16s and equipment for other military contracts.

We’re seeing some foreign investment as well. It’s an important part of our economy that I think has the potential to grow even more, especially with advanced manufacturing,” Porter says.

Orlando is in the midst of a $15 billion infrastructure investment that includes an overhaul of Interstate 4 and expansions of the rail system, international airport and Port Canaveral. In April, Bridging the Innovation to Development Gap (BRIDG), the world’s first industry-led sensor consortium, opened the Florida Advanced Manufacturing Research Center in Osceola. The facility will be one of the most advanced fabrication labs in the world.

According to the US Census Bureau, Tampa is one of the fastest-growing cities in the nation, reaching 3 million residents last year. The Brookings Institute also ranked the region as 18th in the country for economic performance. Steve Morey, vice president of Business Development at the Tampa Hillsborough Economic Development Corp., says more than 20 percent of the projects announced in the region in the past year have been in the manufacturing sector. He also says Tampa is being driven by rapid population growth that is rising with the Caribbean, Central and South America.

Aero Simulation, a manufacturer of flight simulators for military and commercial aircrafts, last year announced an expansion in the region and pointed to Tampa’s rich pool of talent. Tampa is also growing as a logistics hub, and the new Manufacturing Alliance of Hillsborough County was formed last year to bolster job training. Morey says the county is being driven by population growth with an influx of highly skilled workers and strong education programs at the University of South Florida, the University of Tampa and Hillsborough Community College. “We’ve got skilled people moving here, strong academic institutions and a lot of veterans and workers coming out of the military,” Morey says.

Activity Spreading Across the Sunshine State

Manufacturing activity is also growing in other areas of Florida, with new expansions adding 47,000 jobs in the sector since 2010. Hans-Mill Corp. recently moved operations from China and established its first US facility in the US in Jacksonville. Brazilian company Clodam do Brasil and German medical supply manufacturers KLS Martin Group also established operations here in the past couple of years. Governor Rick Scott hailed the HAECO expansion in Lake City as another step toward expanding in rural North Florida.

Enterprise Florida is also striving to expand manufacturing in more rural areas of the Panhandle due to the region’s abundant land, direct access to ports and interstates and a robust talent market. Grissom says Florida is working with CareerSource Florida, the state’s workforce development organization, to help train citizens in rural communities to prepare for the talent that manufacturers are seeking. “There’s really nowhere in the state of Florida where you are more than an hour from the Interstate or the coast, and the logistics options that companies have to choose from are what make Florida truly unique,” Grissom says.

Last year, Eastern Shipbuilding in Panama City was awarded a $10.5 billion contract to build more than two dozen new US Coast Guard cutters. It was the largest contract the Coast Guard awarded in its history and is set to add an additional 2,000 jobs in the region. Panama City Mayor Greg Brudnicki at the time called it a “game changer” for manufacturing in the region.

Environmental efforts at US ports handling shipments of export cargo and import cargo in international trade.


Having fueled smog and pollution around the globe since the advent of the modern shipping industry, ports haven’t had the best environmental reputations. Yet stewardship, public perception and new regulations have driven many to significantly clean up their acts over the past decade. Some U.S. ports are even becoming models of environmental leadership with investments, programs and initiatives that conserve resources, minimize emissions and take a holistic view of their impacts on the community.

Leading ports say things like clean truck programs, equipment upgrades, shore-side electricity and emission reduction strategies can go a long way in positively impacting both their operations and the natural environment. And while ports may also face uncertainty about regulations and capital for upgrades, their commitment to their communities and environments remains strong.

Reducing Emissions and Improving Air Quality with Equipment Upgrades

Air pollution remains the single biggest challenge at many ports due to the daily movement of thousands of trucks, vessels and equipment. In early June, the mayors of Los Angeles and Long Beach signed a two-page declaration to move to zero-emissions trucks and yard equipment by 2035. A smog-cleanup plan approved in March also requires the California Air Resources Board to draft regulations to achieve up to 100 percent zero-emission cargo handling equipment by 2030. Long Beach Mayor Robert Garcia said in a release that it was “crucial to double down on our commitment to combating climate change by achieving the goals of the Paris Agreement and by committing to zero emissions goals for the Clean Air Action Plan.”

A recent National Port Strategy Assessment by the EPA found there are many strategies and technologies that can help reduce port emissions and harmful pollutants. This includes things like replacing older equipment and outdated diesel fleets, implementing operational improvements to reduce idling and switching to cleaner fuels. The EPA report said upgrading equipment alone could provide significant reductions in NOx and PM2.5 emissions.

Since implementing its Green Port Policy in 2005, Long Beach has driven clean truck programs and installed shore-side electricity. At the nearby Port of Los Angeles, Christopher Cannon, director of Environmental Management, says they are installing at-berth emissions control devices and testing a smokestack “hood” that would collect and treat emissions from cargo ships. The port is also aiming to become the first terminal in the world to operate entirely on zero-emissions equipment. Cannon says the terminal will be fueled by a $27 million solar and microgrid with 2.6 MW of battery storage. “It’s attracting a lot of attention, even from the federal government, because of the benefit of being able to operate a terminal in the event of an emergency. If there [was a blackout] it could still operate,” Cannon says.

Improving air quality is also a priority in Texas, especially in the Houston-Galveston-Brazoria region. The Port Houston utilizes new technologies, alternative fuels, an employee vanpool program and strategic fleet replacement with low-emission vehicles as part of a formal Clean Air Strategy Plan aimed at reducing real and sustainable maritime and port-related emissions.

Meanwhile, the Texas General Land Office says 65 percent of the state’s shoreline is eroding at an average rate of about six feet per year, and even faster in some areas, leaving people, ports and refineries increasingly vulnerable to storms. That threat spurred the Port of Galveston’s Roger Quiroga to join the advisory committee for the Texas Coastal Resiliency Master Plan, which is looking at 177 environmental restoration projects to protect the state’s shoreline from erosion. “The main thrust I think in the long run is going to be how do we protect the coastline from these hurricanes, especially the ones that might affect the upper Texas coast,” Quiroga recently told Houston Public Media. “Galveston, Beaumont, Port Arthur, you know, heavy industry.”

Drinking water became an issue earlier this year at the Port of Corpus Christi, which the city of Beeville summoned for leverage logistics after spring storms cut power at water treatment systems, exhausting the water supply. Fortunately, the port had a stockpile of bottled water on pallets due to a previous tap water contamination issue in Corpus Christi, so that water was redistributed to the parched citizens of Beeville. “Our port is deeply rooted with the citizens of our region,” explains Charles W. Zahn Jr., the Port of Corpus Christi Commission chairman.  “We are ready and willing to provide support during this and other times of need.”

Sustainability and Stewardship

The Port of Corpus Christi Authority has implemented a strategic plan “to ensure its continued economic success while ensuring its operations and activities are conducted in a manner conducive to environmental sustainability and resiliency.” A revised environmental policy recently implemented by commissioners identified five key precepts to be considered when evaluating new developments and operations: air quality, water quality, soils and sediments, wildlife habitat and environmental sustainability. Last year, the nation’s fifth largest port in total tonnage became the first in Texas to join Green Marine, the biggest voluntary environmental program for the maritime industry in North America. “Green Marine certification aligns well with our strategic initiatives with regards to the environment and sustaining the clean air, water and soil that we have in our port,” explains Sarah Garza, Port of Corpus Christi Authority’s director of Environmental Planning & Compliance.

Many ports around the country are making big strides in reducing their environmental impacts. At the Port of Baltimore, the Dray Truck Replacement Program has replaced more than 130 trucks since 2012 and significantly reduced turn times. The Port of Portland has invested $3 million in energy efficiency improvements and aims to reduce greenhouse gases by 15 percent by 2020. The South Carolina Port Authority is also installing solar panels on the warehouse roofs of two of its terminals, something it says will generate 3.6 megawatts of electricity. And the Port Authority of New York and New Jersey used cleaned dredged material to restore several marsh islands in Jamaica Bay.

New software applications and the Internet of Things are also enabling ports to make their operations more efficient. Cannon says the Port of Los Angeles is working on a new information portal that will enable port operators to obtain more updated information on cargo aboard incoming ships. As the port typically can’t obtain that information until 24 to 48 hours before arrival, having more real-time access to cargo information would allow them to prepare, sequence and move equipment more efficiently. “By being more efficient with how we move cargo at terminals and how we get cargo in and out of the port, it allows for much greater efficiency in terms of all the steps in the movement chain and reducing emissions,” Cannon says.

Port Canaveral recently received its environmental certification and became the 100th port to join the Green Marine program, a North American environmental certification program for the marine and port industry. Robert Musser, director of Port Environmental at the Port of Canaveral, says the port has implemented many “top-down” programs to reduce the environmental footprint with actions and measurable results.

At the Port of Oakland, Richard Sinkoff, director of Environmental Programs and Planning, says environmental stewardship has become “enshrined” in the strategic plan. The port is eight years into its 12-year Maritime Air Quality Improvement plan and has since reduced diesel particulate matter by 85 percent. Sinkoff says the port has implemented dozens of innovative programs and looks at all areas of port operations and administration with environmental considerations at the forefront. “We call it a lens for our port business,” Sinkoff explains. “So, in our agreements, in our discussions with tenants, it’s really a topic that is always raised front and center.”

Contemplating Costs and the Future of Regulations

As system-wide equipment upgrades can be costly, some ports are challenged with raising the capital they need. According to a report by the American Association of Port Authorities, U.S. ports and partners expect to spend nearly $155 billion on infrastructure upgrades by 2020. Yet AAPA noted that at “best case,” the federal government might only invest up to $25 billion during that time.

Donnell Jackson, the Port of New Orleans Media Relations manager, says sustainable improvements cost more in nominal terms but are often comparable to traditional infrastructure costs after factoring in things like reduced resource expenditures, quality of life improvements and impacts to natural environments. The Port of New Orleans has a Department of Sustainable Development team with a certified LEED Associate Professional and certified Environmental Sustainability Professional who can quantify and value projects. “When taking sustainability into account, we are extending the lifespan of the investment by considering changes to our surroundings as well as other sustainability factors,” Jackson says.

As the Trump administration aims to roll back regulations, some also question how it may impact American ports and the access to federal grant money. Some transportation companies and ports say a drawback of regulations wouldn’t necessarily reduce their commitment to environmental stewardship. Sinkoff notes that many of California’s regulations already exceed those at the federal level. He says they are watching the situation closely and believe such actions from the administration would mainly result in a reduction of “redundant regulations.”

We’re developing strategies now to address that, to make sure that our business can continue to operate with the highest level of environmental stewardship,” Sinkoff says.

Musser says with the potential for more infrastructure funds on the way, a streamlining of multiple layers of regulations could help reduce some “logjams” in the system. He says while some “fine-tuning” to existing regulations could help reduce friction, it wouldn’t impact Port of Canaveral’s commitment to the environment and community. “Regardless of what happens [with regulations], I foresee programs continuing because it’s not just a sustainability issues. It’s a steward issue. The port is responsible to the citizens and taxpayers of Broward County,” Musser says.

Ports seek to accommodate big ships carrying shipments of export cargo and import cargo in international trade.


One year after the opening of the Panama Canal expansion, East Coast ports are receiving some of the largest ships to ever call in the region. While a number of ports already have the channel depths required to receive such vessels, others are working on deepening and expansion projects to accommodate the growing size of vessels that are transiting the canal.

Experts say that while the trend is gradual, expanding port access and new routes are offering new transportation options between the East Coast and Asia.

More Direct Trade Route Between the East Coast and Asia

The Panama Canal expansion opened in late June of 2016 after nearly a decade and $5 billion worth of construction. The new locks and channels have doubled the canal’s capacity and can boost shippers’ economies of scale by allowing larger, wider and deeper vessels to transit the canal. While the expansion opened to questions about its design and international shipping trends, the Panama Canal Authority said in a written statement that it has since experienced a “boon in cargoes from newer segments, larger quantities and rerouted shipping lines.”

The expanded canal has so far transited more than 1,300 Neopanamax vessels, an average of 5.9 per day. Container ships now represent more than 40 percent of the vessels while the remaining consist of liquefied petroleum gas and liquefied natural gas. The Panama Canal Authority said the expansions are reverberating beyond Panama and around the world with a new and more direct trade route between Asia and the East Coast. The authority notes that January 2017 was a record month, with many U.S. ports such as Charleston, Philadelphia and Savannah also experiencing record container volume.

Ports around the world are in varying stages of work to deepen and widen their channels to accommodate the growing number of Neopanamax vessels that can now transit the canal,” the authority said.

Many of these larger ships are already bringing record volumes to East Coast ports. In early May, the 13,092-TEU COSCO Development docked in the region, and less than a month later the 13,208-TEU, 1,202-foot-long OOCL France became the largest ship to ever transit the canal. It called at a number of ports including Charleston and Savannah before heading to Hong Kong. Both vessels are part of Ocean Alliance’s weekly South Atlantic Express service between Asia and the United States.

East Coast Ports Capitalizing on Larger Ships

A number of ports on the Atlantic say they are ready to accommodate the newest and largest Panamax ships. Griff Lynch, executive director of the Georgia Ports Authority, said the Port of Savannah is well-positioned to capitalize on the growing number of larger ships transiting the canal. Because Savannah is the westernmost port on the East Coast, he says it is often the first call made on arrival and the last call made on departure. Lynch says in the first 10 months of the fiscal year 2017, nearly 35 percent of Savannah’s import and export cargo transited the Panama Canal. “By loading up on the last stop, vessels avoid carrying unnecessary weight during the port calls along the coast,” Lynch says.

The Savannah Harbor Expansion Project (SHEP) is expected to be completed in 2020 and will allow 14,000 TEU equivalent container vessels to call on the port with greater scheduling flexibility. Lynch says proximity to Midwest manufacturers could make Savannah a more viable and cost-effective port of entry for parts or for sending finished goods. He estimates that as the SHEP project comes online, many American businesses will be able to save 20 to 40 percent on transportation costs by their cargo going through Savannah.

Joe Harris, Virginia Port Authority spokesman, says fiscal year to date volumes at the Port of Virginia are up across the board in all categories, including truck, trail and barge. He attributes much of this to a strong economy, growing confidence in the Port of Virginia and the Panama Canal expansion. The port is currently working on $670 million worth of improvements and projects that will expand container capacity by 40 percent by 2020. Harris says these ships are also coming in “loaded heavy” into Virginia to take advantage of the deep water before offloading and making calls at peer ports to the south that haven’t yet completed their deepening projects.

We’re going to continue to take advantage of it, because we know we can grow our ship sizes parallel to what is happening. The Panama Canal is certainly a contributor to this,” Harris says. “We’re now seeing [larger vessels] once per week coming from China via the canal.”

Other East Coast Ports Upgrading to Accommodate New Panamax

Many ports are still working on infrastructure projects to accommodate new Panamax ships. At the Ports of New York and New Jersey, the recently completed Bayonne Bridge-raising project now allows the largest ships to gain access to the ports of Newark, Staten Island and Elizabeth. New Jersey Governor Chris Christie said at a conference in May that it’s a “game-changer” that will help generate billions of additional dollars in economic activity to the region.

Steve Coleman, spokesman for the Port Authority of New York and New Jersey, says the bridge has been raised to a clearance of 215 feet, allowing ships of up to 18,000 TEUs to call on all terminals. He says it gives the ports an opportunity to compete for more discretionary cargo destined for inland points by truck and rail. The port has been preparing for the expansion for nearly a decade by deepening the harbor to 50 feet, expanding intermodal rail facilities and investing in larger gantry cranes.

Other deep-water ports on the East Coast include Miami, Norfolk and Baltimore. The ports of Boston, Charleston, and Jacksonville are also deepening their harbors, and the Port of Virginia is studying the benefits of deepening the harbor and channels to 55 feet, which would make it the deepest port on the East Coast.

Harris believes while more Asian bound and incoming cargo will enter the U.S. on the East Coast, the trend will happen slowly over the next decade. He also notes that despite access and cost, shippers want to diversify their routes. He points to past work stoppages, environmental controls, congestion and surcharges that have occasionally led to delays and added expenses on the West Coast. “I think we are seeing that the ocean carriers and cargo owners are diversifying their logistics chains and using the East Coast,” Harris says. “When you have 50 feet of water up and down the East Coast, we think it’s going to be a good thing for cargo coming here.”

Enviromental efforts by ocean carriers of shipments of export cargo and import cargo in international trade.


The shipping industry hasn’t always had the best environmental reputation. Yet stewardship, public perception and new regulations have driven many shipping companies and ports to significantly clean up their acts over the past decade. Some shippers are even becoming models of environmental leadership with investments and initiatives that conserve resources, minimize emissions and reduce their impacts on the environment.

From more efficient ship designs to larger cargo capacities to increase the economies of scale, shipping companies are continually reducing their emissions on a per-ton basis. They’re also instituting more efficient designs and new technologies such as “scrubbers” (a.k.a. emissions cleaning systems) to remove sulphur from their emissions. And in conjunction with ports, they’re tapping into things like shore-side power and real-time information to reduce their environmental impact while at berth.

Reducing Emissions Through Economies of Scale

Air pollution remains the single biggest challenge in the shipping industry. The International Chamber of Shipping reports the 50,000 merchant ships operating around the globe touch 90 percent of the global trade. The industry also accounts for a large portion of CO2 emissions that are expected to grow to 17 percent of all global CO2 emissions by 2050.

Natasha Brown, Media and Communications officer with the International Maritime Organization, says despite the numbers, shipping remains the most environmentally friendly means of transporting cargo on a per-ton basis. A greenhouse gas study by IMO found that a very large container vessel (18,000 TEU) produces CO2 emissions of only 3 grams per tonne-km compared to 80 for trucks and 435 for a 747 plane.

Shipping is by far the most environmentally friendly means of transporting large quantities of goods,” Brown says. “It is in the interest of everyone to ensure that shipping continues to become safer, greener and cleaner, as well as more efficient.”

Rainer Horn, spokesman for Hapag-Lloyd, says the largest modern vessels can carry up to 140,000 tons with a fuel consumption of only 100-130 tons per day at 16 knots. While the continuous growth of ship size has been driving fuel savings through economies of scale, Horn believes the growth is waning with the development of the Ultra Large Container Vessels (ULCVs) of up to 20,000 TEU capacity. Aside from Far East vessels, he says these larger ships don’t provide greater cost advantages over the 15,000 TEU ships. They also require longer port stays and have less flexibility for capacity management.

Reducing Emissions Through Self-regulation

Brown says the industry has been working for decades to reduce the environmental impact by addressing operational pollutants and the causes of accidents. Statistics compiled by the International Tanker Owners Pollution Federation found a 90 percent reduction in the number of oil spills since the adoption of the International Convention for the Prevention of Pollution from Ships (MARPOL) in 1973. New annexes in the past couple of decades have addressed air pollution and the disposition of garbage from ships.

In 2011, IMO became the first international regulator for a transport sector to adopt globally binding energy efficiency requirements that apply to all ships globally regardless of trading pattern or state flag. MARPOL Annex VI, Chapter 4 aims for a gradual reduction of CO2 emissions in the shipping industry from a 10 percent reduction by 2020 to a 50 percent cut by 2030.

Today, the expanded, amended and updated MARPOL Convention remains the most important as well as the most comprehensive, international treaty covering the prevention of both marine and atmospheric pollution by ships,” Brown says.

IMO has also placed a cap on sulphurus content in marine fuel oil of .5 percent by 2020. The move is designed to force shipping companies to invest in scrubbers and look to low sulphur marine fuel or alternative fuels such as liquefied natural gas (LNG).

MOL on June 1 was delivered the LNG carrier CESI Beihai, the third of six such vessels now on line through a joint venture with COSCO and China Petroleum & Chemical Corp. The other three will be ready to sail in 2018. Meanwhile, the MOL-operated 50,000 DWT methanol carriers Taranaki Sun, Manchac Sun and Cajun Sun received the Technology Special Prize at the 2016 Ship of the Year awards sponsored by the Japan Society of Naval Architects and Ocean Engineers, the shipping company announced on July 10.

But Horn points out that while the industry should work on reducing emissions such as nitrogen oxide, sulphur dioxide and particulate matter, small local laws can present big challenges for an international industry. “Changes should be done with enough lead time to prepare efficient and viable technical solutions,” he says, “and last but not least, one needs efficient enforcement and monitoring.”

Hapag-Lloyd collaborates globally with industry partners, terminals, port authorities and technical suppliers to reduce its environmental impact. Many ports are leading initiatives that help reduce emissions while at berth. Christopher Cannon, director of Environmental Management at the Port of Los Angeles, says they are installing at-berth emissions control devices and testing a smokestack “hood” that will collect and treat emissions from ships while at port. The port is also aiming to have the first terminal in the world to operate entirely on zero-emissions equipment fueled by a $27 million solar array and microgrid with 2.6 MW of battery storage.

Innovative Technologies

New technologies are also reducing the environmental impact of the shipping industry. Many manufacturers are experimenting with ways to mitigate the environmental impact of big ships. One of the most effective mechanisms is a scrubber that can remove sulphur emissions from the exhaust gas. Shippers are also upgrading propellers and engines to boost fuel efficiency and increase the capacity of the vessels. Other new technologies are showing promise. German manufacturer SkySails is developing a high-altitude automated towing kite system that can partially power large cargo ships.

New Internet of Things devices and softwares are also enabling both shipping companies and port operators to more efficiently plan and transfer cargo. Horn says since 2013, Hapag-Lloyd’s Fleet Support Center in Hamburg, Germany, has consistently analyzed all types of fleet and other data to transport containers more efficiently with less fuel consumption per TEU and mile. The shipping company is also testing cloud-based stoward planning software to support real-time visibility into the loading and unloading operations. “The more transparency there is throughout the supply chain, the more efficiently everyone involved can make plans for and employ their assets and resources,” says Jörn Springer, head of Hapag-Lloyd’s Fleet Support Center.

Cannon says the Port of Los Angeles is also working on a new information portal that will enable its operators to obtain more updated information on cargo aboard incoming ships. As the port typically can’t get that information until 24 to 48 hours before arrival, having more real-time access to cargo information would allow them to prepare, sequence and move equipment in a more efficient manner. “By being more efficient with how we move cargo at terminals and how we get cargo in and out of the port, it allows for much greater efficiency in terms of all the steps in the movement chain that reduce emissions,” Cannon says.


American manufacturing is in the midst of a renaissance. While the sector has been riding a wave of automation, increased efficiencies and changing macroeconomic forces, manufactures say the Trump administration could help fuel further growth with a reduction in regulations and new tax incentives.

Economic development commissions (EDCs) across the country say manufacturing is thriving with new expansions and investments being driven by local tax incentives, access to quality talent, and a value proposition making it increasingly cost-effective to produce products in the United States. On a national scale, support for innovative technologies, workforce development, and a pro-business environment have the potential to drive American manufacturing to new levels.

Growth in many subsectors and regions

The manufacturing sector is experiencing robust growth across the country. Major manufacturers such as Ford, GM, and Carrier have announced new investments, while the Labor Department revealed the country added 28,000 manufacturing jobs in February. National Association of Manufacturers President and CEO Jay Thomas attributes the surge to a “Trump bump” of positive economic activity and says that “confidence is high, and business optimism continues to soar” due to a focus on pro-business policies. President Trump said in late -January that he wants to cut regulations by 75 percent and that there will “be advantages” for manufacturers to operate in the United States.

American manufacturing has been growing on an impressive scale. NAM reports the top five states for manufacturing growth are Indiana, Wisconsin, Michigan, Iowa and Alabama. Greg Canfield, Secretary of the Alabama Department of Commerce, says the sector remains a “core strength” of the state’s economy, generating 17 percent of state GDP ($35 billion) and 13 percent of the state’s jobs. Canfield notes that Alabama exported a new annual record of manufactured goods in 2016, totaling $10.7 billion in shipments.

“Alabama’s manufacturing climate has been thriving in the past few years, with steady gains in employment, rising productivity, and increasing sophistication among manufacturers,” said Canfield.

He adds that while there has been a sharp decline in apparel, textile and steel manufacturing due to offshoring and automation, automobile manufacturing has been on the rise. While there was virtually no automotive manufacturing twenty years ago in Alabama, there are now  facilities across the state operated by Honda, Hyundai and Mercedes-Benz that  produce more than 1 million vehicles annually.

Up in Michigan, American manufacturing is surging. Detroit emerged from bankruptcy last year and has leveraged manufacturing growth as a pathway to continued recovery. Jennifer Nelson, executive vice president of the Michigan Economic Development Corp., says there has been strong investment in automotive manufacturing, totaling close to $30 billion over the past five to seven years. Michigan has remained the top state for automotive related jobs in recent years, adding more than 200,000 jobs since 2009.

Ryan McCrady, president of the Economic Development Corp. of Decatur & Macon County in Decatur, Illinois., says they have seen new investments in the region. This includes a $200 million investment by Chinese company Fuyao Glass. During its consolidation, Caterpillar also moved 500 jobs to the region to manufacture wheel loads and compactors. And by the end of 2017, Akron Pharmaceuticals will have injected $75 million in the region for recent expansions.

“Decatur has been around 177 years, and manufacturing has been our legacy. [Manufacturers] feel comfortable here and there’s this legacy of workforce where people’s parents and grandparents worked in these settings. They really have pride in what they make here,” says McCrady.

New skills for a new age of manufacturing

Massive job losses over the years can distort the productivity of American manufacturing. According to the Bureau of Labor Statistics, the manufacturing industry lost roughly 5 million jobs between 2000 and 2015. Yet it remains the largest sector in the U.S. economy, having contributed more than $2.17 trillion to the GDP in 2015. Experts say it’s not necessarily that manufacturing has left, it’s that it has changed processes to become more efficient by requiring less human capital.

The U.S. manufacturing sector remains one of the most competitive in the world with output per workers higher than that in any other manufacturing country. The Dallas Federal Reserve manufacturing index also rose to 24.5 in February 2017, the highest reading in more than 10 years.

While unskilled factory line workers have lost jobs over the years due to automation and offshoring, manufacturers have a growing need for skilled workers. Deloitte Consulting projects that at the current rate, 2 million of the 3.5 million jobs expected in the coming decade will go unfilled. More than 80 percent of manufacturing executives surveyed by Deloitte said there is a talent shortage for U.S. manufacturing, and six out of 10 said that production positions were unfilled due to a talent shortage.

American EDCs know that aside from utilities, labor is now often the single most important factor for manufacturers in site selection. New initiatives at the federal, state and local levels are pushing trade schools and training programs to prepare the workforce.

Nelson says that from an economic development perspective, the state that “gets the talent equation correct is going to be the leader.” Two years ago, Michigan Governor. Rick Snyder announced a $50 million grant program to help 18 community colleges boost their skilled trades curriculums.

The search for talent is also forcing manufacturers to look outside of the traditional hubs. San Angelo, Texas, has seen notable growth in manufacturers setting up shop in the region. San Angelo Vice President of Economic Development Michael Looney says continuing to build a talented workforce is the primary need that the sector needs to grow on a national scale. He stresses the importance of encouraging more kids to enter the trades and proposes a “European model” of testing and moving certain students into the trades. “The creation of many products still has to be done by sharp minds and skilled hands. Fortunately for our region, we are home to thousands of skilled fabricators,” says Looney.

Nelson says Michigan is retaining its heritage and legacy of traditional auto manufacturing while also trying to remain competitive in the environment of new advanced manufacturing. She says that as assembly line workers are “somewhat a thing of the past,” the state is trying to ensure its labor pool can meet the need for technicians, operators and machinists. “Automation can be good. We just need to make sure that we are training our folks here within Michigan to be able to work on the more automated technology that’s coming out,” says Nelson.

U.S. leading through innovation and flexibility

The U.S. has also grown to be a world -leader in manufacturing innovation. Since 2014, the Manufacturing USA institute network has been bringing together industry, federal partners and academia to boost U.S. manufacturing competitiveness and promote a national infrastructure. The network has a goal of establishing 15 manufacturing hubs where public-private partnerships can advance new technologies. Hubs already in operations include the Smart Manufacturing Innovation Institute in Los Angeles, the Next Generation Power Electronics Innovation Institute in Raleigh, North .Carolina., and the new Advanced Robotics Manufacturing (ARM) Innovation Hub in Pittsburgh, Pennsylvania.

American manufacturing hubs are also evolving to meet the changing needs of the global economy. Kian Kamas, vice president of Economic Development at the Tulsa Regional Chamber of Commerce, says despite the downturn in oil prices in the energy-driven state, manufacturing has continued to grow in sub-sectors such as aerospace. Port Catoosa, the most inland, ice-free port in the U.S. with access to the Mississippi River, has also diversified in recent years. Kamas says the growing port is an asset that allows manufactures to move materials and product in and out of the city “at a tremendously low rate.”

“Our central location continues to make Tulsa a great location for manufacturers. The port offers a tremendous advantage when it comes to steel-based industries, because it just makes it so much more competitive to move steel here,” says Kamas.

Flexibility and innovation is increasing the attractiveness of many states. In Indiana, leading manufacturers— such as GE Aviation, Rolls-Royce, Alcoa, Raytheon and Praxair— have announced plans to invest more than $900 million in the state and to create more than 1,200 jobs. Indiana Secretary of Commerce Jim Schellinger, says the manufacturing growth is being driven by its balanced budget, AAA credit rating from all three agencies, and overall positive business climate.

Indiana also has strong facilities and programs to drive innovation, such as the Purdue Research Park and Aerospace District. The state also recently joined forces with the city of Fishers to form the Indiana IoT Lab-Fishers, a 24,000-square-foot lab designed to help businesses use of the Internet of Things in ideation, cloud data, edge software, and development.

U.S. companies coming back, foreign direct investment increasing

America’s manufacturing renaissance is also attracting record amounts of direct foreign investment. The non-profit advocacy group Reshoring Initiative says more American companies have been moving manufacturing operations back to the U.S. either for practical or public relations reasons. Rising wages in Asia, higher tax burdens abroad, high international shipping costs, and the desire to be closer to markets are driving many companies to the States.

Canfield says that in 2015 alone, Alabama attracted a record $3.4 billion in investments from foreign companies, making it one of the top states for foreign investment. Since 1999, the state has attracted $25 billion in FDI and generated 77,000 jobs through projects from 32 countries, including Germany, South Korea and Japan. Canfield credits the state’s global reputation and attractiveness to its workforce and business environment.

While the U.S. is attracting more foreign investment there’s also news that manufacturers that would have otherwise moved expansions offshore are keeping them at home. In mid-January, a number of companies— including General Motors, Hyundai, Bayer AG, and Walmart—announced billions of new U.S. manufacturing investments.

Many in the industry say a reduction in red tape and regulations could fuel further growth in American manufacturing. A Q3 2016 survey by the National Association for Manufacturers found that nearly 74 percent of manufacturers reported an unfavorable business climate, including taxes and regulations, were their primary concern.

The Department of Commerce is currently surveying domestic and foreign manufacturers to learn how federal regulations impact businesses and about how it can streamline permitting and simplify regulatory compliance. The Trump administration has promised to cut regulatory burdens by as much as 75 percent, and in late -January, it formed a council with more than 25 manufacturing CEOs to advise the president on manufacturing growth.

Emerson Electric Co. CEO David Farr, who serves as a board chair of the National Association of Manufacturers, wrote in a blog post that federal regulations are “the biggest obstacle” for manufacturers and can cost up to nearly $35,000 per employee per year. Like many manufacturing executives, Farr has generally expressed optimism about the future of the industry.

“It is encouraging to have an administration that will take the time to sit down with manufacturers and hear what we have to say,” Farr says. “… Manufacturers have the solutions. We just need our leaders to get the work done.” said Farr.


New regulations, innovative technologies and changes in the coal market are fueling new trends in rail shipping. While rail has often remained the most efficient means of long-distance ground transport, it hasn’t always moved quickly with technology. Experts say the industry is upgrading facilities and locomotives with new technologies that are not only improving safety and maintenance but also creating new efficiencies and optimizing operations.

Increased Intermodal Shipping

A decline of coal production and the bankruptcy of several major coal companies in the U.S. has recently put a big pinch on the rail industry. The Association of American Railroads reports that revenues from intermodal transport accounted for more revenue than coal from 2013 to 2015. Railroads have also been investing more in expanding their infrastructure in anticipation of further growth in intermodal truck-to-rail shipping.

Norfolk Southern Railways’ $2.5 billion expansion of the Crescent Corridor in 2012 opened 30 new lanes of rail across 2,500 miles between New Orleans, La., and Trenton, N.J. BNSF has also completed a $3.5 billion expansion of its Northern Corridors to offer faster intermodal service between Seattle, Wash., and Chicago, Ill.

John Ireland, project manager with R.L. Banks & Associates in San Diego,  says many recent expansions have been designed to better support the integration between truck and rail. He points to Union Pacific’s Santa Teresa Intermodal Ramp which opened in Santa Teresa, N.M., in 2014 to expedite cargo movement across the entire country with proximity to the biggest maquiladoras in Mexico. The $400 million state-of-the-art facility has an annual lift capacity of 225,000 units and features refrigerator container and trailer refueling, along with 1,200 container and trailer parking stalls. The facility is using a number of advanced technologies such as an Automated Gate System (AGS) that has improved gate/terminal throughput and turn times.

“[Rail shipping] is really heading toward [facilities] with more integrated communications and energy between rail and truck. Much like at large ports, they’re all continuing to better integrate the movement of these containers from ship to rail and so on,” says Ireland.

Technology Improves Safety

In the past few years, the rail industry has also been implementing new technologies to improve safety. In 2008, Congress passed a mandate in 2008 requiring the country’s privately -owned railroads to finance, develop and install Positive Train Control (PTC) technology across all 60,000 miles of the rail network by the end of 2015. The implementation deadline was later granted a three-year extension to the end of 2018. PTC uses sensors and communications technology to automatically stop a train before certain types of incidents occur. Ireland says PTC implementation affects the majority of mainline railroads in the U.S. and requires a complete overhaul of every locomotive and signaling system on the railroad.  “It’s a very big undertaking. That has been the most pressing technological issue in the rail industry for the last few years, and I think it will be going forward,” says Ireland.

Many trains are now also using electronically -controlled pneumatic braking systems (ECP), which was suggested by a mandate on the federal level to be used on any train carrying hazardous waste.

The rail industry has also been seeking other ways to improve safety. John Tuna, director of the  Office of Research and Development at the Federal Railroad Administration, says the industry has deployed more wayside advanced technology systems (WATS) to look for defects as trains pass, something he says the industry is becoming better at. In one example, he says a network of hot bearing detectors has allowed trains to prevent burned off wheel bearings. A number of Class I railroads, including BNSF and UP, are now testing unmanned aerial vehicles (UAVs) to inspect tracks. Operators can fly them up to 150 miles away and use high powered cameras and imaging software to better detect anomalies more quickly.

“Our contractors that do this kind of research work to develop systems that eventually, once prototypes and commercialized, go into service,” says Tuna.

Data to Optimize

New technologies are also enabling the industry to improve efficiencies. Union Pacific has started using new GE Evolution Series Tier 4 Locomotives, 432,000-pound machines that have 4,400 horsepower and can reach a maximum speed of 70 miles per hour. The machines reduce emissions by 70 percent compared to Tier 3 locomotives and produce 90 percent less particulate matter and oxides of nitrogen than locomotives did 15 years ago. Improving efficiency continues to make trains the most efficient mode of long-distance on-ground transport. On average, BNSF says it can move one ton of freight almost 500 miles on a single gallon of diesel. The U.S. EPA notes that while rail carries more than 40 percent of U.S. freight by volume, it only accounts for 2.3 percent of all transpiration related greenhouse gas emissions.

Hubert Gassner,  chief  financial officer with  OmniTRAX in Denver, Colo., says new technologies are also being used to solve “business issues and problems.” He says the rail industry is implementing and using more data-driven technologies that can optimize operations and improve rail shipping by enhancing efficiencies. “We can see immediately if a fuel rate is off the charts or if [a train] is going too fast or not and we can [engineers] manage performance,” says Gassner.

While using trains can save money for business shippers, they’re often unfamiliar networks and not often easy to use. OmniTRAX offers to make rail shipping easier with Class I railroads that offer personal “door to door” service for small and large companies. Gassner says OmniTRAX runs everything in the cloud, providing shippers real-time insight into schedules and where their cargo is at any point in time. “We wanted to get rid of paper and have what we call dynamic operational dashboards that make all the information available to the right people at the right time,” says Gassner. “Everyone from the shipper to the guy in the field can see how we’re operating and get constant feedback.”

Gassner says blockchain is another piece of technology that offers great potential in rail shipping. As a distributed database that serves as the infrastructure for bitcoin, blockchain is now being used in the financial and retail industries to improve security, bring more transparency to information, boost reliability, and reduce friction in rail shipping. As a direct form of communication, blockchain can offer real-time digital ledgers of shipping data for use by third parties, port officials, and anyone in the supply chain. Gassner says it could eliminate the problems often encountered with “closed off” data sources. “I think blockchain, if people start putting real effort into it, like the financial industry does, can make a big difference in the rail shipping industry.”