The Authority For 
Small Town Advantages
In this episode, our special guest, Mike Running, Director of Economic Development for Dumas Texas, talks about the advantages small towns can offer companies that want exceptional quality of life, a dependable workforce and infrastructure that can keep them globally positioned.
United States Secretary of Transportation Elaine L. Chao has announced that the Maritime Administration (MARAD) will establish a new, dedicated Gateway office in Paducah, Kentucky. Gateway offices provide assistance to public ports and state and local officials in addressing transportation congestion relief and improving freight and passenger movement.
The new location and resources will allow MARAD to expand in the area around the Paducah hub, and be better able to support the Inland Marine Transportation System, its ports, service providers and vessel operators. Paducah’s proximity to three major river confluences will support stakeholders working to create a strong transportation network on our inland waterways.
“The Paducah-McCracken County Riverport is a multi-modal center, with waterway, rail, and road connections, and with this level of maritime activity, it makes sense to place a Gateway office in Paducah,” said Chao. “This new Gateway Office will support Paducah’s important role as an inland waterway crossroads between the Tennessee, Ohio, Cumberland and Mississippi rivers, as well as a major dry dock center.”
MARAD has nine other Gateway offices in proximity to the nation’s largest ports. The Gateway offices were established to act as liaisons between maritime communities, state and local authorities and their federal counterparts to identify intermodal challenges and solutions and assist in identifying Federal and state funding opportunities.
“Enhancing MARAD’s impact nationwide is critical for the continued success of the maritime industry,” said Maritime Administrator Mark H. Buzby.
The Inland Waterways Gateway Office in Paducah will have an area of responsibility which includes all or portions of the following Kentucky-adjacent states: West Virginia, Ohio, Indiana, Illinois and Tennessee. The Paducah office will also provide support to MARAD’s St. Louis Gateway Office for the states of Arkansas and Oklahoma.
Kuehne + Nagel announces a partnership with Sincero, a Chinese automotive logistics group with a nation-wide operation coverage, to invest in a joint venture focusing on contract logistics for the automotive sector. Kuehne + Nagel will hold majority share of the joint venture.
In recent years, Kuehne + Nagel has been developing a strong automotive footprint in the country by organically expanding the partnership with premium European brands. The company will now enlarge this footprint by almost seventy per cent serving major Chinese brands and Tier 1 suppliers.
“Contract logistics for the automotive industry is a strategic focus area for Kuehne + Nagel globally and especially in China, the biggest automotive market,” said Gianfranco Sgro, member of the managing board of Kuehne + Nagel International AG, responsible for contract logistics. “The joint venture confirms Kuehne + Nagel’s position as a leading international provider of automotive logistics in China. Following the recent launch of our digital platform for e-fulfilment centres in China this investment further strengthens our presence in Asia.”
“Establishing the joint venture with Kuehne + Nagel is a strategic move to comply with the irreversible globalization trend of economics and competitive landscape of the automobile logistics industry, thereby to complement each other’s strength in global network and local expertise,” said Jiang Jun, Sincero’s chairman of the board.
Both parties agreed not to disclose the purchase price. The joint venture is subject to customary closing conditions and to clearance by the competent merger control authorities.
Officials from the Port of Los Angeles and APL welcomed the first arrival of APL’s new premium cargo delivery service, Eagle Express X (EXX). The new weekly China-to-Los Angeles ocean freight service provides faster, expedited transit for cargo owners looking for a more on-time, speed-to-market delivery option.
Features of the Eagle Express X service include time-guaranteed transit from China to Los Angeles — 11 days from Shanghai and 12 days from Ningbo with attractive origin cutoffs and 100 percent guaranteed space and equipment. When EXX inbound containers are discharged at the Eagle Marine Service (EMS) terminal at the Port of Los Angeles, they are immediately loaded onto specially reserved smart chassis and directly parked in a dedicated EXX yard within the terminal for same day availability. Exclusive EXX gates have been established and no appointments are necessary.
“The Eagle Express X is yet another way that we are responding to the evolving needs of our cargo customers,” said Gene Seroka, executive director at the Port of Los Angeles.
The service is supported by APL’s White Glove Customer Service teams in Asia and Nashville for its North America customers.
“APL is always looking for ways to provide differentiated services for our customers,” said Ed Aldridge, president of APL North America. “The Eagle Express X (EXX) is our new initiative which provides our valuable customers with a cost efficient air freight alternative for its urgent cargo and a first class service for its ocean shipments from origin to destination. The customer support for this new expedited service has been both exceptional and exciting.”
The EXX service will soon benefit from new technology used at the Port of Los Angeles. Developed in partnership with GE Transportation, the Port Optimizer is a first-of-its-kind cloud-based portal that digitizes maritime shipping data for cargo owners and supply chain stakeholders through secure access channels. The technology platform greatly improves goods movement, predictability and planning.
The developments underway in Europe’s natural gas sector are some of the most influential and closely watched in the global gas market. In the past decade, Europe has seen significant demand swings, falling domestic production, growing concerns about dependence on Russian gas, and the advent of US liquefied natural gas exports to the world. Just as important has been the emerging competition from renewable fuels. Indeed, questions are now arising about whether Europe needs new investments in natural gas infrastructure or if those investments would become stranded assets.
In a new paper from the Columbia University Energy Policy Center, an analysis is presented for the outlook for natural gas in Europe’s electricity generation, the most substantial market for gas in the continent, to 2030. The authors create various scenarios that make increasingly bold assumptions about the costs of renewables going forward while at the same time addressing the absence of balancing costs of intermittent renewables in most recent analyses. The paper assumes a robust average carbon price over the forecast period in two of its scenarios, noting the highly complicated politics around more ambitious carbon pricing. Finally, the authors include all planned phaseouts of existing thermal generation capacity, per the reference case of the EU Energy, Transport and GHG Emissions Trends to 2050 as well as all recent national announcements concerning nuclear and coal phaseout.
The paper finds that a renaissance of natural gas in the EU-28 electricity sector looks unlikely, with only modest room for fuel switching and growth—about 40 billion cubic meters (bcm) on a continental scale through 2030. Fuel prices, carbon prices, and interest rates will be critical factors in determining whether demand for natural gas increases or declines.
The paper also found that there is moderate room for carbon pricing to drive fuel switching across Europe, similar to the experience in the United Kingdom. However, to allow for fuel switching, existing underutilized generation capacity must be available to use. If not, utilities face serious questions related to the cost of new generation capacity, anticipated fuel costs and cost curves, and time horizons. Importantly, recent data suggest that even though the carbon price floor did provide an incentive for incremental gas-fired power generation in the UK, soon thereafter, renewables, storage, and efficiency eroded some of the gains made by natural gas.
Increasing natural gas demand for electricity generation is most promising for southern Europe, chiefly because electricity demand in this part of the continent is still growing, although competition from renewables here is fierce. In a scenario with high carbon prices and high natural gas prices, by the end of the forecasting period, investments in renewables make more economic sense than natural gas in the southern part of the European Union. The costs of capital are likely going to be critically important in the coming years to determine whether investors turn to renewables or (in part) natural gas.
The paper concludes that new EU investments in gas infrastructure are probably necessary in parts of the European Union. New investments are less necessary in more mature parts of the continent relative to the less-developed parts of the continent, where gas demand has room for growth and/or single source dependency concerns trump basic economic considerations.
Century Aluminum, the largest primary aluminum producer in the United States, announced the ceremonial restart of its smelter in Hawesville, Kentucky, that will return the facility to full capacity, create 300 new jobs by early next year, and result in the investment of more than $150 million in the local economy.
The ceremony marked the return to full production of the first of three production lines to be restarted at the smelter, which has already hired more than 125 new employees since the announcement of the Section 232 tariffs in March 2018. Commerce Secretary Wilbur Ross joined Michael Bless, CEO of Century Aluminum, at the ceremonial opening.
“The Trump administration’s trade policies have provided much needed relief to America’s primary aluminum workers – leveling the playing field and ensuring that the US primary aluminum industry maintains its competitiveness on the world stage,” said Bless. “Today’s restart will allow us to return to 100-percent capacity in the months ahead while upgrading our smelting technology to ensure we remain competitive long into the future. We want to publicly thank President Donald Trump and Secretary Ross for their leadership on this issue.”
“The aluminum sector has weathered the hardships caused by unfair foreign trade practices,” said Wilbur Ross, the US Secretary of Commerce. “For too long, the government ignored repeated warnings of the impact on the US aluminum sector and its ability to support our armed forces. President Trump’s initiatives are addressing the very problems previous leadership failed to confront with the urgency that these threats presented. This administration remains steadfast in our Made-in-the-USA commitment.”
“Century’s products coming out of Hawesville and Sebree are in demand in Kentucky, across the United States, and around the world,” said Kentucky Governor Matt Bevin. “There is no better place in America to produce high-quality aluminum, and we’re delighted to see the Century facility operating at full capacity and bringing hundreds of jobs back to the local community.”
A major driver of local economic growth, Century Aluminum will invest nearly $150 million in the facility to upgrade smelting technology, train existing employees to use new equipment, and add specialty positions, including welders, mechanics and engineers. For the past three years, the Hawesville smelter has operated at just 40 percent capacity. With today’s restart, the facility will return to full production and add nearly 300 jobs by early next year.
Century’s Hawesville smelter produces aluminum that supplies the defense and aerospace industries, with a majority of Hawesville’s production lines configured to produce military-grade aluminum, making the smelter the largest producer of military-grade aluminum in North America. Hawesville was one of the many smelters forced to curtail operations in late 2015 as global aluminum overcapacity devastated the US primary aluminum industry, threatening American national security and leading to the loss of thousands of American primary aluminum jobs.
The United States Trade Representative’s (USTR) in August held a comment period and public hearings on the administration’s proposal to levy additional duties on Chinese goods. The proposal would increase the tariff on Chinese imports from 10 to 25 percent on $200 billion worth of imports.
Freedom Partners Executive Vice President Nathan Nascimento termed the administration’s tariffs “a self-destructive policy threatening to undermine the tremendous growth our economy experienced in the past two years.”
The news from around the country has not been good. Brinly-Hardy Co., a Jeffersonville, Indiana-based company that manufactures lawn care accessories, laid off 75 employees in response to Washington’s tariffs. Coca-Cola CEO James Quincey announced recently that the company would be raising prices. Though the additional cost on each can of Coke may be small, the costs add up for the company.
A Missouri-based nail company Mid Continent Nail Corp. has seen the prices of raw materials imported from Mexico increase by 25 percent. Nails now cost more, which has turned away customers. Lower revenue has resulted in 60 layoffs at Mid Continent, with the potential for hundreds more.
Tariffs have also cost significant revenue to Little Bay Lobster Co. of New Hampshire. The company had been shipping more than 50 percent of its lobsters to China, about 50,000 pounds a week. But that came to a crashing halt when China imposed a 25-percent tariff on US lobster.
Nascimento urged the administration not “to accelerate this trade war,” and to work “with trading partners like China to protect intellectual property.” He added: We’re encouraged by news that leaders from Beijing and Washington are meeting to re-start a trade dialogue. Ultimately, that is a better path to create more American jobs and achieve tariff-free trade than a trade war.”
During six days of public and interagency hearings held by the US Trade Representative in late August, the recreational boating industry joined hundreds of other industries and businesses to express deep concern about the harmful effects of the escalating trade war, including Section 301 tariffs targeting $200 billion in Chinese imports.
US businesses, including those making up the uniquely American-made recreational boating industry—which sees ninety-five percent of boats sold in the US made in the US—shared numerous examples during their testimony on how the tariffs negatively impact the US economy. From increasing the cost of parts, materials and components to creating uncertainty for American businesses, the testimony shed light on the worries of countless US industries, spanning from recreational boating to food, apparel, construction, and more.
“When you force American companies to pay taxes on $200 billion worth of Chinese imports—parts, components and materials that these companies have relied on for decades to build quality American products that are not only sold here in the US but around the globe—you’re paralyzing a significant part of the American economy,” said Nicole Vasilaros, senior vice president of government relations and legal affairs at the National Marine Manufacturers Association (NMMA). “Why put American businesses and American jobs at risk when there are better ways to go about fighting unfair trade?”
During the hearings, recreational boating industry leaders cautioned the administration that tariffs are not the solution to our country’s trade issues.
“Instead of these Section 301 tariffs, which do the opposite of what they’re intended to do and put our country’s economy at risk, we need to see a more strategic approach and negotiate a trade agreement with China that takes into consideration the real needs of US businesses and American workers,” said Vasilaros.
In her testimony, Vasilaros emphasized the effects tariffs are having on the global supply chain. “While we recognize and support the need to deal with China’s unfair trade practices, the administration’s proposal to levy a 10-25 percent tariff on $200 billion worth of imports will increase the harm US manufacturers are already experiencing due to misguided US trade policy,” she said. “The recreational boating industry will continue to suffer the consequences as American business are subjected to compounding tariffs that disrupt global supply chains and increase the cost of US manufacturing. Simply put, doubling down on bad trade policy will wreak havoc on American-made industries.”
Chris Welch, Supply Chain Manager of Magic Tilt Trailers, spoke on the disproportionate affects the tariffs are having on the marine manufacturing industry. “Although Secretary Ross was able to demonstrate on television that 25-percent steel tariffs will have little impact on the overall cost of a can of soup, the reality of our situation couldn’t be more opposite,” he said. “I don’t think the secretary would have garnered the same visual result had he presented a two-ton steel boat trailer as his example. Price increases along our entire supply chain on metal products have been swift and significant since the domestic steel and aluminum premium markets moved north, absorbing the ramifications of the Section 232 investigation and subsequent tariff decisions.”
John Hoge, President of Sea Eagle, highlighted how small businesses like his are negatively impacted by the trade war, possibly resulting in less job opportunities in the future. “Fewer orders means that fewer Americans will be employed in occupations from warehouse work to web development,” he testified. “Marketing budgets will have to be cut sharply and that will mean cancelled orders for advertising, catalog printing, video production and digital marketing. Fewer orders means less business for carriers such as FedEx and UPS. Jobs that are currently secure will be lost overnight.”
Transportation One, one of the nation’s fastest-growing logistics companies, has joined forces with FreightRover to drive supply chain efficiencies through digital freight automation.
Record-tight capacity and record-high rates have many shippers and third-party logistics providers scrambling to develop private freight marketplaces and other proprietary solutions in response. Taking a much different approach, Transportation One selected FreightRover’s suite of tools to quickly add digital freight brokerage to its business model. The company also plans to leverage FreightRover’s customizable platform as a tailored transportation management system unique to Transportation One’s operations to support faster growth and scalability.
Transportation One now will provide their customers with a private, proprietary freight marketplace branded to their business, as well as a carrier-facing portal for quicker carrier payments (many quick pay options offered) and overall seamless payment automation. In addition, Transportation One will use FreightRover’s white-labeled SmartLTL to instantaneously gather rates from multiple carriers and simplify LTL shipment management.
“Utilizing FreightRover’s leading-edge features and leveraging its technology as the foundation to build our own robust platform enables Transportation One to become a digital freight broker that competes with the top proprietary solutions out there,” said Jamie Teets, CEO of Transportation One. “We believe that investing in both people and technology will drive efficiencies and improve carrier and shipper satisfaction that will place us at the top of the industry. We are excited for this collaborative and strategic partnership.”
FreightRover’s suite of digital products are positioned to increase Transportation One’s efficiency and productivity, improve margin to generate customer cost savings, and reduce overall operating costs. By providing customers with personalized service and employees with software that eases everyday manual processes, Transportation One is poised to continue their rapid growth.
“While the transportation industry focuses on improving efficiencies in an era when consumers demand time-sensitive and visible delivery end-to-end, Transportation One is investing in new capabilities that drive profitable growth,” said Eric Meek, CEO of FreightRover. “FreightRover has taken a comprehensive approach to technological advancement, building individual solutions to touch upon each of the fragmentation points within transportation.”
FreightRover continues to transform transportation digitization through online carrier quick pay, automated LTL rate return and invoicing, and a private freight marketplace where shippers and 3PLs post freight to their preferred carriers.
Now, transportation companies can use FreightRover’s next-generation technology suite as a solution branded to their business, effectively providing customers with the same products and services as the largest 3PLs in the industry with improved scale and speed.
Emissions of nitrogen oxides (NOx), a key component of smog, are down an unprecedented 60 percent compared to 2005 emissions levels, their lowest level to date. The 2017 Inventory of Air Emissions released by the Port of Los Angeles shows it set new record lows for emissions reductions while its container volume reached an all-time high of 9.34 million TEUs.
Overall, the 2017 findings show the port has maintained or exceeded the dramatic clean air progress it has made over the last 12 years, and has now met all of its 2023 Clean Air Action Plan (CAAP) goals. Diesel particulate matter (DPM) remains down 87 percent, and sulfur oxides (SOx) remain down 98 percent.
“Our port is driving the global economy forward and showing the world how we can produce record-breaking growth and protect the environment at the same time,” said Mayor Eric Garcetti. “Our progress on reducing emissions to just a fraction of our 2005 levels while we ship more cargo than everis proof that our Clean Air Action Plan is working and exceeding expectations.”
“As of this inventory, we’ve hit all our 2023 targets for tackling the primary pollutants associated with port operations during our busiest year ever,” said Harbor Commission President Jaime Lee. “This is great news for our Port, our industry and our community.”
To reduce emissions while also significantly increasing cargo volumes, the port had to reduce the average amount of emissions it generates to move each container. Using this type of measurement, the port also posted its best year ever, lowering the average amount of emissions the port generates to move each container of cargo for all eight pollutants tracked by the port’s emissions inventory, including greenhouse gases (GHG), which were down 30 percent per container on average since 2005.
“We’re seeing the combined benefits of our ongoing clean air strategies and increased efficiencies across the supply chain,” said Port Executive Director Gene Seroka. “The results also validate our focus on further reducing NOx and greenhouse gases going forward.”
Based solely on tonnage, though, GHGs are down only 13 percent, which is a result of the substantial increase in activity in 2017 leading to the record cargo volumes. The port’s best year for reducing tons of GHGs was 2013 when GHG emissions were down 23 percent, a year when TEU volume was still down from its pre-recession peak.
“This is why cleaner technology and increased efficiency matter,” said Chris Cannon, Director of Environmental Management for the Port of Los Angeles. “Greenhouse gases come from burning fuel. The more cargo we move, the more CO2 emissions we generate, and greater the need to switch to cleaner low-carbon based equipment, while continuing to optimize port operations.”
Larger ships carrying more TEUs played a key role in preserving the port’s clean air gains. Container ship calls were down 22 percent while the average number of TEUs per vessel increased 60 percent since 2005. Fewer ship calls also led to fewer harbor craft trips.
The largest ships tend to be new-builds with cleaner engines, another contributor to clean air gains reported in 2017. Additionally, in compliance with California’s progressively stricter shore power requirements, more ships plugged into shore-side electricity instead of burning fuel at berth. Ships that cannot plug in increasingly used alternative technology to capture emissions at berth.
Effective 2017, all ships calling at the port met California and North American Emissions Control Area requirements to use fuel with 0.1 percent or lower sulfur content. More ships also are reducing fuel consumption by slowing down within 40 nautical miles of the Port.
Ongoing turnover of the truck fleet and upgrades of cargo handling equipment with the cleanest available engines also helped hold the line on emissions. More than half of nearly 17,000 drayage trucks calling at the Port in 2017 have 2010 model year or newer engines. Nearly 47 percent of cargo handling equipment – including cranes, tractors and forklifts – have Tier 4 or equivalent diesel engines, the cleanest diesel emission technology on the market.
“The percentage of cargo handling equipment using the cleanest available diesel technology has nearly doubled since 2016,” Cannon said. “That’s an example of how seriously terminal operators, trucking companies and our other partners are investing in new equipment and working with us to achieve our clean air goals. We look forward to continuing to partner with them using private investment and public funding programs to develop and deploy even cleaner technologies as we move toward new CAAP goals.”
The latest findings are based on data collected during calendar year 2017 and reviewed by regional, state and federal air regulatory agencies. The annual inventory details the impact of all strategies for reducing emissions from port-related sources: ships, locomotives, trucks, cargo handling equipment and harbor craft.
As container throughput increases, the port is working to implement more aggressive strategies to maintain its clean air gains and continue to meet the 2023 goals.
New in the 2017 Clean Air Action Plan (CAAP) Update are targets for reducing GHG emissions: 40 percent below 1990 levels by 2030 and 80 percent below 1990 levels by 2050. Strategies for reaching these targets include transitioning the on-road drayage fleet serving the Port to zero-emissions trucks by 2035 and all terminal equipment to zero emissions by 2030. Improving operational efficiencies, deploying advanced technology and managing energy resources are essential to this progress.
Near-term measures for accelerating clean air progress include requiring all trucks entering Port service for the first time to meet 2014 model engine emissions standards. Technology advancements expected to further reduce emissions by improving the flow of cargo include the Port Optimizer™, which gives the supply chain a head start of about two weeks to plan operations and allocate resources for handling inbound cargo.
To advance long-term goals, the port is working with private and public sector partners to test more zero emissions drayage trucks and demonstrate near-zero and zero emissions cargo handling equipment. The Port launched a number of projects before the 2017 CAAP Update was finalized.