China Seeks to Redraw the Global Trade Map

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China Seeks to Redraw the Global Trade Map

February 3rd, 2020 Lauren Kyger Leave a comment

Don’t Forget About Belt and Road

It’s a busy time for trade news. Headlines report every twist in the U.S.-China trade war, Brexit nears another deadline, and the U.S.-Mexico-Canada Agreement (USMCA) only just passed in Congress after a year of domestic debate. In Asia, countries are negotiating “mega” trade deals like the Regional Comprehensive Economic Partnership (RCEP) and the China-Japan-South Korea deal, while the United States is favoring “mini” or partial deals like the initial U.S.-Japan Free Trade Agreement. The WTO’s dispute settlement mechanism is stalling out without a functioning appellate body. The list of negotiations goes on.

All the while, China moves forward with its ambitious hard infrastructure plan to connect continents through its Belt and Road Initiative. The results will have a serious long-term impact on global trade. Policymakers are working to get their arms around its implications. Here are the basics everyone should know.

What is the Belt and Road Initiative?

Announced by Chinese President Xi Jinping in 2013, China’s Belt and Road Initiative is made up of two parts: The Silk Road Economic Belt (a “belt” by land) and the 21st Century Maritime Silk Road (a “road” by sea). Inspired by the historic trade routes forged between Asia and Europe and that once bustled with traders swapping silk, spices, tea, paper, and gunpowder, China is driving a state-planned version around its own vision of China-centered global trade.

The project has gone by many names: Launched as “One Belt, One Road” (OBOR), it’s now referred to as the “Belt and Road Initiative” (BRI). The plan redraws and expands China’s modern land and sea routes through new roads, railways, ports, bridges, power plants and more.

BRI spans some 138 countries, collectively home to 4.6 billion people and $29 trillion in combined GDP, an area the Chinese have loosely divided into six corridors. The biggest is the China-Pakistan Economic Corridor (CPEC), where China has spent an estimated $68 billion to date.

According to the American Enterprise Institute, Pakistan has received the most Chinese construction funds ($31.9 billion) along the BRI so far, followed by Nigeria and Bangladesh, but China is also investing heavily in more developed economies like Singapore ($24.3 billion), Malaysia and Russia. Construction projects have focused mostly on the power, transport and property sectors.

$1 Trillion Price Tag

The World Bank estimates investment in BRI totals $575 billion so far. Firms like PWC and Morgan Stanley estimate the final cost at around $1 trillion over the next 10 years. To put that number in perspective, the U.S. spent just $13.2 billion ($135 billion in today’s dollars) to help rebuild western Europe after World War II under the 1948 Marshall Plan.

The $1 trillion price tag is just a drop in the bucket compared to the overall infrastructure needs of the region. The Asian Development Bank estimates that Developing Asia will need to invest $1.7 trillion a year in infrastructure to maintain its growth, respond to climate change and eradicate poverty. This adds up to over $26 trillion in total investment needed by 2030.

Many participating BRI economies are in desperate need of infrastructure to expand trade. Trade in BRI corridor economies is 30 percent below its potential, and FDI is 70 percent below potential, according to a recent World Bank report. The BRI has the potential to increase trade, encourage foreign investment and reduce poverty by lowering trade costs. If fully implemented, the World Bank says it could end up increasing global trade between 1.7 and 6.2 percent. But improvements need to be implemented to make this a reality.

Opportunity Costs

For BRI to live up to its potential, the World Bank says China and participating countries must work to deepen policy reforms like increasing transparency, improving debt sustainability, and mitigating environmental, social and corruption risks along the belt and road.

Large infrastructure projects are notoriously difficult to execute. But risks are heightened along the BRI, where limited transparency along with weak economic fundamentals and governance make debt sustainability a real concern. The World Bank estimates 12 of the 43 BRI corridor economies are at risk for deterioration in their debt sustainability outlooks.

China has been criticized for using “debt-trap diplomacy” along the BRI to take advantage of developing countries unable to repay large debts. One frequently cited example is Sri Lanka’s Hambantota Port, which was handed over to a Chinese state-owned company in 2017 after the Sri Lankan government was unable to pay its bill for the Chinese-built port. China now holds a 99-year lease on the strategic port.

Some countries have been able to successfully renegotiate their BRI debt with Chinese banks. Malaysia recently refinanced its East Coast Rail Link project from over $15 billion to $10.7 billion after Malaysian Prime Minister Mahathir Mohamad initially cancelled $22 billion worth of BRI projects. Myanmar scaled back a major port project from $7.3 billion to $1.3 billion in 2018.

In a study of 40 cases of China’s external debt renegotiations with 28 different countries, research firm Rhodium Group found that asset seizures were rare and debt renegotiations in the form of write-offs, deferral and refinancing were far more common.

Rebranding the Belt and Road

Facing growing criticism abroad, BRI leaders announced at the second major BRI forum held in Beijing in April 2019 that the project would be getting a facelift. The joint statement says BRI investments would focus on “high-quality” cooperation, green development, and debt sustainability moving forward.

China’s Ministry of Finance also released a debt sustainability framework (DSF) for the BRI. The Chinese DSF closely mirrors the World Bank-IMF DSF, which has been used for over 20 years as a framework to guide countries and investors on how best to finance development needs while avoiding potential build up of excessive debt. The World Bank-IMF DSF requires regular debt sustainability analyses (DSAs) measuring a country’s projected debt burden, vulnerability to economic and policy shocks, and assessing the risk of debt distress.

While the introduction of the Chinese DSF is a welcome step toward improving debt sustainability along the BRI, there are still outstanding questions about how China will actually implement it. For example, Chinese officials have not yet indicated whether the DSF will be binding, or how transparent the DSF process will be.

All Roads Lead Back to Beijing

There’s plenty of trade news to vying for our attention nowadays. But China’s Belt and Road Initiative should not get lost in the shuffle. Beyond building roads and bridges in developing countries, the BRI also has serious implications for trade in areas like 5G technology, arctic trade and even space travel.

The U.S. response to the BRI has varied. The Obama administration followed a “Pivot to Asia” approach, negotiating the Trans-Pacific Partnership (TPP), a mega-trade deal excluding China. President Trump scrapped the TPP days after coming to office. His administration has since passed the BUILD Act which authorizes the U.S. government to invest up to $60 billion in developing countries across Asia and Africa.

But the United States’ muted response may be too little too late. With every new BRI project, China is physically laying the groundwork for new trade routes across the region. If successful, BRI means all roads will lead back to Beijing.

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Lauren Kyger served as Associate Editor for TradeVistas. A former Research Associate at the Hinrich Foundation, Lauren is also a Hinrich Foundation Global Trade Leader Scholar alumna. She recently joined the National Committee on U.S.-China Relations as digital content manager.

This article originally appeared on TradeVistas.org. Republished with permission.

Archives, Global Logistics, Global Trade Daily

Overcoming Obstacles in 2020 to Optimize the Digital Supply Chain

January 31st, 2020 Pervinder Johar Leave a comment

The logistics and supply chain market is transforming quickly. For the stakeholders involved, managing multiple partners, high customer expectations, siloed IT systems and dynamic conditions is a challenge. I recently shared my predictions for the supply chain and logistics industry and what global and domestic businesses can do to prepare for success in the new year. But, exactly how can businesses prepare for and confront some of the biggest barriers in 2020?

Transportation capacity constraints lead to inflated prices and significant waste.

In the supply chain, the saying “time is money” is particularly meaningful. Digital freight forwarder, Zencargo, analyzed more than 100 shipments from across the UK and found that more than 100 million hours are wasted per year in procurement, supplier management and freight-administration functions, for a total annual cost of nearly $2 billion.

With the state of capacity constraints, the transportation industry is a key contributor to the waste and inflated prices in logistics and supply chain processes. In the United States alone, 15 to 25 percent of trucks on the road are empty — and for non-empty miles, trailers are 36 percent underutilized. The Environmental Defense Fund (EDF) advises that capturing just half of this underutilized capacity would cut freight truck emissions by 100 million tons per year and reduce expenditures on diesel fuel by more than $30 billion a year. According to EDF, the movement of goods currently accounts for nine percent of U.S. greenhouse gas emissions, which is nearly 500 million metric tons annually in direct emissions.

On top of that, due to the fuel emissions produced by this sector it is responsible for an additional 100 million tons of climate pollution each year. Globally, trucks are the largest source of freight emissions (57 percent), and the emissions resulting from transportation vehicles and logistics operations contribute significantly to air pollution and unhealthy air quality.

With advanced technology-driven solutions, organizations have the ability to reduce waste and capacity constraints. By leveraging artificial intelligence and GPS devices to optimize shipping routes on an international, national and local scale, companies can decrease the distance and time involved in shipping products. In addition to optimizing planned routes, advanced analytics can also be utilized to take account of congestion and update routes in real-time. Through the use of technology, companies of all sizes can reduce carbon emissions and drive sustainability across the supply chain.

Looking ahead, I believe we will continue to see a concerted effort to reduce waste in the supply chain. We need to. The potential of an orchestrated, collaborative supply chain that addresses environmental and social challenges is profound. It is the responsibility of the industry to make the movement of goods sustainable. Across industries, leading with purpose, ethics and social responsibility is a model that resonates with businesses — including employees, partners, stakeholders, as well as with customers.

In fact, today’s consumers expect companies to meet a certain set of ethical standards to gain their buy-in. Companies that don’t address sustainability issues are at risk of losing business. Eliminating the empty miles and excess CO2 emissions will become a bigger focus for smaller companies as larger organizations use sustainability initiatives and ethical standards as criteria when selecting supply chain partners. Prepare for tomorrow, today by maximizing capacity and minimizing empty miles.

Increasing customer demands and faster delivery expectations

Due to rising customer demands and unprecedented expectations for product availability and expedited delivery, companies’ transportation spend is skyrocketing — and will continue to accelerate. Thanks to a culture of instant gratification, customers want what they want, where and when they want it — and that means they want it immediately. According to findings from Dropoff, 69 percent of consumers would not purchase from a retailer again if their delivery was late. Keeping up with the high customer demand brought on by events like Cyber Monday can be challenging for companies and especially exhausting resource-wise. However, this elevated pressure offers an opportunity to optimize and reduce costs.

In 2019, holiday retail sales grew 4.1 percent over the same period in 2018 to $730.2 billion, NRF reported. Online shopping sales during the winter holiday season increased 14.6% in 2019, accounting for $167.8 billion of the total. Given the high-demand of the holiday season, companies in 2020 should look to implement technologies, such as dynamic mapping, to ensure products are delivered efficiently and on-time to their final destinations.

With dynamic mapping, retailers can gain real-time visibility into their products, receiving exception alerts and recommendations, including dynamic predictive ETA. In addition, use of solutions like dynamic mapping provides real-time analysis, based on data from inside and outside their network, delivering the most accurate dynamic visibility available.

Digital Supply Chain 2020

In this increasingly complex industry, the supply chain will never be immune to disruptions — some things are simply unpredictable. But moving forward in 2020, one thing is certain: the ability to rapidly innovate and adapt will be vital for companies in the supply chain ecosystem. To effectively manage expectations and strategize for the year ahead, businesses should take a proactive approach to addressing any obstacles in their path and face challenges head on. Prioritizing sustainability as a strategic initiative is imperative for all businesses, across industries. Companies should equip themselves with the talent, tools and resources to navigate disruptions and deliver real results in 2020 and beyond.

Archives, Global Trade Daily, Trucking

The Trucking Industry’s Fuel Efficiency is Still Far Too Low, While Carbon Output is Far Too High

January 21st, 2020 Daniel Burrows Leave a comment

In 2017, the EPA reported that the transportation sector is the leading contributor of carbon emissions in the U.S. A major part of that sector is the $700 billion domestic trucking industry, which spends approximately $105B on diesel fuel annually, according to the American Trucking Association (ATA). To help offset this trend, many logistics and transportation companies have recently launched some level of fuel-saving initiative, aimed at helping to reduce their fuel use and carbon impact.

The trucking industry remains a critical function for the U.S. economy, and that reliance is only set to grow. However, most Class 8 trucks on the road today are only achieving roughly seven miles per gallon (MPG) – which keeps fuel consumption and carbon output unnecessarily high. The adoption of technologies to improve truck aerodynamics for long-haul carriers, along with helping to change fuel-hogging driver behaviors, can help fleets reduce fuel costs significantly while eliminating large amounts of carbon emissions. The industry must move aggressively closer to the long-desired goal of a 10MPG standard.

Innovation in Aerodynamics

Aerodynamic drag of a Class 8 truck accounts for a majority of a truck’s energy loss at highway speeds and results in unnecessary fuel usage. Reducing drag improves fuel efficiency which translates to greater efficiency benefits for the industry overall. So, how do trucking companies get there?

Truck manufacturers offer a variety of models with increased aerodynamic efficiency, and aftermarket providers offer numerous products that are proven to further improve fuel economy. One example from the aftermarket is an active-aero device that automatically closes the tractor-trailer gap on commercial trucks when the vehicle reaches a certain speed (approximately 40 miles per hour) and creates an estimated fuel savings of between four-to-six percent. The product also offers GPS-enabled software that tracks fuel savings information in real-time. Improving aerodynamics would cut annual fuel use of a single truck by up to 860 gallons.

Improving Driver Behavior

Another area worth noting to cut down fuel consumption– reducing the driving speed. According to ATA estimates, an average truck traveling at 75 mph will consume 27% more fuel compared to one going at 65 mph. Additionally, what most people don’t realize is an idle truck can be a massive fuel consumer. Drivers that idle their engines while resting to provide air-conditioning or heat for their sleeper compartments or those that have the habit of keeping their engines warm during cold months are just simple notions that cause major fuel consumption. Developing better practices to the above will help streamline fuel costs overall.

Beyond systems and behavior that address fuel efficiencies, companies can adopt other innovative ways to address managing fuel consumption such as side skirts or streamlined hoods to help reduce drag.

Opportunity with Data and Analytics

While physical and behavioral solutions can put more control in the hands of fleet managers, data analytics can play a large role as well. Valuable information gained through data/analytics provides a way to obtain greater transparency and visibility into performance. GPS-enabled software can help to validate the fuel savings from each innovation and help ensure it continues forward. These programs can be put in play to help manage efficiencies for the carrier and utilize technologies in ways that benefit the industry overall.

Carbon Reduction and Pushing to 10 MPG

According to the U.S. Environmental Protection Agency (EPA) experts, freight activity will nearly double by 2040, and global freight transport emissions will exceed passenger vehicle emissions by 2050. As sustainability is becoming a higher priority within the transportation industry, it’s important that carriers understand the benefits of investing in sustainability programs and resources, and how this translates to cutting costs.

Today’s top fleets are leading the sustainability charge. Everyone in the industry is watching what UPS, DHL, and the like-minded industry leaders are doing in regards to innovation adoption for the best fuel-efficiency technology. With trucking predicted to grow more and more each year, improving the fuel efficiency of the industry is critical to reducing greenhouse gas emissions and supporting profit margins in an increasingly regulated industry. According to NACFE’s 2017 Run On Less demonstration, achieving an average fuel efficiency of 10 MPG would save the U.S. trucking industry 9.7 billion gallons of diesel fuel, $24.3 billion and 98 million tons of CO2 each year [ref 1]. While the primary goal is to reduce the environmental impact of the transportation sector, it is successful in large part because it demonstrates financial benefit for industry stakeholders as well.

It’s clear that there is an abundance of challenges when it comes to fuel consumption in the trucking industry. However, the industry can be confident that there is an equal abundance of solutions to help improve fuel efficiency in order to manage costs and reduce carbon output.

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References

1. https://rmi.org/press-release/press-release-run-less-proves-available-techs-unlock-24-billion-n-trucking/

Daniel Burrows is the CEO and Founder of XStream Trucking, an engineering company building connected hardware to improve the efficiency of the trucking industry

Archives, Global Trade Daily, Imports/Exports

France Emerged as the Largest Dried Grapes Producer in the EU

January 19th, 2020 IndexBox Leave a comment

IndexBox has just published a new report: ‘EU – Dried Grapes – Market Analysis, Forecast, Size, Trends And Insights’. Here is a summary of the report’s key findings.

The revenue of the dried grapes market in the European Union amounted to $1B in 2018, flattening at the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). The market value increased at an average annual rate of +1.3% from 2007 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations being observed over the period under review.

Consumption By Country

The countries with the highest volumes of dried grapes consumption in 2018 were the UK (98K tonnes), Germany (68K tonnes) and France (56K tonnes), with a combined 55% share of total consumption. These countries were followed by the Netherlands, Italy, Spain, Poland, Belgium, Greece, Romania, Hungary and the Czech Republic, which together accounted for a further 35%.

From 2007 to 2018, the most notable rate of growth in terms of dried grapes consumption, amongst the main consuming countries, was attained by Greece, while dried grapes consumption for the other leaders experienced more modest paces of growth.

In value terms, the UK ($426M) led the market, alone. The second position in the ranking was occupied by France ($125M). It was followed by Italy.

The countries with the highest levels of dried grapes per capita consumption in 2018 were the Netherlands (2,466 kg per 1000 persons), the UK (1,470 kg per 1000 persons) and Belgium (1,080 kg per 1000 persons).

Production in the EU

In 2018, the amount of dried grapes produced in the European Union amounted to 84K tonnes, flattening at the previous year. In general, dried grapes production, however, continues to indicate a significant drop. The most prominent rate of growth was recorded in 2011 when production volume increased by 16% y-o-y. In that year, dried grapes production attained its peak volume of 130K tonnes. From 2012 to 2018, dried grapes production growth failed to regain its momentum.

Production By Country

The countries with the highest volumes of dried grapes production in 2018 were France (31K tonnes), Greece (21K tonnes) and Hungary (5.3K tonnes), with a combined 69% share of total production. These countries were followed by Portugal, Slovakia, Romania and Spain, which together accounted for a further 19%.

From 2007 to 2018, the most notable rate of growth in terms of dried grapes production, amongst the main producing countries, was attained by Slovakia, while dried grapes production for the other leaders experienced mixed trends in the production figures.

Exports in the EU

The exports totaled 70K tonnes in 2018, approximately reflecting the previous year. In general, dried grapes exports continue to indicate a relatively flat trend pattern. In value terms, dried grapes exports totaled $175M (IndexBox estimates) in 2018.

Exports by Country

In 2018, Greece (18K tonnes), the Netherlands (13K tonnes), Germany (9.8K tonnes) and Belgium (9.2K tonnes) represented the major exporters of dried grapes exported in the European Union, generating 71% of total export. It was distantly followed by the UK (4,306 tonnes) and Latvia (3,768 tonnes), together creating an 11% share of total exports. Denmark (2,442 tonnes) followed a long way behind the leaders.

From 2007 to 2018, the most notable rate of growth in terms of exports, amongst the main exporting countries, was attained by Denmark, while exports for the other leaders experienced more modest paces of growth.

In value terms, the largest dried grapes exporters in the European Union were Greece ($51M), the Netherlands ($31M) and Germany ($25M), with a combined 61% share of total exports. Belgium, the UK, Denmark and Latvia lagged somewhat behind, together comprising a further 23%.

Latvia experienced the highest growth rate of market size, among the main exporting countries over the period under review, while exports for the other leaders experienced more modest paces of growth.

Export Prices by Country

In 2018, the dried grapes export price in the European Union amounted to $2,495 per tonne, picking up by 11% against the previous year. Over the last eleven years, it increased at an average annual rate of +2.9%.

There were significant differences in the average prices amongst the major exporting countries. In 2018, the country with the highest price was Greece ($2,859 per tonne), while Latvia ($1,592 per tonne) was amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by Greece, while the other leaders experienced more modest paces of growth.

Imports in the EU

The volume imports stood at 391K tonnes in 2018, lowering by -3.4% against the previous year. In general, dried grapes imports continue to indicate a relatively flat trend pattern, in accordance with the overall dynamic of the market. In value terms, dried grapes imports amounted to $791M (IndexBox estimates) in 2018.

Imports by Country

The imports of the three major importers of dried grapes, namely the UK, Germany and the Netherlands, represented more than half of total import. France (26K tonnes) held a 6.8% share (based on tonnes) of total imports, which put it in second place, followed by Belgium (5.5%), Italy (5.5%) and Spain (4.7%).

From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by Spain, while imports for the other leaders experienced mixed trends in the imports figures.

In value terms, the largest dried grapes importing markets in the European Union were the UK ($199M), Germany ($163M) and the Netherlands ($109M), together comprising 60% of total imports. These countries were followed by France, Italy, Belgium and Spain, which together accounted for a further 21%.

Import Prices by Country

In 2018, the dried grapes import price in the European Union amounted to $2,021 per tonne, rising by 11% against the previous year. Over the last eleven-year period, it increased at an average annual rate of +2.7%. The most prominent rate of growth was recorded in 2008 when the import price increased by 27% against the previous year. The level of import price peaked at $2,503 per tonne in 2012; however, from 2013 to 2018, import prices remained at a lower figure.

Average prices varied somewhat amongst the major importing countries. In 2018, major importing countries recorded the following prices: in France ($2,204 per tonne) and Germany ($2,105 per tonne), while Spain ($1,615 per tonne) and Belgium ($1,776 per tonne) were amongst the lowest.

From 2007 to 2018, the most notable rate of growth in terms of prices was attained by the Netherlands, while the other leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

Archives, Global Logistics, Global Trade Daily

On Our Radar: How Blackberry Redefined Visibility for the Transportation Sector

January 16th, 2020 Haylle Sok Leave a comment

Visibility by definition is, “the state of being able to see or be seen.” For transportation professionals, this definition merely scratches the surface of what’s required for streamlining operations while eliminating costs and inefficiencies. Everything is connected in some form or capacity, and the moment one part of the equation is affected, the entire supply chain can suffer or become enhanced. The determining factor between the two ultimately depends on the tools being used to ensure all parts are in motion while maintaining an optimal view of each moving part.

In the modern supply chain ecosystem, disruptions come at a high cost–both in time and money. Industry players require advanced solutions to weather the various storms on the horizon, especially in a world where theft costs seem to only be rising and cybersecurity risks become advanced by the day. Visibility in the modern world no longer entails the “ability to see or be seen” and that’s exactly what BlackBerry’s asset tracking Radar solution aims to redefine and revolutionize.

The Radar dashboard provides a multitude of visibility options for trailers, chassis and containers all through securely stored data on a cloud-based platform. BlackBerry takes pride in leading the industry as a security software and services company with an impressive portfolio of solutions designed with transportation professionals in mind. Launched in 2016, the BlackBerry Radar solution continues to recreate opportunities for growth and maximizing operations impacting every part of the asset tracking process down to maintenance.

“Radar was the brainchild of founder Sandeep Chennakeshu leveraging the legendary BlackBerry patents and engineering talent, and we’ve been able to transform the Radar BlackBerry experience and history into a new, modern solution for the transportation industry,” explains Christopher Plaat, senior vice president and general manager of BlackBerry Radar. “Radar fits into the overall vision of BlackBerry providing end-point security and effectiveness for customers. Built into the basis of BlackBerry Radar is the secure infrastructure and operating system leveraging BlackBerry QNX software to provide additional layers of security in the growing transportation sector. Ensuring technology cannot be hacked is a growing concern for transportation professionals.”

Over the years, BlackBerry has established its position as a leader in legacy engineering offering unique, modern and viable solutions built to last and overcome current and anticipated industry obstacles for the transportation sector. BlackBerry Radar takes asset management and tracking to a new level and industry leaders are noticing. Last year, Radar received recognition from American Trucking Associations as the newest ATA Featured Product Provider, attributing the offering’s real-time data capabilities as one of the hallmark features redefining asset tracking and transportation visibility. More recently, Class 1 railway Canadian Pacific announced the integration of Radar devices on their intermodal chassis fleet–2,000 to be exact.

“CP is constantly looking to evolve, innovate and elevate the experience for our customers,” says Jonathan Wahba, vice president Sales and Marketing, Intermodal and Automotive at Canadian Pacific. “We’re excited about this collaboration with BlackBerry Radar, and the potential benefits this technology will allow us to drive within our network.”

Plaat understands why the industry is reacting so positively to Radar. “Visibility means different things to different people and for Radar, visibility is more than just knowing where your asset is,” he explains. “It also means visibility into utilization and the effectiveness of your operations. We provide visibility in the way of information that is actionable that can help improve asset utilization, reduce costs, improve service for customers.”

Radar takes what customers were previously blind to and presents it along with a solution to ensure it doesn’t happen again. An example of this is revealing when other companies connect to another chassis and leave while starting to do business with another customer’s assets. This is a prime example of taking visibility beyond what’s available to view and revealing unidentified and hidden challenges. The Radar solution takes a proactive approach rather than preparing for reactive measures.

“We have customers that have seen on the Radar solution that their chassis is going somewhere they do not serve, only to later to find out that another carrier was using their assets to do business,” Plaat notes. “This is wrong but it’s happening. Knowing where your assets are, what they’re doing, and how they’re being utilized is something many companies don’t have visibility into. By deploying asset-management solutions, customers are provided with information they don’t have access to.”

Recall the industry-wide concern surrounding theft and unauthorized use in the industry. BlackBerry customers are building geofences that pair nicely with Radar devices, creating a tandem effort in addressing the issue of theft and ultimately preventing it. It’s a two-part solution that relies heavily on both ends of the solution. Repeated errors are costly and have no place in operations

“Beyond reporting how long assets sit within geofences, we provide reporting on what’s going on outside of geofences and terminals,” Plaat says. “Our customers receive alerts when their trailer leaves the yard to ensure thieves aren’t pulling their customer’s cargo in their trailer. Our reporting and alerting mechanism are very good at preventing theft.”

The reporting abilities found with Radar are paramount compared to other solution offerings in that it addresses a multitude of questions all at once. Radar is providing more than basic tracking of asset utilization by reporting the frequency a chassis is moving and when it’s stationary for a selected period through weekly, monthly or annual snapshots. This provides a clearer picture of exactly how productive operations are and how your customers are impacted. Radar also provides a trailer pool management solution addressing too much or too little available equipment, all while providing information on how the end customer’s needs are being addressed.

“This allows the effective balancing of equipment while reducing costs and using current assets,” Plaat says. “It also eliminates the need to buy more and the possibility of coming up short. Radar provides the ability to do mileage-based maintenance for customers with time-based chassis. Accurate mileage reporting found within Radar enables the customer to channel maintenance dollars where they are needed. Customers can allocate costs more effectively through identifying high-use equipment versus low-utilization equipment.”

The Radar solution differentiates itself beyond its asset management offerings. The solution offers a one-of-a-kind level of durability not typically found in transportation solutions. Radar devices boast a rugged and long-lasting hardware reputation through a self-contained, high-capacity six-year premium battery life, eight sensor reading capabilities, and the elimination of external wiring.

Additionally, Radar devices provide ease in installation combined with an unmatched and modern software nature. Customers don’t have to worry about delayed operations and can focus efforts on features such as the solution’s timeline tools, visibility tools and graphical user interface. It’s really that simple.

“BlackBerry has standard set of open APIs for customers to integrate Radar data into their TMS system or into their own PRP for providing visibility for customer service or operations or even management,” Plaat explains. “About 50 percent of our customers use the Radar dashboard while the other 50 percent use their own dashboards and reporting tools with Radar data populating those reports and visibility tools. Our software is easy to understand and provides great utilization at the customer’s fingertips that helps improve performance immediately upon deploying our solution. Those major differences–the durability, the ease of implementation and use are really what make Radar stand out.”

Radar does not forget about key pieces of the transportation puzzle, including drivers. In fact, it has specific features designed with drivers in mind, directly affecting the amount of time spent on locating assets. For trucking companies, locating assets quickly is essential in maintaining efficiencies. Unfortunately, this is an issue still very much present within the sector due to outdated pieces of information. With Radar devices, real-time updates for drivers are a major advantage that address existing problems in time management. The goal is to give back the time previously lost and with Radar, this is easily accomplished.

“Radar has a unique capability that sends a link to a driver that launches navigation to route a driver to the exact location of a chassis or trailer,” Plaat says. “This eliminates the issue of inaccurate or outdated data which in turn maximizes time efficiencies. A driver can save up to 30 minutes per day, per driver in their hours of service, which is valuable to all players in the supply chain.”

Whether it’s dwell times or the number of turns drivers are taking, Radar is equipped with the technology necessary to provide a clear picture of exactly what’s going on and identifying an opportunity for increasing average turns and ultimately, revenue. These features support the notion that asset tracking is more than basic visibility and requires a sophisticated and user-friendly approach that is not only secure but revolutionary technology solutions.

“Knowing how long an asset is sitting in a geofence and getting reports of average dwell times within an intermodal terminal or shipping facility–whether that’s a weekly or monthly basis–can provide good information for conversations with your customers and suppliers,” Plaat adds. “It opens the conversation of ‘how long is my container sitting before I can utilize it for other customers?’ which is very important for improving the utilization of one’s assets. Having this information can be highly valuable for operations and increase revenue.”

BlackBerry’s Radar solution shows no signs of slowing down fleet management and optimization in transportation for 2020. It’s clear this solution has set the bar higher and continues redefining the real transparent, real-time visibility for intermodal asset tracking. Through actionable visibility, BlackBerry Radar aims to impact every moving part of the supply chain and reinforce the role of advanced technology while improving service for customers and reducing costs.

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Christopher Plaat is senior vice president and general manager of BlackBerry Radar. He has more than 25 years of experience in the transportation and logistics industry. With a focus on advanced technology solutions that help companies improve operational efficiencies, manage compliance and reduce costs, Plaat spent more than 18 years in strategic technology sales and leadership roles for Fortune 500 companies, including Qualcomm and Lockheed Martin. He previously led sales and operations units for organizations including Overnite Transportation Co. and Emery Worldwide. Prior to joining BlackBerry, Plaat was vice president of Strategic Account Sales at Omnitracs. He earned his bachelor’s degree in Business and Economics from Point Loma College in San Diego.

Archives, Global Logistics Planning Guide, Global Trade Daily

Global Trade’s Annual Logistics Planning Guide Reveals the Year’s Top Trends

January 15th, 2020 Taylor Girardi Leave a comment

Sometimes buying your business into the latest trends isn’t the best idea. Saddled with high costs and incompatible programs, trendy new technology can often make business processes more difficult for your business, not less. But there are some industries where the latest really can be the greatest, and one of those industries is the logistics industry.

Let’s face it: Logistics make the world go round. Whether it’s shipping perishables to community markets or lifesaving machinery to medical clinics, there’s a lot riding on the shoulders of logistics providers. That’s why it often pays to rely on cutting-edge technology. From tracking and tracing to locating items in your warehouse, new technology can often get the job done faster and more accurately. Plus, with the growing e-commerce market, logistics is more important than ever before as businesses push to get their products into customers’ hands at the speed of retailers such as Amazon.

So, what’s on the horizon for the logistics industry this coming year? Here’s what’s on our radar—and should be on yours—for the best (and one troublesome) new innovations and trends in logistics in 2020.

LOGISTICS IT

When it comes to logistics, information technology (IT) may arguably be the most important innovation of 2020. That’s because without a solid tracking system in place you’re not only causing potential backlogs for your workers, but you could be causing frustration for your clients, too. After all, if your customer can’t see where their merchandise is in the supply chain, they may bring their business to someone else who can. This is where an excellent Warehouse Management System (WMS) comes in. Using RFID and GPS, warehouse management systems can now monitor and trace every piece of inventory in your warehouse, providing real-time data to both you and your customer.

Other systems expected to be used with increased frequency in the new year include order entry systems and transportation management systems (TMS).

But logistics IT isn’t just what the customer sees, or even what your employees interact with. It goes well beyond that. Logistics IT also encompasses the back end of your IT solutions—not just the IT product itself but also the customer support that goes along with it.

We all know the logistics industry doesn’t just run from nine to five. When there’s a problem like a software bug or outage, is your IT provider available to offer technical support when you need it? Does your provider strive to make software updates that are meaningful to your business, and that integrate seamlessly into your other systems? Does your provider notify you when there are new versions of your system that could benefit your business? These are all signs of a good IT provider—a trend you definitely don’t want to miss the boat (or train, plane or truck!) on.

Logistics providers are using the latest technology, such as Collaborative Planning, Forecasting and Replenishment (CPFR) and Vendor Managed Inventory (VMI), to satisfy ever-changing customer requirements. DHL Express introduced a fresh TC55 technology that works on the Android platform and is simple to use, as well as the navigation skills in the global positioning system (GPS).

ARTIFICIAL INTELLIGENCE AND MACHINE LEARNING

Artificial intelligence, or AI, is another way technology is streamlining the logistics industry. Currently, the biggest benefit of AI is arguably its ability to automate many of the processes logistics providers provide every day, including repetitive tasks that exhaust human capital and don’t challenge workers. Though many workers worry that AI will someday replace human workers, currently the technology is actually assisting them.

Another use for AI in the logistics industry relates to the driving of vehicles. As many are aware, initiatives from companies like Google have in recent years invested time and resources into developing self-driving cars, i.e. autonomous vehicles. These vehicles may be manned by a human driver, but they allow the driver to take breaks from driving while still traveling. This in turn gets deliveries to their destinations quicker, a fact that is projected to save logistics providers a lot of money. In fact, according to Mckinsey, autonomous vehicles could save logistics providers up to 45 percent, a savings providers can then pass along to their clients. These savings could then be passed to the consumer in the form of lower prices or lower shipping rates.

ENVIRONMENTALLY CONSCIOUS LOGISTICS

With many seaports developing green initiatives and land- and air-based logistics providers initiating a greater push for a reduced carbon footprint, 2020 is set to be a big year for reducing carbon emissions. Some land-based initiatives include more efficient route mapping, video conferencing and net-zero emissions.

Route mapping works by eliminating excess travel on longer routes. The idea is that a more direct route cuts fuel waste as well as carbon emissions. Video conferencing saves both money and the need for travel to meetings. As for net zero emissions, many logistics providers are investing in low or zero-emission vehicles and alternative fuels that emit less carbon into the air.

Logistics companies with warehousing services are also increasing their push toward a lower carbon footprint, using sustainable packaging and ramping up recycling efforts with the packing, shipping and packaging of products.

Maritime initiatives include the restoration and protection of wetlands as well as the planting of trees at some ports. Strategies also include the use of more efficient photosensitive lighting, such as the switch to LED lighting. Some ports have even switched over to the use of electric equipment instead of diesel fuel equipment, the establishment of fuel efficient requirements for ships which frequent the port and much more.

BLOCKCHAIN

If you’re in the logistics world, you’ve likely been hearing about blockchain for several years now. But what is it? Simply put, blockchain is a way of recording data which cannot be altered, using a technology called cryptology. Blockchain data is nearly unchangeable. The “chain” in blockchain refers to the chain of messages that originate from a single entry. To edit the chain, all members who posted to the chain must be willing to alter their own data to support the potentially edited data. This reduces the risk of that data being falsified or otherwise compromised along the way.

Blockchain data can be used to do everything from order tracking to payment issues. Blockchain also streamlines the way we communicate, reducing the need for time-consuming paperwork. Blockchain works in real-time, so shippers can trace every detail of their shipment as it progresses and make necessary adjustments to their route and load temperatures as needed. This can save time and money, preventing delays or rejected shipments.

Blockchain can also aid in financial decisions regarding fleet vehicles. Similar to a Carfax report, blockchain can show whether a pre-owned logistics vehicle has been maintained as well as the previous owner claims, and can help the potential buyer make decisions that could cost them—or save them—significantly down both the literal and figurative roads.

Indeed, blockchain has become so big that an organization has been founded to monitor the industry. The Blockchain in Transport Alliance, or BiTa, was founded to help advance the Bitchain industry, developing rules and regulations and providing education for new and veteran Bitchain users. The organization already boasts an impressive member list, including representatives of UPS and FedEx.

TECHNOMAX

In the maritime sector of the logistics industry, one revolutionary service that is “making waves” is TechnoMax, or TMX. TechnoMax works to streamline maritime operations by working with AI and the Internet of Things (IoT). The system provides risk and compliance data, app development, infrastructure development and data management. Some of TechnoMax’s capabilities include monitoring a ship’s emissions, analyzing cargo information and guiding navigation.

TRADE TARIFFS

Now for some bad news. With trade deals between the United States and China again delayed, there remains a lot of uncertainty among retailers and manufacturers. Though there is no crystal ball to predict the future or what it holds for these industries, the potential for raised prices on goods is of big concern. Price increases would inevitably be passed down to consumers, who could cut out or cut back on goods, causing sales to plummet. This could in turn negatively impact the logistics industry, as fewer products will be warehoused and transported.

For now, the industry seems to be holding its own, with some businesses preparing for the looming tariffs by shipping larger amounts now to avoid elevated costs later. Whether this bulking up will cause a dramatic drop in shipments in the first few months of 2020 remains to be seen.

LOOKING TO THE FUTURE

All things considered, 2020 seems to be gearing up to be a great year for the logistics industry, with many new technological and environmental advances on the horizon. From AI to blockchain, the industry is poised to become more efficient than ever, saving providers money which they can pass along to their clients, and in turn potentially to the consumer.

Even with the potential for steep tariffs on China (and vice versa) on the horizon, these positive advances should still make an impact on the industry in the coming year and decade.

Archives, Global Trade Daily, News

APL Logistics Vascor Celebrates 2019 with “Best 3PL Company” Recognition

January 3rd, 2020 GT Staff Leave a comment

As 2019 came to an end, APL Logistics Vascor was recognized for the first time as a shortlist nominee for the Confederation of Indian Industry (CII), earning the title as this year’s “Best Third-Party Logistics Company” award.

This recognition reiterates the Delhi-based automotive 3PL as a leader in providing bulk transportation options within the region. APL Logistics Vascor is a joint-venture between APL Logistics and VASCOR Ltd. established in 2012.

“Our unique rail-based solutions have proven to be a great success among the Automotive companies and OEMs,” commented Umesh Bhanot, Managing Director of APL Logistics Vascor.

“This award is a testimony to the commitment and hard work our employees put in to achieve operational excellence. We are honored to receive this award and will continue to strive to provide a seamless and delightful experience for our customers,” he concluded.

Held annually, the 2019 Supply Chain and Logistics Excellence awards took place the second week in December in Bengaluru, India and highlighted leading logistics and supply chain successes from the year. Factors evaluated to determine category winners were based on four main pillars which included:

-Overall business performance

-Financial performance and stability in supply chain

-Operational supply chain performance

-Enablers of supply chain management through submission of case studies

Archives, Global Trade Daily, News

U.S. Pulp Market – Exports to China Fell 9.4% in 2018, U.S Companies Lost $78M

January 3rd, 2020 IndexBox Leave a comment

IndexBox has just published a new report: ‘U.S. Pulp Market. Analysis And Forecast to 2025’. Here is a summary of the report’s key findings.

The revenue of the pulp market in the U.S. amounted to $4.8B in 2018, going up by 9% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). The market value increased at an average annual rate of +2.5% from 2013 to 2018; the trend pattern remained relatively stable, with somewhat noticeable fluctuations throughout the analyzed period. The pace of growth was the most pronounced in 2014 with an increase of 19% against the previous year. In that year, the pulp market attained its peak level of $5.1B. From 2015 to 2018, the growth of the pulp market remained at a lower figure.

Pulp Production in the U.S.

In value terms, pulp production totaled $7.2B in 2018. Overall, pulp production, however, continues to indicate a relatively flat trend pattern. The growth pace was the most rapid in 2014 with an increase of 8.9% year-to-year. In that year, pulp production reached its peak level of $7.7B. From 2015 to 2018, pulp production growth failed to regain its momentum.

Exports from the U.S.

In 2018, approx. 6M tonnes of pulp were exported from the U.S.; going down by -4.7% against the previous year. Over the period under review, pulp exports continue to indicate a mild shrinkage. The growth pace was the most rapid in 2015 with an increase of 3.1% against the previous year. Exports peaked at 6.4M tonnes in 2013; however, from 2014 to 2018, exports remained at a lower figure.

In value terms, pulp exports amounted to $4.5B (IndexBox estimates) in 2018. The total export value increased at an average annual rate of +1.7% from 2013 to 2018; the trend pattern remained relatively stable, with only minor fluctuations being observed over the period under review. The growth pace was the most rapid in 2018 when exports increased by 11% against the previous year. In that year, pulp exports reached their peak and are likely to continue its growth in the immediate term.