Over the past few decades, international commerce has seen technological advancements which allowed an increase in the cargo shipped globally. A recent development was the expansion of the Panama Canal, one of the most significant structures built for maritime trade connecting the Atlantic and Pacific Oceans. Yearly, it is responsible for the transit of over 13000 cargo vessels. Shippers especially felt the canal’s expansion during the COVID crisis, when the amount of freight shipped internationally grew exponentially.
Neopanamax Locks
In April of 2006, the former president of Panama announced the Panama Canal expansion project. Along with deepening current channels and increasing the water levels, the project included adding a third set of locks to the canal. In 2016, builders completed the Neopanamax locks, increasing freight volume moved through. Before 2016, the Panama Canal only had two sets of locks which allowed for a capacity of 5000 TEUs (Twenty Foot Equivalent). The Neopanamax permitted ships with 15000 TEUs to pass through, which meant more ships could go across. Canal Authority predicts that the cargo tonnage moved through the Panama Canal in 2005 will double by 2025.
Covid-19 Shipping Surge and the Panama Canal
When the COVID-19 pandemic started to make its way globally, most of the world’s nations imposed lockdowns. Instead of driving to a local store for merchandise, many goods were purchased online and delivered to the customers. This tread continued to rise even after the lockdowns ended. The number of freight containers shipped internationally increased significantly due to the COVID pandemic. More goods were purchased online and imported from different countries. The increased capability of Panama Canal has proved to be a key component in the context of the shipping surge generated by the pandemic.
One example of this is the transportation of grain exports from the U.S. Grain exports such as corn and soybeans are a common commodity moved through the Panama Canal. The Neopanamax locks allowed vessels to carry 25% more of bulk grain compared to when the canal had two sets of locks. COVID-19 further increased the need to export grains globally through the Panama Canal. In 2020, the value of global wheat exports rose by 10.9% compared to 2019 due to the demand. The Panama Canal’s expansion aided in streamlining the grain exportation. Another example of the positive impact of the Panama Canal’s expansion is the movement of LPG (Liquified Petroleum Gas) carriers to China.
The U.S. LPG exports rose 32% from January-July 2019 to January-July 2020. LPG exports like propane and butane are popular shipments to Asia. This is because China has the highest manufacturing output globally, and factories use LPG in creating polypropylene, a material used to produce plastic. LPG carriers in the U.S use the Panama Canal as the easiest way to reach China. Some other industries that could benefit from the Canal expansion are the automotive and the manufacturing ones, whose products will be more easily moved from the USA to Asia. If you need to have your goods cleared or shipped, contact A1 Worldwide Logistics at 305-821-8995 to begin the process. We have a team of experts ready to help you in the exporting/importing journey from US to China and all around the world.
The transportation industry has seen massive growth and development in freight movement over the last few decades. A recent topic that has become popular in the Transportation and Logistics industries is the usage of 3D printing. Advances in technology lead some to believe that 3D printing may help the industries grow. Others predict that 3D printing can have an opposite effect and interrupt freight movement. This was recently discussed in a virtual session at The Economic Club of New York. One of the topics brought up was the effect that 3D printing may have in the future.
Pros and Cons of 3D Printing
3D printing is a manufacturing process that converts digital data into a three-dimensional image. One of the main benefits of 3D printing is that it will streamline the supply chains of transporting products. The traditional supply chain process involves obtaining, manufacturing, and transporting goods to customers. 3D printing may allow companies to create goods in their location instead of importing the products elsewhere. Manufacturing goods in one’s facility can save money, time, and resources. 3D printing also allows for versatile, complex design due to its method of digital creation.
One of the main disadvantages of 3D printing is the effect that it could have on the freight forwarding/transportation industries. A freight forwarder is an intermediary between shippers and transport companies who coordinate the movement of goods internationally. With companies creating products in their facilities through 3D printing, the need for a freight forwarder becomes lessened. The way that many companies create products today is by outsourcing materials from different countries. Freight forwarders may coordinate the importing of those materials internationally.
What Effect will 3D printing have on the Transportation Industry?
The current supply chain model for manufacturing and moving freight involves many steps. Companies source cheap labor overseas, and then pay to get the goods transported. With 3D printing, a portion of the supply chain could be gone, although any statement suggesting that goods will be made in anyone’s basement are truly exaggerated. Perhaps, in many (many!) years from now, the international movement of goods may be replaced with the international movement of designs and information to create the goods.
3D printing may impact globalization because it is based in the countries’ permanent exchange of goods. With companies creating goods domestically, supply chains could become less dependent on other countries to be effective. A nationwide lockdown or a conflict between two countries may become less of a disruption to a supply chain.
A1 Worldwide Logistics
While 3D printing may impact the future of transportation, it may be a while before 3D printing becomes standard practice. Freight still has to be moved internationally. When moving freight, it is essential to have a freight forwarder that understands the world of international shipping. A1 Worldwide Logistics has experience working with freight transport methods such as ocean, air, and land. Contact us at 305-821-8995 or info@a1wwl.com for a quote to get your goods moving today. We also have customs brokers to arrange the customs clearance process of your imports.
Several districts in China have been on lockdown for the past few weeks due to Covid, and the impact is now being felt on global supply chains. As outbreaks began to surge in Shanghai, the lockdown has lengthened until further notice. This was after an announcement of 16766 positive coronavirus cases on April 5. Even before the lockdowns returned to China in March, many supply chains worldwide struggled to keep up with the overwhelming demand. With some of the world’s biggest ports being shut down, global supply chains may feel more significant stress.
In the past few years, the demand for shipping internationally has risen significantly. After the coronavirus made its way worldwide, ordering goods online instead of driving to a store became more common. When goods are bought online, they tend to be transported from different countries like China. While the number of goods shipped rose, the coronavirus was still present. Limited workers, lockdowns, and other effects of the coronavirus started to show in the supply chains of different companies globally.
How does this impact supply chains
One of the leading exports out of ports like Yantian and Shanghai located in China are electronic products. Manufacturers that create electronic products for large companies like Apple, Tesla, Samsung, and others are being forced to suspend operations. Foxconn, an electronics supplier to Apple, has recently announced that it will pause operations in Shanghai. Since Foxconn is one of Apple’s biggest suppliers, this may lead to product shortages in the next few weeks. The supplier outages will affect the supply chains of Apple and dozens of other electronics companies as well.
Companies have decided to move their manufacturing facilities away from lockdown zones to keep supply chains going during the current lockdown. However, the goods still have to be transported to the ports by truck. Not only are several highways shut down in the lockdown zones, but truck drivers also have to test negative for Covid a certain period before bringing containers to the ports.
Not only will the lockdowns affect production, but the shipping of the products as well. Because many ports in China are shut down, shipping orders can become delayed. China has some of the most prominent ports in the shipping world and many orders may be backlogged. This could mean that ports in Europe and the United States will increase inbounding cargo in the near future, further growing congestion in those ports. The ports in the Los Angeles area saw their fair share of issues last year. From equipment shortage to the backlog of vessels stuck at the ports, the lockdowns in China may prolong the challenges.
A1 Worldwide Logistics
Although different supply chains may be strained at the moment, the world of shipping is continuing. Freight is still being moved internationally. However, much greater precautions than usual may have to be taken when transporting goods. You must be informed of what to expect. If you need assistance with any part of your supply chain, contact A1 Worldwide Logistics at 305-821-8995. Our services include international shipping, customs clearance, trucking, warehousing, etc.
It is never too early to start planning your businesses holiday shipping and logistics in October – November; the ‘trick’ is to begin planning now to manage your holiday deliveries during this holiday season. The ‘treat’ is that A1 Worldwide Logistics a leading provider of logistics and Supply Chain services and has put together a checklist to help small to SMB owners understand seasonal trends that can affect their businesses and the strain on the shipping industry during this frantic shipping time.
This year was substantial due to trends and challenges that kept the shipping industry busy. Logistics pressures will intensify as the holidays begin, with high season surcharges, a rush of customers orders and other constant weather-related delays.
A1 World Logistics recommends all businesses, large or small take these four steps to get ahead of seasonal pressure and reduce the effect of delayed, lost or damaged shipments:
Set Realistic Expectations: No company is exempt from delays due to weather conditions, driver shortages and other industry realities. Embrace logistics clarity with customers when there is a spike in shipping volume and carriers are stretched thin. This is your businesses chance to be as accommodating and realistic as possible when setting peoples expectations for customer orders. Handle any delayed, damaged or lost shipments by providing regular updates on an estimated solution.
Be Diligent with Scheduling: Keep in mind that there are fewer business days and there can be more weather disruptions during the holiday season, which means transit times for shipping may surge, and guarantees are often suspended. Planning by getting your ‘just in time inventory’ out early and accelerating urgent shipments whenever possible will help you avoid delays. Don’t risk putting your business and customers in a bind by not planning for the correct number of transit days.
Plan Accordingly: Be aware that time-sensitive merchandise such as fresh food requires more care and attention. Confirm all paperwork and labels reflect the priority of the delivery and consider contacting your carriers rep to restate the shipment’s time sensitiveness. Also, be mindful of your shipping technique since a loading dock may treat your load as a lower priority if it requires more time and labor due to awkward or odd-proportioned packaging.
Consider Hiring a Professional: Logistics is a multidimensional industry, and it is beneficial to have someone as your shipping guide—throughout the year, but particularly during the holiday season. A third-party logistics expert like A1 Worldwide Logistics, A1 provides you with a level of service and expert consultation that ensures you’re using the best shipping options for your specific needs. Whether it’s considering seasonal price hikes, comprehending insurance, accessing vast carrier partners or getting help with tracking and troubleshooting, A1 Worldwide Logistics is your industry expert.
Here at A1 Worldwide Logistics, we know from experience that as the B2C and B2B markets have grown and evolved, customers are demanding faster shipments, greater flexibility, and more clarity in the order lifecycle and logistics process.
As such, A1 Worldwide Logistics knows that only with true innovation can you establish real-time visibility with the power to make changes can you achieve the agility that clients demand and stand out from your competition.
To help your business grow and scale, here are four trends you can use to supercharge your Supply Chain Orchestration (SCO). These trends will allow you to completely transform your businesses supply chain and provide the best service to your clients at a cost-effective price.
Establish end-to-end logistics visibility. A comprehensive, all-inclusive picture of your supply chain, combined with the ability to act, allows you to optimize every individual client order. You must be able to granularly analyze logistic costs against your customer’s satisfaction to find the perfect balance that enables the highest volume of on-time, completed orders.
Get real-time control of your business inventory network. Inventory distortion, including out-of-stocks and overstocks, costs businesses over $1.2 trillion globally. That is a massive sum of money to be losing to inventory issues. It’s no surprise that many forward-thinking companies are rushing to have complete visibility of not just their internal inventory, but also the whole network—custom brokers, suppliers, warehouses, and in-transit stock.
Dynamic planning wins out over high-level stationary planning based on forecasts, cutting down on inventory that is always depreciating and ensuring customers get their orders swiftly. SCO can show you exactly where the stock is at any given moment, and also enables your business to ship directly from different locations or even reroute stock in-transit.
Remember that your customer is looking to buy a complete “experience.” Customers have a vast choice of vendors for their desired product; what decides customers continued loyalty in the future is the experience they have ordered from your business. It has been proven that repeat customers order more, spend more, and refer more customers. In short, they bring in more money and business, so it’s vital to create amazing customer experiences and to build customer loyalty.
Optimize every part of your supply chains. The path to a genuinely customer-centric methodology comes through optimizing for specific orders. Factoring in every factor from stock readiness to timeliness, and tailoring every step to achieve a great customer experience without overspending, requires supply chain optimization.
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