by Rob Simmons | Apr 30, 2021 | Customs Broker, Customs Broker Miami, Customs Clearance, Freight Forwarding, Import and Export Experts, Shipping Logistics, Supply Chain
The value of wine imported into the United States has always been greater than the value of beer imported. However in 2020 this changed, and the value of beer imported into the U.S. surpassed the value of wine. Different theories and methods have been proposed as to why this is happening such as government policy and the coronavirus.
Did Covid-19 Affect This?
A common belief is that the coronavirus led to beer becoming a wanted commodity. This is because, with high levels of unemployment, the level of economic depression went up. This could have led to more consumption of beer. Beer is known for being a countercyclical good, meaning that when the economy is bad, it does well. On the other hand, the import of beer has been increasing and hitting records for over a decade. There may be other reasons why beer is doing so well. Despite the coronavirus may not have an effect on the beer imports it could have affected the wine imports.
Where is most Beer Imported From?
When beer comes into the U.S. it is imported from various countries. Mexico was responsible for over 70% of beer imported in 2020. Mexico’s market share and imports have been steadily increasing over the last 20 years. And this includes the importing of beer. Other countries like Canada, Germany, and the Netherlands have decreased beer imports over that time period, however. A belief is that the proximity of Mexico to the U.S. means that the customer will get their product quicker. Since Mexico is so close it may seem like an ideal country of choice. Instead of further regions.
The Impact of Tariffs on Wine
In 2019 tariffs were placed on wine from France and other countries in Europe before the coronavirus even reached the U.S. The result of this was felt all last year and even in 2021. The importing of French wine dropped greatly. Interestingly, Italy did not have tariffs placed on its wine in 2019. Italy’s wine imports not only stayed relatively steady but surpassed France.
Months after the tariffs were placed on the wine was when the coronavirus hit the U.S. The shutting down of restaurants and bars that order wine internationally added to the decline since they are the largest business sectors that rely on wine. With a 25% tariff and businesses closing, the wine industry felt the effects.
A1 Worldwide Logistics
When importing goods such as wine or beer from a foreign supplier they have to go through customs. The customs clearance process tends to not be simple, and you may be lost if it’s your first time doing it. Finding an experienced customs broker to guide you through the process can save you time and energy. If you are looking for a customs broker, call us at 305-821-8995 or email us at info@a1wwl.com for or information.
by Rob Simmons | Apr 26, 2021 | Customs Broker, Delivery, Freight Forwarding, Shipping Logistics, Supply Chain, Transportation
During late March, the freight carrying ship Ever Given got lodged in the Suez Canal for almost six days. With the vessel currently freed, Egypt is now requesting more than $1B for damages and losses. As the Suez Canal opens back up and traffic is cleared, the costs from the blockage may start to come in. The Ever given is currently being held at the Suez Canal for investigation and analysis.
The Suez Canal, known for being one of the businesses canals in the world is responsible for over a billion tons of freight a day. When the canal got blocked, it hinders global trade and created fears for potential shortages. Meanwhile, the world is still dealing with the effects of the corona pandemic; so more stress was added.
Where did the payment come from?
The $1 billion requested from Egypt is a payment for the monetary and substantial damages done because of the Ever Given. Lt. Gen. Ossama Rebei, head of the Suez Canal Authority stated that the payment would include the costs of digging out dirt for six days. It will also include the damages in the canal from dredging the boat and costs from transit fees. It will not cover the cost for the 400+ boats that were delayed for almost a week and costs for freight on the boat.
The owner of the ship, Shoei-Kisen stated that what may happen will be that the shippers will split the general average amongst themselves. This could be a complex situation because of the large number of freight shippers that the boat has. When a general average occurs, cargo insurance tends to pay. However, if the shipper does not have cargo insurance, the shipper may have to pay out of pocket.
Who is liable for litigation?
If legal action is required, it could be complicated to find out who is to blame. This is because of the various nationalities associated with the freight vessel. First, the flagging of Ever Given was done in Panama. This means that the boat is registered in Panama. The firm that owns the ship is Japanese and the operator of the ship is Taiwanese. When the vessel got lodged, two of the pilots on the ship were Egyptian.
As a preventive measure, Lt. Gen. Ossama explained plans to increase the number of ships that pass through the Suez Canal a day to 95. The current number of daily ships is around 50. More support boats will also be added. What may be an issue is that the equipment used to tow the large freight boats has not developed compared to the boats themselves. The freight boats grew in size over time while the equipment stayed the same.
by Rob Simmons | Apr 22, 2021 | Customs Broker, Freight Forwarding, Import and Export Experts, Shipping Logistics, Supply Chain, Technology, Transportation
French company Compagnie Fluviale de Transport (CFT) plans on launching the first hydrogen-powered freight vessel later this year. This vessel will solely be for inland use and run fully on hydrogen fuel cells. Pallets and containers will be used to carry the freight on the boat, and it will go through the Seine river. This is all part of the Flagships project, which goal is to reduce toxic gas emissions from freight ships. Five million EUR has been given to the Flagships program for the creation of two hydrogen-powered freight vessels. One of which is currently scheduled to be released in September 2021.
Why Hydrogen-Powered?
Since the development of cargo ships, they have been a huge resource for moving freight internationally. The issue arises when it comes to the pollution that cargo ships generate. Not only may the ocean be polluted during the journey, but greenhouse gases are also being emitted into the air. Add to that the number of cargo ships in the ocean today and it can be a source of concern. Hydrogen is a perfect solution because it does not create the waste that bunker fuel does.
Bunker fuel is currently the main type of fuel oil vessel that carries freight internationally use. This type of fuel is dangerous for the environment and is known as the second leading contributor to global warming. Also, it is predicted that the wells that provide oil will dry up and be unusable in around four decades. Because of this, new energy sources like hydrogen and other renewable energy are an ideal replacement.
What can this mean for the Future?
At the current moment, the plan for the vessel is to just carry freight through the city by inland water channels. If this is successful it may open the gateway for creating hydrogen vessels for the ocean. However, developing a larger hydrogen-powered cargo vessel for the ocean may be a difficult task. This is because Hydrogen is not easily storable. The cost of producing hydrogen is also expensive compared to fossil fuels. Plus, refueling stops for hydrogen-powered ships will also have to be built, costing more money. Despite this the potential benefits of hydrogen as a widely used fuel in the future are grand.
This may be an example for not only freight-carrying vessels but other sources of climate change as well. Car companies may follow along and hydrogen-powered vehicle production may become more common. Hydrogen vessels could be the start of a greater push to a more environmentally friendly future. If international emission reduction goals are to be met worldwide, freight shipping is an important factor.
A1WWL
If you plan on exporting/importing freight, feel free to contact us at 305-821-8995. We have freight forwarders who specialize in getting your goods to the final destination. Along with forwarding by air or ocean, we also provide drayage services.
by Rob Simmons | Apr 20, 2021 | Delivery, Shipping Logistics, Supply Chain, Transportation, Warehousing
How has the creation of its first automated warehouse led to the growth of Chewy’s warehousing logistics? Chewy is a company that has used its extensive supply chain to deliver pet products across the U.S. At a time where there is a high reliance on e-commerce, Chewy has stepped the warehouse logistics up to meet the needs of customers.
What is Warehousing Logistics?
The definition of logistics itself is the comprehensive planning and execution of a complex process. Warehousing logistics is the moving of goods in and out of a warehouse and everything in between. This may include order picking, storing goods for a period of time, sorting the goods, and other intricate practices.
Different types of warehouses like fulfillment centers, Storage centers, and distribution centers have specific logistics in place. The difference between automated fulfillment centers and regular fulfillment centers is how the goods are processed. Automated facilities rely more on technology to process and move the goods.
Chewy Creates Its First Automated Warehouse.
In October of 2020, Chewy opened its first automated fulfillment center after years of planning. This warehouse is different from Chewy’s previous fulfillment centers in terms of logistics. In the past, workers would manually pick, move, and store the items in the facility. The automated warehouse allows for conveyor belts to move the goods. This saves time and energy. The storage of the goods has also been redesigned for easier access.
The idea behind this automated facility is to quicken delivery and fulfillment while improving worker safety and logistics. The amount of money saved by automation is also an advantage. Chewy’s warehouse system management team is currently examining and analyzing this first automated warehouse in hopes of producing more in the future.
What can this mean for the Future of Warehousing Logistics?
Warehousing tends to be an important part of many supply chains. With Chewy developing its warehousing operations, other companies and corporations may join in on the trend. United Natural Foods has announced that it anticipates that its new automated facility will double picking time. Big lots have also created 2 warehouses that focus solely on the processing of bulky and heavy inventory.
One of the main goals in 2020 for many companies was to protect and strengthen their supply chains. Many companies including Chewy have developed innovative ways to protect against economic downturns. This can include changing their warehousing logistics. If you are looking for a warehouse to store your imported goods and assist with your company’s logistics, call us at 305-821-8995. We have a bonded warehouse facility where your imports can be stored for 5 years without payment of duties.
by Rob Simmons | Apr 6, 2021 | Delivery, Freight Forwarding, Shipping Logistics, Supply Chain, Transportation
How does the Suez Canal Congestion affect the ships carrying freight and supply chains? During a journey through the canal, the Ever-Given container ship was moving through a sandstorm. The rough winds turned the ship sideways and lodged it in the canal. This created a domino effect that has lasted a few days and may continue on for much longer. Although the ship has been successfully released, there may still be an aftereffect.
The Importance of the Suez Canal.
Created over a century ago, the Suez Canal is known as one of the most important passageways for shipping freight globally. After many attempts to connect the Red Sea to the Mediterranean Sea spanning thousands of years, the first successful completion happened in 1869. Freight vessels have been using the canal as a shortcut from Asia to Europe and vice-versa ever since. Today, the canal is used as a convenient shortcut sailing by South Africa. Around 50 ships pass through the Suez Canal on a daily basis.
The Chain Effect of the Trapped Vessel on Supply Chains.
When freight is moved internationally, there can be many components that contribute to the distribution of the freight. When one component is disrupted, it may trickle down to other parts of the supply chain. In the case of the Suez Canal, the Ever Given vessel blockage resulted in over 300 ships being restrained by Sunday. This means that the ships may not make it to their ports in time which means that the freight may not reach the endpoint in time. Which can look unfavorable to the companies distributing the goods.
The Ships that were impacted contained thousands of containers each. Companies like Ikea and Walmart also depend on the Suez Canal when moving their freight. The total monetary cost of this incident is yet to be determined. This may be extensive nonetheless, depending on how much the supply chains are strained.
Now that the Ship is Freed, what is next?
On Monday, the Ever Given ship was released and allowed for the resuming of Vessel activity. But with the delay already creating a large backup, it can take a while to clear. The vessel itself will first be sent to Great Bitter Lake for damage examination. With the canal still backed up, freight forwarders and shippers are looking for other passageways to move their freight. Some carriers are taking a lengthier route and going through the Cape of Good Hope in South Africa Instead.
As of today, the ports that the ships were on their way to have not been affected greatly. This is because the vessels that were blocked by the canal were planned to arrive on a later date. The ports may see an increase in volume in the coming weeks, however, it may be too soon.
A1 Worldwide Logistics
Are you planning on moving freight and need a forwarder to aid you? Feel free to contact us at 305-821-8995 . We also provide customs clearance services to clear your freight when it enters the country.
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