This week’s logistics news is as follows: There have been backups on the highways to the lakes, mountains, and beaches. Expect this to continue through August. And finally, only working stiffs like you and I are reading about logistics this time of the year. Just kidding, welcome to the official begin to Summer! (or Winter to our readers Down Under) Ok, on to the real news:
- Nafta Surface Trade Rises 1.2% in April
- Intermodal Rail Traffic Rises to Record Level for Second Week
- Supply Chain Risk Management a Growing Concern for Businesses
- Augmented Reality transforms logistics processes
- Norfolk Southern to Require Legal Protection Against Older Tank Cars (WSJ)
- Descartes Announces Pricing of Public Offering
- LLamasoft and CHAINalytics Announce Partnership
US trade with Canada and Mexico increased 1.2 percent year- over- year in April. Pipelines and trucks, representing two of the five modes tracked, increased year over year. Trucks are the largest transportation mode, representing over 60 percent of April’s trade. Meanwhile, pipeline was the mode that grew at the fastest rate, increasing 28
percent year over year. The pipeline increase reflects both increases in volume transported and the price of fossil fuels. Vessel was the mode that decreased by the greatest percentage, coming in at a reduction of 13 percent. Much of the overall reduction in Vessel trade was due to a 33 percent reduction in US imports of vessel freight from Canada. As an aside, there has been some press regarding the negative revisions to first quarter US GDP. I continue to believe the negative reading was largely a result of the bad weather we have shown to be reflected in numerous economic measures. The uptick in these measures, such as the NAFTA trade numbers, further indicated that the first quarter reduction in GDP was an isolated incident.
Intermodal rail traffic last week, representing a more limited, but also more current measure of transportation activity, rose to the highest volume on record. This volume represented a 7.8 percent increase over the same period last year. Rail car volume, which excludes intermodal units, also increased slightly. Perhaps more importantly, intermodal volume for the first 25 weeks of the year is up 5.9 percent over the same period last year.
Accenture released a report on a study they conducted on supply chain risk management. The heading of the eweek article indicated that supply chain risk management is a growing concern. Interestingly, the article mentions that only 7 percent of respondents are generating returns of greater than 100 percent on their risk management initiatives. I would think that risk management initiatives would only generate returns during adverse circumstances. Am I off base here? Anyway, here is a link to download the Accenture report if you want to dig deeper.
I came across an article on humanipo.com that discusses a report recently published by DHL on the use of augmented reality in logistics. I have trialed augemented reality glasses for use in warehouse operations such as picking. I found it to be interesting, but perhaps a bit distracting due to the requirement to abruptly adjust one’s depth perception. However, the article also mentions its use for display on windshields in transportation activities. Here is a link to the DHL report.
The Wall Street Journal reports that Norfolk Southern is requiring its customers to give the railroad legal protection against damages that may occur from tank cars that don’t meet the rail industry’s latest standards. Norfolk Southern is the first major US freight railroad to require such protections from its customers. This comes after a recent string of accidents in the US and Canada, including a derailment of crude in Pennsylvania being carried by Norfolk Southern.
Descartes Systems Group announced its intentions for a public offering (secondary offering) of common shares in the US and Canada. The press release states, “Descartes will offer 9,500,000 Common Shares at a price of US $13.50 per Common Share, for gross proceeds of US $128,250,000… Descartes intends to use the net proceeds of the offering for general corporate purposes, including as an available source of funding for potential future acquisition opportunities, as well as for possible repayment of outstanding indebtedness under its revolving debt facility.” It sounds to me like the company is planning something in the near future.
LLamasoft announced a new partnership with Chainalytics to integrate Chainalytics’ proprietary Freight Market Intelligence Consortium (FMIC) truckload data with LLamasoft’s and Chainalytics’ mutual North American customers. The partnership will provide customers with a seamless environment to access, manipulate, and load transportation rates into supply chain design models.
Have a great weekend everybody!