Global Logistics-Oct 2007

Plans to ensure that the international ocean freight industry pilots a sustainable course for the future received a shot in the arm recently.

At its U.S. Legislative Policy Council meeting in Norfolk, Va., the American Association of Port Authorities (AAPA) got the go-ahead from its member ports to advocate for setting new, tougher air emission standards for both foreign and domestic ships.

The emissions-limiting agenda sought by AAPA follows a U.S. government proposal for more stringent international rules for ocean-going vessels.

“As stewards of the coastal environment, our member ports feel strongly that their seaport operations should be the cleanest they can be, so they have empowered AAPA to advocate for limiting the emissions that ships produce,” says Susan Monteverde, the AAPA’s government relations vice president.

“What AAPA recommended, and our members approved, is for the association to work with the Environmental Protection Agency (EPA) to support its proposal to the International Maritime Organization to adopt more stringent vessel emission requirements as part of the international MARPOL Annex VI treaty,” she adds.

The recommendation calls for strict emission limits for particulate matter and oxides of sulfur, beginning in 2011; limits on new engines to achieve oxides of nitrogen reductions of at least 15 percent beginning in 2011 (compared to existing emissions levels); and phased-in requirements on “legacy” engines (built before Jan. 1, 2000) to achieve a 20-percent oxides of nitrogen reduction starting in 2010.

The approach to cut emissions is through a combination of new fuel standards in certain coastal areas and new engine system standards.

AAPA members agreed to support the EPA in its quest to set new international standards for oxides of nitrogen for tier two and tier three ships’ engines, new standards for particulate matter and oxides of sulfur for all vessels, and standards for oxides of nitrogen for existing vessels.

“Our member ports were clear that they want their association to take on the challenge of limiting ship emissions worldwide,” adds Monteverde.

“Considering that emissions from ocean-going ships are predicted to grow by more than 70 percent over the next 15 years with the expansion of global trade, our members believe it is imperative to take a strong stand on this issue.”

Logistics Providers Sharpen Focus on Mexico
The quest to reduce global transport costs is causing stateside consignees and shippers to consider bringing outsourcing and procurement activities closer to home. In anticipation of a race for the border, logistics providers are expanding their services in Mexico.

Some 3PLs have already created a foothold in Mexico to help shippers move products across the border into the United States more seamlessly and with fewer administrative and operational headaches.

At the same time, some supply chain experts are hinting that in the wake of China sourcing scares and increasing logistics costs, Mexican suppliers may be seeing more business in the near future.

In either case, logistics service providers are making clear efforts to step up their offerings around the U.S.-Mexico border to facilitate transportation within the region.

Among recent press rumblings:

DHL introduced a new cross-border service based out of Harlingen, Texas, capable of handling triple the volume of its previous offering, as well as heavier palletized freight and non-conveyable material. The new service responds to growing logistics needs in the Rio Grande Valley and Northern Mexico regions.

Con-way Freight recently acquired CFI in an effort to combine the truckload carrier’s network and expertise with its own resources, as well as Menlo’s in-country and border-based logistics operations.

Averitt Express opened a new supply chain facility in Pharr/McAllen, Texas—four miles from the U.S./Mexico border. The center’s proximity to Mexico enables Averitt to process customer freight and transload goods for nationwide distribution more quickly and efficiently.

FedEx has expanded its FedEx Transborder Distribution service for cross-border trade between Mexico and the United States by opening new facilities in Ciudad Juarez, Mexico, and El Paso, Texas, to help facilitate the flow of goods.

Dubai Goes to Maritime School
Capitalizing on its growing reputation as an intermodal global crossroads, Dubai is taking elementary steps to growing its human logistics resources in the maritime sector.

Dubai Maritime City (DMC), the world’s first purpose-built maritime center, recently announced plans to construct an academic center in concert with the International Association of Maritime Universities (IAMU).

On completion, the Maritime Education University will be a fully comprehensive education, training, and research institute for maritime science, and will play a key role in creating a labor pool for the global maritime industry.

“The shortage of qualified manpower in the maritime industry today is of enormous concern, as it affects the industry’s seagoing, management, and educational components,” says Amer Ali, CEO of Dubai Maritime City.

Tentatively, the university will offer an array of full-time and short courses, covering at least 10 disciplines including maritime law, maritime engineering management, maritime IT and logistics, environment management, ship management and operation, and ocean energy technology, among others.

The 88,500-square-foot facility will also be affiliated with a research and development institute to assist graduate students with their studies.

Tibet Transportation Reaches New Heights
Marking yet another major notch in China and Asia’s expanding transportation and logistics infrastructure capabilities, Tibetan authorities have begun building the region’s largest logistics facility to further exploit the potential of the Qinghai-Tibet Railway.

The logistics center, covering 1,317 acres, is located next to a railway station at an altitude of 14,763 feet in Nagqu, northern Tibet. The facility is scheduled for completion within 15 months, at a cost of nearly US $200 million, reports Hao Peng, executive vice chairman of the Tibet Autonomous Region.

The center will handle 2.23 million tons of cargo by 2015 and 3.1 million by 2020, including raw minerals, construction materials, and commodity goods.

“The northern part of Tibet is rich in natural resources, and the Nagqu logistics center will provide easier access to the resources, which will drive the area’s industrial development and trade, and raise its self-development capabilities,” says Lu Chunfang, vice minister of railways.

The 1,215-mile Qinghai-Tibet Railway, which opened in July 2006, links Tibet with the rest of China and has greatly expanded the region’s economic prospects.

Tibet’s GDP posted 14.7-percent growth to reach US $1.84 billion in the first half of 2007, the highest increase in the past decade, says the Tibet Regional Statistics Bureau.