IN THE NEWS: Logistics Players Brace for US Supply Chain Stress Test as Imports Hit a High

The Loadstar
June 6, 2024
Ian Putzger

FROM THE ARTICLE: Paul Brashier, VP drayage and intermodal at ITS Logistics, said so far there had not been any serious congestion, but added that dwell times for intermodal containers at ports in southern California and in Washington state had grown. A scramble for capacity out of Asia and concerns about further extension of dwell times at US gateways may prompt cargo owners to seek alternative routing options through untested alternatives, he added.

Since the pandemic the logistics industry and cargo owners have heard an incessant mantra on the need to build more-resilient supply chains. Recently, however, any momentum appears to have stalled, diagnosed last month by the Federal Reserve Bank of New York after a survey found that about one-third of service companies and nearly half of manufacturers were still reporting difficulties obtaining supplies.

“There’s been a lot of talk at government level of resilience in supply chains, but it’s difficult to implement this. In reality, it’s a long process to build this in,” said Mr Imbriani.

A survey of 1,800 supply chain decision makers, published last month by IDC InfoBrief, found that the average supply chain takes five days to respond to a crisis. Only 17% of respondents said they could respond within 24 hours.

Mr Brashier attributed the relatively smooth operation of US logistics infrastructure over the past 18 months primarily to reduced volume. A spike in traffic would likely expose the same problems the industry experienced in 2021/22, he warned.

And he predicted that the coming 8-12 weeks would be a stress test for the system.

A number of observers have pointed to rail as a likely ‘Achilles heel’, noting that the railways had shown little progress in improving performance. Mr Brashier shares these misgivings, but suggested the surplus of truck capacity in the system could alleviate problems with rail transport.

Meanwhile, ITS has been advising clients to stay aware of developments that could affect cargo flows, and to develop contingency plans.

For its part, the company has invested in technology to achieve better visibility of supply chains, said Mr Brashier, adding that the Freight Logistics Optimisation platform championed by the US Department of Transportation had proved to be a useful tool to improve visibility and navigate disruptions.

Read the full article here.