Covenant Transport, a subsidiary of Covenant Transport Services (NASDAQ:CVTI), has created a hiring program aimed at increasing the number of people with military backgrounds who become professional drivers.
?On a day when we honor our nations? veterans, we couldn?t be prouder to announce our newest military program, Operation Victory,? Jason Rice, senior director of recruiting, said in a statement.
The program accommodates veterans with different levels of professional driving experience.
All veterans entering Covenant Transport?s highway services division with a military occupational specialty related to driving will receive 100% of that time credited toward their truck driving experience when determining their compensation packages.
All non-driving military occupational specialty jobs will be credited 50% toward a new truck driving career.
To be eligible for the program, veterans need to have been generally or honorably discharged dating back a period of seven years.
For example, a veteran entering Covenant Transport with four years of military transportation driving experience who was generally or honorably discharged dating back a period of seven years will receive 100% credit for those years as driving experience.
In this way, veterans with driving-related experience can begin a driving career at Covenant?s highway services division without having to repeat CDL training.
A service member entering Covenant with four years of service unrelated to driving will still net 50% credit, or two years experience.
?I?m excited about the growth of our highway services veterans program, where we want to become the veteran?s choice employer for driving careers,? said Chris Schoate, Covenant?s recruiting manager and an Army and Air Force veteran.
Evergreen Marine (TSE:2603) reported third-quarter profit from continuing operations of 87.4 million new Taiwan dollars ($2.65 million US), a sharp drop from the 771.2 million NTD profit recorded in the same period last year, according to a filing with the Taiwan Stock Exchange’s Market Observation Post System.
However, Evergreen said total operating revenue was 11% higher, 49.86 billion NTD in the third quarter of this year compared to 44.91 NTD billion in the third quarter of 2018.
Evergreen had said in June that it thought there would be stable growth in Southeast Asian freight volumes this year, according to a report in the Taipei Times.
Evergreen is a member of the Ocean Alliance, a space-sharing agreement with CMA CGM/APL, COSCO and OOCL. Alphaliner ranks it as the seventh-largest container carrier, with 112 owned and 92 chartered ships with a total of about 1.3 million TEUs of capacity.
Evergreen has announced plans to aggressively expand its fleet in the next few years.
In a July 26, 2019, investor presentation, Evergreen said it had 63 ships on order, with capacities ranging in size from 1,800 to 20,000 TEUs and deliveries scheduled through 2022. After those ships were delivered, it said its capacity would reach 1.66 million TEUs.
But subsequently, in August, Evergreen said it would add even more ships ? building five or six ships with 23,000-TEU capacity each and chartering four or five similar-size ships.
It has certainly been a tumultuous year for dry bulk. Will it end with a whimper, or is there still time for one more reversal of fortune?
Rates are now just over half the levels seen in early September and back to where they were in late June, and iron-ore giant Vale (NYSE: VALE) has just cut its sales forecast, dealing dry bulk another blow.
The most important market for Capesizes ? bulkers with capacity of 100,000 deadweight tons (DWT) or more ? is the iron-ore trade from Brazil to China. It is both high volume and very long: three times the distance as the Australia-China run.
Vale initially estimated it would sell 307 million-322 million tons of iron ore and pellets in full-year 2019. On Oct. 21, Vale reaffirmed that estimate but cautioned that the final tally would likely fall in the lower half of that range. On Nov. 11, it cut the outlook further, to 307 million-312 million tons.
?Vale is a significant player in the market and without a recovery from them, dry bulk cannot really thrive,? said John Kartsonas, founder of BreakWave Advisors, in an interview with FreightWaves. His company created the BreakWave Dry Bulk Shipping ETF (NYSE: BDRY) to allow investors to more easily wager on dry bulk rates.
?I?m still optimistic, but fundamentally, the market is not as strong as I would have expected it to be three months ago, because Vale is not really delivering,? Kartsonas said.
Rate slide since September
Clarksons Platou Securities estimated that Capesize time-charter-equivalent (TCE) rates had fallen to $19,700 per day as of Friday, Nov. 8, down 20% week-on-week and 48% below the Sept. 6 high of $37,600 per day. Rates for Panamaxes (65,000-90,000 DWT) were assessed at $11,300 per day on Nov. 8, down 14% week-on-week and 43% below the Sept. 4 high of $19,900 per day.
Rate assessments by the Baltic Exchange pointed to further declines on Monday, Nov. 11, with new estimates for Capesize rates at $19,390 per day and Panamax rates at $10,007 per day. The Baltic Dry Index is now down to 1,345 points, its lowest level since June 27 and down 47% from its Sept. 4 high of 2,518. The Baltic Capesize Index is at 2,393 points, its weakest level since June 28 and down 50% from its Sept. 4 high of 5,043.
S&P Global Platts administers indices that track the dry bulk market with a different methodology than the Baltic Exchange. The Platts indices show the same downward trend. As of Nov. 11, its Cape T4 Index was estimating a TCE of $20,091 per day, a 17% decline from the estimated rate on Oct. 1, when the index debuted.
Kartsonas put the slide in rates since early September into context. ?Rates are always going to go up and down. That?s the way shipping works,? he said. ?But if you have higher highs and higher lows, that?s a good thing. If the high [for Capesizes] is $40,000 a day and the low is $20,000 a day, that?s actually a great market. If we bottom at $20,000 a day, it?s party time ? the breakeven is in the low teens.? The problem, of course, is if Capesize rates push through that floor and keep tumbling .
Volatile first three quarters
To recap the wild swings of the first through third quarters of 2019:
Following the tragic Brazilian dam disaster in late January, which closed mining operations and drastically reduced iron-ore exports to China, Capesizes rates plunged. In the Panamax segment, trade tensions slashed exports of U.S. soybeans to China via the Panama Canal. Instead, China bought soybeans from Brazil and Argentina, which are transported on a longer route around the Cape of Good Hope.
Brazilian iron-ore exports to China then came back online abruptly, and there were not enough Capesizes in the Atlantic Basin to carry the revived cargo flow, causing rates to rebound sharply in May through early September. As Capesize rates rose, shippers began splitting cargoes and putting them on two Panamaxes instead of one Capesize, causing a positive trickle-down effect for Panamax rates.
By mid-September, however, more than enough Capesizes had repositioned into the Atlantic to handle the Brazilian iron-ore business and rates retreated. Consequently, shippers had no incentive to split Capesize cargoes into Panamax loads, so Panamax rates fell.
The ability of South America to replace U.S. soybean exports and support Panamax ton-mile demand will reach its limit in the fourth quarter, due to crop timing. As Evercore ISI analyst Jon Chappell has pointed out in his research, ?The calendar is once again approaching the time of year when the U.S. harvest cannot be fully offset by Argentinian or Brazilian exports.?
The coal sector also faces fourth-quarter headwinds, courtesy of the expected implementation of an import quota by China. In a client note Nov. 11, Chappell said, ?Given the government cap, there is likely to be a significant drop in imports for the final two months of this year, similar to 2018, when December imports fell by 55%.? Coal is carried by both Capesizes and Panamaxes.
The just-announced reduction by Vale compounds the pressure from these first two factors. According to Chappell, ?It is becoming increasingly difficult to envision iron-ore growth fully offsetting some of the challenges we foresee for coals and grains into year-end for dry bulk, likely providing rate headwinds until 2020.?
Still causes for optimism
But not all is doom and gloom. One factor that should provide at least temporary support to Capesize rates is vessel withdrawals for scrubber installations. Starting Jan. 1, all ships without exhaust-gas scrubbers will be required to burn more expensive low-sulfur fuel. Bulkers of 100,000 DWT and larger are heavily opting for scrubbers.
Although a large number of Capesizes were originally expected to be out of service by now for scrubber installations, it turns out most of the out-of-service time is still to come. The more bulkers at the yards, the less there are competing for spot cargoes, and the higher the rates.
Asked for the out-of-service estimate as of Nov. 11, Clarksons Platou Securities analyst Frode Mørkedal reported, ?In terms of [dry bulk] vessels larger than 100,000 DWT, there are no more than 16 in the yards, with another 158 vessels scheduled to do so over the next six months.?
Jefferies analyst Randy Giveans also pointed to a major increase in installations ahead. ?The ramp-up is certainly expected, as there have been considerable delays [in installations], which have pushed the retrofit schedules out and have increased off-hire expectations from 30 days to 40 days per vessel,? he told FreightWaves, pointing out that ?large container ships and tankers were first in line, and delays with those caused a domino effect of delays for bulkers.?
Another potential positive: The Chinese coal quota narrative is not as onerous as it may seem, maintained John Wobensmith, CEO of Genco Shipping & Trading (NYSE: GNK). During the conference call with analysts Nov. 7, he said, ?We all see coal being cut back. We?ve been talking about this for six months because of the quotas. But keep in mind that in Southeast Asia, particularly Vietnam, those numbers continue to move up by double digits, and Indian coal imports continue to move up significantly ? so it?s not just about China.?
Finally, according to Kartsonas, there could be seasonal upside that boosts rates, at least a little, in the next two months. ?I believe there will be a small rally towards the end of the year,? he affirmed.
?The reason is that I think there is seasonality in dry bulk. I think there is a weather element in the winter, both in the Atlantic and in China, where you do have delays,? he explained. Port delays remove vessel supply from the market; the less vessel supply, the more the supply-demand balance shifts in favor of vessel interests in rate negotiations with shippers.
?I also believe there is more coal demand in the Atlantic because of weather. You see European utilities stockpiling ahead of winter and you get higher trans-Atlantic demand. Historically, rates from North and South America to Europe are very seasonal and pick up from mid-November until the end of December.
?These factors could potentially push the market higher a bit,? he continued, arguing that the BDRY exchange-traded fund should react more quickly to short-term rate moves than listed dry bulk stocks, which are priced on longer-term expectations. ?If seasonal factors had been combined with strong iron-ore exports, we would have seen a decent rally, but because Vale has cut its guidance, I still think we?ll see a bounce, but I don?t think it will be as meaningful as it would have been.? More FreightWaves/American Shipper articles by Greg Miller
FedEx Express, the air and international unit of FedEx Corp (NYSE: FDX), said it has more than doubled the number of Asia-Pacific origin markets serving the U.S. and Canada for its early-morning delivery service, FedEx International First.
The unit said it has added 14 originating Asia-Pacific markets, bringing to 25 the number of markets in the region with flights to the U.S. and Canada.
The unit offers door-to-door service, which includes customs clearance, at a pre-defined delivery commitment for packages weighing up to 150 pounds. U.S. consignees can receive deliveries as early as 8 a.m. in one to two business days. The service is available to nearly 5,000 U.S. ZIP codes. Delivery times to Canada are 10 a.m., also in one to two business days.
?Asia-Pacific remains an engine of the global economy, powering the growth of global trade. The accelerated development of Asia Pacific businesses has spurred increased need to reach global customers in a time-definite manner,? said Karen Reddington, president, Asia Pacific, FedEx Express, in a statement.
The statement did not mention the additional markets, and the parent company did not provide that information at the time of the story?s posting.
Some rail unions are becoming more vocal about the rail industry?s practice of furloughing employees, saying the cuts in staffing that have resulted because of precision scheduled railroading (PSR) are stretching the workforce too thin.
?Mass layoffs have been a disturbing and central component of PSR operations? Railroads may want us to believe these workers are extraneous, but it has become clear that reductions are simply about cutting costs, even if those cuts result in the degradation of safety,? said the October 29 policy statement of the Transportation Trades Department (TTD) of the AFL-CIO, which is a coalition of 33 member unions. ?Workers who remain have been forced to do more with less, and are faced with discipline or dismissal if they refuse to comply. The consequences of these choices are no longer hypothetical.?
Furloughing employees is a long-standing practice of the freight railroads and serves as a means of adjusting staffing levels to meet demand. Furloughs, which typically involve unionized workers, can occur seasonally, such as maintenance-of-way employees working in larger numbers in the non-winter months. For instance, furloughs typically increase right before Christmas every year because the railroads pare down their operations after the fall peak shipping period. Employees expect to be furloughed at certain points throughout the year and adjust their budgets accordingly.
Furloughs can also occur if a freight railroad experiences lower rail volumes, as the Class I railroads have in 2019.
From a railroad?s perspective, furloughing employees enables the railroad to bring back employees should volume return, instead of having to find employees and having them undergo a training program that can last at least six months if not more. In contrast, layoffs typically occur to non-agreement staff, such as those working at headquarters or in management.
But furloughs and layoffs have increased as almost all of the Class I railroads have adopted PSR. PSR seeks to streamline a railroad?s operations by running longer trains on a fixed schedule. Another goal of PSR is to cut a railroad?s costs.
?The combination of weaker traffic levels and a focus on precision scheduled railroading principles that strive to maximize the efficiency of the operation have each played a role in the aggressiveness of carriers to use furloughs in the present cycle,? said Todd Tranausky, vice president of rail and intermodal services for FTR Transportation Intelligence, a consulting firm.
Tranausky pointed to October data from the U.S. Bureau of Labor Statistics showing that rail transportation jobs have declined nearly 8% compared with October 2018. The transportation sector was also the fastest contracting sector, beating out even motor vehicle parts and manufacturing, which was impacted by a strike during the month, Tranausky said.
FreightWaves has reported previously how headcount levels at the U.S. Class I railroads have fallen to their lowest levels in 2019.
The unions and the railroads acknowledge that recent furloughs are partly the result of operational changes brought about by PSR. Norfolk Southern (NYSE: NSC) last week confirmed it furloughed 95 employees in Altoona, Pennsylvania, and 58 employees in Chattanooga, Tennessee, while Union Pacific (NYSE: UNP) recently closed its Neff Yard in Kansas City, Missouri, and moved the Neff Yard?s operations to other facilities nearby.
Norfolk Southern (NS) said the furloughs are related to the company?s organizational realignment that was announced earlier this year.
?Consistent with our strategic plan and current business levels, our ability to streamline operations and use fewer locomotives has required the difficult but necessary decision to reduce our locomotive mechanical forces due to the decreased demand for locomotive maintenance and repair. Norfolk Southern will continue to evaluate staffing needs as our business evolves,? NS said. The company added that furloughed employees might have the opportunity to apply for other positions.
?In today?s rapidly changing environment, Norfolk Southern continues to focus on ensuring that we have the optimal number of people and assets at every location across our system in order to operate safely and efficiently. As we execute our new strategic plan, we expect that targeted hiring and furloughing will remain components of our operating model,? NS said.
Meanwhile, Union Pacific (UP) said it closed the Neff Yard as a result of its efforts to streamline operations.
?Union Pacific values safety above all else, and our employees understand we will not sacrifice the well-being of our team for productivity. Work conducted at Neff Yard was transferred to nearby facilities that handle rail cars with the same necessary safety protocols and inspections,? UP said.
But rail unions are questioning whether the furloughs are justified, especially in light of the higher profits and the lower operating ratios that have occurred as a result of PSR.
These concerns also come as the railroads and the unions are about to undergo negotiations to modify collective bargaining agreements.
?Despite taxpayer dollars and tax cuts helping Union Pacific gain more per share for Wall Street, their way to say ?thanks? seems to be, pack up and go,? said Ty Dragoo, legislative director for Kansas for the Sheet Metal, Air, Rail and Transportation union – Transportation Division, also known as SMART-TD. Dragoo was referring to UP?s closure of the Neff Yard and the closure?s ensuing job losses. ?This is leaving behind an economic catastrophe for impacted communities to clean up for themselves. To add insult to injury, the company didn?t even have the decency to warn employees until a few days out.?
Dragoo continued, ?These job losses will ripple through the heart of the local economy. Without income and security, workers and families won?t be able to spend on clothes, restaurants, recreation and much more. Union Pacific isn?t only undermining workers and families, but entire regional economies.?
Meanwhile, the TTD said the workers that have remained after jobs have been cut are being stretched too thin.
?As carriers that have prescribed to PSR run fewer trains, understaffed shop craft facilities are reporting increasingly idle locomotives and equipment, but lack the workforce to keep the equipment in a state of good repair. In some cases, carriers are closing facilities entirely, increasing the workload for employees elsewhere who are already overwhelmed,? TTD?s October policy statement said.
?Carriers are also compensating for reduced staffing by requiring remaining employees to perform work outside their craft in addition to fulfilling their regular duties. At best, this may involve employees performing tasks with which they are not experienced. At worst, employees may be forced to do work for which they are not qualified,? the statement continued. ?Furthermore, rather than maintaining appropriate staffing levels, carriers are mandating overtime for workers who are already stretched thin. In an industry where fatigue is a constant risk factor, exposing employees to additional fatigue by asking them to work longer and faster while performing multiple jobs is a recipe for disaster.?
With shippers also airing their concerns about some of the effects of PSR before the Surface Transportation Board earlier this year, the TTD policy statement questioned whether the U.S. government should be more involved in providing a check and balance to the railroads? PSR efforts.
PSR ?works for the few ? wealthy investors who have little concern for anything other than their bottom lines. These investors are fickle, and when they have extracted every last cent out of the railroad industry, they will move on to the next sector. Meanwhile, we will be left with a hollowed-out system that does not serve its customers, has abandoned safety, and has pushed out thousands of skilled workers who may never return,? the statement said. ?This trajectory can be changed, but doing so will require active engagement from Congress and federal safety and economic regulators, as well as a serious rethinking of operational strategy from freight rail carriers. TTD calls on them to reverse the damage caused by PSR before it becomes too late.?
Toyota?s hydrogen fuel-cell commercial vehicle prototypes keep rolling off the factory floor, but the automaker hasn’t had the same luck pushing the boundaries on hydrogen fuel infrastructure.
Last week the automaker unveiled a utility tractor designed to handle port container cargo. The project comes as Toyota and truck manufacturer Kenworth are bringing 10 hydrogen-fueled Class 8 trucks to the Ports of Long Beach and Los Angeles.
Amid fanfare over the vehicles, Toyota executives are scrambling to save on a first-of-its-kind fuel cell power plant and fueling station the vehicle manufacturer had planned to bring to the Port of Long Beach facility.
The plant, a partnership between Toyota Motor North America and FuelCellEnergy, a developer of fuel-cell power plants, would produce 2.35 megawatts of electricity and 1.2 tons of hydrogen per day ? enough to power the plant?s operation and commercial vehicle projects.
The new facility would also power Toyota Mirai fuel-cell sedans coming from Japan into the Ports of Long Beach and Los Angeles.
But the project is now in limbo after Southern California Edison (SCE) said it would not purchase excess electricity from the plant because of concerns about the kind of fuel used to generate the electricity.
Absent the power purchase, the facility is not economically feasible, the project team has said.
The utility?s decision not to support the project came as a huge surprise, said Craig Scott, director of the Advanced Technologies Group for Toyota Motor North America. ?It essentially flies in the face of everyone?s expectations.?
The plant, first announced in 2017, is integral to the clean truck demonstration projects, Scott said.
?It was the foundation. Having renewable hydrogen produced at scale at the port to support the fleet of trucks, and the future fleet of trucks, would allow us to demonstrate that true zero emissions, from well-to-wheel in heavy duty transportation, is possible ? and that we could do it at a cost that was competitive.?
Biogas vs. directed biogas
As originally conceived, the Long Beach facility would participate in the Bioenergy Market Adjusting Tariff (BioMAT) program. BioMAT is a feed-in tariff program, which allows small bioenergy projects to sell power to one of the state?s investor-owned utilities at a price that is higher than that of power produced from nonrenewable sources.
SCE spokesperson Robert Laffoon Villegas told FreightWaves he couldn?t comment directly on the Toyota project. However, in an emailed statement, he said the utility was generally opposed to projects that use the type of fuel intended for the Long Beach plant.
The plant?s marketing materials say it will be powered by biofuel produced from California agricultural waste.
But the reality is a little more complicated in that the biowaste won?t fuel the plant directly.
Instead, the developers would purchase what is called ?directed biogas,? in which the biogas is produced at an offsite facility and then pumped into the general gas pipeline, where it mixes with traditional natural gas.
That once-removed process doesn?t meet the criteria for the BioMAT program, Villegas said.
?The objective of the BioMAT program was to support specified fuel sources,? he said.
?The allowance of directed biogas from other locations without a specific limit fundamentally changes the operation of the program (i.e., increases the ability to use lower-cost fuel stock) without related cost reduction benefit to customers,? Villegas said in the email.
Scott disagreed, saying the BioMAT rulemaking explicitly allowed for directed biogas. The project developers have submitted the project for review by the California Public Utility Commission, and a response is expected in about 30 days. If the decision is not favorable, the Long Beach facility will not move forward.
In the meantime, Toyota is actively exploring on-site alternatives to making hydrogen ? e.g., through solar electrolysis, in which hydrogen is produced from solar-generated electricity.
It that doesn?t work, Toyota will buy renewable hydrogen from other sources and have it delivered to the site, which is how most hydrogen is bought and sold today.
?We were just hoping we could push the envelope, to go beyond the status quo,? Scott said.
Toyota has already built one of the largest hydrogen fueling stations in the world on-site in partnership with Air Liquide.
Scott said the Long Beach facility would produce more hydrogen than any other plant in the world. But that amount ? one ton per day ? is still ?minuscule? compared with industrial scale refineries producing 300 to 400 tons per day, he emphasized.
The amount of renewable electricity is likewise small, about two megawatts of power. That?s a drop in the bucket for an investor-owned utility like SCE, Scott said.
?It?s helpful to keep these things in context because I think there?s a lot of commentary, people saying, well it?s a really big project and that?s why there?s some hesitation,? Scott said.
?It?s not a big project.?
Freight Futures data to watch today: Spot Month weekly percentage changes
This past week turned out to be a generally lower week for the Trucking Freight Futures Markets. On Friday, the spot National contract (FUT.VNU201911) finished fractionally lower to $1.483/mile and off $0.012 for the week. The East regional contract (FUT.VEU201911) finished 0.2% higher on Friday to settle at $1.468, slightly down for the week. The West regional contract (FUT.VWU201911) gained 0.31% on Friday but still fell by $0.011 for the week and closed at $1.631. The South regional contract (FUT.VSU201911) suffered the largest drop, shedding $0.23 or 1.7% on the week and settled at $1.350.
The only lane to finish in positive territory for the week was the ATL to PHL contract (FUT.VAP201911), which gained 0.44% to close at $1.583. Two lanes in particular came under downward pressure. In the South, the LAX to DAL contract (FUT.VLD201911) dropped $0.045 or 2.5% to finish the week at $1.725. In the West, the SEA to LAX contract (FUT.VSL201911) fell $0.018 or 1.5% to settle at $1.148. The week could have been far worse for the LAX to SEA contract (FUT.VLS201911), which finished the week down by 0.24% to $2.114, thanks to a strong $0.012 showing on Friday. Total open interest remained at 36,000 miles last week.FreightWaves SONAR: Tree Watch List
Transloading, the process of moving product from one mode of transportation to another, is critical to freight shipping across the entire transportation network. Interest in transloading is tied to general demand for product as shippers seek ways to bring their goods to market.
For many companies, transportation represents the largest portion of logistics costs. Combining multiple methods of transportation offers shippers cost savings, flexibility and the opportunity to expand their business and market reach. This is why expertise and efficiency are paramount when choosing a transloading service provider.
Martin Lew, chief executive officer of railcar leasing and storage marketplace Commtrex, said the purpose of transloading is to transfer product as efficiently as possible in order to meet the demand for all manner of goods ? coal, grain, consumer products and more.
?Most domestically shipped products and all internationally shipped product will involve some form of transloading at some point before reaching their final destinations,? Lew said.
Transloading is vital to keep product moving along the supply chain. A product that sits in a railcar or truck is not generating revenue, and transloading often allows for more efficient use and productivity of the rail equipment.
?There are many reasons a product would need to be transloaded. Consider an automobile manufactured in Ohio that is destined for a dealership in Colorado. The brand-new vehicle will not be driven to the dealership; rather it will be shipped via rail flat car, loaded onto a haul-away truck and finally arrive at its destination,? Lew said.
?The combination of rail and trucking is optimal in this situation because rail offers long-haul economics while trucking provides the short-haul flexibility,? he added.
Transloading is one of the core growth areas for Class I railroads such as CSX and Canadian Pacific (CP). Senior management at both railroads have been consistently communicating that they are investing significant resources into their businesses.
TRANSFLO, a unit of CSX and the operator of one of the largest transloading networks in the U.S., handles more than 300 products, including chemicals, food-grade products, crude oil, waste materials and dry-bulk freight. CP?s transloading unit facilitates the movement of consumer packaged goods, industrial products, dry and liquid bulk commodities, oversized freight, machinery and many other products.
?The transload sites that will see the most growth will be the sites designed to work efficiently with the railroad and trucking industry while providing value and full pipeline visibility for customers,? said Morgan Kernohan, director of transloading at Canadian Pacific. ?Each commodity requires a different method of shipping, from the type of equipment moving the product to the regulations regarding safe handling.?
Short line railroads Genesee & Wyomng and Patriot Rail also offer transloading, as do third-party service providers such as Savage and OmniTRAX.
?The Commtrex Exchange directly connects shippers with over 1,400 transload locations across the U.S. and Canada, not including mobile and project-specific transloading locations,? Lew said. ?Commtrex has the most comprehensive database of transload facilities available.?Commtrex’s heat map shows search interest for rail transloading. (Photo: Commtrex)
While rail freight volumes are still weak, shippers are nonetheless keeping an eye on transloading facilities to be ready for the next upturn in the market, Lew said. In the last three months, Commtrex has seen more than a 200% increase in transloading searches.
?Even though rail traffic has been declining for the past several months, the amount of search activity for transloading locations within the Commtrex Exchange has been increasing.?
He attributes the continued uptick in activity to shippers looking for ways to move freight more efficiently and increase productivity across the various modes of transportation. ?When demand for commodities is down, shippers need to extract savings from the delivery costs of the commodities and products they are shipping,? Lew said.
Volumes moving through transloading sites follow overall rail freight, with some sectors more challenged than others. Coal transloading facilities are seeing weaker volumes due to declining usage. Frac sand transloading sites are seeing a market shift as oil drillers switch away from sand sourced from mines in Wisconsin to mines closer to shale fields in Texas.
Lew said much of the search has been concentrated in rail hubs such as Houston, Chicago and Stockton, California; near metropolitan centers such as New York, Charlotte, North Carolina, and Atlanta; and near oil and gas production such as Calgary and Edmonton, Canada.
These trends are reflective of the demand for the specific commodities being delivered, produced or manufactured in these geographic regions. For example, the U.S. Gulf Coast has become the epicenter for petrochemical growth, with over $60 billion in petrochemical investments being made. The region is outpacing the Middle East in a shift that is expected to accelerate as shale producers extract more natural gas in nearby reserves.
Lew said that some shippers using transloading also use the cars for in-transit storage. A large portion of the plastic pellet traffic moves through transloading facilities in this way.
Another dynamic that is increasing the need for additional transload infrastructure is Mexico?s growing demand for refined fuels. There are several U.S.-based companies, such as USD Group, Savage, Koch and KCS, that are making major investments into transloading, terminaling and rail infrastructure to facilitate the burst of petroleum product rail shipments.
With Mexico?s demand for refined petroleum fuels is projected to grow by 40% over the next 25 years, these investments will continue to increase over time.
Commtrex, the leading online marketplace for rail shippers, and the Commtrex Rail Services Directory lists over 1,400 North American transload sites. Below are the current Commtrex top 10 transload locations based on searches and user feedback in the Commtrex Rail Services Directory:
1. Site: Bayport Container Terminal
Location: Pasadena, Texas
Class I connections: Union Pacific
Services offered: dry bulk, liquids, packaged goods, rail-to-truck transloading and inventory management, hazardous material handling
2. Site: Chemical Transfer Co. Inc.
Location: Stockton, California
Class I connections: BNSF, Union Pacific
Services offered: liquids, hazardous liquids, hazardous material handling
3. 3. Site: MidAtlantic Transloading Inc.
Location: Virginia Beach, Virginia
Class I connections: CSX, Norfolk Southern
Services offered: dry bulk
4. Site: Superior Bulk Logistics
Location: Midland, North Carolina
Class I connections: CSX, Norfolk Southern, with connection to Aberdeen Carolina Western Railway
Services offered: dry bulk, food grade, liquids
5. Site: Greens Port Industrial Terminal
Class I connections: BNSF, Kansas City Southern, Union Pacific Services offered: dry bulk, liquids, oversized, other
6. Site: MHF Services
Location: North Bergen, New Jersey
Class I connections: CSX, Norfolk Southern
Services offered: dry bulk, packaged goods
7. Site: Titan Lansing Transloading
Location: Levelland, Texas
Class I connections: BNSF, Kansas City Southern, Union Pacific
Services offered: dry bulk, food grade, liquids, oversized, packaged goods, frac sand, crude oil and hydrochloric acid
8. Site: Norfolk Southern TBT
Location: Edwardsville, Illinois
Class I connections: Norfolk Southern
Services offered: dry bulk, food grade, liquids
9. Site: Transloading Logistics
Location: Stockton, California
Class I connections: BNSF, Union Pacific
Services offered: dry bulk, food grade, other
10. Site: OnPoint International
Location: Edison, New Jersey
Class I connections: CSX, Norfolk Southern
Services offered: dry bulk, food grade, liquids, packaged goods other.
Editor?s note: Commtrex has a business agreement with FreightWaves that includes editorial coverage.
There have been a steady stream of blockchain-based pilot projects within the supply chain landscape. Today, UPS announced a collaboration with agri-tech solutions provider HerdX of the successful delivery of a blockchain-verified beef shipment from a U.S. farm to Japan. UPS heralded this to be a significant step forward in quality assurance and traceability in the beef industry, which incidentally was also the first time HerdX shipped beef on the back of a blockchain network.
The excessive fragmentation of the logistics market in terms of the volume of stakeholders has led to opacity within the market, as businesses work in silos and continue to have blindspots all across the supply chain, severely affecting their operational efficiency.
To an industry that is distressed with a perpetual lack of visibility and transparency, blockchain may be an antidote. Blockchain is a decentralized ledger that effectively makes every stakeholder within the network equally responsible as custodians of the data that flows within it. The data in the blockchain network is immutable and can only be edited with the explicit approval of all the stakeholders within the ecosystem.
The logistics industry was quick to begin blockchain pilots, understanding fully well that blockchain had the wherewithal to get all the stakeholders within a particular supply chain to toe the line, while ushering never-before-seen levels of transparency and visibility into shipment movement.
?Blockchain verification for international air freight shipments is complex and requires a great amount of expertise in customs and freight forwarding. Getting it right has implications for many industries, such as restaurants, food & beverage, and retail,? said Romaine Seguin, the president of UPS Global Freight Forwarding. ?We?re committed to upholding HerdX?s industry-leading quality assurance and traceability standards for all customers eyeing international growth moving forward.?
The beef shipment originated from a Kansas farm, and it was put in a UPS temperature-sensitive air freight container that contained sensors that monitored and recorded the shipment?s temperature throughout its journey to Japan. The data derived from the sensors were fed in real-time to HerdX?s blockchain verification platform.
After the beef shipment landed in Japan, it was transported to a contemporary steakhouse where invited guests were given a menu that featured beef dishes with QR codes. Going forward, upon scanning the codes, diners will be able to gather information on the shipment?s journey from the farm to the fork, which essentially helps them verify the quality of the beef being served.
?It?s an exciting time to be entering the Japanese market with a much-needed, innovative solution to a pervasive industry issue,? said Seguin. ?We hope our relationship with HerdX will catalyze an expansion of service offerings for our international shipping customers.?
To expedite the use of blockchain in the supply chain industry, it is vital to create data standards that help businesses to easily develop pilots without burning a lot of cash in the process. Standardization also helps immensely with interoperability, which will be crucial for different blockchain networks to interact seamlessly in the future.
The Blockchain in Transport Alliance (BiTA) is looking to achieve standardization, having published its inaugural set of royalty-free blockchain data standards earlier this year. These standards can be leveraged by any company looking to create a blockchain platform within the logistics space. BiTA is the largest consortium of its kind in the world, with nearly 500 members spread across 25 countries and collectively generating over $1 trillion in annual revenue.
Saloodo! has launched a new one-stop digital trucking platform offering road freight connections for South Africa domestic shipments and international movements to neighboring countries.
The logistics-start-up, a subsidiary of Deutsche Post DHL Group, will use South Africa as a ?launch-pad? into Sub-Saharan Africa for its digital trucking solutions.
Southern Africa relies heavily on road freight, but trucking operations are fragmented. Saloodo! claims its platform will, as ?the first digital platform available in the region,? help address these shortcomings by delivering the ?visibility, efficiency and security that technology offers.?
Tobias Maier, CEO of Saloodo! Middle East and Africa, said, ?With real-time visibility, Saloodo! will inject greater transparency and efficiency into the road network in the region, enabling shippers ? from small enterprises and start-ups to large multinational groups ? to find trusted and reliable freight carriers in South Africa.?
Maier added, ?This will in turn help carriers manage existing fleets and optimize capacity with full truckload shipments.?
The company will piggyback the footprint of its parent company to roll-out the service, with all contractual relationships on the platform organized via existing local DHL entities.
The Saloodo! platform was first launched in 2017 in Germany and is now available in Italy, Poland, the U.K. and the Middle East, where it was launched six months ago.
?After successfully entering the Middle East we have taken the decision to continue on our growth path by expanding to the African continent,? said Thomas Grunau, CEO of Saloodo!
?As the world?s youngest continent with 60% of the population below 25, economic decisions and growth are increasingly driven by a dynamic generation of digitally minded young adults. These are ideal conditions for offering and further developing our smart solution.?
Deutsche Post DHL Group said with a market value of Rand121.1 billion ($8.2 billion) in 2018, road freight volumes in South Africa have been increasing steadily, growing at 5.6% year-on-year in June this year.
?Equally, intra-Africa exports already accounted for 26% and 12% of South Africa?s 2018 total exports and imports, respectively ? almost 50% of which are with neighboring countries in this landlocked region,? said a Saloodo! statement.
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