Energy & Diesel Fuel & Other Commodities
TODAY IN ENERGY: Wednesday, March 27, 2013 – EIA
Rising North Dakota oil production and demand spurs two new refineries
One of two new refineries being built in North Dakota broke ground this week. The 20,000-barrel-per-day (bbl/d) Dakota Prairie facility is scheduled to be built in 20 months. The impetus for the state’s second and third refineries is the rapid increase in demand for diesel fuel and kerosene for trucking and industrial use within the state.
TODAY IN ENERGY: Monday, March 25, 2013 – EIA
Over half of U.S. natural gas pipeline projects in 2012 were in the Northeast
U.S. natural gas pipeline capacity investment slowed in 2012 after several years of robust growth. Limited capacity additions were concentrated in the northeast United States, mainly focused on removing bottlenecks for fast-growing Marcellus shale gas production.
Commerce – Regulatory & Compliance
Court Opens Way for U.S. Retailers to Import Lower-Priced Goods Despite Copyright Laws
Storefront Backtalk | April 02, 2013
The U.S. Supreme Court has removed a major barricade for cross-border e-commerce, ruling that so long as a product isn’t pirated, U.S. retailers can import it without violating copyright law. In practice, that means an online retailer can sell U.S. customers many products that are lower priced—and were never intended to be sold in the U.S.—without breaking the law. We’re not talking about pirated goods here, but what’s often called the “gray market”—legitimate products that aren’t authorized for U.S. sale. Those products are usually priced lower, because they’re intended for less-affluent markets than the U.S. Costco and Kmart have sold those types of products in the past and gotten into legal trouble. This ruling says they won’t have that trouble again (at least until Congress changes the law or product manufacturers come up with new arguments).
Zepol reports February imports hit highest level in four years
Logistics Management | March 18, 2013
According to Zepol, trade intelligence company, imports fell 5 percent from January and were up 15 percent compared to January 2012. The firm reported that February’s container count came in at more 1.4 million TEU (Twenty-foot Equivalent Unit), with shipments above 720,000, hitting levels for February imports that have not reached this level since 2009.
Zepol said this also was the case with January’s import numbers, stating that import levels appear to be closely resembling those seen before the recession. “Total imports for January and February of 2013 are almost 7% higher compared to the same time last year,” said U.S. trade expert and CEO of Zepol Paul Rasmussen in a statement. “It will be interesting to see if this holds true for the remainder of quarter one as the data for March comes in. We may be looking at a stronger year for imports than expected.”
The recent edition of the Port Tracker report from the National Retail Federation and Hackett Associates noted that said 1.33 million TEU were handled in January for the ports followed by Port Tracker, marking a 0.8 percent gain from December 2012 and a 3.7 percent gain compared to January 2012. This is the most recent month for which data is available. The ports surveyed in the report include: Los Angeles/Long Beach, Oakland, Tacoma, Seattle, Houston, New York/New Jersey, Hampton Roads, Charleston, and Savannah, Miami, and the recent addition of Fort Lauderdale, Fla.-based Port Everglades.
The report is calling for the first six months of 2013 to hit 8 million TEU, which would be a 4.3 percent annual improvement. For all of 2012, the total TEU count was 15.8 million TEU, marking a 2.9 percent annual bump.
Labor, Staffing & Issues
ABF, Teamsters extend labor contract negotiations for 30 days
Logistics Management | March 28, 2013
ABF Freight System, the seventh-largest less-than-truckload (LTL) carrier by revenue, said today that it has made inroads on its hotly-contested contract with the International Brotherhood of Teamsters that was scheduled to expire on March 31, which has led to a 30-day extension for the National Master Freight Agreement. ABF officials said negotiations are scheduled to resume the week of April 8 and that service to shippers remains business as usual.
And Teamsters for a Democratic Union, the dissident wing of the 1.4 million member union, said in an online note to its members said that bargaining continues “with the company in the driver’s seat, focusing on concessions being demanded by management on operations, unbalanced freight lanes, and more.” “Bargaining on economics (wages, pensions, health and welfare) has apparently not taken center stage yet,” TDU said in a statement.
In December, union locals representing 7,500 drivers, dockworkers, mechanics, and clerical staffers at ABF asked the seventh-largest LTL carrier for a two-year contract with healthy wage and benefit increases. As previously reported, Teamsters locals are asking ABF for $1-per hour wage increases and additional contributions to their pension, health and benefit package. Among the initial demands by the nation’s sixth-largest LTL carrier, ABF wanted to eliminate all supplemental agreements to the basic contract; reduce paid time off; eliminate the longstanding grievance procedures that have been in effect for more than half a century; expand use of nonunion subcontractors, expand use of worker surveillance; and create new, lower-paying part-time positions in most job classifications.
ABF has responded with details of its current financial plight. Its stock price has plummeted by more than 80 percent in the past two years to trading around $9 a share at press time. It says its high labor costs are responsible for more than $230 million in losses since 2009. ABF says its goal is to secure a new contract that allows ABF to “substantially lower its costs, become more flexible and better compete in a rapidly changing marketplace” that has seen hundreds of union carriers go out of business and non-union carriers proliferate.
Logistics: Carriers, All Transportation Modes & International
New Rules Applicable to Brokers and Forwarders Effective October 2012
This new set of rules will change some important aspects of the brokerage and forwarder landscape, click on this link.
Canadian Freight Costs and Fuel Increases Marginal to Start 2
Nulogx | April 02, 2013
Results published by the Canadian General Freight Index (CGFI) indicate that the total cost of ground transportation for Canadian shippers increased by .575 percent in January when compared with December results. The base rate index, which excludes the impact of accessorial charges assessed by carriers, increased marginally by 0.38 percent when compared to December 2012.
Average fuel surcharges assessed by carriers have seen an increase from 19.66 percent of base rates in December 2012 to 20.36 percent in January 2013.
“Cross-border truckload saw an increase while the other segments (domestic LTL,TL & cross-border LTL) had decreases,” said Doug Payne, president and COO, Nulogx, a provider of transportation management systems and the sponsor of the CGFI. “Of particular note, total costs are still trailing behind a year-ago levels.”
Freight payment and audit services provider Trendset has alerted its clients to an internal fraud
American Shipper | 04-02-2013
The freight payment and audit services provider Trendset has alerted its clients to an internal fraud and embezzlement issue which could affect payments the provider was supposed to make on behalf of its shipper customers to their transportation carriers. Trendset Chief Executive Officer said in a letter to customers last week, which was obtained by American Shipper, that a “trusted employee” engaged in a fraud and embezzled funds from the company’s bank accounts, accounts from which Trendset pays its customers’ freight invoices.
“The fraud was discovered through a review of suspect transactions first noted by our bank,” the CEO wrote. “Federal authorities, including the FBI, were alerted and a forensic review was conducted. The employee was indicted and plead guilty to certain charges.” The CEO noted while the amount withdrawn from the company’s accounts “represents a tiny percentage of the volume of transactions which we process annually on behalf of our customers. the volume of transactions we handle is large. Consequently, the total amount of the deficiency is significant and is a sum larger than the company can pay from its current funds.”
The 3PL & 4PL World
Hanson Logistics Marks Third Expansion of Chicago Consolidation Center
SupplyChainBrain-Hanson Logistics | March 28, 2013
Hanson Logistics has launched the third phase of a program to expand its temperature-controlled Chicago Consolidation Center, located in Hobart, Ind.
The location’s third expansion in five years is in line with growing demand for Hanson’s Velocities Multi-Vendor Consolidation (MVC) program. It is geared to filling and shipping multiple-SKU frozen-food orders to major retail, wholesale and food-service distribution centers throughout the U.S. Slated for the third quarter of 2013, the expansion will create another 100,000 square feet of space, along with energy-saving LED lighting, 12,000 new pallet positions and 14 “in-swing” dock doors. That feature allows trailer doors to be opened from inside the facility, reducing loading times and energy loss, and enhancing security. The Chicago Consolidation Center will increase to a capacity of 11 million cubic feet, nearly all devoted to high-volume throughput. The facility includes flexible racking for quick-pick consolidation and cross-docking of temperature-controlled food products.