Supply Chain Industry Trends & Latest News - June 13th - June 17th, 2022

The Bipartisan Ocean Reform Act

US President Joe Biden signed the bipartisan Ocean Reform Act on June 16th which is a revision to the maritime legislation since the Shipping Act of 1984. Amid the shipping and supply chain bottlenecks since the onset of the pandemic, this Act holds immense significance for the industry. It aims to alleviate supply-chain bottlenecks caused by factors like labor shortages and a surge in demand for goods. The law directs the FMC to prevent ocean carriers from unreasonably refusing to fill open cargo space with US exports and investigate late fees charged by the container lines. However American shippers are concerned that it may fail to recognize the issues related to the fact that Asian and European companies control 80% of the capacity for moving sea shipments.

The bill focuses on the high detention and demurrage charged by ocean carriers and terminals that are eventually paid by importers and exporters. These charges are then passed on to the consumer, adding to inflation. However, experts are of concern about whether the new law will impact the effects of ongoing inflationary issues. The Federal Reserve recently raised the interest rates the most since 1994 to control the soaring prices. Learn More.

The US Supply Chain Crisis for Baby Formula

The lingering crisis around baby formula in the US has caused much upheaval in its supply chain. Abbott Laboratories is halting production at its Sturgis plant. As stores try to get the baby formula back in stock, Abbott mentioned that it plans to ramp up production despite problems in its Michigan plant. While the government has assured adequate supplies will be available across the nation soon, the disruption caused by the production halt points to the fragile nature of the US supply chain for the product. The efforts to restock baby formula from other countries continue with Reckitt Benckiser ready to send infant formula into the US by air from Singapore starting June till November. Read More.

South Korean truckers end strike

The recent trucking strikes in South Korea came to end when the truckers reached a consensus with the government. The strikes had disrupted the country’s economy adding to global supply chain constraints. The Korean Public Service and Transport Workers Union's Cargo Truckers Solidarity division stated that the transport ministry has agreed to provide subsidies to reduce pressure on rising gasoline costs. According to the transport ministry‘s data, inbound and outbound traffic at Busan, one of the world's top ten busiest container ports, was approximately half of normal on Tuesday. The daily container volume shipped to and from all Korean ports decreased by 53% due to these strikes.

South Korea is not the only country where organized labor has disrupted the flow of goods this year. Several labor strikes continue to disrupt supply chains as countries struggle to restore their supply systems following the pandemic-related bottlenecks. Read More to know.

Decarbonizing Supply Chains - A Rising Focus Area

Sustainability has taken the centre stage in many industries across the world with businesses focussing on strategies and actions for sustainable business practices. Decarbonization is one of the burning topics of concern across industries and supply chains. To combat emissions companies are looking for comprehensive solutions that encompass the whole value chain instead of focussing on individual factories.

Many multinational firms have committed to decarbonizing their supply chains, under the guidelines of the Science-Based Target initiative (SBTi), and they will require sufficient and trustworthy data to manage this transition effectively.

Companies rely on trustworthy and comparable data to meet these present challenges, and this is where the three key trends of Decentralization, Digitalization, and Democratization come into play. The use of digital platforms to address the growing challenges to reap benefits from these trends is inevitable. Read More: 

Novigo provides some innovative decarbonization solutions for road transport scenarios. And here’s our deep dive into Sustainability and Decarbonizing Freight Transportation.

Collaborative Work might assist retailers in hyper-networked supply chains

A collaborative supply chain model will facilitate the way ahead for a hyper-networked supply chain that can offer retailers a third option between attaining supply chain freedom and heavy reliance on the industry’s big players. Amazon, Walmart, and Target have already proven the importance of scale in retail in terms of consumer choice and logistics.

According to Statista, in 2021 online retail sales accounted for 19.6% of global retail sales, up from 13.8 percent in 2019. The number is going to touch 24.6 percent of global retail sales by 2025. Retailer supply chains include a network of warehouses and distribution facilities. Customized infrastructures have their limitations, while outsourcing sections may provide flexibility at the expense of greater marginal costs.

The Quiet supply chain model is built on collaboration, and it doesn’t require participants to give up ownership of their infrastructure but interconnects them and opens them to others. The success of new collaborative models like Quiet is dependent on the cooperation of the participating companies. Everyone is willing to provide infrastructure when they have the capacity, but what happens when the pressure is high, and warehouses and distribution centers may be pressed to handle both their parcels and those of others in the network? The concept also necessitates cutting-edge data sharing methods and traceability systems. Read More.

Partner News

FourKites Maintains Unprecedented Growth in Europe

FourKites grow by 148 percent year on year in Europe. In the past year, the number of customers tracking loads with FourKites in EMEA has increased by 59 percent, while the number of carriers tracking shipments has increased by 55 percent.

FourKites’ acquisition of NIC-place in January 2022 has resulted in the creation of Europe's largest multimodal carrier network, providing global shippers with the most comprehensive end-to-end global supply chain visibility platform. FourKites’ new offices in the region compounded its expansion plans by strategically locating its European headquarters in Amsterdam. While the new office in Munich caters to the German market, the Polish office serves the Eastern European carrier market. Read More.

Sleek Technologies Awarded Procurement Solution of the Year

Sleek Technologies has been named Procurement Solution of the Year by the Annual Awards Program for Innovation in the Global Supply Chain Technology and Logistics Industry. The annual SupplyTech Breakthrough Awards program's mission is to conduct the industry's most comprehensive analysis and evaluation of the top supply chain and logistics technology companies, solutions, and products available. Read More.