https://www.wsj.com/articles/todays-top-supply-chain-and-logistics-news-from-wsj-1521023629
WSJ Logistics Report
Today's Top Supply Chain and Logistics News From WSJ
Delivering up-to-the minute news, analysis, interviews and explanatory journalism on logistics, supply-chain management, e-commerce and more
Paul Page
BiographyPaul Page
@PaulPage
paul.page@wsj.com
March 14, 2018 6:33 am ET
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It's no wonder U.S. freight channels are overflowing. Container imports into the neighboring ports of Los Angeles and Long Beach soared more than 32% from a year ago in February, WSJ Logistics Report's Erica E. Phillips writes, as strong economic growth and a push to restock inventories ahead of the Lunar New Year came together at the Southern California gateways. The cargo crush is echoing out from the docks, straining U.S. rail and road networks and leaving operators and shippers scrambling for the transport equipment needed to keep goods moving. The imports are fueling unusually strong expansion in intermodal rail shipments, which nearly matched peak-season volumes last month. The National Retail Federation's Global Port Tracker report says the rush may already be easing in the post-holiday period. But truckload carriers and logistics operators say they're still coping with the flood of February shipments and most economic signals suggest no letup in demand.
Something may be gaining on Tesla Inc. TSLA 1.83% Volkswagen AG is mounting a big challenge to the electric-car pioneer with plans to build at least 16 factories in the U.S., Europe and China, the WSJ's William Boston and Max Bernhard report, building on the global scale of its supply chain to outpace a business that's had trouble expanding production. Volkswagen aims to sell three million electric vehicles a year by 2025, dwarfing the sales of 102,807 high-end cars that Tesla reported last year. Global demand for electric cars is still only a tiny fraction of new-car sales, and it is far from certain that huge investments by car makers will pay off. But Volkswagen is spending big to ensure a flow of batteries from suppliers in China and South Korea for its production line, flexing its global supply chain weight in a way that may make it tougher for Tesla to expand its own production pipeline.
Demands from digital commerce are triggering changes in the inner gears that support supply chains. A handful of technology companies are adding new tools for freight-payment systems that connect shippers and freight haulers, WSJ Logistics Report's Erica E. Phillips writes, efforts aimed at streamlining how companies handle invoices while catching billing and other errors more quickly. The software is part of a stream of new services and adjustments coming into traditional shipping systems as e-commerce changes expectations and raises the stakes. Software from companies Haven Inc. and Shippabo is aimed at speeding the auditing and invoicing process—effectively moving money faster as shipments move faster. The idea is to catch errors more quickly. But the automation can also improve how companies manage their payments, an increasingly important issue as shippers vie for tight transportation capacity.
The Port of Los Angeles. Photo: Bloomberg News
Here's a supply-chain problem that's leaving a sour taste in the food industry. Global prices for vanilla are climbing as supplies of the staple food ingredient wane and production in agriculture markets is falling far behind demand. It's the result of separate developments in supply and demand that are crashing together to roil the market, and Toronto's Globe and Mail reports the cost for vanilla—real, pure and highly-prized vanilla—has grown by nearly 20 times in recent years. One factor: roughly 80% of the world's supply of vanilla comes from one source, the island of Madagascar, where a cyclone last year devastated crops and cut projected harvests by a third. But demand also plays a major role. Big packaged-foods suppliers have turned to more natural ingredients as consumers have rejected artificial flavors, leaving them straining for fresh flavors, and now paying more for them.
" Truck capacity is going to get worse before it gets better. "
—Diogo Lobo, chief executive of NorthPoint Logistics in Kansas City.
Number of the Day
Decline in truckload shipments on the U.S. spot market from January to February, according to DAT Solutions LLC.
China's economy expanded a faster-than-expected 7.2% in the first two months of 2018, helped by robust overseas demand for Chinese goods. (WSJ)
U.S. consumer prices rose in February at a slightly slower pace than the month before. (WSJ)
More U.S. small-business owners say they are increasing capital outlays and raising compensation. (WSJ)
The U.K. government says economic growth in 2018 will be modestly higher than earlier predicted. (WSJ)
Walmart Inc. will offer home delivery of groceries in 100 cities and launch same-day delivery in New York City, adopting a costly model it previously resisted. (WSJ)
Shoe retailer DSW Inc. is shuttering the Ebuys e-commerce business it bought just two years ago. (WSJ)
Gun maker Remington Outdoor Co. plans to file for bankruptcy protection and pass ownership to bondholders. (WSJ)
Amazon.com Inc. is shutting down Vendor Express, a wholesale program that made it easier to sell in bulk to the company. (CNBC)
There is still little shipping of materials for big infrastructure projects into Puerto Rico six months after Hurricane Maria. (Journal of Commerce)
Tesla Inc. suspended production of its Model 3 electric car for several days last month as it added automation at its factory. (Reuters)
Car maker BMW AG plans to file a damage claim against ocean carriers involved in a price-fixing case. (Shipping Watch)
The U.S. Department of Transportation awarded $500 million in grants to 41 projects around the country. (Logistics Management)
U.S. Customs and Border Protection released a detailed plan for how it will handle the rising volume of cross-border e-commerce shipments. (American Shipper)
Freight forwarder Nippon Express will work with Shanghai International Port Group to extend its reach in China beyond coastal cities. (Nikkei Asian Review)
Watco Cos. LLC will take over maritime bulk cargo handling at the Houston-area Green Port Industrial Park. (Progressive Railroading)
The International Air Transport Association expects airfreight growth to accelerate over the next five years. (Air Cargo News)
A Moscow official says Russian companies are considering starting up automobile assembly plants in Syria. (Automotive Logistics)
Paul Page is deputy editor of WSJ Logistics Report. Follow him at @PaulPage, and follow the WSJ Logistics Report team:@jensmithWSJ and @EEPhillips_WSJ. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.
Write to Paul Page at paul.page@wsj.com
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