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Transportation News Bulletins - Logistics

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Obama's ambitious export plan may rekindle free-trade battle
Friday, 12 March 2010 00:00

President Obama unveiled plans Thursday to double U.S. exports over the next five years in hopes of spurring job growth, an ambitious goal that may rekindle the battle over free-trade policy.

The president acknowledged the formidable barriers to his goal: doubts in Congress over new free-trade agreements, misaligned currencies that make Chinese products cheaper on global markets, and continued weakness in global demand, all problems that could dwarf efforts to promote U.S. products and services abroad.

But, Obama said in a speech, "in a time when millions of Americans are out of work, boosting our exports is a short-term imperative."

"We are at a moment where it is absolutely necessary for us to get beyond those old debates. . . . Those who once would oppose any trade agreement now understand that there are new markets and new sectors out there that we need to break into if we want our workers to get ahead," he said.

The U.S. economy has gone through spurts in which exports have doubled—or nearly so—within five years, most recently from 2002 to 2007, when a cheap dollar gave American products and services a competitive edge. But a repeat may be tougher in the current global climate, with the dollar strengthening against some key currencies.

The president may also face domestic opposition over a renewed emphasis on free-trade policies that some argue have helped shift U.S. manufacturing jobs overseas—a sensitive issue at a time when unemployment remains at nearly 10 percent. Predicting such an argument, Obama said Thursday that although he sympathized with communities that have lost factories and livelihoods to overseas labor, the country needs to recommit to free trade in a way that ensures Americans benefit through the opening of new markets for their goods and services.

"There is no question that as we compete in that global marketplace, we've got to look out for our workers," Obama said. "But to look out for our workers, we've got to be able to compete in the global marketplace."

Designed to deliver on a pledge he made in his State of the Union speech, Obama's plan includes $2 billion in new export financing through the Export-Import Bank, which helps U.S. companies finance overseas sales; establishment of a Cabinet group to promote U.S. goods and services abroad; and an expanded role for the Nixon-era President's Export Council, to be chaired by W. James McNerney, Boeing's president and chief executive. Restrictions on the overseas sale of some high-end technology goods may also be eased.

If successful, the president said, the program would create 2 million jobs. Experts said the viability of that figure would depend on the type of exports that are expanded.

As the world economy slowed last year, U.S. exports fell to $1.5 trillion from a peak of more than $1.8 trillion in 2008. They began to rebound in the latter half of 2009, but trade analysts said Obama's goal could prove difficult absent the opening of new markets.

The goal of doubling exports in five years "is useful, and it is achievable," said John Murphy, the U.S. Chamber of Commerce's vice president for international affairs. "But he needs a laser like focus on tearing down foreign access barriers."

An expansion of exports could also be made more difficult by the strengthening of the dollar, which has gained recently against key currencies, including the euro. A stronger dollar makes U.S. goods more expensive.

Without favorable exchange rates and progress negotiating more open markets worldwide, "the things you can do around the edges will get overwhelmed," said Scott Paul, executive director of the Alliance for American Manufacturing.

In his remarks, made at the Export-Import Bank's annual conference in Washington, Obama singled out China, saying that a change in the value of its currency was a central step in "rebalancing" a situation in which the United States "served as the consumer engine for the entire world," racking up large trade deficits as a result. China, by contrast, accumulated large trade surpluses that Obama said should now be used to expand domestic consumption—and increase the products it imports from countries such as the United States. The U.S. trade deficit fell slightly in January, to $37.3 billion, largely because of a decline in petroleum imports.

Obama also promised a fresh push on an issue that could prove divisive in the Democratic Party— pending free-trade agreements with South Korea, Panama, Colombia and a group of Pacific countries— as well as on the broader round of world trade talks in Doha, Qatar. The migration of U.S. manufacturing jobs overseas has stoked opposition to free-trade agreements, which some say have given developing economies access to U.S. consumers without offsetting benefits for American workers.

"Moving forward with leftover Bush-negotiated free trade agreements is a nonstarter with many members of Congress," Rep. Michael H. Michaud (D-Maine), chairman of the House Trade Working Group, said in a written statement.

U.S. Trade Representative Ron Kirk, who met with Michaud and other members of Congress on Wednesday, said the administration was approaching the trade deals intent on seeing that they also create jobs.

"We don't pick up everything as it was but will take a real strategic look at trade policy," Kirk said. The pending agreements with South Korea, Colombia and Panama, in particular, "have value, and when we are fighting for every job on the table, we need to get these right so we can reap the benefit."

The Washington Post, 3/12/2010

Retail Container Traffic Could Be Up 13 Percent in March
Thursday, 11 March 2010 00:00

Import cargo volume at the nation’s major retail container ports is expected to be up 13% in March 2010 compared with the same month a year ago, and double-digit increases are expected to continue through the summer as the U.S. economy begins in improve, according to the monthly Global Port Tracker report from the National Retail Federation (NRF) and Hackett Associates.

“These numbers show that retailers continue to anticipate improvements in the U.S. economy,” NRF Vice President for Supply Chain and Customs Policy says Jonathan Gold, NRF’s vice president for supply chain and customs policy. “This is very different from the past two years when merchants were continually cutting their imports in an effort to manage inventory.”

U.S. ports handled 1.08 million twenty-foot equivalent units (TEUs) in January, the latest month for which actual numbers are available. That was down just under 1% from December as imports wound down after the holiday season, but up 2% from January 2009. It was also the second month in a row to show a yearover- year improvement after December broke a 28-month streak of year-over-year monthly declines. One TEU is one 20-foot cargo container or its equivalent.

February was estimated at 1.08 million TEU, the same as January but a 29% increase over unusually low numbers in February 2009, and March is forecast at 1.09 million TEU, up 13% from the previous year. April is forecast at 1.17 million TEU, up 19% as retailers begin to stock up for spring and summer, May at 1.21 million TEU, up 17%, June at 1.26 million TEU, up 25%, and July at 1.33 million TEU, up 20%.

The first half of 2010 is expected to total 6.9 million TEU, up 17% from last year’s 5.9 million TEU. Imports for 2009 totaled 12.7 million TEU, down 17% from 2008’s 15.2 million TEU and the lowest since the 12.5 million TEU reported in 2003. First-half growth is down from the 25% increase forecast a month ago, but reflects statistical issues at West Coast ports rather than a change in retailers’ import intentions.

The U.S. economy appears to be in true recovery rather than the mid-point upswing of a double-dip recession, observes Hackett Associates founder Ben Hackett. “We are in a cautious but sustained growth cycle,” he says. “Trade will grow and as a result of statistical comparison with the trough in 2009, the growth rates will appear to be healthy.”

Global Port Tracker, which is produced for NRF by the consulting firm Hackett Associates, covers the U.S. ports of Long Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the East Coast, and Houston on the Gulf Coast.

Logistics Today, 3/11/2010

Logistics Employers Fear Card Check Legislation
Wednesday, 10 March 2010 00:00
Unions keep up pressure to organize warehouses, other companies

The drive by labor unions to organize warehouses and other companies has not taken a back seat to the immediate goal of employees to retain their jobs during the economic downturn, according to an attorney who represents warehouse operators.

Pat O'Connor, government affairs counsel of the International Warehouse Logistics Association, said organized labor's primary goal of recent years, passage of the Employee Free Choice Act, also known as card check, is alive and well.

"The supposed death of card check is greatly exaggerated," O'Connor told the annual conference of the IWLA in Coronado, Calif.

If Congress were to approve card check legislation, a union attempting to organize a company would seek to get 50 percent plus one of the employees to sign a card requesting union representation. The company would then have to recognize the union as the bargaining unit without the need for a secret ballot election.

Although the economic downturn, a national unemployment rate of 9.7 percent and the Democratic Party's loss of its 60-member majority in the Senate appear to bode ill for passage of card check, O'Connor said organized labor has not given up on passing some type of legislation.

Furthermore, some labor analysts believe the National Labor Relations Board can impose card check through a regulatory action, he said.

Also, labor is considering other approaches such as pushing for "quickie elections." If 35 percent of a company's employees sign cards requesting unionization, the NLRB can require that an election by all employees be held in five days, O'Connor said.

Herb Shear, chairman and chief executive officer of GENCO Supply Chain Solutions, a warehouse and third-party logistics provider, charged that unionized warehouse operators "have a difficult time performing effectively."

If workers choose to be represented by a union, it is normally management's fault, Shear said. Successful managers do not treat employees the way managers want, but rather the way employees want to be treated.

In order to make this strategy work, the key is for management to "get workers to want what you want," Shear said.

GENCO has resisted union organizing attempts twice over the past decade. Such management efforts can cost $200,000 to $500,000, he said.

GENCO surveys nine percent of its employees each month so every worker has the opportunity to express personal views once a year. The company believes surveying employee attitudes toward unionization is a dynamic process. Since issues can crop up suddenly, it is necessary to survey a portion of the employee population each month.

If the surveys uncover views such as declining trust in management, a feeling that employees have no voice in the company, concern about job security or allegations of discriminatory practices, GENCO management takes immediate action, Shear said.

Journal of Commerce Online, 3/10/2010

NTSB: Fatigue endangers across all transportation modes
Monday, 08 March 2010 00:00

WASHINGTON—National Transportation Safety Board Chairman Deborah A.P. Hersman March 5 encouraged the sleep research and healthcare community to continue their efforts to educate transportation policy makers of the dangers of fatigue in all modes of transportation.

Speaking before the annual conference of the National Sleep Foundation in Washington, Chairman Hersman remarked that fatigue has been a concern for the board since the creation of the agency in 1967 and it has been an issue on the Board's Most Wanted List of Transportation Safety Improvements since the list was established in 1990.

"The work of the National Sleep Foundation and other organizations and individuals is critical to improving transportation safety policy," said Chairman Hersman. "The NTSB is interested and willing to partner with you in developing a greater awareness of fatigue."

Hersman highlighted a number of accident investigations across all transportation modes that included fatigue as the probable cause or a contributing factor to accidents. As a result, the board has made safety recommendations that range from deploying fatigue detection systems to reduce the occurrence of accidents to installing electronic on-board recorders that collect and maintain hours of service data on vehicle operators.

"We can't always prove fatigue as a cause of an accident, but the frequency with which we now routinely document the presence of fatigue-related factors in transportation operations is alarming," Hersman stated.

Hersman remarked that while there are still no definitive tools to conclusively identify the degree to which a person is fatigued, the major challenge is to ensure that all those in transportation report to work rested and fit for duty—for their own safety and for the safety of those they are transporting., 3/8/2010

RFID Market to Hit $5.35 Billion in 2010
Monday, 08 March 2010 00:00

Despite the economic recession which required downward adjustments to ABI Research’s RFID forecasts for 2009 and 2010, the outlook is good for steady growth through the next five years, according to new market data released by the firm.

“We expect the overall RFID market to exceed $8.25 billion in 2014, or approximately $7.46 billion with automobile immobilization excluded,” predicts practice director Michael Liard. “That would represent a 14% compound annual growth rate (CAGR) over the next five years.”

(Automobile immobilization is the largest single RFID application and has a low growth rate which impacts overall market size, so it is often excluded when examining market trends, Liard notes)

In 2010, the RFID market appears set to reach a size of $4.47 billion (without automobile immobilization), 15% more than the adjusted 2009 figure.

“Not all segments of the RFID market are created equal,” adds Liard. “To 2014, the greatest growth will be found in RTLS (real-time location systems), baggage handling, animal ID and item-level tagging in fashion apparel and retail.”

Other key opportunities include electronic vehicle registration, continued penetration of RFID-enabled e- ID/e-government documents (including health cards), and continued expansion of library systems. Also worth watching: slowed but continued progress in retail/consumer packaged goods supply chain management, and multiple flavors of asset management that leverage RFID technologies, including specialty passive UHF tags.

“Modernizing” applications for RFID will grow more rapidly than their traditional predecessors such as access control, automobile immobilization, electronic toll collection and others that account for slightly more than 61% of the total market today. These applications are expected to grow 6% compounded annually from 2010 through 2014. In contrast, modernizing applications—animal ID, asset management, baggage handling, cargo tracking and security, POS-contactless payment, RTLS, supply chain management and ticketing—are forecast to grow roughly 19% in the same time period.

Logistics Today, 3/8/2010

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