Subscribe to our free, weekly email newsletter!


More complications for Japan’s shippers

U.S. multinationals were shifting some critical cargoes from ocean to air carriage a few days ago, but that strategy may become complicated due to a shortage of fuel
By Patrick Burnson, Executive Editor
March 18, 2011

Japan’s supply chain continues to be disrupted by the ongoing consequences of last week’s earthquake and tsumami.

Maersk Line and other global vessel operators are avoiding some Japanese ports to mitigate the risk of contamination from damaged nuclear reactors.  U.S. multinationals were shifting some critical cargoes from ocean to air carriage a few days ago, but that strategy may become complicated due to a shortage of fuel.

“We use a combination of both air and ocean to transport parts from Japan,” said Larry Wilson, a spokesman for Boeing’s supplier management division. “We have not made any changes in shipping, and are continuing to monitor the situation.”

Brandon Fried, executive director of the Air Forwarders Association, told LM that air carriers are flying into Japan fully fueled, but must stop at Honolulu or Anchorage before arriving at the U.S. mainland.


“That, of course, displaces the cargo payload substantially,” he said.


Japan produces 3-4 percent of the global jet fuel supply, some of which is exported to Asia. Some of this refinery capacity has been lost due to damages caused by the earthquake. This supply restriction could lead to higher jet fuel prices. Meanwhile, The International Air Transport Association (IATA) has mobilized its resources to support the aviation industry in several critical areas including procurement of fuel.

“Some key fuel infrastructure facilities in Japan have been damaged,” said IATA spokesmen. “Most Japanese airports have fuel supplies for the next 10 days. IATA is coordinating actions among airlines to maximize existing fuel supplies, including voluntary tankering of jet fuel.”

IATA is also briefing airlines and officials on industry agreed rationing regimes should supply shortages arise.

“It is too early to assess the long-term impact of the Japanese tragedy on the global air transport industry,” said Giovanni Bisignani, IATA’s Director General and CEO. “However, understanding the structure of the Japanese air transport industry does give insight on the potential short-term impact of a major slowdown in Japanese air travel.”

For related stories click here.

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Panjiva, an online search engine with detailed information on global suppliers and manufacturers, recently said it is opening up the “vault,” so to speak. The vault in this case is making its copious amount of trade data accessible through an Application Programming Interface (API), which enables customers to extract Panjiva’s trade data into their own database.

Freight transportation and logistics services provider Averitt Express recently announced it has rolled out improved transit times for less-than-truckload (LTL) service from the Midwest to Toronto and other cities.

Data issued by the National Retail Federation lowered its 2014 retail sales forecast, due to a slow first six months of the year (and largely negatively influenced by the terrible winter weather), but noted that retail sales are expected to be strong over the next five months to finish the year.

Anne Ferro, a ferocious advocate for greater truck safety and a constant thorn to truck drivers and some unsafe trucking fleets, says she is leaving as administrator of the Federal Motor Carrier Safety Administration. No successor has been immediately named.

Data issued by the National Retail Federation lowered its 2014 retail sales forecast, due to a slow first six months of the year (and largely negatively influenced by the terrible winter weather), but noted that retail sales are expected to be strong over the next five months to finish the year.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA