Shanghai will be hosting the Ninth International Heavy Haul Conference this week. China has invested a significant amount of resources into improving their railway system for shipping and this is their opportunity to show off their progress. The conference will focus on new technologies such as advanced technologies and equipment in the fields of heavy haul, high speed, operations management, locomotives and rolling stock, communications and signalling, operational safety, and information technologies. Full details available here.

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Shipping routes between China and Taiwan opened this week. This is the first time since 1949 that there will be direct routes. This will eliminate the costly practice of shipping goods through Hong Kong. The immediate effect will be that people who ocean ship will save approximately 50 million dollars. In the long term, this is an important step in the development of Taiwan's attempt to be a transport and logistics hub in the Asia-Pacific area.

To read the whole article, click here.

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It was recently announced that China's economic growth in the 3rd quarter was 9% compared to 10.1% in 2007. This is due to slower exports, investment and consumption. One industry that has not been hit as hard is the logistics industry. Analysts are projecting continued growth for the industry in 2009 and have stated "Asia Pacific region is the best placed to weather the current financial and economic storm."

For the full article, click here.

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In the past few months, China has struggled with the capacity of their ports. In the north, building of new ports has not kept up with growing demand. In the south the opposite is true. Production has slowed in many areas, but the government has already invested in increasing the capactiy of the local ports. Growth of the logistics centers in the south are currently outpacing the growth of production.

To read the full article, click here

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Transfer Logistics is set to open their new logistics center in Chengdu, China. The center will eventually have a capacity of 24 million tons of cargo. This is the second logistics center opened by Transfer Logistics. They plan on opening a total of 10 centers all across China. They will serve as transaction, information, warehousing and distribution centers.

For the full article click here

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In China not many companies look to use 3PL companies for their logistics. The top 10 companies only own a 13% market share. The market is growing however, as companies are feeling heightened pressure to upgrade their supply chains. The logistics market in China grew at 26% from 2006 to 2007. Over 50% of American 3PL companies have plans to expand operations in China in the next few years.

Two recent conferences in Shanghai discussed these trends. Click here for the article

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Manufacturing in China does not make sense for every company. Many companies have underestimated the logistics costs involved in manufacturing in China and have decided to bring their production back to their home country. With rising logistics costs, it makes it all the more important to have a team on the ground in China to evaluate the production and logistics costs and decide whether it makes sense to outsource. For the full article, click here.

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Rising jet fuel prices have caused many international carriers to rethink their shipping plans. Fuel prices have recently increased 25% in China. Although the price is still significantly lower than the international market price, the increase will force many carriers to cut back on their flights and focus on the profitable routes. Analysts are predicting the price will remain stable until after the Olympics when the Chinese government will likely remove more subsidies and let the price rise even higher. Click here for the full article.

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AMR (an independant research firm) recently ranked China as having the second highest supply chain risk (US had the highest risk). Factors cited in the study include geography rising transportation costs, and weakening consumer demand. While America still attracts a high percentage of sourcing due to the increased visibility of the supply chain, China still offers a major cost advantage and close proximity to a growing customer base.  To capitalize on this cost advantage without bringing on too much risk in the supply chain, it makes sense to have constant communications with every stage in the logistics process. Click here for the full article.

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China has recently opened a state of the art agricultural logistics center near Hong Kong  in southern China. The import/export center will have food-testing labs and warehouse space. This is a joint venture between the Oregon Department of Agriculture and a private Chinese firm.

 

The new logistics center will make the growing Chinese market much more accessible. It includes a domestic distribution center. This logistics center will make importing and exporting agricultural product in China much easier. Click here for more info.

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The Chinese government has started to impose shipping restriction in advance of the upcoming Olympic games in Beijing. The Chinese Post Office has suspended mailing of liquids or powders as a safety precaution. Other products such as  powdered goods, chemical products, unidentified metal, mechanical and electrical products, as well as sealed containers with unidentified gases and liquids will also be banned from delivery.

It will be important to stay up to date on the latest shipping restrictions from the Chinese government in the upcoming months as they are in a particular state of flux. See this article for more detail.

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The Chinese government is about to begin construction on what will be Asia's largest rail center. It will be located in the city of Chengdu, within the Sichuan province, and will serve as a railway link to the ports of Shanghai, Guangzhou, Shenzhen, Qingdao, Lianyungang and Tianjin.

It will reduce the transport time of rail cargo from its current 5-6 days down to 2 days and is another example of the enormous scale of Chinese logistics development projects.

See the article here.

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