Container shipping needs better information exchange says Slangerup

Port of Long Beach CEO said ports are in a “perfect position” to play this role.    Jon Slangerup, the chief executive of the Port of Long Beach, says that “information can transform the supply chain if we can get people to cooperate.”
   The former Federal Express executive, who joined the port in June 2014, has contrasted the end-to-end visibility from warehouse to consumer that is provided by express carriers such as FedEx and what he calls the “front end” of the supply chain which he believes is inefficient, fragmented, and not integrated.
   “I think we need to insert ourselves in the middle of this discussion and apply information technology end-to-end so we provide visibility of the container’s movement from origin through the vessel voyage to port and then through the distribution warehouse,” Slangerup said yesterday at a logistics conference for members of the American Apparel and Footwear Association. He added, “the port is in the perfect position to take on that responsibility and is obligated to do so.”
   Slangerup made a similar suggestion during his first “State of the Port” this morning where he outlined an ambitious initiative dubbed “Energy Island” to have the port generate more renewable energy.
   “Successful, sustainable operations that meet the challenges of our industry and our community will require reliable energy. As we move towards our goal of becoming a zero emissions port, we are increasing reliance on electrical power. At the same time, the grid is aging and there is increasing concern that regional outages could cripple port operations and our Long Beach community.”
   The Energy Island project would make the port a showcase for advance technologies to “harness the sun, the wind, the sea and provide a self-sustaining reliable energy system for the entire port of the future,” said Slangerup, using both power purchased from renewable energy providers and electricity generated at the port with wind turbines, fuel cells and solar panels.
   The port would become more competitive by providing alternative fueling, he said.
   Another benefit would be the ability to provide power independently from the electrical grid in an emergency to critical facilities such as hospitals, police and fire departments and city offices. The port also envisions installing seawater desalinization plants to ensure supplies of drinking water.
   Art Wong, a port spokesman, said the port would look to obtain grants for many of the projects. The Energy Island name, he explained, was chosen to reflect the fact that the port would be self-sufficient from the grid, not that there were plans to build an island.
   Slangerup said that Long Beach has been working “aggressively to put in short term fixes to what are very systemic issues” causing port congestion.
   These include, for example, the port’s creation of a lot outside the container terminals where trucks could drop empty containers so that truckers will have bare chassis to get loaded containers. The lot is not yet in use.
   The port has also said that it will acquire 3,000 chassis to help alleviate shortages during peak shipping season this year.
   He also said he was encouraged by reports that chassis lessors are making progress in creating a “gray” chassis pool.
   Speaking yesterday to the AAFA, Slangerup he said he believes that the federal mediator that began assisting the ILWU and PMA in contract talks this month “has done a good job of getting the two sides closer together,” pointing to the tentative agreement on chassis that was announced earlier this week.
   Slangerup highlighted the challenges terminals and other port businesses are facing as large ships, with capacity of around 14,000 TEUs, become more common. Ships of about 8,000 TEUs were dominant just a year ago.
   He said when the bigger ships arrive “it is like having a mini-peak.”
   Those large ships, plus the new, larger vessel sharing alliances that many shipping companies have formed, have created problems, particularly in “block stowage” of containers at origins overseas.
   Instead of containers for like destinations — Chicago, for example — all being stowed in the same location on ships used by multiple carriers in VSAs, then stowed in blocks at terminals, he said containers are being stored at scattered locations.
   The larger numbers of containers being discharged and lack of block stowage has seen the number of times containers are routinely handled jump dramatically, from 1-3 times to 4-8 times.
   However, Slangerup also expressed the belief that the new alliances are on a “learning curve” and will figure out how to solve these problems.