Trucking and maritime regulators should take immediate action to help ease cost burdens on packaged goods shippers concerned about potential shortages amid signs of inflation, according to a manufacturing lobby group.
In a letter sent on Thursday to the National Economic Council, an office within the White House, the Consumer Brands Association (CBA), which represents shippers of consumer packaged goods (CPG), warned that the CPG industry “is experiencing the perfect storm: Costs associated with ingredients, materials, transportation and labor are skyrocketing at a time when consumer demand is surging to levels not seen since March 2020,” wrote CBA CEO Geoff Freeman.
FreightWaves market analyst Michael Baudendistel earlier this year pointed out that the current inflationary environment in general, and rising transportation and logistics costs in particular, will have major financial impacts on CPG companies in 2021.
“Rising costs are hitting every link of the supply chain, evidenced by commodity prices hitting their highest levels since the Bureau of Labor Statistics began tracking them in 2010,” Freeman wrote.
CBA is urging the administration to put in place five regulatory measures to alleviate concerns and head off problems down the road:
- Fast-track modernization of truck size and weight rules and preserve current hours-of-service regulations to make better use of existing capacity and stabilize the transportation marketplace.
- Accelerate Federal Maritime Commission efforts to address ocean carrier consolidation, declining maritime shipping performance, port delays and container shortages.
- Assess department and agency resources to ensure efficient clearances, inspections, safety checks and other required actions do not create avoidable supply chain delays, like understaffed ports of entry.
- Facilitate return-to-work and participation in skills education programs by incentivizing states to create greater flexibility to unemployment and assistance programs.
- Update workplace guidance and protocols to reflect the current vaccinated workforce while continuing public campaigns to foster vaccine acceptance.
Freeman said the current inflationary environment is a “worst-case outcome” for the packaged goods supply chain that was weakened by the response to the COVID-19 pandemic. He also noted that initial efforts by the Biden administration to strengthen supply chains in the wake of the pandemic have been “impactful.”
However, those efforts “will be most effective when coupled with actions that address current cost pressures,” Freeman stressed.
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Stephen Webster
Bring in a range of minimum and maximum range of freight charges and driver pay while on U S soil. Pay every truck at least $48.00 U S plus fuel and tolls for every driving hour or time at delivery waiting to be loaded or unloaded. Where were these people 2 years ago and 13 months ago when truck drivers were leaving because of poor pay and treatment. The same thing too many container ships shutdown because of low rates.