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Committed to Being the Best

FALL
2005



FOREIGN INSIGHT

by Del Brahm

Short Sea Shipping is a current topic, which is getting a lot of lip service, but not enough action.  We first reported on this topic in the Winter 2003/2004 issue of NOIBN, but not a lot action has taken place in the last couple years.  Fortunately the topic will not go away, and periodic articles keep the subject alive.

Years ago, we referred to this concept as feeder service.  A few decades ago we used this type of service, but it declined in favor, because we wanted speed and cheap.  We got the speed in trucking and the cheap in government railroad subsidies.  No longer did we want to load cargo in the Great Lakes on feeder vessels and transload onto larger vessels in Eastern Canada.  No longer did we want to load barges in our major rivers and transload onto an oceangoing vessel or load the entire barge on board the ship (LASH (Lighter Aboard SHip)).

Now try to get a trucker.  Can the trucker get diesel?  Can the trucker afford diesel?  Can the trucker get a driver?  It’s even difficult to get a trucker for short runs for your cargo or full containers.  What about railroads?  They are at their limit as evidenced by their service or lack thereof.  In their defense, they did a fantastic job in recovering from last year’s peak season fiasco.  Many people bet that the Far East international trade congestion would not subside after the peak season, because of vastly increased transpacific cargo.  While last year’s peak season congestion did subside more than many expected, the peak season surcharge has been extended this year to the end of January 2006.  Speculate, if you want, that this is just a money making scheme by the ocean carriers, but it may help to force buyers and sellers to spread out their imports and exports over a longer period of time and during a less congested time.



Would short sea shipping alleviate some of these problems?  Certainly, and more.  Consider the huge ships coming off the construction yards.  Consider 8,000, 12,000, 15,000 teu (twenty-foot equivalent units).  That means that each ship will hold that many twenty foot containers or half that many forty foot containers or a combination thereof.  Not all ocean ports will accommodate ships that size.  Why spend millions and millions of dollars dredging all the ocean ports for the bigger ships, when some ports have a natural draft for the huge ships and short sea shipping could bring cargo and containers from the other ports to the huge ships, saving the cost of dredging and simply using the natural deep draft ports?

What about expanding the barge service on the central US rivers?  Expand the use of river barges.  Expand the use of rake barges capable of moving in the central US rivers and moving into certain areas of the Caribbean.  What about expanding these barges into the area of food grade bulk cargoes?  All of these short sea shipping ideas will take pressure off the railroads, and relieve truck problems and traffic congestion.  Hopefully short sea shipping will happen sooner than later.

SCWWTA.  The South Central Wisconsin World Trade Association (SCWWTA) held its first meeting of the season on September 29, 2005 at the Belwah Café in the Beloit Inn in downtown Beloit.  The subject was Wood.  An excellent panel presented this hot topic and a very interested group of attendees provided very good interaction.



The next meeting will be on October 27, 2005 at the same venue.  The dinner program this month will be presented by a personally licensed customhouse broker.  It will provide an importer’s perspective on C-TPAT, FAST and CSI.  C-TPAT is Customs-Trade Partnership Against Terrorism.  It is designed to secure the supply chain.  We will look at how it is working from the importer’s viewpoint.  FAST is a Customs program to provide supply chain security and expedited release of qualifying shipments between the US and Canada and the US and Mexico.  How well is it working?  CSI is Container Security Initiative.  The focus of this program is on the foreign port of loading.  How are these performance measures working?

TAMI.  The Transportation Association of Milwaukee Inc. is holding its semi-annual Bingo Bash at noon at Potawatomi on October 16, 2005.  The Packers are NOT playing.  The cost is $20.00 for six cards and dauber and personal Potawatomi employee assistance.  Please see their website at www.tami-mke.org for more information and check out other programs and the award winning NOIBN.