CHEMICAL LOGISTICS ONAROLL
Warehouse space was similarly scarce, Buber says. Adding to the challenge, only a few areas within the United States have the capability to store certain products, such as substances that require temperature-controlled storage, ignition control, ventilation, and/or proper segregation. EXTRAORDINARY TIMES The development of COVID-19 vaccines also consumed transportation infrastructure and drivers, leaving fewer resources to handle other chemicals. “It was one of the first times a vaccine had been mass produced to this scale,” says Joe Hassenfratz, sales and marketing manager with The Logistix Company. Adding another obstacle, the COVID vaccine products that are based on mRNA technology require temperature- controlled environments for storage and transport. This drove a spike in demand for dry ice. “Chemical logistics providers had to scrape through every bit of capacity available to meet the pressing concerns,” Kaitwade says. In the United States and other markets, logistics providers directly partnered with dry ice manufacturers and providers on a scale never seen before, he adds. The weather also presented unwanted surprises. Early in 2021, severe winter weather caused nearly every major chemical complex in Texas to shut down. “It’s the first time I’ve seen gas stations without fuel,” Buber says.
Odyssey Logistics & Technology ensures its customers’ shipments—valued at approximately $60 billion annually—arrive at their destinations safely and on schedule.
governing 3,300 high-risk chemical facilities across the United States hadn’t been updated in more than 10 years. Without a program of regular review, the facilities could be more vulnerable to cyber-related threats, the report stated. NAVIGATING THE OBSTACLES Over the past few years, some chemical shippers have relocated their sources of raw materials, adapting to changes in tax regulations and tariff agreements, says David Vieira, chief executive officer with CLX Logistics. For instance, a product that had been sourced in North America might now be sourced in Asia. Managing these new supply chains “requires a different set of skills,” he adds. In response, logistics providers “dialed up” tactics on which they’ve long relied to manage congestion and weather
environmental impact of shipments. Many logistics providers are relying more extensively on automation to minimize delays that can occur due to human errors, Buber says. Typical human errors include incorrect quantities or types of products being shipped, and inventory mistakes. Visibility solutions that let companies know the location of their products in shipment, enabling them to act to counter any delays, also are attracting interest. Before a company can determine whether to change its sourcing strategy or inventory policies, it needs visibility to these functions, says Bob Boyle, vice president, North American managed logistics services with Odyssey Logistics & Technology. Data is similarly key. “The proper use of data, as part of collaborating with customers and carriers, allows for faster recovery and improved service within the various segments of an organization’s supply chain,” Gonya says. GROWING MARKET Shippers’ need for visibility and leverage with carriers is a positive for many logistics providers, as it’s prompting a growing number of chemical shippers to use their services, Rodysill says. Valued at about $253.7 billion in 2019, the global chemical logistics market is forecast to reach $322.5 billion by 2027, for a compound annual growth rate of 3.9%, according to Allied Market Research.
With some chemical shippers relocating their sources of rawmaterials, providers are tapping a different set of skills.
Add to this a fluke event like the Ever Given , a 20,000-TEU container ship, getting stuck in the Suez Canal for about a week. A chunk of world trade stopped during this time. Cyberattacks against steamships, pipelines, and logistics providers add more uncertainty. The May 2021 attack against Colonial Pipeline Co. forced it to shut operations for a week. A 2020 Government Accountability Office study found the cybersecurity guidance
events, Rodysill says. These include shifting modes or adding locations, such as ports, to boost their ability to work around congestion. Promptly paying carriers, who often work on thin margins, also helps secure access to capacity. Logistics companies also are seeking ways to use less fuel, given how the cost of diesel fuel rose by more than one-third, while the cost for gasoline jumped 65% over the past year. An added benefit: these efforts reduce the
70 Inbound Logistics • June 2021
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