Boeing sees rising demand for freighter conversions – FreightWaves

Aircraft manufacturer Boeing (NYSE: BA) is experiencing an uplift in business to convert former passenger planes for all-cargo operations.

“Strong demand is driven by customers transitioning to newer-generation freighters and choosing a Boeing converted freighter (BCF) as a cost-efficient alternative that can be modified with approximately a 90-day turnaround time, regardless of the conversion facility,” spokeswoman Laura Fenton told American Shipper.

Sustained e-commerce growth and an abundance of affordable aircraft to convert to freighters is driving this demand, she added.

German courier DHL Express (OTCMKTS: DPSGY) recently contracted with Boeing to convert four 767-300 passenger planes to freighter operations. The express carrier said conversions are part of an effort to modernize its long-haul intercontinental aircraft fleet.

“We have operated the 767-300F model across our global fleet for many years and look forward to continue investing in the platform by adding more 767-300BCFs,” said Geoff Kehr, DHL’s senior vice president of global air fleet management, in a statement.

The website Plane Spotter says DHL Express currently operates a fleet of 34 767-300 freighters.

According to Boeing, the 767-300BCF has the same cargo capacity as the purpose-built 767-300 freighter, with about a 50-ton payload and a 3,000-nautical-mile flight range.

In another recent announcement, Boeing said it will convert two 737-800 passenger planes to cargo operations for Aircraft Finance Germany (AFG), an aircraft brokerage firm.

The 737-800 cargo plane can carry up to 24 tons of freight per payload and with a 2,000-nautical-mile flight range is best suited for regional express services, Boeing said.

Boeing delivered its first 737-800BCF in 2018 and now has 10 airline customers that utilize the cargo aircraft. The company said it has ramped up production of 737-800BCFs with 132 aircraft orders. So far, Boeing has delivered 34 of the converted planes.

Boeing did not disclose financial terms of the aircraft conversions for DHL and AGF.

Related news

COVID-19 response boosts Deutsche Post DHL’s Q2 profit

DHL prepares three 767 passenger planes for freight operations

Boeing tells 737 MAX fuselage maker to pause production

Click for more FreightWaves/American Shipper articles by Chris Gillis.

Brussels Airport bucks trend with June rise in cargo volume – FreightWaves

A huge flow of all-cargo aircraft flown by independent operators combined with heightened activity from integrated logistics providers DHL, UPS and FedEx, pushed Brussels Airport’s cargo volume into positive territory in June after three months of steep declines caused by the coronavirus pandemic.

It’s a positive sign for a hub airport that normally depends on passenger traffic.

Brussels Airport Co., which operates the airport, reported Wednesday that cargo volume increased 4.8% in June, year-over-year, despite a 91% drop in cargo volume carried on passenger aircraft. Most large passenger airports that also serve as international cargo hubs have been deluged by freighter traffic, but it has not been enough to offset the loss of shipments carried in the bellies of passenger aircraft grounded by COVID travel restrictions.

Freighter volume in June jumped 71.5% above the June 2019 level, while volumes from express carriers/integrators grew 29.5%, according to figures from the airport. It handled 1,738 cargo flights, a 46% increase, while passenger moves fell 94% from 18,107 to 1,146.

First half results showed a 4.6% drop in cargo volume to 235,729 tons, with belly cargo tonnage down 50.7%, freighter tonnage up 27% and integrator volume up 9.7%.

Airport officials said heavy demand for personal protective equipment and other coronavirus supplies led to a huge surge in freighter operations, including from airlines that never before flew there and passenger planes temporarily converted to fly dedicated cargo services. 

New airlines that have called at Brussels Airport since the start of the pandemic include Miami-based all-cargo carrier Amerijet, Silk Way Airlines and Virgin Atlantic.

Express carriers DHL, FedEx and UPS are integrated logistics companies that run their own airlines and control the shipments that ride on board. DHL is the dominant express carrier at Brussels Airport.

Amsterdam Schiphol Airport earlier reported a 13% decline in June cargo tonnage despite a 124% increase in full freighter flights (2,473), with volume down 14.5% to 656,000 tons for the first half of 2020. The Hong Kong Airport Authority said cargo throughput decreased 7.7% to 357,000 tons in June versus 2019 primarily due to the decline in transshipments from reduced belly capacity on passenger flights. 

“One of the strengths at Brussels Airport was the sense to tackle the rapid capacity reduction from a community standpoint. Different parties worked together reaching out to their network to get the traffic flows moving. This coordination and active facilitation between shippers, forwarders, handlers, customs and airlines truly made a difference and was already part of our earlier success. In these times of crisis, we could even leverage this with these volumes as a result” said Steven Polmans, director cargo and logistics at Brussels Airport Co., in a statement.

Polmans this month announced he will resign his position at the end of 2020 after 10 years with the airport operator.

Officials said the highest import growth came from Africa and Asia,  with export volumes mainly growing towards Asia and North America. Export to Africa is still below pre-Covid levels due to the grounding of home carrier Brussels Airlines, but is slowly recovering as more and more carriers resume flying.

The airport said it has continued to work on infrastructure upgrades and is currently working on a runway renovation. Construction will have a marginal impact on freighter movements during the six-week project, it said.

(Updated July 27, 9 A.M. ET to include FedEx operation.)

Click here for more FreightWaves/American Shipper stories from Eric Kulisch.

@ericreports / LinkedIn: Eric Kulisch / ekulisch@freightwaves.com

RECOMMENDED READING:

Air Canada cargo chief to head freighter operator Amerijet

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How the FMC monitors ‘blank sailings’ and their competitive impacts – FreightWaves

The coronavirus pandemic has made the schedule-driven ocean container carriers seasick. To counter decreased U.S. import volumes and maximize vessel operations, these companies have resorted to the use of “blank,” or canceled, sailings.

Shippers and non-vessel-operating common carriers have struggled to manage their own fragile supply chains against hundreds of skipped-sailings announcements in recent months.

While blank sailings offer ocean container carriers a means to economize their capital-intensive vessel operations, the U.S. Federal Maritime Commission (FMC) said it will continue to closely monitor this activity for anticompetitive behavior.

Under the Shipping Act, ocean container carriers may use blank sailings to reduce capacity in response to low demand. The FMC, however, has an obligation to ensure that the capacity reductions are not unreasonable and do not cause unreasonable increases in transportation costs for shippers.

The FMC generally requires notice from the alliances before blank sailings are implemented and no later than 15 days after any such changes are agreed upon. Alliances may request a waiver from the FMC if they are unable to make a timely filing.

“The unusual circumstances and challenges created by the COVID-19 pandemic, together with trade agreement changes, have heightened the FMC’s scrutiny of capacity reductions by global alliances,” FMC Chairman Michael Khouri said in a statement.

The FMC monitors this activity through the ocean carrier alliance agreements filed with the agency.

“The FMC receives exhaustive information from regulated entities, in this case, parties to an ocean carrier alliance agreement,” Khouri explained. “That information is carefully analyzed, along with other information that permits FMC staff to determine trends in the marketplace and the potential for illegal behavior.”

To monitor ocean carrier agreements, the agency uses a “red-yellow-green scale,” with red signifying higher-profile agreements.

“All global carrier alliances are categorized as red agreements,” Khouri said. “These agreements have the highest potential to cause or facilitate adverse market effects based on the agreement’s authority and scope in combination with underlying market conditions.”

Specifically, Khouri said the FMC staff monitors key economic indicators and changes in market conditions for all global alliance agreements “to detect any joint activity by agreement members that might raise and maintain freight rates above competitive levels.”

The FMC follows these analyses with detailed quarterly reviews, which are periodically presented to the commission with recommendations.

Under the FMC’s “four-tier” approach to monitoring alliance agreements, blank sailings are closely analyzed:

  • The first tier involves an immediate review of advance notifications of canceled alliance sailings or changes in vessel capacity that affect the supply of vessels of any individual alliance service by more than 5% of average weekly vessel capacity.
  • The second tier includes a deep-dive review of minutes submitted by the carrier management in charge of making vessel deployment decisions in the alliance. This information helps the FMC assess medium- and long-term outlook for capacity levels and how that impacts freight rates.
  • The third tier of review covers service changes in individual alliance members’ vessel capacity, capacity projections and how that relates to changes in freight rates.
  • The fourth and final tier consists of reviewing and analyzing confidentially filed carrier data submitted by the alliances for completeness and accuracy and to spot “potential red flags.”

If the agency detects carrier behavior that violates the Shipping Act, it seeks to address these concerns with the carriers first and, if necessary, can go to federal court to seek an injunction to enjoin further operation of the alliance agreement, Khouri said.

Khouri said, however, the FMC is receiving notice from ocean containers in both the trans-Pacific and trans-Atlantic trades that some blank sailings will be withdrawn.

The FMC is also monitoring the impacts of the COVID-19 pandemic on the U.S. container shipping industry through its Fact Finding 29 investigation, which is being led by Commissioner Rebecca Dye, and making recommendations to ease marine terminal inefficiencies.

The agency on April 27 issued an order to temporarily allow service contracts to be filed up to 30 days after they take effect to provide relief to shippers and ocean container carriers impacted by the coronavirus pandemic. This relief will remain in place through Dec. 31, the FMC said.

Related news

Are trans-Pacific carriers guilty of price gouging?

How canceled sailings will impact US ports — and when

Blank sailings threaten to sink heartland ag exports

Click for more FreightWaves/American Shipper articles by Chris Gillis.

Commentary: Flags of inconvenience causing problems for crew members – FreightWaves

The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.  

On a tonnage basis about 70% of U.S. exports and imports travel by ocean vessel. Volume-wise it is the most important mode of international trade. When merchandise trade is focused on Canada and Mexico, as members of the United States-Mexico-Canada Agreement (USMCA), the motor carrier sector dominates in U.S. export flows. Since March 21, 2020 border crossings among the three USMCA nations have been restricted to essential workers due to concerns over the spread of COVID-19. This restriction has been reviewed on a month-by-month basis. As of today, it will remain in place at least until August 21.

There is also fear of further spread of COVID-19 by disembarked crews from the world’s ocean vessels and cruise ships. This has kept about 200,000 crew members in limbo since March. While these crews are still being paid for their work, they have been stuck aboard vessels with little to do other than work or sleep. Contracts for crews are under one year in duration in order to comply with the 2006 Maritime Labor Convention. Vessel companies pick their crew members up and drop them off at major ports of call. Beyond that, crew members typically fly to and from their home countries. The International Maritime Organization (IMO), which regulates international waters on behalf of the United Nations, estimates that only 20% of crews scheduled to stop work and leave their vessels during March have been able to do so. On any given day there are about 60,000 cargo vessels involved in commercial activity around the world. They are crewed by about 1 million people.

Members of a ship’s crew on its bridge.
(Photo: Flickr/Michele Rinaldi)

The nature of the ocean vessel sector has exacerbated the current problem. About half of the world’s commercial vessels engaging in international trade fly so-called flags of convenience (e.g., those of Panama, Vanuatu, etc.). This serves to keep operating costs and taxes down. Also, crews can be made up of citizens of practically any country. In contrast, U.S.-flagged vessels require the crew to be only U.S. citizens – and, therefore, subject to U.S. employment laws (see 46 U.S.C. §8103 (a) and (b)).

Under these circumstances it is easy for a country to deny entry to a crew member who has finished out his contract because he is already on a conveyance capable of taking him elsewhere. However, other ports of call can act in the same way. The number of commercial flights to the crew member’s home country may be reduced and may not depart from an airport near a vessel’s scheduled port of call. Putting all these possibilities together creates a dicey situation for all those who have been working well beyond the official close of their contracts. On the other side of the coin, the drop in flights due to travel bans has left those crew members who were scheduled to work stuck at home since March.

A cargo ship at anchor.
(Photo: Jim Allen/FreightWaves)

Why not designate these crews as essential workers as was done for others in the transportation industry? Well, these were government pronouncements applying to their domestic workers and to foreign workers entering their countries on a temporary basis in order to make export or import deliveries. By contrast, ocean vessel crews can remain confined to their vessels while cranes and drayage vehicles do all the loading and unloading. 

Certainly, boredom and fatigue can take their toll on crews and their vessel captains. Mistakes at sea and at port can be costly. Therefore, it makes sense for the international community to come together to work out a solution. In that regard the IMO has been urging its 174 member states to allow crew members ashore who simply wish to return home. So far 13 nations have signed the IMO’s pledge. These are Denmark, France, Germany, Greece, Indonesia, Netherlands, Norway, Philippines, Saudi Arabia, Singapore, United Arab Emirates, United Kingdom and the United States.

The importance of the ocean vessel sector to international trade cannot be overstated. It is a global industry requiring global solutions whenever problems arise. The maritime sector is also a reminder that supply chain management is just as much about the efficient movement of people as it is of raw materials, sub-assemblies and final goods. Transportation makes or breaks international trade. Well-rested crews contribute to the quality of transportation.

Click here to see other commentaries by Darren Prokop on American Shipper and FreightWaves.

DHL injects $1.6M into new Indianapolis life sciences facility – FreightWaves

DHL Global Forwarding (OTCMKTS: DPSGY) has opened a 20,000-square-foot, temperature-controlled facility in Indianapolis that will cater to pharmaceutical and medical product shippers.

The $1.6 million facility has variable temperature capabilities to process all types of pharmaceutical, biotech or medical products that require strict temperature control, the company said.

The Indianapolis facility is one of eight “Certified Life Sciences Stations” that support DHL’s Thermonet service for temperature-controlled airfreight transport. Thermonet uses shipment sensors and an IT platform to provide customers with in-transit temperature visibility.

David Goldberg, CEO of DHL Global Forwarding USA (Photo: Courtesy)

The site is ideal because many large pharmaceutical companies are located in Indianapolis and it is next to the airport, David Goldberg, CEO of DHL Global Forwarding USA, told American Shipper.

DHL Global Forwarding is exploring the development of a dedicated life science freighter service linking Indianapolis with Europe, the Middle East and Africa, Goldberg said.

He said the ongoing investments by DHL Global Forwarding into its North American life sciences and health care logistics network is timely, since the coronavirus pandemic will likely result in more reshoring of pharmaceutical production to the region.

DHL and other larger third-party logistics companies have invested heavily in logistics services that cater to shippers in the life science and pharmaceutical fields.

Its contract logistics unit, DHL Supply Chain, in mid-July announced a 10-year service agreement with Siemens Healthineers (OTCMKTS: SMMNY) to oversee its product distribution in North America.

Siemens Healthineers will occupy about 260,000 square feet of a 422,000-square-foot, DHL Supply Chain-owned facility in Memphis, Tennessee.

Related news

Siemens Healthineers taps DHL to manage North American distribution

COVID-19 response boosts Deutsche Post DHL’s Q2 profit

Pandemic prompts DHL to beef up expedited LCL services

Click for more FreightWaves/American Shipper articles by Chris Gillis.

Brussels Airport bucks trend with June rise in cargo volume – FreightWaves

A huge flow of all-cargo aircraft flown by independent operators combined with heightened activity from integrated logistics providers DHL, UPS and FedEx, pushed Brussels Airport’s cargo volume into positive territory in June after three months of steep declines caused by the coronavirus pandemic.

It’s a positive sign for a hub airport that normally depends on passenger traffic.

Brussels Airport Co., which operates the airport, reported Wednesday that cargo volume increased 4.8% in June, year-over-year, despite a 91% drop in cargo volume carried on passenger aircraft. Most large passenger airports that also serve as international cargo hubs have been deluged by freighter traffic, but it has not been enough to offset the loss of shipments carried in the bellies of passenger aircraft grounded by COVID travel restrictions.

Freighter volume in June jumped 71.5% above the June 2019 level, while volumes from express carriers/integrators grew 29.5%, according to figures from the airport. It handled 1,738 cargo flights, a 46% increase, while passenger moves fell 94% from 18,107 to 1,146.

First half results showed a 4.6% drop in cargo volume to 235,729 tons, with belly cargo tonnage down 50.7%, freighter tonnage up 27% and integrator volume up 9.7%.

Airport officials said heavy demand for personal protective equipment and other coronavirus supplies led to a huge surge in freighter operations, including from airlines that never before flew there and passenger planes temporarily converted to fly dedicated cargo services. 

New airlines that have called at Brussels Airport since the start of the pandemic include Miami-based all-cargo carrier Amerijet, Silk Way Airlines and Virgin Atlantic.

Express carriers DHL, FedEx and UPS are integrated logistics companies that run their own airlines and control the shipments that ride on board. DHL is the dominant express carrier at Brussels Airport.

Amsterdam Schiphol Airport earlier reported a 13% decline in June cargo tonnage despite a 124% increase in full freighter flights (2,473), with volume down 14.5% to 656,000 tons for the first half of 2020. The Hong Kong Airport Authority said cargo throughput decreased 7.7% to 357,000 tons in June versus 2019 primarily due to the decline in transshipments from reduced belly capacity on passenger flights. 

“One of the strengths at Brussels Airport was the sense to tackle the rapid capacity reduction from a community standpoint. Different parties worked together reaching out to their network to get the traffic flows moving. This coordination and active facilitation between shippers, forwarders, handlers, customs and airlines truly made a difference and was already part of our earlier success. In these times of crisis, we could even leverage this with these volumes as a result” said Steven Polmans, director cargo and logistics at Brussels Airport Co., in a statement.

Polmans this month announced he will resign his position at the end of 2020 after 10 years with the airport operator.

Officials said the highest import growth came from Africa and Asia,  with export volumes mainly growing towards Asia and North America. Export to Africa is still below pre-Covid levels due to the grounding of home carrier Brussels Airlines, but is slowly recovering as more and more carriers resume flying.

The airport said it has continued to work on infrastructure upgrades and is currently working on a runway renovation. Construction will have a marginal impact on freighter movements during the six-week project, it said.

(Updated July 27, 9 A.M. ET to include FedEx operation.)

Click here for more FreightWaves/American Shipper stories from Eric Kulisch.

@ericreports / LinkedIn: Eric Kulisch / ekulisch@freightwaves.com

RECOMMENDED READING:

Air Canada cargo chief to head freighter operator Amerijet

Airlines grew 1H cargo revenues despite drop in volumes

KLM gets EU blessing for Dutch emergency aid

How the FMC monitors ‘blank sailings’ and their competitive impacts – FreightWaves

The coronavirus pandemic has made the schedule-driven ocean container carriers seasick. To counter decreased U.S. import volumes and maximize vessel operations, these companies have resorted to the use of “blank,” or canceled, sailings.

Shippers and non-vessel-operating common carriers have struggled to manage their own fragile supply chains against hundreds of skipped-sailings announcements in recent months.

While blank sailings offer ocean container carriers a means to economize their capital-intensive vessel operations, the U.S. Federal Maritime Commission (FMC) said it will continue to closely monitor this activity for anticompetitive behavior.

Under the Shipping Act, ocean container carriers may use blank sailings to reduce capacity in response to low demand. The FMC, however, has an obligation to ensure that the capacity reductions are not unreasonable and do not cause unreasonable increases in transportation costs for shippers.

The FMC generally requires notice from the alliances before blank sailings are implemented and no later than 15 days after any such changes are agreed upon. Alliances may request a waiver from the FMC if they are unable to make a timely filing.

“The unusual circumstances and challenges created by the COVID-19 pandemic, together with trade agreement changes, have heightened the FMC’s scrutiny of capacity reductions by global alliances,” FMC Chairman Michael Khouri said in a statement.

The FMC monitors this activity through the ocean carrier alliance agreements filed with the agency.

“The FMC receives exhaustive information from regulated entities, in this case, parties to an ocean carrier alliance agreement,” Khouri explained. “That information is carefully analyzed, along with other information that permits FMC staff to determine trends in the marketplace and the potential for illegal behavior.”

To monitor ocean carrier agreements, the agency uses a “red-yellow-green scale,” with red signifying higher-profile agreements.

“All global carrier alliances are categorized as red agreements,” Khouri said. “These agreements have the highest potential to cause or facilitate adverse market effects based on the agreement’s authority and scope in combination with underlying market conditions.”

Specifically, Khouri said the FMC staff monitors key economic indicators and changes in market conditions for all global alliance agreements “to detect any joint activity by agreement members that might raise and maintain freight rates above competitive levels.”

The FMC follows these analyses with detailed quarterly reviews, which are periodically presented to the commission with recommendations.

Under the FMC’s “four-tier” approach to monitoring alliance agreements, blank sailings are closely analyzed:

  • The first tier involves an immediate review of advance notifications of canceled alliance sailings or changes in vessel capacity that affect the supply of vessels of any individual alliance service by more than 5% of average weekly vessel capacity.
  • The second tier includes a deep-dive review of minutes submitted by the carrier management in charge of making vessel deployment decisions in the alliance. This information helps the FMC assess medium- and long-term outlook for capacity levels and how that impacts freight rates.
  • The third tier of review covers service changes in individual alliance members’ vessel capacity, capacity projections and how that relates to changes in freight rates.
  • The fourth and final tier consists of reviewing and analyzing confidentially filed carrier data submitted by the alliances for completeness and accuracy and to spot “potential red flags.”

If the agency detects carrier behavior that violates the Shipping Act, it seeks to address these concerns with the carriers first and, if necessary, can go to federal court to seek an injunction to enjoin further operation of the alliance agreement, Khouri said.

Khouri said, however, the FMC is receiving notice from ocean containers in both the trans-Pacific and trans-Atlantic trades that some blank sailings will be withdrawn.

The FMC is also monitoring the impacts of the COVID-19 pandemic on the U.S. container shipping industry through its Fact Finding 29 investigation, which is being led by Commissioner Rebecca Dye, and making recommendations to ease marine terminal inefficiencies.

The agency on April 27 issued an order to temporarily allow service contracts to be filed up to 30 days after they take effect to provide relief to shippers and ocean container carriers impacted by the coronavirus pandemic. This relief will remain in place through Dec. 31, the FMC said.

Related news

Are trans-Pacific carriers guilty of price gouging?

How canceled sailings will impact US ports — and when

Blank sailings threaten to sink heartland ag exports

Click for more FreightWaves/American Shipper articles by Chris Gillis.

Commentary: Flags of inconvenience causing problems for crew members – FreightWaves

The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.  

On a tonnage basis about 70% of U.S. exports and imports travel by ocean vessel. Volume-wise it is the most important mode of international trade. When merchandise trade is focused on Canada and Mexico, as members of the United States-Mexico-Canada Agreement (USMCA), the motor carrier sector dominates in U.S. export flows. Since March 21, 2020 border crossings among the three USMCA nations have been restricted to essential workers due to concerns over the spread of COVID-19. This restriction has been reviewed on a month-by-month basis. As of today, it will remain in place at least until August 21.

There is also fear of further spread of COVID-19 by disembarked crews from the world’s ocean vessels and cruise ships. This has kept about 200,000 crew members in limbo since March. While these crews are still being paid for their work, they have been stuck aboard vessels with little to do other than work or sleep. Contracts for crews are under one year in duration in order to comply with the 2006 Maritime Labor Convention. Vessel companies pick their crew members up and drop them off at major ports of call. Beyond that, crew members typically fly to and from their home countries. The International Maritime Organization (IMO), which regulates international waters on behalf of the United Nations, estimates that only 20% of crews scheduled to stop work and leave their vessels during March have been able to do so. On any given day there are about 60,000 cargo vessels involved in commercial activity around the world. They are crewed by about 1 million people.

Members of a ship’s crew on its bridge.
(Photo: Flickr/Michele Rinaldi)

The nature of the ocean vessel sector has exacerbated the current problem. About half of the world’s commercial vessels engaging in international trade fly so-called flags of convenience (e.g., those of Panama, Vanuatu, etc.). This serves to keep operating costs and taxes down. Also, crews can be made up of citizens of practically any country. In contrast, U.S.-flagged vessels require the crew to be only U.S. citizens – and, therefore, subject to U.S. employment laws (see 46 U.S.C. §8103 (a) and (b)).

Under these circumstances it is easy for a country to deny entry to a crew member who has finished out his contract because he is already on a conveyance capable of taking him elsewhere. However, other ports of call can act in the same way. The number of commercial flights to the crew member’s home country may be reduced and may not depart from an airport near a vessel’s scheduled port of call. Putting all these possibilities together creates a dicey situation for all those who have been working well beyond the official close of their contracts. On the other side of the coin, the drop in flights due to travel bans has left those crew members who were scheduled to work stuck at home since March.

A cargo ship at anchor.
(Photo: Jim Allen/FreightWaves)

Why not designate these crews as essential workers as was done for others in the transportation industry? Well, these were government pronouncements applying to their domestic workers and to foreign workers entering their countries on a temporary basis in order to make export or import deliveries. By contrast, ocean vessel crews can remain confined to their vessels while cranes and drayage vehicles do all the loading and unloading. 

Certainly, boredom and fatigue can take their toll on crews and their vessel captains. Mistakes at sea and at port can be costly. Therefore, it makes sense for the international community to come together to work out a solution. In that regard the IMO has been urging its 174 member states to allow crew members ashore who simply wish to return home. So far 13 nations have signed the IMO’s pledge. These are Denmark, France, Germany, Greece, Indonesia, Netherlands, Norway, Philippines, Saudi Arabia, Singapore, United Arab Emirates, United Kingdom and the United States.

The importance of the ocean vessel sector to international trade cannot be overstated. It is a global industry requiring global solutions whenever problems arise. The maritime sector is also a reminder that supply chain management is just as much about the efficient movement of people as it is of raw materials, sub-assemblies and final goods. Transportation makes or breaks international trade. Well-rested crews contribute to the quality of transportation.

Click here to see other commentaries by Darren Prokop on American Shipper and FreightWaves.

Connecting seafood producers to consumers via blockchain – FreightWaves

Within the global food supply chain, seafood logistics are among the most compromised, due to the widespread misuse of labels and direct seafood fraud. Marine conservation non-profit Oceana published a report on the extent of seafood fraud within North America. Its research showed that the U.S. was particularly vulnerable, as 90% of all the country’s seafood is imported – often from Southeast Asia. 

Unisot, a Norwegian blockchain-based company, is working to bring visibility into global seafood supply chains. Unisot’s platform is powered by blockchain and provides all parties within the network a ‘universal source of truth’ to the end-to-end movement of shipment – from origin to the end customer. 

“We have technology like electronic data interchange (EDI) and email in use right now, but they are old and inefficient technologies. This results in companies not exchanging enough information with each other,” said Stephan Nilsson, the co-founder and CEO of Unisot. “Companies collect tons of data and store them in their data warehouses. They only use it internally, creating closed data silos inside their organizations. That’s a big problem, and we are tackling that.”

Trust is a deciding factor in data exchange, which the technology of blockchain can provide via its secure and decentralized ledger system. Nilsson explained that Unisot realized early that supply chains could benefit tremendously by adopting blockchain across their ecosystems.  

Due to its Norwegian roots, Unisot chose the seafood supply chain to pilot its blockchain technology, as the fishing industry is one of the largest contributors to Norwegian exports. Unisot created the Seafood Chain, which is a vertical built over its blockchain platform. The company is currently working with two pilot customers in Norway – one being a fish producer and the other a seafood distribution business. 

“By working with these two customers, we can cover the whole seafood supply chain – right from fish eggs to breeding and then the distribution that goes all the way to restaurants and end consumers,” said Nilsson. 

He contends that the COVID-19 situation has exacerbated the need for implementing such technology within supply chains, as they depend heavily on a human workforce to run logistics operations. 

“When you have people staying at home due to the pandemic, it disrupts the supply chain. Automating simple things such as order and delivery messages can help save a lot of time,” said Nilsson. “We’ve built the blockchain data interchange (BDI) that is just like EDI, but with blockchain as the communication layer. Instead of going via third parties and EDI providers, we do it peer-to-peer via the blockchain and have a secure, encrypted and cost-efficient network.”

The end-to-end visibility into supply chains will mean complete provenance tracking for end consumers. Nilsson explained that consumers would only have to scan a code on the seafood product they buy at the market to get details on the type of fish, the fishing company, fishing location, the time and place of its processing, and the time to reach the supermarket shelf. 

The transparency also allows seafood producers to seek feedback from end consumers directly. Unisot has developed a feedback process that works similarly to that of Uber or Airbnb, in which consumers can leave a rating between one to five on the product they consume. This rating would reach the producers, helping them improve their seafood quality based on real-time feedback.

With data stored within an encrypted and secure network, companies can now start sharing information with businesses of their choosing. Companies can also monetize data, with critical data put behind a paywall and charged for according to its market need. 

“Our customers only pay for what they use and do not need any understanding of blockchain to work on our platform,” said Nilsson. “Most blockchain companies only provide APIs for companies to build integrations, making it very complex and time-intensive. We mitigate that, making it very easy and low cost for companies to start using a blockchain system.”

***

More from Vishnu Rajamanickam
Bumble Bee Foods is tracking seafood across global supply chains through blockchain
In the blockchain race, supply chains stand to gain the most
Blockchain can leverage transparency to make supply chains more consumer-centric

Boeing sees rising demand for freighter conversions – FreightWaves

Aircraft manufacturer Boeing (NYSE: BA) is experiencing an uplift in business to convert former passenger planes for all-cargo operations.

“Strong demand is driven by customers transitioning to newer-generation freighters and choosing a Boeing converted freighter (BCF) as a cost-efficient alternative that can be modified with approximately a 90-day turnaround time, regardless of the conversion facility,” spokeswoman Laura Fenton told American Shipper.

Sustained e-commerce growth and an abundance of affordable aircraft to convert to freighters is driving this demand, she added.

German courier DHL Express (OTCMKTS: DPSGY) recently contracted with Boeing to convert four 767-300 passenger planes to freighter operations. The express carrier said conversions are part of an effort to modernize its long-haul intercontinental aircraft fleet.

“We have operated the 767-300F model across our global fleet for many years and look forward to continue investing in the platform by adding more 767-300BCFs,” said Geoff Kehr, DHL’s senior vice president of global air fleet management, in a statement.

The website Plane Spotter says DHL Express currently operates a fleet of 34 767-300 freighters.

According to Boeing, the 767-300BCF has the same cargo capacity as the purpose-built 767-300 freighter, with about a 50-ton payload and a 3,000-nautical-mile flight range.

In another recent announcement, Boeing said it will convert two 737-800 passenger planes to cargo operations for Aircraft Finance Germany (AFG), an aircraft brokerage firm.

The 737-800 cargo plane can carry up to 24 tons of freight per payload and with a 2,000-nautical-mile flight range is best suited for regional express services, Boeing said.

Boeing delivered its first 737-800BCF in 2018 and now has 10 airline customers that utilize the cargo aircraft. The company said it has ramped up production of 737-800BCFs with 132 aircraft orders. So far, Boeing has delivered 34 of the converted planes.

Boeing did not disclose financial terms of the aircraft conversions for DHL and AGF.

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