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Wednesday, May 26, 2021

Logistics Intelligence Brief


No break from high truckload spot rates for US shippers

The Journal Of Commerce William B. Cassidy May 25, 2021

The average DAT US dry-van spot rate for May to date is $2.69 per mile, including fuel surcharges. That’s up from $2.59 per mile in April and $2.65 per mile in March. Overall, spot rates are hitting new highs in May, according to DAT. Technology company and load board operator Truckstop.com saw a similar trend last week, with loads falling and the supply of trucks rising, and spot rates up 1.2 percent. Truckstop.com’s all-in shipper-paid market rates rose last week to $3.10 per mile, a 77 percent year-over-year increase, the company said Monday. Dry-van rates averaged $2.72 per mile in what was the 20th week of 2021. That’s the highest average dry-van rate for Truckstop.com this year, and the highest weekly average rate since the last week of December, when the dry-van price hit $2.78 per mile. Sizzling southern truck markets A JOC.com analysis of all-in shipper quotes for top US freight lanes supplied by digital marketplace Loadsmart found the biggest jump in dry-van pricing has been in the US Southeast. Outbound rates from the region rose $0.24 to $3.38 per mile from April to May. Outbound dry-van spot rates from the US Southwest rose 21 cents in the same period to $3.50 per mile, according to the analysis.

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Manufacturers focus on cycle times, delivered costs

Supply Chain Dive Matt Leonard May 25, 2021

Dive Insight: Manufacturers' interest in order cycle time is likely driven by the Amazon effect, or the increased interest in faster delivery across sectors, Liddell said. Supplier deliveries slowed over the course of the pandemic, and manufacturers have struggled to build inventories, which has led to new order backlogs growing for the last 10 months, according to the Institute for Supply Management's manufacturing report. In this context, improving order cycle time could prove to be difficult. The task requires manufacturers to focus not just on making the product, but on distribution channels, Liddell said. "There's more pressure for them to produce and provide the product in a more rapid fashion," he said.

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Manufacturing sales—digital and otherwise—are rebounding

Digital Commerce 360 Mark Brohan May 24, 2021

For many manufacturers, selling even more online to business customers—or offering ecommerce for the first time—is rapidly becoming a strategic priority, according to data and analysis contained in the newly published 2021 B2B Manufacturing Report from Digital Commerce 360. For example, a recent survey of more than 800 manufacturers by ecommerce services providers finds that 98% of companies either have an ecommerce channel already in place or plan on adding one. For 45% of companies, increasing sales was the top reason noted for launching or expanding ecommerce, followed by improving customer relationships (42%), increasing profit margin (41%), and improving product or brand awareness (38%). “Despite industry differences, manufacturers do have a lot in common when it comes to the advantages they’re gaining from digitizing and embracing ecommerce,” the report says.

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Ports on Both Coasts Continue Record-Setting Runs in April

Transport Topics Dan Ronan May 25, 2021

The nation’s ports reported record container volumes in April as the U.S. economy continues its strong recovery from the COVID-19 pandemic. Contributing factors are imported goods being rushed to restock stores and warehouses, and consumers continuing their buying spree. Port of Los Angeles, the nation’s busiest, moved 37% more 20-foot-equivalent containers — 946,966 TEUs compared with 688,999 a year ago. “April continues our record-setting streak for the Port of Los Angeles,” Executive Director Gene Seroka said. “We have set high-water marks six of the last nine months, and the other three months were darn close to new milestones. It’s truly been an unprecedented run here.”

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Positive Marijuana Tests Are Up Among U.S. Workers (Subscription Based)

The Wall Street Journal Matt Grossman May 26, 2021

The proportion of U.S. workers who tested positive for marijuana in urine climbed higher in 2020 while the overall share of positive drug tests plateaued last year, according to Quest Diagnostics Inc., one of the largest drug-testing laboratories in the U.S. About 2.7% of the approximately seven million drug tests Quest conducted on behalf of employers came back positive for marijuana—up from 2.5% in 2019 and 2% in 2016. Companies in safety-sensitive industries have less flexibility because on-the-job testing is mandated by law. Within the trucking industry, a federal database launched last year also makes it harder for truck drivers—who are subject to U.S. Transportation Department-mandated drug and alcohol testing—to hide past positive tests from prospective employers. While a potential boon to safety, the new database has significantly contributed to a hiring crunch, said Avery Vise, a trucking analyst at FTR Transportation Intelligence. Since its launch, nearly 70,000 truck drivers have been added to the database for positive tests, and the majority of those drivers haven’t completed the steps necessary to return to work, Mr. Vise said. The greater scrutiny of truck drivers’ drug and alcohol use has hit trucking companies just as the pandemic’s strain on logistics networks has also contributed to a tight labor market in the sector, he said.

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Survey of motorists’ reckless behavior should be wake-up call for commercial fleets, Travelers says

Freight Waves Mark Solomon May 25, 2021

The 2021 Travelers Risk Index, a survey of 1,001 U.S. motorists conducted in January, found that one-quarter of respondents thought that American roads were safer after the COVID-19 pandemic reached the U.S. in March 2020 than they were before then. Emboldened by what a Travelers executive said was a dangerous misconception, an increasing number of drivers engaged in high-risk behavior that might seem incomprehensible to most American motorists. For example, 17% of respondents said they had shopped online while their vehicles were in motion, up from 8% pre-pandemic. About 19% said they took videos or pictures with their mobile devices while they were in motion, up from 10% before the pandemic, according to the survey. In other actions that were high-risk but still seemed more in line with today’s realities, 26% reported that they texted and emailed while driving last year, up from 19% before the pandemic. About 20% checked social media platforms while driving, up from 13% before the pandemic, the survey found.

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Trucking orgs unite, call proposed truck mileage tax ‘shortsighted, inequitable, discriminatory

CCJ Jason Cannon May 25, 2021

Tuesday, the American Trucking Associations (ATA) and Owner-Operator Independent Drivers Association (OOIDA) penned a joint letter to Finance Committee Chairman Ron Wyden and Ranking Member Mike Crapo, expressing their collective and "vehement opposition to any truck-only funding scheme that singles out truckers for the purposes of filling the nation’s infrastructure funding gap." "Placing a disproportionate burden on the backs of truckers to avoid Highway Trust Fund insolvency is shortsighted, inequitable, discriminatory against the industry, and deeply concerning to the millions of essential workers in trucking who have kept our nation fed, clothed, and with access to medicine throughout the COVID-19 pandemic," read the letter co-signed by OOIDA President and CEO Todd Spencer and ATA President and CEO Chris Spear. The two agencies, which represent a combined nearly 200,000 industry stakeholders, noted that should the Committee pursue the Cornyn Tax proposal, "know that it will encounter an intractable wall of opposition from our industry and from the many economic sectors which we serve. Doing so will not only alienate some of the strongest champions and natural allies of user-funded infrastructure investment, but it will also wreck the possibility of achieving the broad stakeholder support needed to advance the legislative process."

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Texas tort reform for trucks moves forward in Legislature and courts

Freight Waves John Kingston May 25, 2021

Texas is drawing closer to approval of one of two pieces of tort reform legislation sought by the state’s trucking industry, while the goals of the second proposal may have been achieved through a favorable court ruling. Both the state’s House and Senate have approved HB 19 and its Senate companion. The bills approved by each of the chambers are slightly different and will need reconciliation, according to John Esparza, the president of the Texas Trucking Association, which has spearheaded the drive. HR 19 deals with an issue that may seem relatively minor on the surface in a quest to reduce the size of enormous damage awards handed down against the trucking industry. But Esparza made clear that its provisions were considered one of the key targets of the legislative session. At the heart of HR 19 is the issue of bifurcation. The new law would delineate more clearly what can be discussed in the first part of a trial and what the focus of the second part would be. What that means in practice, Esparza said, is that phase 1 would need to focus only on the incident itself and any damages suffered by the plaintiff who brought the suit. “What we’re trying to fix is the practice where the trial lawyers would jam all the evidence in the first part of the trial,” Esparza said.

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GOP to Offer Biden Nearly $1 Trillion for Infrastructure Plan

Bloomberg Erik Wasson And Jennifer Jacobs May 25, 2021

A group of Senate Republicans plans to present their latest offer to the White House on a major new infrastructure package on Thursday, with one member saying it will weigh in at almost $1 trillion. “This is going to be a very good offer,” Senator Roger Wicker of Mississippi told reporters Tuesday. The latest counter will be “close” to $1 trillion, spread over eight years, he said. Democratic lawmakers have warned that time is running short to determine whether a bipartisan deal on infrastructure is possible, with progressives already calling for a go-it-alone approach using fast-track budget procedures. A new offer around $1 trillion would still be well short of Friday’s $1.7 trillion proposal from the White House.

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ATRI’s 2021 Research Priorities Include Young Drivers, Electric Trucks

Transport Topics Eleanor Lamb May 25, 2021

Understanding the most effective way to bring 18- to 20-year-olds into the trucking industry was listed as a top 2021 research priority for the American Transportation Research Institute. The research topics, unveiled May 25, were identified by the group’s Research Advisory Committee and subsequently approved by ATRI’s board of directors. The Research Advisory Committee, which includes trucking company executives, labor union leaders, academics and government officials, developed the list of research topics at its meeting held May 4-5 in Atlanta. In order to understand how to integrate younger people into the industry, ATRI will use a case study approach to document best practices for recruiting, training and retaining younger people in trucking careers. ATRI President Rebecca Brewster noted that recruiting younger drivers to trucking aligns with the industry’s focus on resolving the truck driver shortage, which has ranked No. 1 on ATRI’s Top Industry Issues list four years in a row. American Trucking Associations estimated a shortage of 60,800 drivers at the end of 2018. Brewster also pointed out this priority extends beyond attracting young drivers and includes a focus on bringing young people into the “whole host of career options in the trucking industry.” Link: ATRI Press Release ATRI Board Approves Research Agenda for 2021

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Bipartisan Motor Carrier Safety Selection Act makes a case for needed upgrades

Logistics Management Jeff Berman May 25, 2021

TIA President and CEO Anne Reinke called this legislation a commonsense bipartisan measure that lays out, in the clearest terms possible, that before a shipper selects a carrier, it must certify specific information regarding the carrier. “The Federal government’s safety rating system is effectively broken, leaving industry stakeholders with no reliable information on carrier selection,” said Reinke. “This has created a situation of confusion and conflicting vagaries in the marketplace and quite frankly less safe highways and roads. H.R. 3042 would amend the way the Federal Motor Carrier Safety Administration (FMCSA) conducts its compliance review audits and replaces the physical system with one of data. Currently, nearly 90% of motor carriers remain unrated, which is a direct result of the dysfunctional system that exists today. This legislation is about one thing, safety. The current process for selecting a carrier does not work; we need the federal government to facilitate one that does. This legislation adds clarity and rigor to our member's day-to-day operations.” “H.R. 3042 is a bipartisan solution to address a severe safety gap in the marketplace supply chain, by fixing the system and in the interim establishing a standard that requires entities selecting motor carriers to undertake due diligence,” said Burroughs. From a practitioner’s perspective, Jeff Tucker, CEO of Haddonfield, N.J.-based Tucker Worldwide, the nation’s oldest freight brokerage, told LM that this legislation has been desperately needed since 2004.

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