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Logistics Report
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Today’s Top Supply Chain and Logistics News From WSJ

We are delighted to debut WSJ Logistics Report, a new digital news hub which will delve into the supply chain management and logistics issues that are at the heart of global commerce.

A team of dedicated Wall Street Journal reporters will deliver up-to-the-minute news, analysis, interviews and explanatory journalism on transport choices and software applications; the flow of raw materials to the factory floor and then to markets; and events and strategies that are shaping how goods and services reach end users. Our email newsletter will provide you with the best in coverage from the Logistics Report as well as the most important logistics and supply chain reporting from The Wall Street Journal and other sources.

Logistics spending makes up anywhere from 8% to 10% of overall U.S. gross domestic product alone and supply chains are critical to global economic expansion. The processes and strategies are essential to the success of businesses large and small. The Logistics Report team will work with Wall Street Journal reporters in our international bureaus, ensuring that you receive a truly global view that spans industries and the direction of commerce. The Journal’s Logistics Report editors can be reached at logisticseditors@wsj.com. You can follow team members on Twitter @WSJLogistics or via their individual Twitter accounts, which can be found here along with brief biographies. We look forward to covering the supply chain and logistics arenas for you in greater depth and breadth than ever.

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LOGISTICS INSIGHT AND ANALYSIS WRITTEN AND COMPILED BY UPS

“We’re only in the second inning”

Mobile commerce is big. But we've just scratched the surface. To say that mobile has become big isn’t news anymore. With smartphones now packing as much processing power as the supercomputers of yore, mobile devices have become our phone, our watch, our camera, our TV – and increasingly, our wallets.

Read more UPS Insights »

TRANSPORTATION

Industrial distribution delays didn’t begin with the strife at U.S. West Coast ports this year and the uneasy labor peace there won’t end shipping bottlenecks. The longshore labor dispute only exacerbated deeper congestion problems at American ports, where today’s new mega-vessels are running up hard against terminals and trucking operations that can’t keep up, the WSJ’s Arian Campos-Flores and Cameron WcWhirter report. The big ships “have stressed the infrastructure to the breaking point,” says international trade adviser Jock O’Connell, who believes there needs to be “a concerted effort to rethink and redesign the ports” to adjust to the larger ships. There’s a real cost here: Frank Layo of the Kurt Salmon retail consulting firm says the cumulative costs of shipping delays could reach $7 billion this year and soar as high as $37 billion in 2016. Consumers, he says, may “feel it in the form of mass out-of-stocks and price increases.”

A container ship arrives at the Port of Oakland. Ben Margot/Associated Press

SUPPLY-CHAIN STRATEGIES

Outsourcing is a bedrock business tool at manufacturing companies and that’s especially true for their transportation operations. Ashley Furniture Industries is resisting that trend, and the largest U.S. furniture maker and retailer tells the Journal’s James R. Hagerty the 3,000 people and 800 trucks in its shipping operation in fact are an important part of the company’s focus on service and reliability. “We think it is a core competency,” says chief executive Todd Wanek. Family-owned Ashley has some special circumstances that make in-house trucking a good fit: the furniture typically requires the sort of special handling that puts a premium on service. That has given Ashley a chance to turn its trucking operations into something more than a cost center. Ashley’s ability to fill 80% of its empty truck space with other firms’ goods on the way back from its own deliveries suggests the furniture maker has found a way to put some revenue behind its strategy.

The roster of food companies that want to eliminate palm oil from their products is getting longer. WSJ Logistics Reports’ Erica E. Phillips reports that actually reaching that goal will require an enormous effort across their supply chains.

INFRASTRUCTURE

The humanitarian aid effort in the wake of Nepal’s deadly earthquake is challenging even the most seasoned disaster logistics professionals. “Logistically, this particular disaster, because of the geography and the mountainous terrain and poor roads, is probably the most difficult response I have ever had to implement,” says Alex Marianelli of the United Nations’ World Food Program, one of the leaders in the relief effort. As the WSJ Logistics Report describes, the U.N. and its logistics cluster is executing a multi-phase plan that combines the best of private industry supply chain practices with humanitarian imperatives. They are doing that with the experience gained in disasters from the 2004 Southeast Asia tsunami to the ongoing response to Ebola in West Africa, and the logistics operation is getting a jumpstart from preparations already in place in a zone considered likely to experience earthquakes. “We wouldn’t have been moving as fast we have if we had not been prepared for this,” says Mr. Marianelli.

TRANSPORTATION

Do you REALLY want that thing right away? Retailers are offering same-day delivery, but WSJ Logistics Report’s Loretta Chao writes the service is drawing skeptics.

TECHNOLOGY/INNOVATION

The Internet of Things is coming to a truck stop near you. Erica E. Phillips writes Intel Corp. has helped Saia LTL Freight Inc. deploy Internet-enabled technology on its fleet of more than 3,000 trucks.

E-COMMERCE

Retailers want to go global with e-commerce, and for many that means setting up supply-chain partnerships to reach consumers, writes the WSJ’s Erica E. Phillips.

IN OTHER NEWS

Fast-growing XPO Logistics says it will buy French contract logistics provider Norbert Dentressangle in a $3.53 billion trans-Atlantic deal that will create what the companies said would be the world’s second-largest freight brokerage.

Iron ore giant Vale is in talks with Chinese companies to build about 50 bulk carriers that would be largest such vessels ever built and fix shipping rates for the Brazilian producer for years to come.

U.S. exports fell 7.2% in the first quarter, providing the single largest drag on a weak 0.2% gain in GDP. Inventories jumped more than 25% but business investment in industrial property tumbled 23%.

The airline industry is moving toward tougher restrictions on the transport of lithium batteries, but it’s unclear how far international aviation regulators will go in meetings this week on the cargo issue.

The managers of the Maersk Tigris, the container ship seized by Iran say the vessel’s crew appeared to be safe but confined to quarters when the company contacted the ship on Wednesday. The motivation behind the seizure remains murky, the WSJ reports.

U.S. Steel cut its earnings outlook on surging imports from competitors and excess inventories, reports the WSJ, as rising prices and a strong dollar weigh on the company.

Wal-Mart’s plans to open 115 stores in China sound ambitious enough, but the WSJ notes the plan actually marks a step back from an earlier aggressive strategy the retailer had for the Chinese consumer market.

The airline industry is moving toward tougher restrictions on the transport of lithium batteries, but the WSJ says it’s unclear how far international aviation regulators will go in meetings this week on the cargo issue.

A bid at United Parcel Service Inc. to raise e-commerce shipment pricing has cost the company customers but the WSJ says the move has made the shipping more profitable.

The head of APM Terminals tells Container Management Magazine that it’s up to ports and terminals–not the shipping lines–to make the investments needed to handle the newer mega-vessels.he WSJ says it’s unclear how far international aviation regulators will go in meetings this week on the cargo issue.

A group promoting “reshoring” of jobs says 60,000 jobs were brought to the United States last year, Industry Week reports, as a result of foreign direct investment and efforts to reverse offshoring.

Boeing insists it is not at the end of its 747-8 jumbo aircraft program, pointing to interest in the freight market that may keep the production line for the iconic airplane open, Bloomberg reports.

China may allow Chinese participants in the Shanghai Free Trade Zone to invest in overseas markets, The South China Morning Post reports, an unprecedented step aimed at promoting use of the yuan currency in international trading.

Audio equipment manufacturer Voxx International signed trans-Pacific shipping contracts calling for double-digit increases in rates, The Journal of Commerce reports, a sign that rates on major shipping lanes may grow sharply this year.

ABOUT US

Paul Page is deputy editor of WSJ Logistics Report and is based in Washington, D.C. He previously was an editor at Congressional Quarterly and before that The Journal of Commerce. Follow him at @PaulPage.

With one click, subscribe to this email newsletter. The newsletter will initially with appear twice weekly, and starting in late May will arrive each weekday morning. Follow us on Twitter at @WSJLogistics or Logistics news-team members on their individual Twitter accounts. Reach the Logistics Editors at logisticseditors@wsj.com.

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