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Slow steaming is disrupting supply chains

The survey, conducted by BDP International’s consulting arm Centrx and Saint Joseph’s University in Philadelphia, found that 92 percent of transpacific shippers had to make supply chain adjustments
By Patrick Burnson, Executive Editor
August 23, 2011

Leading global importers and exporters participating in recent survey addressed concerns about “slow steaming” in the transpacific.

The survey, conducted by BDP International’s consulting arm Centrx and Saint Joseph’s University in Philadelphia, found that 92 percent of transpacific shippers had to make supply chain adjustments. Of the 290 senior executives participating in the survey, 37 percent were from the Asia-Pacific region, comprising shippers in the chemical, consumer goods, retail, healthcare and electronics industries.

This mirrors observations made by U.S. shipping associations, who have demanded lower rates on trade lanes served by slow-steaming vessels. They noted that some ports will also be adversely affected.

“Slow steaming on the transpacific, will continue to hurt the long-term competitive position of U.S. West Coast ports,” said Don Pisano, National Industrial Transportation League’s ocean transportation committee chairman.

Shippers in the Asia-Pacific trade (73 percent of the respondents) agreed that vessel operators should pass down the cost savings made by reducing knot-speed. Furthermore, 36 percent suggested that these savings be used to offset increased rates in the future.

Currently, transpacific shippers are responding by conducting more advanced planning advanced (48 percent)  increasing the number of carriers they use (38 percent) and increasing inventory levels (36 percent).


About the Author

image
Patrick Burnson
Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

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