📊 Biden administration announces massive logistics plan

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Biden administration announces massive logistics plan The Biden administration has announced a comprehensive plan to address issues in the U.S. supply chain. The strategy involves both domestic and international partnerships aimed at diversifying and strengthening the U.S. supply chain.

The plan includes several key elements:

• Partnership between the Department of Health and Human Services (HHS) and the Department of Commerce This partnership aims to assess data to address foreign dependency and points of serious failure for critical drugs. The HHS will appoint a supply chain resilience and shortage coordinator.

• Expansion of the Department of Transportation’s (DOT) digital information sharing system The Freight Logistics Optimization Works (FLOW) program will be expanded. This program sources stakeholder data and creates a comprehensive picture of the supply chain, which is key for business success. A deeper line of sight into a company’s supply chain enables logistics managers to plan more efficiently, potentially reducing costs that are passed onto the consumer.

• First meeting of the White House Council on Supply Chain Resilience This council will work on strengthening the supply chain.

• Launch of the Office of Multimodal Freight Infrastructure and Policy This office will oversee the FLOW system data sharing and freight network maintenance.

The plan represents a significant government effort to tackle systemic issues in the U.S. supply chain using data sharing, coordination, and infrastructure modernization. (link)

Big Oil has a place in ESG funds Markus Müller, CIO ESG at Deutsche Bank's Private Bank, has recently stated that traditional energy shares, including those of fossil fuel companies, should still be considered for inclusion in Environmental, Social, and Governance (ESG) funds.

• Müller's comments come at a time when the role of fossil fuel companies in ESG investing is being hotly debated due to their environmental impact.

• Despite the push for clean energy, the business models for ESG industries are relatively new and sensitive to interest rates.

• Investors are still showing interest in traditional energy sectors, and the performance of oil and gas stocks suggests that meeting the world's energy needs still largely depends on hydrocarbons.

• Investors are seeking traditional energy companies with investments in renewables, preferring a transition approach over exclusions. (link)

Shippers spend $235M to bypass Panama Canal jam Shippers have spent a total of $235M this year to bypass congestion at the Panama Canal, a 20% increase from last year.

• The Panama Canal Authority plans to reduce access through February 2024 due to severe drought caused by El Niño, leading to increased competition among shippers.

• Transport companies are paying record-high fees through auctions held by the canal agency to expedite passage and jump the queue.

• The auction fees generated this year are expected to cover a projected revenue shortfall of $200 million caused by reduced slots.

• Auctions provide options to customers without reservations, and prices are determined by market dynamics.

• The long-term impact of the auctions on revenues is uncertain, as the amount of money being paid and customers' willingness to pay is unpredictable. (link)

• Swire launches a transpacific service avoiding congested Panama Canal.

SME forwarders getting into M&A mode The small to mid-size forwarding market is experiencing a wave of consolidation, with several M&A deals taking place.

• Rhenus Logistics's Italian operation has acquired Pesenti Trasporti & Logistica, marking another M&A deal in the sector.

• SME forwarders are optimistic due to their profitability during the pandemic and see consolidation among larger forwarders as an opportunity.

• SME companies that performed well during the pandemic are considering selling and maximizing returns through acquisitions.

• The consolidation trend is expected to continue in the coming year. (link)

Maersk signs landmark green methanol offtake agreement Maersk has signed a groundbreaking green methanol offtake agreement, marking a significant step towards low-emission operations.

• The offtake agreement is with Chinese developer Goldwind and covers annual volumes of 500KT.

• This agreement enables Maersk to reduce its emissions footprint and stay aligned with the 1.5-degree Celsius trajectory set out in the Paris Agreement.

• Maersk aims to reach net-zero greenhouse gas emissions by 2040 across its business.

• The deal de-risks Maersk's net-zero journey and supports expectations for a competitive green methanol market by 2030.

• The volumes of green methanol will be produced using wind energy at a new facility in Hinggan League, Northeast China, starting in 2026.

• Maersk will receive its first large ocean-going methanol-enabled vessel in Q1 2024 and is working on sourcing solutions for the entire vessel series. (link)

CEVA Logistics sees India among its top 5 markets within 3 years, says Deputy CEO CEVA Logistics, a leading global third-party logistics company, anticipates that India will become one of its top five revenue-generating markets within the next three years.

• The company's growth expectations are driven by India's economic progress, the relocation of manufacturing to the country, and government policies like "Make in India."

• Recently, CEVA Logistics acquired Stellar Value Chain Solutions, a tech-driven warehouse and distribution provider with a significant presence in India.

• They are also in the process of acquiring Bolloré Logistics, which will further boost their presence in India.

• The company plans to focus on servicing clients in various sectors, including industrial, automotive, e-commerce, fashion, and pharmaceuticals.

• The warehousing and logistics segment in India is expected to flourish due to favorable regulations and government support. (link)

Other headlines 

EV maker BYD makes 6 millionth vehicle - DC Velocity

Amazon Unveils Newest Fulfillment Robot Named Titan - Supply chain Digest

Walmart, in partnership with Bamboo Rose. to develop a single sourcing platform to manage global suppliers - DC Velocity