This Week in Logistics News (April 23 – 29)

logistics newsHave you ever had one of those mornings where you’re a little groggy and you accidentally pour orange juice into your cereal instead of milk? Cereal ruined, right? Well, maybe not. Even the orange juice specialists at Tropicana admit that OJ might not be the ideal choice for mixing with cereal, but in honor of National Orange Juice Day on May 4, the brand is planning to rectify this situation. Tropicana is releasing a cereal specifically intended to mix with orange juice instead of milk. Tropicana Crunch is touted as “the first-ever breakfast cereal created to pair with Tropicana Pure Premium so you can sip your sunshine and eat it, too.” While it sounds interesting, I’m not quite sure I can envision this as a tasty part of my breakfast. And now on to this week’s logistics news.

Prices are climbing at grocery stores and gas stations across the country. Walmart is looking at ways to help customers alleviate the financial strain of these rising prices, with a nod to its Walmart+ customers. The retail giant announced this week that it will offer deeper discounts on fuel to nudge more customers to join and renew Walmart+. Starting Wednesday, Walmart+ members were able to save up to 10 cents per gallon at more than 14,000 gas stations. The retailer already offered a fuel discount, but it has doubled the savings and increased the eligible gas stations more than sixfold through a partnership with Exxon Mobil. Walmart+ costs $98 per year, or $12.95 per month. It includes free shipping of online purchases, free grocery deliveries to the home for orders of at least $35, prescription discounts and other benefits.

Walmart’s Canadian stores are now outfitting some of their workers with a ring-mounted scanner that the company says helps them fill online grocery orders faster. More than 1,500 of the rings have arrived at more than 130 stores, Walmart Canada said in a corporate blog post. The rings are “one of the first pieces of wearable technology to be deployed by Walmart Canada,” the company said. The scanners make it easier and more comfortable for store workers to “pick” items for orders, the company said, and their lightweight and intuitive design keeps both hands free for picking. The hands-free gadgets send and receive data over the internet. They can be worn as accessories, embedded in clothing and implanted or even tattooed on the skin. A spokesman for Walmart Canada said the ergonomic ring scanners have a button that workers press with their thumbs to scan an item while they pick. The company’s hope is to bring the technology to all of Walmart Canada’s 408 stores.

logistics newsAmazon is making more changes to its inventory limits, including a new extra-large category and an increased price threshold for its small and light program. Effective this past Monday, Amazon added a new extra-large storage type, in addition to the standard-size, oversize, apparel and footwear storage types it already has in place. Existing inventory that fits the qualification for the extra-large storage type will automatically be reclassified as extra-large. Amazon also adjusted the price threshold for its US small and light program to $10 from $8, effective April 28. The recent announcement underscores some of the uncertainties merchants have to deal with when they rely on fulfillment by Amazon (FBA) to meet orders. These inventory limits determine how many units of various products sellers can send to a warehouse at any given time — thus, any changes made to inventory limits could impact whether or not a seller is able to keep enough product in stock.

Last Friday was Earth Day, an annual event on April 22 to demonstrate support for environmental protection. In that spirit, a number of freight- and supply chain-focused companies and at least two federal agencies used the annual observance of Earth Day to publicize what they are doing or plan to do to help the environment, promote sustainability and reduce emissions. Here are some of the higher profile announcements around sustainability initiatives:

  • AIT Worldwide Logistics set a net-zero emissions target for 2035 in its first sustainability report.
  • XPO Logistics launched a Ship Net-Zero program, giving shippers the option to purchase carbon credits to offset emissions from shipments.
  • The Federal Railroad Administration announced a Climate Challenge initiative, which urges railroads and rail equipment manufacturers to achieve net-zero greenhouse gas emissions by 2050.
  • CSX Corp. recognized six customers with an inaugural environmental excellence award for emission reductions from truck-to-rail conversions.
  • Mitsubishi Heavy Industries signed a memorandum of understanding with electrofuels producer Infinium to advance development of electrofuels in the Japanese market.
  • Cold Chain Technologies committed to saving 50 million pounds of waste from going to landfills through reusable thermal packaging solutions.
  • The Federal Highway Administration highlighted several climate programs, including the Carbon Reduction Program, that could help fund electrification at truck stops.

Speaking of sustainability initiatives, General Motors’s BrightDrop announced that, in collaboration with FedEx, it set a new Guinness World Record title for the greatest distance traveled by an electric van on a single charge. The BrightDrop Zevo 600, formerly known as the BrightDrop EV600, completed the nearly 260-mile trip from New York City to Washington, DC. As part of the journey, the Zevo 600 transported a shipment of Full Circle sustainable cleaning products from its headquarters in New York City to a MOM’s Organic Market location in Washington, DC, a Mid-Atlantic chain of family-owned and operated organic grocery stores. The BrightDrop Zevo 600 has a payload of up to an estimated 2,200 pounds and over 600 cubic feet of cargo area. The two companies forged a partnership in January where FedEx agreed to an initial deal for 500 vans with plans for at least another 2,000 more over the next several years.

The California Air Resources Board released new draft language on Monday for the Advanced Clean Fleets regulation, requiring medium and heavy-duty truck manufacturers to sell only zero-emission vehicles beginning in 2040. The updated proposal follows a series of public workshops held last year and would include purchase requirements beginning in 2024 for state, municipal and drayage fleets as well as federal agencies and private operators with more than 50 trucks, excluding package delivery vehicles. Under CARB’s proposed ACF regulation, all trucks added to the California fleet must be zero-emission vehicles beginning Jan. 1, 2024, and internal combustion engine vehicles must be removed from the California fleet by Jan. 1 of the year following the end of the vehicle’s minimum useful life. CARB defines that as ranging from 13 to 18 years or 800,000 miles.

Earlier this week, the Port of Oakland said it is defraying its rising costs through new funding from the U.S. Department of Agriculture (USDA). The money is intended to ease ship schedule disruptions and preserve outbound vessel space for U.S. shippers by supporting the port’s temporary container yard, which was first announced in January. The USDA pledged in February to support that effort with funding but hadn’t shared specific dollar amounts at the time. The federal agency now says it will provide agricultural and other exporters with financial assistance in covering expenses for using the pop-up yard. Specifically, the USDA is now offering a $400 incentive per export reefer and $200 for a “dry” container. This funding is for the temporary staging of loaded export containers. In addition, the USDA is offering a $125 incentive to pick up an empty dry container used for agricultural bookings.

Trucking demand is “near freight recession levels,” according to Bank of America. Shippers’ outlook on rates, capacity and inventory levels are matching attitudes not seen since May and June 2020, when pandemic lockdowns sent freight volumes into a historic decline. In a Friday note to investors, Ken Hoexter, the managing director of Bank of America’s trucking research, wrote that shippers’ view of demand is down 23 percent year-over-year. The proprietary Truckload Demand Indicator hit 58 — the lowest since June 2020. Hoexter said the shippers’ view of rates have “melt(ed) down,” hitting a low not seen since May 2020. Bank of America’s survey represented views from 44 shippers in industries including retail, consumer goods and manufacturing. Meanwhile, these shippers are finding it easy to find capacity to move their loads; outlook on capacity hit its highest level since June 2020. They also noted their view on inventory levels had climbed to its highest point since May 2020.

That’s all for this week. Enjoy the weekend and the song of the week, Snoop Dogg’s Gin and Juice.

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