Logistics stakeholders braced late today for the fiercest hurricane to hit the U.S. in 12 years as Harvey, upgraded to a "Category 3" storm and packing winds that may reach 125 mph, bears down on the Texas Gulf Coast.
The storm, which is tracking to make a direct hit around Corpus Christi, is expected to remain in place for several days. It is projected to dump more than 30 inches of rain in some places, and produce record and life-threatening flooding. Damage is being estimated at around $40 billion if the storm maintains its current intensity when it makes landfall, which is expected later Friday or early Saturday. That would make Harvey the third costliest hurricane in American history, behind Katrina in August 2005 and Sandy in October 2012.
Hurricane Wilma is believed to be the strongest hurricane to ever hit the U.S., reaching top winds of 183 mph in October 2005.
Atlanta-based UPS Inc. suspended pick-up and delivery operations in multiple zip codes throughout the southern tier of Texas and four in neighboring Louisiana, including parts of New Orleans. Memphis-based rival FedEx Corp. issued a statement on its web site that it was monitoring the storm but didn't provide details on service disruptions, if any.
The ports of Houston, Galveston, and Corpus Christi have ceased operations for the duration. Port of Houston Executive Director Roger Guenther told CNBC this afternoon that it may take a few days for the Houston Ship Channel to reopen once the storm passes.
Omaha-based rail giant Union Pacific Corp., whose network feeds directly into the affected areas, began last night to curtail train operations there, it said. UP has also begun moving rail cars in yards prone to flooding to higher elevations. BNSF Railway, the other big western railroad, didn't respond to a request for comment at press time.
The American Logistics Aid Network (ALAN), a nonprofit group that connects providers of logistics and supply chain management resources with groups helping disaster-recovery efforts, said in its latest communiqué today that it has not yet received requests for logistics support. However, ALAN anticipates "additional not yet identified needs for warehouse space, transportation, and material handling equipment," Kathy Fulton, ALAN's executive director, said in the communiqué. Such requests may take several days to a week to surface as damage assessments are completed and local resources are exhausted, she said.
The Warehousing Education and Research Council (WERC), which works closely with ALAN to coordinate logistics support activities during emergencies, said in a statement late today that it will share requests from groups on the ground via its weekly newsletters and over social media outlets.
Oil prices rose today as traders priced in supply reductions as Harvey forced companies to shutter operations. Several oil companies had already shut down production from several facilities and had evacuated personnel from offshore platforms.
West Texas Intermediate (WTI) crude oil priced for October delivery rose today by 43 cents a barrel from yesterday to $47.86 a barrel. The Gulf of Mexico accounts for nearly 20 percent of total U.S. crude oil production, and the Texas Gulf Coast is home to nearly one-third of U.S. refining capacity, according to estimates from the Energy Information Administration (EIA), a unit of the Department of Energy. Gasoline prices are expected to spike this weekend in certain areas of the Southeast and in the mid-Atlantic.
On-highway diesel fuel prices averaged $2.59 a gallon nationwide in the latest EIA weekly data, which was published last Monday. Diesel prices will next be adjusted after the close of trading Aug. 28.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.