Michelin is trying to take air out of the tire

Fact: Michelin estimates problems with inflation, be it wrong tire pressure or unrepairable punctures, knock a whole 20 percent of tires out of service early—that's 200 million of them each year. 

Welcome Uptis : the airless tire 

Michelin is trying to take air out of the tire equation, which it thinks it can do as soon as 2024 with an airless tire called the Uptis. It recently demonstrated these with YouTuber Mr JWW at the wheel of an electric Mini Cooper SE so we could learn more about their behavior.

After wheeling the Mini mostly on city streets the feedback was rather positive, the YouTuber claiming that handling of the vehicle appears to be sharper than with traditional tires. According to Michelin, test drivers who have explored the bounds of the Uptis' performance say its lack of air makes it easy to handle at the limit. JWW also noticed less steering slop on the prototype tires, making airless tires a promising future option for performance cars. Keyword performance.

This application will no doubt be on the radar for Michelin, which aims to have Uptis-style tires on the market in 2024. If performance tires are among the first airless options to come out, though, expect them to first reach high-dollar vehicles that already use purpose-built tires. Think more Bugatti Chiron than Mazda MX-5, though don't count out seeing these at a track day later this decade.

Michelin's Technical and Scientific Communication Director Cyrille Roget, told YouTuber Mr JWW that developing the Uptis has taken Michelin a full decade so far. Its end goal is to aim the airless tire at markets that go through large numbers of them, from carmakers to commercial fleets, to even developing countries where punctures are common. Obviously, the Uptis would need sidewalls on rocky roads to keep debris out, and Roget indeed confirmed the production tire could have sidewalls.

Unique Puncture-Proof Tire System: UPTIS

The Uptis features fiberglass belts under its tread and, in place of air, spring-like spokes that are also reinforced with fiberglass. The tires themselves have been designed not to mount to preexisting wheels, but ones supplied by Michelin, on which they are balanced at the factory. In theory, they can arrive ready to mount to a car with no special tools or labor needed.

Because Uptis is airless, the breakthrough wheel assembly eliminates the dangerous risk of flat tires and blowouts:

Drivers of passenger vehicles feel safer on the road.

Operators of passenger vehicle fleets minimize downtime and improve efficiency resulting from flat tires and near-zero levels of maintenance.

Society at large benefits from extraordinary environmental savings through reduced use of raw materials for replacement tire or spare tire production.

Sustainable Mobility

The Uptis Prototype represents a major advancement toward achieving Michelin’s VISION concept, which was presented at the Movin’On Summit in 2017 as an illustration of Michelin’s strategy for research and  development in sustainable mobility. The VISION concept introduced four main pillars of innovation: airless, connected, 3D-printed and 100% sustainable (entirely renewable or bio-sourced materials).

CMA-CGM, Hapag announce rate freeze! What to expect? What is the rationale behind rate freeze?

CMA-CGM, Hapag announce rate freeze! What to expect? What is the rationale behind rate freeze?

 

Almost 40 ships are reportedly lined up across leading ports in the U.S.A.

The move by German carrier Hapag-Lloyd to follow French carrier CMA CGM by announcing a halt in spot rate increases as container prices on most trade routes hover at record highs has left the industry guessing for answers.

While CMA CGM had said on September 9 that it will not increase freight rates till February 1, 2022, Hapag said it would avoid any surcharges "for the time being," S&P Global Platts reported on September 13, 2021.

 

Does the cap include a cap on surcharges?

“Generally no, but we gave ourselves an internal halt to any new high surcharges in particular for relations with very high FAK rates," Hapag spokesperson told S&P Global Platts.

The announcement by Hapag Lloyd and CMA-CGM comes at a time where there's a lot of strain in the container markets with spot freight rates at multi-year highs and schedule reliability decreasing!  

The Platts Container Index was at $7,506.69 per FEU (forty-foot-equivalent unit) on September 10, nearly 400 percent higher than $1,554.27 per FEU a year ago. This cap on rates has been welcome by parts of the market. A fraction of the industry believed that prices had peaked, and traditionally the month of October ushered in a slowdown in volumes due to a halt in manufacturing activity during the Golden Week Holiday. Should carriers hold back on rate increases for some time, it's worth noting that even current levels are at historic highs. There has even been a growing reluctance among small scale exporters to ship goods due to high freight.

 

 

What are the two key components to the all-in freight?

The FAK (Freight All Kinds, broadly defined as a single tariff classification for freight that otherwise would attract different rates) and surcharges. We don’t know yet whether other players will follow it (rate freeze). We have seen Hapag-Lloyd join CMA CGM on the decision to freeze price hikes, and industry sources think that the carriers may now try to solidify their market share and attract new customers. We will have to wait to see how things unfold.

Container inbound levels are at all-time highs at the US West Coast ports, according to Container xChange, an online platform for container logistics. “Our CAx (container availability index) data reveals 60 percent increase in the inbound outbound ratio at the ports of US West Coast, surpassing the pre-Covid levels, indicating that there is excessive stress on the ports, and therefore indicating further congestion is expected in the coming months as we approach the holiday season in the later part of the year,” said Dr Johannes Schlingmeier, co-founder and CEO, Container xChange.

 

What is the rationale behind rate freeze?

“The all-time high in cargo congestion at the US West Coast ports are a result of the global supply chain disruption and its domino effect. The ever-higher imports owing to higher demand, grappling with the infrastructural and human resources struggles are further adding to the stratospheric congestion which is ultimately leading to further delay in vessel arrival,” added Christian Roeloffs, co-founder and CEO, Container xChange.

CMA CGM is prioritising long-term relationships with customers in the face of an unprecedented situation in the shipping industry, the carrier had said while announcing the rate freeze. The decision applies to spot rates and is effective immediately until February 1, 2022, CMA added.

“CMA has increased the capacity of its operated fleet by 11% since December 31, 2019, with the addition of new vessels and purchase of second-hand vessels. Over the last 15 months, the Group has also increased its container fleet by 780,000 TEUs,” the statement said.

 

Will future rate increases be in the form of additional surcharges?

The container market is facing a lot of stress now, as you can imagine with port congestion and logistical uncertainties. There are a lot of delays happening and the blank sailings affected the schedule reliability further.

The announcements by the two major carriers had stoked concerns of increases in the form of different surcharges like premium, port congestion and peak season fees, over and above the FAK rates, the S&P report said. “Carriers introduced hefty general rate increases on FAK rates and also premium surcharges on top of the FAK, to ensure fixed space and timely loading, as the pandemic resulted in supply chain blockages and container shortage all across the world.”

The current spot freight level follows more than a year of unexpected challenges in the container market. Prices started increasing at the start of 2020 when supply chain disruptions made it difficult to cope with the unanticipated demand. While the spread of the pandemic has since then bridled recovery, recurring disturbances like Suez blockage, port congestion and shutdowns have exacerbated the situation. Most market participants expect the current challenges to prevail at least till the first quarter of 2022. However with these price freeze announcements, bearishness among the exporters and a slight dip in rates on the Asia-Europe route, it won’t be too surprising if the container trend bucks market anticipations once again. 

While the current FAK on active North Asia to West Coast North America route is $9,000/FEU, the all-inclusive premium rate is within $15,000-$22,000/FEU, Platts data showed.

Almost 40 ships are reportedly lined up across leading ports in the U.S.A. . So, an announcement by Maersk and MSC that they have cancelled 4 scheduled Asia-North Europe loops is adding to the woes of shippers. 

Are these temporary announcements on rate freezes by carriers aimed at soothing tempers? 

The container market is facing a lot of stress now, especially with port congestion and logistical uncertainties. There are a lot of delays happening and the blank sailings affected the schedule reliability further. The prevailing challenges in the container markets are unlikely to clear up in the next few months. Hence, the current trends suggest that the bullishness may continue till the start of next year. But the container market may have surprises for us!

Advantage Dwarf Containers

 

Union Shipping Minister Sarbananda Sonowal virtually flagged off the dwarf container train service on 20-09-2021 from Jawaharlal Nehru Port (JNPT), the biggest container port in India located off Mumbai. With this, the first consignment of laden dwarf containers from Dwarf Container Depot (DCD) at the port was being moved by train to Inland Container Depot Kanpur.

What are Dwarf Containers?
The Hindu mythology talks about Mahabali (Bali Chakravarthy), the Asura, who grows too big for his boots. In a ceremony where he is giving away gifts, Lord Vishnu appears disguised as Vamana, a dwarf, and asks him three paces of land, and Mahabali agrees. Immediately, Vamana assumes the shape of a giant. With one step he covers the Earth, with another the Heaven, and for the third Mahabali offers his head, which Vamana steps on, sending him to the Paatala (the Netherworld). Similarly, the vamana (or the ‘dwarf’ container‘), is the Indian Railways’ initiative that is expected to grow into a giant, capturing high-end traffic it lost to the road sector over the years when, in the 1980s, end-to-end running of block rakes was introduced.  

Dwarf containers are 6 ft 4 inches in height and can run on electrified tracks. Despite being smaller in size, the dwarf containers can hold a capacity of 30,500 kgs.
Dwarf containers are 660 mm less in height compared to ISO containers, giving them a logistical edge. The low height of dwarf containers loaded on trailers allows them to pass through rural, semi-urban and urban roads, limited height subways and level crossings in electrified sections.
Dwarf containers also provide a 67 per cent increase in volume when double-stacked and can carry a weight of 71 tons, as against 40 tons by an ISO container. The Indian Railways has offered a 17 per cent discount on haulage cost compared to double stack ISO container trains, resulting in an overall 33 per cent discount to shippers, making Indian Railways competitive.

 
Dwarf Container Vs ISO Container
Presently, due to its height, the regular double stack ISO containers can run only on few chosen routes on Indian Railways but these short-heighted Double Containers can run on most tracks very easily. These containers in double stack formation can run under 25kV overhead lines. With the use of these double-stack dwarf containers, the cost of the unit will be significantly reduced due to the rail transport being cheaper than the road.
Currently, 'Low Density Products', such as plastic granules, PVC polyester fabric, white goods, FMCG products, polyethylene, auto car, etc. are being transported mostly by road, but due to the low cost of transportation in dwarf containers, Railways now offers a viable transport. At the general freight rate, the double-stack dwarf container trains can generate more than 50% of the revenue.
 
 

 The untapped potential of dwarf containers  

The rail movement of cargo through dwarf containers has the potential to lower export-import logistics costs.  The port is also expected to gain steadily from the implementation of the dwarf container train services from JNPT.

Speaking at the inaugural event, Sonowal said, “The commencement of dwarf container train services from JNPT is a pivotal step towards streamlining rail movement of cargo via double-stacked dwarf containers. This will give the community a competitive cost advantage by lowering hinterland logistical costs, while simultaneously enhancing rail cargo traffic at JNPT. Dwarf containers are port-friendly and can be manufactured in India at a cost-efficient price point, thereby opening up opportunities for Make in India.”
 
A location within the JNPT container terminal has been identified for the establishment of Dwarf Container Depot, where cargo transfers from ISO containers to dwarf containers would be done, thereby making available empty ISO containers at the port for export repositioning.
 

Currently, there is a shortage of ISO containers for export, and this initiative will help bring down the turnaround time of containers from a month to a few days, as import-laden ISO containers need not go all the way to the hinterland.

Container ship capacity crunch leaves 3.5 million bags of Brazilian coffee unshipped

Container ship capacity crunch leaves 3.5 million bags of Brazilian coffee unshipped

Redução da capacidade dos navios porta-contêineres deixa 3,5 milhões de sacas de café brasileiro sem escoamento

Exports of green coffee from Brazil, the world’s largest producer, fell 27% in August from a year earlier to 2.33 million 60-kg bags as difficulties to find containers and space at vessels increased, exporters association Conselho dos Exportadores de Café do Brasil (Cecafe) said.

Cecafe said in a monthly report that around 3.5 million bags of coffee could not be shipped on time this year due to shipping hurdles, causing losses of around $500 million to the country’s coffee exporting industry.

The amount of coffee shipped by Brazilian exporters in August was the smallest monthly volume in at least a year.

“This operational crisis caused a large increase in freight prices, recurring bookings’ cancellations and increased difficulty to make new bookings for containers or vessel space,” said Nicolas Rueda, Cecafe’s president.

The association said that 40% to 50% of all coffee cargos faced postponements at ports in the last three months, compared to 10% to 20% seen in the first months of the year, as the situation deteriorated.

Brazil accounts for almost 40% of the global coffee trade. Delays could disrupt operations for some roasters in the United States and Europe, its biggest clients.

Supply chain breakdowns and shortages have swept the world in the wake of the COVID-19 pandemic amid a rise on online orders and disruptions in the transportation system as workers got sick or decided to abandon those jobs. There are shortages of everything.

Containers have been more demanded in destinations such as the U.S., and have stayed there for longer than normal, causing a shortage in routes such as South America to U.S. or Asia to Europe.

Datamar, a shipping information agency, said on Monday that Brazil received 604 container ships in August, 10% less than in the same month a year ago.

“There is a lot of (shipping) demand and the infrastructure takes long to react. The ports are at the limit of their capacities,” said Rueda.

__________________________________________________

Redução da capacidade dos navios porta-contêineres deixa 3,5 milhões de sacas de café brasileiro sem escoamento

As exportações de café verde do Brasil, o maior produtor mundial, caíram 27% em agosto em relação ao ano anterior, para 2,33 milhões de sacas de 60 kg com o aumento da dificuldade de encontrar contêineres e espaço nos navios, associação de exportadores Conselho dos Exportadores de Café do Brasil (Cecafe) disse.

Cecafe disse em um relatório mensal que cerca de 3,5 milhões de sacas de café não puderam ser despachadas no prazo este ano devido a obstáculos no transporte, causando perdas de cerca de US $ 500 milhões para a indústria exportadora de café do país.

A quantidade de café embarcada pelos exportadores brasileiros em agosto foi o menor volume mensal em pelo menos um ano.

“Esta crise operacional causou um grande aumento nos preços de frete, cancelamentos de reservas recorrentes e maior dificuldade para fazer novas reservas de contêineres ou espaço de navio”, disse Nicolas Rueda, presidente da Cecafe.

A associação disse que 40% a 50% de todas as cargas de café sofreram adiamentos nos portos nos últimos três meses, em comparação com 10% a 20% verificados nos primeiros meses do ano, com a deterioração da situação.

O Brasil responde por quase 40% do comércio mundial de café. Atrasos podem interromper as operações de algumas torrefadoras nos Estados Unidos e na Europa, seus maiores clientes.

Falhas na cadeia de suprimentos e escassez varreram o mundo na esteira da pandemia COVID-19 em meio a um aumento nos pedidos on-line e interrupções no sistema de transporte quando os trabalhadores adoeceram ou decidiram abandonar esses empregos. Há falta de tudo.

Os contêineres têm sido mais procurados em destinos como os EUA, e lá permanecem por mais tempo do que o normal, causando escassez em rotas como a América do Sul para os EUA ou da Ásia para a Europa.

A Datamar, agência de informações marítimas, disse na segunda-feira que o Brasil recebeu 604 navios porta-contêineres em agosto, 10% a menos que no mesmo mês do ano anterior.

“Há muita demanda (transporte) e a infraestrutura demora para reagir. Os portos estão no limite de sua capacidade ”, disse Rueda.

What is a Switch Bill of Lading? When is a Switch BL used?

What is a Switch Bill of Lading? 

When is a Switch BL used?

The world of shipping and freight is dynamic and several changes happen during the course of a shipment. Ownership of Goods can change, destinations can change, cargo routing can change, cargo release parties can change and even important documents such as a Bill of Lading may be subjected to changes..

Some may be simple amendments, but in some cases, the changes or requirements may necessitate the issuance of a Switch Bill of Lading..

Before we look at what is a switch bill of lading, let’s review the types of bills of lading and how these are issued..

There are 3 ways in which a bill of lading may be issued:

1) When a B/L is issued in Original(s) to a “named” consignee it is referred to as a “Straight B/L” and a straight B/L is a NON-NEGOTIABLE & NON-TRANSFERABLE DOCUMENT..

2) When a B/L is issued to a “named” consignee but without any originals, it may be considered as a “Sea Waybill“.. This B/L is also a NON-NEGOTIABLE & NON-TRANSFERABLE DOCUMENT..

3) When a B/L is issued in Original(s) and consigned “TO ORDER” or “TO ORDER OF SHIPPER” or “TO ORDER OF XYZ BANK” it is termed as “Negotiable B/L or Order Bill“..

A bill of lading has 3 functions as below and each of the above types of bill of lading fulfils one or more of these functions..

1. Evidence of Contract of Carriage

2. Receipt of Goods and

3. Document of Title to the goods

 

Now let us discuss about the Switch Bill of Lading.

A “Switch” bill of lading is NOT another type of Bill of Lading..

A Switch Bill of Lading is simply the second set of bill of lading that may be issued by the carrier or their agent “in exchange of” or “substituting” the first set of bill of lading originally issued when the shipment was effected..

The KEYWORD here is “in exchange of” or “substituting“.. This clearly implies that the second set of bills of lading cannot be issued while the full first set is still in circulation and active..

 

Why do customers require a Switch bill of lading ?

Switch bills may be requested for a few different reasons..

When there has been a change in the original trading conditions ;

Goods have been resold (probably high-seas sale) and the discharge port has now changed to another port ;

The seller (who could be an intending agent) does not wish the name of the actual exporter to be known to the consignee in case the consignee strikes a deal with the exporter directly ;

The seller does not want to know the buyer to know the actual country of origin of the cargo so he requests that the port of loading be shown as some port other than the one the cargo was loaded from..

 

What can and cannot be changed in a Switch Bill of Lading?

Changes are allowed in the switch bill of lading is the shipper, consignee, notify information which is usually displayed in what I term as Part 1 of the bill of lading..

TT Club considers additional elements/information listed below may be changed provided that the new information is true and correct and does not affect the carriage and delivery..

the shipper’s description of the goods;

the name of the ship (if necessary);

the place and date of issue (if not the same as those of shipment);

the freight and the port of discharge

The below details should never be allowed to be changed

place and date of shipment as changing this could affect the terms of delivery based on the sales contract

details of cargo including the number of packages, dimensions, weight and measurement

hazardous cargo information if any (remember cargo is already on board based on original hazardous cargo declaration)

reefer cargo information such as temperature setting, humidity settings etc (remember cargo is already on board based on original cargo declaration)

OOG Cargo information if any (remember cargo is already on board based on original OOG details declared including lost slots calculation etc)

none of the original clauses on the bill of lading

The club further advises that the shipping line/agent should

“obtain written confirmation from your client, setting out in detail his requirements for the new bill of lading. If significant changes are requested to the cargo details, you should consider getting both evidence to support the changes and an indemnity from the client to protect you in the event of a dispute with the consignee.”

 

Where can a bill of lading be switched and who can request shipping line to issue switch bill of lading. ?

Depending on the shipping line and their coverage, a bill of lading may be switched anywhere around the world for shipments from anywhere to anywhere..

For example in a shipment from New York to Antwerp, the bill of lading may be switched in Dubai as long as the shipping line in question has offices in Dubai.. Usually a switch bill of lading happens in a location that may not be on the route of the cargo..

Switch Bill of Lading Fraud - Shipping and Freight ResourceIs the issuance of Switch Bill of Lading legal?

While there is nothing to say specifically that issuance of a switch bill of lading is illegal (unless there is willful intent to commit fraud), it seems to be the concerted view of almost all P&I clubs, that a switch bill of lading issued with any misrepresentation or information contrary to the first set issued, without the express acceptance and understanding of the buyer is a fraudulent document..

In order to protect themselves from any possible claims arising out of issuing switch bills of lading, the shipping line/agent have to ensure that

They are covered by their insurance for the issuance of such switch bills of lading and they provide their insurance company with the exact reason for the issuance of the switch bill of lading ;

They need to ensure that the bill of lading is switched before hand over of cargo and also that the person or entity requesting for the switch bill is authorised to make the request..

If a negotiable bill is issued, generally the shipper on the bill of lading has the right to request for the switch bill of lading, but only before the endorsement to the next party or delivery of the goods ;

All issued originals from the first set of bills must be returned to the carrier, free of any endorsements and cancelled before the bill is switched and a second set is issued..

Point 4 is perhaps the most important point for the carrier to note and ensure as this is the only way to guarantee that there are no other originals floating around for the same shipment.. The dangers of two sets of original bills in circulation for the same cargo are many ;

This is also required to ensure that the party making the request is truly the owner of the cargo and has rights to its further disposal ;

A shipping agent should never issue a switch bill of lading of their own volition based on the request of the customer and must always issue it only with the written authority of the principal (however urgent the situation may be to the customer) ;

The switched set should not contain any information different to that of the first set of bill of lading, (like an incorrect port of loading, or change in the condition and quantity of the cargo)..

If switch bills contain any misrepresentations, the carrier/agent will be at risk of claims from parties who have suffered a loss because of such misrepresentations ;

If the agent has been asked by the principal to issue the switch bill of lading based on an indemnity from the customer, the agent should ensure to get the wording format from the principal and get the completed indemnity approved by the principal before issuing the switch bill of lading.

IKEA Walmart Home Depot TAKE CONTROL OF THEIR SUPPLY CHAINS by Chartering Own Ships to battle peak season

Swedish retail giant IKEA has followed US retailers Walmart & Home Depot in addressing shipping congestion by chartering its own containerships. IKEA has also bought its own shipping containers to ensure goods can keep moving on time, with capacity lacking in a market experiencing soaring freight rates.

The move was spurred by delays to the 100 containers Ikea had on the 20,388-teu Ever Given (built 2018), which made global headlines when it grounded in the Suez Canal in March.

"Congestion in ports combined with historically high demand has created an imbalance in the entire world market for maritime transport," Ikea's product deliveries director Mikael Redin said.

Walmart has taken shipping matters into its own hands, chartering a number of ships from August 2021 onwards. The giant supermarket chain followed the footsteps of Home Depot in deciding to move some of its goods on the transpacific via tonnage it controls rather than pay sky high rates to global liners for shipments that tend to arrive late.

Walmart’s CEO, John Furner, revealed: “We have chartered vessels … we’ve secured capacity for the third and fourth quarter and feel good about the inventory positioning particularly compared to last year with inventory up 20% across the segments.”

According to Steve Ferreira, the CEO of New York-based consultancy Ocean Audit, Walmart has already completed two voyages, both arriving in the US this month, using Walmart branded 53 ft containers. The first voyage had 177 53 ft boxes onboard, and the second one contained 247 similarly sized containers.