This week:
- The enforcement of the Drug Supply Chain Security Act has been delayed one year.The Federal
- Maritime Commission is asking supply chain stakeholders for their opinions on proposed processes.
- A leading industry analyst said that they expect capacity to increase up to 25% on the U.S. West Coast and 35% on the East Coast.
- Ocean carriers on the India-U.S. trade have been using an increased number of blank sailings.
- Railroads are looking to rebound after rocky service years.
Drug Supply Chain Security Act Delayed One Year
The idea of the extension is to give additional time to companies to develop a clean process for the Act’s new regulations pertaining to end-to-end supply chain visibility for products.
Before the extension was granted, drug companies and pharmacists worried that compliance across the entire supply chain would be tough, creating a volatile situation. They argued the larger companies were ready, but some of the smaller pharmacies and dispensers were behind.
According to the FDA, the policies of the act are to help “protect patients from exposure to drugs that may be counterfeit, stolen, contaminated or otherwise harmful and to ensure adequate distribution of finished prescription drugs throughout the supply chain.”
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Federal Maritime Commission seeks opinion from stakeholders on Data Initiative
FMC commissioner Carl Bentzel had several public meetings with industry leaders and experts including Amazon and FedEx.
The questions are aimed at transportation service providers and shippers. Responses are due on Oct. 16.
“Make no mistake, supply chain congestion is a constant and continuing inefficiency,” Bentzel said in a statement. “Recent pandemic-related congestion costs our nation trillions of dollars in lost economic opportunity and higher prices, but only highlighted what is in fact an ongoing problem. The recommendations proposed in the MTDI seek to ameliorate what is a system inadequate for providing supply chain transportation. Further public input will help refine what was issued earlier this year.”
Trans-Pacific capacity set to increase, while rates are low
Speaking at the Intermodal Association of North America Expo 2023 earlier this month in Long Beach, Alan Murphy, CEO and founder of Sea-Intelligence Maritime Analysis, said that he expects not only high capacity, but also a “massive number of blank sailings” to keep freight rates from collapsing, which will likely lead to service issues.
“You are going to have low rates, but you will have very low service levels, I believe,” Murphy said at the IANA.
Cut sailings on India-US trade aim to keep rates up
According to port data acquired by the Journal of Commerce, the Indamex 2 string that connects Western India and the U.S. East Coast will see a 50% capacity reduction for loads leaving India. As of Sept. 15, only two sailings were scheduled for India this month.
Daniel Krassenstein, global supply chain director of US-based industrial packaging manufacturer Procon Pacific, told the Journal that it’s a game of supply and demand, allowing carriers to keep rates rising.
Krassenstein said it’s a “game of artificial leveling off.”
Railroads look to rebound from rough stretch
At the North America Expo Conference in Long Beach earlier this month, Andrew Lynch, group vice president of intermodal for Norfolk Southern Railway, acknowledged the challenge, saying that railroads need to show that they are poised for long-term reliability.
“We make service, we sell service, that’s the only product that we make,” Lynch said at the conference. “If we want to give our customers an avenue to grow, our service needs to be reliable, it needs to be resilient and it needs to be done over a long enough time that we get out of the pendulum swing of win freight, lose freight, win freight back and lose it again.”
