Sector News

“What’s in a name?”

June 19, 2022
Chemical Value Chain

Students of Shakespeare will recognize this quote from Romeo & Juliet, and will know that the question is answered by the line… “That which we call a rose by any other name would smell as sweet”. This quotation simply suggests that names themselves do not hold any value or meaning, but simply act as labels to distinguish one thing or person from another.

And what, might you ask, has this to do with chemical logistics?

Keynoting at a recent FreightWaves Future of Supply Chain event in Rogers, Arkansas, Shelley Simpson, Chief Commercial Officer and Vice President of People and Human Resources at J.B. Hunt Transport Services predicted that Supply Chain’s future will be ‘mode agnostic’. We were intrigued by the use of the word ‘agnostic’ in this context, and explored her presentation further.

Simpson suggested that future supply chain success will require stakeholders to be “indifferent” as to how shipments move and to work together to match customer needs with available capacity. In other words, by ‘agnostic’ we understand that shippers should not be dogmatic in determining how their products are moved. Shippers should define the what, probably incorporated in a Service Level Agreement (SLA), and leave it to their Logistics Service Provider to select the optimal logistics solution (i.e. the how) to meet the safety, service, and quality requirements of the SLA.

Simpson also noted that “more precise load-matching combined with better visibility into network movements could significantly reduce costs and drive out millions of empty miles”, and “go a long way toward converting millions of over-the-road shipments to intermodal movements, which are more cost-effective and environmentally friendly.”

Just a minute…when you said ‘intermodal’, did you mean ‘mode agnostic’, or ‘multi-modal’?

For the European chemical industry, intermodal logistics has been well established since the 1980s, although Bertschi Transport had already persuaded the Swiss railroad to load trucks on trains in the 1960s. Today swap-body tanks, silos, and isotanks are a familiar sight on European railroads as all of the major chemical logistics companies exploit the cost and environmental advantages of intermodal movements…not to mention the fact this minimizes the impact of the current driver shortage in Europe.

What was interesting in the early years was the fact the impetus for this development largely came from the carriers, rather than the chemical industry. The carriers were engaged in the technology developments, as well as in the development of the networks and container terminals, and the chemical industry pretty much left them to it.

For example, during the early 1990s we had a contract with a major Dutch-based road carrier to move granulates from the Benelux to Italy. We discovered, by chance, that the carrier was moving part of the volume by short-sea shipping around the coast to Northern Italy. Although we would perhaps have appreciated being informed in advance, in principle we didn’t care, as long as the SLA was respected. Although we didn’t realise it at the time, I guess we were essentially already ‘mode agnostic’!

In response to the interruption of trans-Siberian overland services as a result of the conflict in Ukraine, Maersk have proposed an alternative multi-modal option which should provide a stiff challenge to ‘mode agnostics’. Containers will be railed through various routes in China and converge in Khorgos on the Kazakhstan border. From there they’ll be railed to the port of Aktau, and then barged to Baku in Azerbaijan. Then back on the rail to the Maersk terminal in Poti, Georgia, where they’ll be loaded on a feeder vessel to Constanta, Romania. Then by rail to European destinations…journey time around 40 days.

This is multimodal, intermodal, and mode agnostic without parallel…or perhaps not quite. There’s a new name in the mix! ‘Synchromodality’

In a recent Loadstar article we read that DP World’s VP for Europe Inland and Logistics, Rob Harrison, is urging shippers to consider ‘synchromodality’ to combat North Europe’s barge congestion. Faced with two-to-three day waiting times on the inland waterways serving Rotterdam and Antwerp, Harrison told The Loadstar: “What we’re trying to offer to combat this is synchromodality, where we don’t focus on the means but the objective – getting goods to the customer”. Therefore DP is expanding both their barge and rail services to counter delays on one or the other mode. Another case of the what vs the how.

To be successful all stakeholders need to share vital information with the terminal operators to enable a synchronized transportation product…and as Harrison said, for the system to work, operators had to be ‘agnostic’ over the terminal used.

So what’s in a name? Whether it’s intermodal, multimodal, mode agnostic, or synchromodal, the success as always depends on the willingness to cooperate and collaborate. Whatever the name, the rose smells the same.

By Paul Gooch. Paul Gooch is Managing Director of The Logical Group GmbH and a non-Executive Director of Borderless.

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