Posts Tagged ‘Supply Chain’

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Supply Chain Sustainability: An Opportunity for U.S. Businesses

July 29, 2022

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Caroline Kaufman and Francys Veras are International Trade Specialists in the Office of Supply Chain, Professional & Business Services.

The Covid-19 pandemic exposed the vulnerabilities of global supply chains, making them a household matter for everyday Americans. Across the country, Americans have experienced shortages of essential products, such as toilet paper, disinfecting wipes, and bottled water, as well as long delays to receive products ranging from household furniture to exercise bikes. As images of empty store shelves and backlogged cargo ships in ports became commonplace, so did the call for stronger, more resilient U.S. supply chains.

For U.S. supply chains to be strong and resilient, they must also be sustainable. Each process in the supply chain, from procurement of sustainable raw materials to low-emission delivery of the product, can be assessed to mitigate its environmental impacts. Sustainable supply chains not only protect global value chains in periods of crisis like a pandemic, but they can also improve overall productivity and help businesses reduce waste. In addressing the climate crisis, stakeholders across the supply chain must recognize that dependence on fossil fuels for the majority of supply chain activity is not a long-term solution.

A pie chart depicting U.S. greenhouse gas (GHG) emissions by economic sector in 2020 with the transportation sector accounting for 27 percent of total emissions. The next source of GHG emissions is the electricity sector with 25 percent, followed by industry with 24 percent, commercial and residential with 13 percent, and agriculture with 11 percent. Source: U.S. Environmental Protection Agency (EPA), Inventory of U.S. Greenhouse Gas Emissions Since 1990-2020.
Figure 1: The pie chart depicts U.S. greenhouse gas (GHG) emissions by economic sector in 2020, with the transportation sector accounting for 27 percent of total emissions. Source: U.S. Environmental Protection Agency (EPA), Inventory of U.S. Greenhouse Gas Emissions Since 1990-2020. Most recent data was released in April 2022.

In 2020, the U.S. transportation sector accounted for the largest portion (27 percent) of total U.S. greenhouse gas (GHG) emissions. Freight transportation accounted for over one third of those emissions. With transportation services responsible for the movement of global trade, these supply chain services industries are increasingly critical to addressing not only the supply chain crisis, but also the climate crisis.

Moving the Needle Forward: Public and Private Sector Must Work Together

The Biden-Harris Administration has prioritized strengthening U.S. supply chains, as well as creating sustainable U.S. supply chains. In November 2021, Congress passed the Biden-Harris Administration’s Bipartisan Infrastructure Law, or the Infrastructure Investments and Jobs Act (IIJA), which invests $17 billion in modernizing infrastructure at coastal ports, inland ports, waterways, and land ports of entry.  

A graphic showing a cardboard airplane trailed by green leaves on a blue background.

The Administration has also worked closely with the private sector to set ambitious goals across the freight logistics industries, for example by announcing the Sustainable Aviation Fuel (SAF) Grand Challenge in September 2021. The SAF Grand Challenge seeks to inspire the domestic production of at least three billion gallons per year of SAF by 2030 and 35 billion gallons of SAF by 2050, enough to supply 100 percent of projected U.S. aviation fuel demand in 2050.

While government initiatives are part of the solution, supply chain sustainability initiatives must also be led by the private sector. Across the different freight transportation industries – including aviation, maritime, rail and truck – U.S. businesses have committed to creating both a more resilient and more sustainable domestic supply chain.

ITA’s Supply Chain Sustainability Efforts and New Report

To help identify where opportunities and challenges exist for U.S. supply chain businesses, ITA’s Office of Supply Chain, Professional and Business Services (OSCPBS) works to address policy and regulatory issues to ensure that the U.S. supply chain system will be among the world’s greenest and most sustainable in facilitating the movement of goods across the nation and abroad. We identify the latest U.S. industry developments in supply chain sustainability. Using that information, we support industry in reducing their carbon footprint and work to enhance the competitiveness of sustainable U.S. transportation and logistics services.

ITA’s OSCPBS recently published a Supply Chain Sustainability Report that examines related key trends, public and private sector initiatives for a more sustainable future across the major modes of freight transportation, and describes how the Biden-Harris Administration and industry have worked together to set ambitious goals to reduce emissions, an important groundwork for progress. It notes that fuel technologies are a key area for research and investment for U.S. freight companies, and it offers examples of ongoing developments. It also notes that while the private sector has been increasingly innovating to address climate change, there continues to be a great need for strong regulatory and market incentives to accelerate decarbonization in the freight sector.

Check out ITA’s Supply Chain Sustainability Report to learn more.

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Innovative Customs Procedures in Laredo, Texas Accelerate U.S. Exports to Mexico

November 18, 2019

Last month, from October 16-17, industry leaders and officials from the U.S. Department of Commerce’s International Trade Administration (ITA) traveled to Laredo, Texas, one of the premier cities for U.S.-Mexico trade.

With over $100 billion in U.S. exports processed in 2018 alone, customs officials on both sides of the border face increasing demands to perform efficient and effective inspections. The Laredo International Airport has seized upon this growing commercial opportunity by innovating their customs process and establishing a unique bi-national inspection facility in 2013. ITA’s Advisory Committee on Supply Chain Competitiveness (ACSCC) had the privilege of touring and learning more about this facility and its achievements over the past several years.

ACSCC-ITA oustide Laredo Airport Inspection Station 110819

Members of the ACSCC and ITA toured the Laredo airport’s Federal Inspection Station and met with U.S. and Mexican customs officials

 The Federal Inspection Station at the Laredo airport, the first of its kind, houses both U.S. Customs and Border Patrol (CBP) and Mexican customs officials (Servicio de Administración Tributaria, or SAT), who jointly perform inspection checks on U.S. exports within a single facility. With goods examined by both agencies in one location, U.S. exports can have expedited entry into airports in eight Mexican cities, allowing for uninterrupted delivery within Mexico. Cargo cleared at this facility can be immediately released to the importer in Mexico with no pauses at customs in these Mexican airports.

Elizabeth Merritt, Managing Director for Cargo Services at Airlines for America and ACSCC member, highlighted the importance of streamlined customs procedures to U.S. industries and value chains saying, “by leveraging a bilateral customs partnership, the Laredo airport boosts the competitiveness of the North American supply chain while maximizing the limited resources of all stakeholders to ensure trade compliance.”

The joint inspection process helps American companies avoid production delays by reducing the amount of time it takes to receive necessary parts and is especially critical for just-in-time deliveries. “Our largest trading partner in the United States is Mexico, so the ability to quickly clear expedited exports heading to that country is essential,” said Brandon Fried, Executive Director of The Airforwarders Association and member of the ACSCC.

Establishing this customs facility was no easy feat. Its creation required both a passage of a law in Mexico’s Congress of the Union and an amendment to the Mexican Constitution, but it was well worth the effort. Today, the Laredo International Airport features the only bi-national federal inspection station in the United States and is the only airport that has approval by the Mexican government to pre-inspect air cargo bound for delivery in Mexico.

Currently this accelerated customs treatment is available for products in the automotive,aerospace, and electronics industries. Importers, shippers, and other logistics companies can also benefit from round-the-clock service from the customs officials, as Laredo has the only airport on the southern border with U.S. customs open 24 hours a day, seven days a week.

During their visit to the facility, members of the ACSCC, all experts in the policies and logistics surrounding U.S. supply chains, received a presentation on the Federal Inspection Station’s activities and spoke with both U.S. and Mexican customs officials to better understand their joint procedures.

“Witnessing the high level of cooperation and information sharing between the U.S. and Mexican customs authorities at the Laredo Airport Federal Inspection Station was an eye-opening experience, showing how such international joint efforts can streamline the border clearance process,” said Michal Mullen, Executive Director of the Express Association of America and ACSCC member. “The trade community has long desired to have this kind of international ‘single window’ operating on the border, and we hope the process will be expanded to more air and land crossing points in the near future.”

ACSCC member at Mexican and US border official 110819

ACSCC member Brandon Fried with a Mexican customs official and a U.S. CBP agent.

Mr. Fried also expressed hopes for the future activities of this bi-national facility saying, “my organization is pleased to see Mexican customs officials working alongside their CBP counterparts at Laredo International Airport. Their joint presence under the same roof enables easy preclearance on air export shipments destined for several manufacturing centers throughout Mexico. We look forward to the program’s continued success and hope to see similar arrangements at other U.S. airports in the future.”

Looking forward, the officials based at the Federal Inspection Station see room for growth, especially as approval of the U.S.-Mexico-Canada Agreement (USMCA) could lead to a surge in trade between the neighboring countries. CBP and SAT officials expressed their desire to grow awareness of their collaborative program and to expand the list of qualified products for inspection. Experts from the Laredo airport have already been invited to pilot similar programs at other airports in the United States, and customs agents believe the joint facility is prepared to handle greater volumes of U.S. exports in the future. This innovative, bi-national process can serve as a model to other ports and cities seeking to expedite inspections for the benefit of U.S. industry.

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Formation of Advisory Committee on Supply Chain Competitiveness

November 4, 2011

David Long is the Director of the Office of Service Industries, part of ITA’s Manufacturing and Services Unit.

It is my pleasure to announce the formation of the Advisory Committee on Supply Chain Competitiveness, published in the Federal Register on 3 November 2011.

The deadline for applications is 14 December 2011. Full details appear in the Federal Register notice: 76 Fed. Reg. 68,159.

As described in the notice, the Committee will advise the Secretary of Commerce on the development and administration of programs and policies to expand the competitiveness of U.S. supply chains, including programs and policies to expand U.S. exports of goods, services, and technology related to supply chain in accordance with applicable United States regulations.

In this effort we will continue to work very closely with our colleagues at the Department of Transportation and other Federal agencies, as we have over the past three years.

This advisory group is possible due to the sustained interest and willingness to participate that has been demonstrated from the beginning in May 2009 at the joint Department of Commerce – Department of Transportation national conference, “Game Changers in the Supply Chain Infrastructure: Are We Ready to Play,” held in Washington and carried on through informal regional outreach discussions on freight policy and competitiveness issues in Atlanta, Chicago, San Diego, Seattle, Kansas City, and New Orleans.

I hope that you will consider applying for this advisory committee. For more information and details on how to apply, please consult the Federal Register notice.

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DOC and DOT Connected to Address Supply Chain Issues

May 13, 2009

Bruce Harsh is responsible for Commerce’s Distribution and Supply Chain unit and has been with the Department about 24 years.

America’s economy depends on the health of our country’s supply chain infrastructure. Problems with the supply chain are not readily noticeable until you don’t get the part you need to keep your supply chain in operation, or the gift you were looking for at a store during the holiday season. Not only do supply chain problems make America’s producers and consumers mad, they are clearly linked to our economic recovery and long-term economic growth.

Supply chains don’t just move products and goods, they also support jobs. One recent report by the U.S. Chamber of Commerce suggests that approximately 110 million U.S. jobs or nearly 80 percent of the entire workforce is critically dependent on our supply chain and transportation infrastructure.

This past Monday, leading supply chain stakeholders met in Washington, DC at the joint Department of Commerce-Department of Transportation conference titled, “Game Changers in the Supply Chain Infrastructure: Are We Ready to Play?” to hold a frank discussion with decision-makers on how to deal with current problems that minimize their ability get those products and services to consumers in a timely, safe, and environmentally-friendly manner and to develop a world-class network to reduce the chance of “game changers” thwarting these goals in the future.

The discussion stirred up lots of suggestions and comments. Panelists and audience participants emphasized that restoring America’s manufacturing jobs depends on not just fixing one part of the supply chain infrastructure but to look at these issues from the start at the manufacturer’s factory floor , or field, to the consumer’s house or company facility. They encouraged governmental agencies to come together to develop a holistic, comprehensive national freight policy that promotes the supply chains and assures America’s competitive advantage in the 21st century.

These suggestions were heard and many participants appreciated seeing two secretaries, Secretary of Commerce Gary Locke and Secretary of Transportation Ray LaHood, stand together to say they were going to have their agencies work together to meet these goals. Many participants also appreciated hearing leading experts share how they would minimize those “game changers” that produce constraints and chokepoints, and offer ways for the government to encourage innovative information technologies, improve security and resilience, and do all of this in an environmentally sound manner to restore America’s world-class transportation network.

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