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April 29 2019

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10 The Journal of Commerce | April 29 2019 Cover Story there are few routes that entirely avoid disruption. That's because the freight crisis spawned by an immigration crisis isn't going away soon. Logistics experts warn delays and congestion at the US-Mexico border are likely to get worse, as the loss of experienced US Customs agents transferred to immigration duties exacerbates an existing imbalance in capacity that tightens the border during the annu- al produce season. Those who don't at least try to reconfigure cross-border supply chains will find their costs jump whenever disruption occurs at the border — and it is occurring more frequently, as the number of migrants hoping to enter the United States climbs higher. In March, US Customs and Border Protection (CBP) apprehended 103,492 individ- uals at the Southwest border, a 106 percent year-over-year increase. 30 to 40 percent capacity loss The personnel transfer by CBP slashed freight-processing capac- ity at the US-Mexico border 30 to 40 percent on average, according to C.H. Robinson Worldwide, the largest US logistics company, with $88.5 million in Customs revenue. In Laredo, Texas, the largest truck crossing on either US border, 300 HOW DESPERATE DOES a shipper need to be to charter a plane to move freight less than 20 miles across the US-Mexico border? Pretty desperate, but it's been done in recent weeks, as congestion and truck delays at US border crossings squeeze North American supply chains, adding days and uncertainty to just-in-time deliv- ery schedules and pushing up costs. Chartering cargo planes to travel any distance isn't cheap, but it can be much less costly than shutting down a production line because automotive parts didn't arrive when needed. "We've seen air charters flying freight from [Ciudad] Jaurez to El Paso," said David Henry, regional manager for Mexico at third-party logistics company GlobalTranz. "That's a five-minute flight going across the border, and it's happen- ing. It's easier to do that and get the freight on its way to Detroit" than to accept delays in truck lanes linking Mexican and US factories. As ongoing, rolling delays at the US-Mexico border threaten cross-border manufacturing opera- tions that rely on quick, dependable deliveries, US importers and Mexi- can shippers are expediting freight, evaluating different transportation modes and sources, and rescheduling deliveries and even production. But Meltdown on the Mexican border To minimize chaos, cross-border shippers must reconfigure supply chains By William B. Cassidy Those who don't at least try to reconfigure cross-border supply chains will find their costs jump whenever disruption occurs at the border."

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