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January 2 2023

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64 Journal of Commerce | J anuar y 2, 2023 www.joc.com EXECUTIVE COMMENTARY ANNUAL REVIEW & OUTLOOK 2023 Maritime replace any supply chains that have been broken during the COVID years with just-in-case supply chains or more expensive reshoring/nearshor- ing manufacturing. Transport providers — asset and non-asset — are injecting value into containerized supply chains by offering the service to customers that they have dearly missed for years now. They are doing this by normalizing measures taken to expedite full and empty container movements — including detention/ demurrage and free time given to clients, which have been widely cut — and by offering green solutions to those beneficial cargo owners (BCOs) and shippers that want to reduce the carbon footprint for their transport needs. Finally, they are making use of the windfall profits made during the COVID years to fix past problems and develop more seamless multimodal solutions. JOC spread. Over-tonnage may not be as disturbing as inflation-led recession. Over the decades, marine ships have been regarded as one of the sources of pollution linked to global warming. With more stringent rules on ship emissions and initiatives on reducing ship pollutants being implemented to improve this situ - ation, the shipping sector today is, to some extent, leading the way in developing innovative solutions on alternative energies that would pro - duce fewer harmful substances. Xeneta Patrik Berglund Co-founder and CEO xeneta.com The COVID-19 years have been all about handling operational difficulties — a lot of that experience is nice to have going forward but not something that will be put to use to a large extent as disruptive obstacles are removed (fingers crossed). Not many groundbreaking developments have surfaced that have irrevocably changed the business. The essential need to stay on top of market devel - opments and have crucial insights and data readily available has become crystal-clear — from being a nice-to- have to becoming a must-have. Let's single one aspect out, though: ocean carriers' purchase of aircraft and acquisitions of logis - tics companies that can help them expand their business vertically going forward. This has allowed them to offer more complex services, combining ocean with air, and extend the current port-to-port offering with something that is closer to the offering that we see from freight forwarders today. The biggest challenge facing container shippers and transport pro - viders in 2023 will be bringing back reliability and predictability to the global supply chain. What's needed is to restore order in the market, normalizing the flow of goods and making the final decision whether to UTC Overseas Diana Davila Project Director and Houston Branch Manager utcoverseas.com The logistics community has faced many challenges in the past two and a half years. While some are starting to resolve, others are escalating, and more are waiting just around the cor - ner — which is great, because we all get into logistics because we love solving challenges! Port congestion and backlogs have shifted between the East and West coasts during the pandemic, but now we are seeing Houston as the main port dealing with these issues. Back - logs and bottlenecks will continue as consumer demand is in flux and ongoing inflation affects buying power. Thankfully, freight rates have decreased over most modes of transportation, with rail and barge being the exception. Lack of labor is a persistent prob- lem throughout all modes and stages of the supply chain. With many union negotiations stalled or at an impasse, ongoing global labor movements have deeply influenced transportation as shippers shift cargo routes to avoid delays. A potential US rail strike would cost an estimated $2 billion per day and have deep ripples throughout the supply chain. Skyrocketing energy prices are affecting everything from fac - tory output to trucking and ocean freight. Refining capacity has been significantly reduced since 2019 due to political unrest, COVID-19, and extreme weather events knocking out capacity. We are also seeing an increase in weather events impacting how we ship things. Cargo that would typically be barged may need to seek alternate modes due to low water levels, etc. Diligent planning and the ability to adapt strategy play a large role in suc - cessful transportation solutions — in August 2020, UTC delivered an 815Mt piece of energy equipment to the Port of Beaumont in the middle of Hurricane Laura. Knowing it was hurri- cane season, we performed a thorough risk assessment and had contingency plans to ensure the cargo arrived safely and on time. Other issues coming down the road that we should keep our eye on are growing cybersecurity threats to the supply chain, increasing geopolitical unrest, and the reduced availability of raw materials. "Ongoing global labor movements have deeply influenced transportation as shippers shi cargo routes to avoid delays." ◀ "The biggest challenge facing container shippers and transport providers in 2023 will be bringing back reliability and predictability to global supply chains." Patrik Berglund

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