As ports continue to close and freight rates remain inconsistent, shippers are too familiar with insecure supply chains. Last month, the global supply chain discussion continued. On the first anniversary of President Biden’s Executive Order on Supply Chains, the U.S. Department of Transportation released a report on the overall state of the nation’s supply chain.
The DOT’s supply chain report is titled “Supply Chain Assessment of the Transportation and Industrial Base: Freight and Logistics.” In it, there’s a summary of actions needed to increase supply chain resilience and efficiency. The DOT anticipates large-scale global events related to climate, public health, and otherwise. With a lack of investment in infrastructure and unsustainable demand for import cargoes, the DOT is concerned that our current supply chain lacks resilience. Here are some of the report’s highlights and how shippers can respond.
Transportation, Production, and Sourcing a Major Priority
The DOT supply chain report made clear that the United States’ economy is dependent on free-flowing import and export of goods outside of the country. “Americans benefit when we bring manufacturing jobs, production, and sourcing to the United States rather than outsourcing them abroad,” the report explained.
The report discussed the need to prepare for events such as the pandemic, weather, and cyberattacks. “While these disruptions cannot be avoided altogether, we can build supply chains that nimbly and effectively respond to minimize interruptions and keep goods moving under all conditions, the report read.”
The DOT supply chain report also delved into continuous factors that supply chains have faced for decades, including changing consumer demand for rapid delivery, warehouse capacity, and workforce shortages. In addition, with new technologies, disruption from climate change, and increased production abroad, the supply chain requires more resiliency than ever.
The DOT supply chain report made 62 recommendations for action by the DOT and other agencies to support supply chain resiliency. These recommendations included a call for investment in freight infrastructures, such as ports, bridges, and railroads. Investment in freight operations would bolster solutions to decrease port congestions, increase efficiency, and support workers overall.
Other potential policy responses could include improving safety, increased supply chain data research, supporting domestic manufacturing, and boosting ally-shoring efforts. The DOT would coordinate with the public and private sectors to support this investment.
The Biden Administration’s Response to the DOT Report
The Biden-Harris Administration has already made these initiatives a priority by passing the Bipartisan Infrastructure Law that invests $450 million in American ports, the Department’s largest investment ever.
Such a significant investment is just one action in the administration’s ongoing response to address supply chain disruption. The DOT’s Maritime Administration also recently announced a notice of funding for the PIDP focused on port-related safety and efficiency programs. In December 2021, DOT announced the Trucking Action Plan, which focuses on the recruitment of truck drivers and improvement in working conditions.
As the federal government continues with future actions, the recommendations of the report will guide policy for the DOT and Biden administration.
How Shippers Can Respond
Shippers can react to the DOT report with continued resilience in their strategies. Strategies can include an increased collaboration with the public sector, a build up of emergency response supply, and optimization of supply chain visibility of routes, carriers, and rates.
Honeybee TMS provides a load optimization tool that allows for dynamic modeling for shipments and real-time tracking of access to over 20,000 carriers. With CTSI-Global’s robust logistics management services and predictive analytics, shippers can bolster their supply chain resiliency plans.
Contact CTSI-Global to discuss the efficiency of your shipping.