Volvo Partners with WWF to Reduce Carbon Emissions

The company, whose brands include Mack Trucks, Volvo Trucks, Renault Trucks and UD Trucks, has become the world’s first vehicle manufacturer to join the WWF Climate Leaders program.

The public-private partnership consists of 24 of the world's largest companies that have committed to reducing their considerable carbon footprints, including Diversey, Johnson and Johnson, IBM, HP, Sony and Nike.

Volvo truck companies have vowed to reduce the greenhouse gas emissions produced over the lifetime of the trucks they manufacture by 13 million tons. The emissions reduction applies to models built through 2014, with results verified by independent technical experts. Model year 2008 trucks will be used as the baseline for the emissions reductions.

Volvo plans to offer commercial trucks that can run on renewable fuel by 2014.
The company also plans to reduce its operational footprint by reducing emissions from its production plants by 12 percent by 2014.

Digital Supply Chain

Is your marine insurance up to date?

From SCDigest's On-Target e-Magazine A freak discovery of an ocean shipping container has led to a study on how the thousands per year that fall off cargo vessels might be impacting the oceanic ecosystem. According to DeVogelaere, several years ago scientists from the sanctuary were in a boat using a robotic submarine when they made a surprising find: a yellow, 40-foot shipping container, standing upside down with one corner stuck into the ocean floor.

The scientists marked the location and other information, and eventually they were able to tie the container to the merchant vessel Med Taipei, which had earlier lost 15 containers in a storm off Monterey Bay.

It turns out there are a lot more than 15 shipping containers in the briny deep - tens of thousands of them actually.

DeVogelaere told PBS that on average, about 10,000 containers fall off of ships every year. While that number may be high, the general consensus is several thousand containers are lost to the sea each year, adding up to tens of thousands over the decades. Naturally, they cluster around the paths taken on the key shipping lanes, and contain an incredibly wide range of goods, from benign to potentially toxic. The shipping container the sanctuary found was full of tires, as it turned out.

As we've known for centuries with regard to sunken ships, the containers are also not surprisingly an attraction for much marine life. The container the sanctuary first identified is now the home of a giant sea snail, which has recently laid eggs. Beneath the container was found an octopus and some crabs that have eaten some but not all of the sea snail eggs.

NPR's Joyce noted that "These containers are creating a new kind of habitat, with its own suite of creatures, in the middle of the seabed. Is that bad? Well, DeVogelaere says no one can say - the seabed is still a big mystery."

The containers might also "provide stepping stones for an invasive species that go from one coastal harbor to another," DeVogelaere.

Who knows what your lost containers are doing down at the bottom of the sea. Maybe we will soon find out.  Just make sure your marine insurance is up to date!

Possible delays to containers in China

SHANGHAI (Reuters) - A two-day strike over rising fuel prices turned violent in Shanghai on Thursday as thousands of truck drivers clashed with police, drivers said, in the latest example of simmering discontent over inflation. About 2,000 truck drivers battled baton-wielding police at an intersection near Waigaoqiao port, Shanghai's biggest, two drivers who were at the protest told Reuters.

Truck drivers also staged strikes in other ports in Shanghai including Baoshan and Yangshan, the drivers said.

Inflation coupled with the sharp increases in fuel prices caused a stir that meant trucking companies had to launch strike action on the 20^th of April 2011. The initial strike action was only supposed to last 7 days but with clashes on the brink and the government keeping quiet so far, this could go on for longer.

As a result of this, the Shanghai port is facing serious congestion and containers are not being loaded on time. Therefore expect delays!

Piracy Risk Surcharge - going up!

The Japanese disaster, the Libyan conflict and now piracy! The global supply chain cannot seem to catch a break this year. “Figures for piracy and armed robbery at sea in the past three months are higher than we’ve ever recorded in the first quarter of any past” said Pottengal Mukundan, Director of International Maritime Bureau (IMB).

In the first quarter of 2011, 18 vessels were hijacked, 344 crew members were taken hostage, and 6 were kidnapped. A further 45 vessels were boarded, and 45 more reported being fired upon. (Source: IMB).

The majority of these being Somali pirates in and around the Arabian Sea and the Gulf of Aden. At last count, on the 31^st of March, IMB figures showed that Somali pirates were holding captive 596 crew members on 28 ships.

To this end, Maersk Line, announced that piracy risk surcharges imposed earlier on containers moving between the Indian subcontinent, the Middle East, Europe and Central/South America, will be increased starting May 1^st 2011.

2011 Incoterms - Uncovered

So what is an Incoterm and why are importers and exporters so excited about them in 2011?

Incoterms or International Commerce Terms are a series of terms used in international trade which are globally accepted to represent conditions and obligations by the various parties involved in the transaction with regard to the delivery of goods sold. These terms are published and reviewed periodically to ensure they remain relevant in today’s international trade environment by the International Chamber of Commerce (ICC).

Clear as mud!?!

Just imagine we lived in a world where Incoterms were unheard off between international buyers and sellers. Let us say that you are a manufacturer of a highly in demand product and you source component parts of your final product from various in-country suppliers. As part of an initiative to make your product more competitive in the market place, you decide to look into how you can find these parts cheaper. You discover an overseas manufacturer who is selling an essential part in your final product for less than half the cost you are paying now. You agree to a price and a date to take delivery with the new overseas supplier.

The said date comes around and you have not received any of the parts. You contact your new supplier in the foreign country and they tell you that the parts are ready and are waiting for you to come and pick them up.

Ophs! When you placed your order with the supplier, you assumed that price would include delivery to your door and it would include all the charges with respect to getting it there.

This is where Incoterms play a part to avoid ambiguity between the buyer and the seller with respect to the responsibilities, costs and allocation of risks when it comes to transacting in the international world of trade.

Now that we got the basics of what Incoterms intend to help us do, let us get to what types of Incoterms there are and what changed in 2011.


Incoterms are broken down into various categories and apply with certain conditions. Furthermore in 2010 there were 13 Incoterms and now in 2011, there will now be a total of 11 terms instead of 13, with 2 new additions, DAP and DAT and 4 deletions, DAF, DDU, DEQ and DES. This was done by the ICC in light of changes in cargo security and Electronic Data Interchange playing a bigger role in today’s international trade.

Listed below are the latest set of Incoterms and brief notes on them. For a full explanation of use conditions and more detail, please refer to http://www.iccwbo.org/

Applies to all modes of transportation:
• EXW

Short form for: Ex-Works
Usage: EXW <Named Place>
Description:
The seller makes the goods available at his premises. The buyer is responsible for all charges. The buyer pays all transportation costs and also bears the risks for bringing the goods to their final destination.

• FCA

Short form for: Free Carrier
Usage: FCA <Named Place>
Description:
The seller hands over the goods, cleared for export, into the custody of the first carrier (named by the buyer) at the named place.

• CPT

Short form for: Carriage Paid To
Usage: CPT <Named Place of Destination>
Description:
The seller pays for carriage to the named point of destination, but risk passes when the goods are handed over to the first carrier.


• CIP

Short form for: Carriage and Insurance Paid
Usage: CPT <Named Place of Destination>
Description:
Seller pays for carriage and insurance to the named destination point, but risk passes when the goods are handed over to the first carrier.

• DAT
Short form for: Delivery At Terminal
Usage: CPT <Named Terminal>
Description:
Deliver the goods to the buyer at the designated Terminal in the harbor. The buyer has to make the necessary clearance arrangements.

• DAP
Short form for: Delivery At Place
Usage: DAP <Named Place of Destination>
Description:
Deliver the goods to the buyer on the arriving mean of transport ready for unloading at the named place of destination.

• DDP
Short form for: Delivery Duty Paid
Usage: DDP <Named Place of Destination>
Description:
This term means that the seller pays for all transportation costs and bears all risk until the goods have been delivered and pays the duty.

Applies only for sea and inland waterway transport:
• CFR

Short form for: Cost and Freight
Usage: CFR <Named Destination Port>
Description:
Seller must pay the costs and freight to bring the goods to the port of destination. However, risk is transferred to the buyer once the goods have crossed the ship's rail. Insurance is at the cost of the Buyer.

• CIF

Short form for: Credit, Insurance and Freight
Usage: CIF <Named Destination Port>
Description:
Seller must pay the costs and freight to bring the goods to the port of destination. However, risk is transferred to the buyer once the goods have crossed the ship's rail. Insurance is at the cost of the Buyer.

• FAS

Short form for: Free Along-side Ship
Usage: FAS <Named Loading Port>
Description:
The seller must place the goods alongside the ship at the named port. The seller must clear the goods for export.

• FOB

Short form for: Free On Board
Usage: FOB <Named Loading Port>
Description:
The seller must themselves load the goods on board the ship nominated by the buyer, cost and risk being divided at ship's rail. The seller must clear the goods for export. Maritime transport only but NOT for multimodal sea transport in containers (see Incoterms 2010, ICC publication 715).

The buyer must instruct the seller the details of the vessel and port where the goods are to be loaded, and there is no reference to, or provision for, the use of a carrier or forwarder.