First, lets get a clear picture of what blockchain technology is.  A blockchain facilitates secure online transactions. A blockchain is a decentralized and distributed digital ledger that records transactions across many computers in such a way that the registered transactions cannot be altered retroactively.  So how can this technology benefit your food grade supply chain?  Shipping today is riddled with documentation, regulations, and policies that require certificates of origin, letters of credit, bills of lading, vessel manifests, and customs declarations.  When dealing with food grade materials, the paperwork can become overwhelming.  Blockchain converts documents, such as traditional vessel manifests or bills of lading into a digital ledger that all parties can see and share. This distributed database maintains a continuously growing list of data records hardened against tampering and unapproved alterations.  

Like with most things change tends to generate more fear than optimism.  The robotics and technology trends are generating similar concerns among the unskilled worker population. Historically robotic applications have been limited to repetitive, mundane manufacturing functions; that too is likely to change.  Technology and robotics engineering is constantly evolving to expand their use in more complicated processes. A somewhat dated study from economists at MIT and Boston University published by the National Bureau of Economic Research attempts to quantify the effects of industrial automation on American employment. It found that between 1990 and 2007, each robot added to the workforce reduced employment in the local commuting area by three to six jobs.  The addition of one robot per thousand workers also lowered wages by 0.25% to 0.5%. Overall, the report estimates robots cost the US between 360,000 and 670,000 jobs total during the span in question.

Robotic Applications in Warehouse Operations

Automation and robotics has been in place in the Logistics industry for years.  Most prevalently in the warehouse and distribution centers. Warehouse-based robots help increase efficiency and productivity when performing product retrieval tasks. At warehouses operated by The Gap, Staples and Zappos, for example, autonomous robots receive information about a product required for an outgoing order. The self-propelled robot navigates the warehouse, finds the product and transports it back to a human operator who processes the order. The robots continually rearrange the warehouse to place popular products around the facility's perimeter, reducing the time spent to route these products to employees. It may not be time to panic about job security just yet. The reality today is that these automated warehouses are typically highly mechanized environments that still employ people in key functions. An example would be a modern sorting center which has much higher productivity and accuracy than in previous generations. Even with all of this advanced technology, in large sorting hubs there may still be more than 1,000 employees who spend their time loading and unloading trucks, handling parcel containers, and manually sorting odd-sized items. There is also the need for supporting staff required to maintain these complicated systems. One thing is certain; the cost and time savings generated by these automation applications means the technology is here to stay. 

Automation on the Road

Autonomous trucking technology companies have popped up everywhere in the past 12 months, each with similar technology that is focused on clearing two very important hurdles: getting the truck on and off the highway.  

2016 was a lackluster year in the transportation industry. Soft demand, driver shortages and looming federal regulation set an uneasy tone for the market. Encouragingly, analysts predict a more positive 2017 albeit in the 3rd and 4th quarters. 

The general consensus of transportation executives and industry analysts is a continuation of 2017 volumes and rates. Leading indexes of the manufacturing sector, which accounts for 80 percent of freight volumes, show that growth in that sector has been flat for almost two years. Orders of capital goods, an indicator of business investment, have come up slightly since sliding in a ditch during the summer. Some good news is the credit markets are expected to loosen up in 2017 under a Trump presidency. The bad news is that interest rates are edging up. In a business with margins as thin as the trucking industry and forecasts for a flat line in 2018, interest rates will make or break additional investment decisions.

During President Obama’s two terms, Washington regulators have produced 600 major regulations with dozens more in the pipeline, many of which will be affecting the trucking industry. They cover everything from emissions, safety reporting of accidents, hours-of-service (HOS), electronic onboard recorders, entry-level training, fuel-mileage standards, overtime pay, hair follicle testing for drug cheaters, speed governors, sleep apnea testing, diesel emission standards and visas for foreign workers who might ease the truck driver shortage. 

Texas is among the busiest states for commercial truck transportation in the U.S. The congestion, inbound traffic volumes and security concerns from its southern neighbor all contribute to its high volume of truck transportation. The volume of cargo traffic and private vehicle traffic in many areas has grown faster than the public road infrastructure. Texas has seven of the top 25 freight bottlenecks in the nation, located in Austin, Dallas, Fort Worth and Houston. Truck traffic over congested public roads contributes to major economic and quality-of-life challenges. Engineers at Texas A&M have designed a possible solution to these traffic issues. 

The Department of Transportation's Office of the Inspector General is on a fact-finding mission to determine the effect of detention on driver hours of service. The purpose of the investigation is to measure detention times during loading/unloading and to quantify the impact of these delays on our economy. 

In a comprehensive presentation at the recent NASSTRAC (National Shippers Strategic Transportation Council) Shippers Conference and Transportation Expo in Orlando, Fla., Bob Costello, chief economist at the American Trucking Associations, provided an outlook specifically focused on the freight industry.

Orders for durable goods fell in February, capping a downward trend in the last four months, reflecting a broad-based slowdown that underscores lingering softness in U.S. capital investment. New orders for manufactured durable goods in February decreased $6.6 billion or 2.8 percent to $229.4 billion, the U.S. Census Bureau announced today. This decrease, down three of the last four months, followed a 4.2 percent January increase. Excluding transportation, new orders decreased 1.0 percent. Excluding defense, new orders decreased 1.9 percent. Transportation equipment, also down three of the last four months, led the decrease, $4.9 billion or 6.2 percent to $74.2 billion.

Economic Implications

Economists viewed the big decline in durable goods orders as evidence that manufacturing companies remain under pressure. Manufacturing experienced a challenging year. The outlook for 2016 remains uncertain among most economists. The industry is being hurt by economic weakness in major export markets and a strong dollar.

“A lot of it is a function of businesses not being very confident about the outlook,” said Stephen Stanley, chief economist at Amherst Pierpont Securities LLC in New York, who correctly projected the drop in durable goods orders. “That’s a combination of a few things -- businesses who export are potentially facing weaker demand, and another important element of it is the policy landscape is very uncertain right now.” The absolute circus, it seems at times, that is the 2016 Presidential election in the U.S. is adding to the economic uncertainty.