2012 Ohio Conference on Freight:
Ohio's Place in International Freight Industry
The freight industry in Ohio is changing in response to events in the world economy, as a widened Panama Canal opens for business, and as different transportation modes develop efficiencies.
Dr. Marc Levinson, one of the keynote speakers at the 2012 Ohio Conference on Freight, spoke to TMACOG about developments that he foresees in the international freight industry
Dr. Levinson says that one factor that could have a big impact on Ohio industry is manufacturers’ decisions about where to locate new facilities. The growing cost of transportation is causing manufacturers to give more consideration to locating facilities closer to their markets. Forty-three percent of the U.S. industrial market and 47 percent of the Canadian market are located within a one-day drive of northwest Ohio (500-mile radius).
Taking an even wider view, when transportation costs are added to labor costs, Mexico might look better as compared to China. Dr. Levinson anticipates that Mexico will continue to grow as a manufacturing center serving the North American market.
Freight coming from Mexico to the Midwest will be moving on rail and highways. Dr. Levinson notes that the rail system in the U.S. “is as efficient as anywhere in the world.” Rail is well-suited to the long distances traveled in the states. Another reason why U.S. rail excels in freight movement, says Dr. Levinson, is the fact that the movement of goods is the primary business of rail in the states whereas passengers are the priority in Europe and Asia. The high speed rail system in Japan is exclusively for passengers. There is a movement in Europe now toward more use of rail and barges because of a push for fuel efficiency and cleaner energy but for now passengers are the primary rail customers.
While rail and highway systems in the U.S. are well-integrated and well-operated, Dr. Levinson says we have room for improvement in ports and intermodal facilities. “We have a lot to learn in terms of port efficiency,” he said. He explains that the U.S. container terminals are small as compared to those in Europe and Asia, and Europe is more highly automated.
Widening the Panama Canal has implications for worldwide freight including Ohio. Asian markets looking to move goods to Ohio will be more likely to use an East Coast port after the canal is widened. When that happens, rail and truck traffic from the East Coast to Ohio is likely to increase. In the other direction, exports of Ohio manufacturers and farm products to Asia would also move to the East Coast rather than the West. Another trend that would affect East Coast ports is growth in manufacturing and exporting from Africa. As the African population grows, Dr. Levinson expects manufacturing in the continent to increase.
Dr. Levinson will present the keynote presentation at dinner Thursday evening September 13 at 6 p.m. following a networking reception. A book signing for his work, The Box: How the Shipping container Made the World Smaller and the World Economy Bigger, will follow. There is a separate registration option available for those who choose to attend only the Thursday reception, dinner, and presentation.