Cargo Ships and containers impact of Japan earthquake and tsunami

A New York Times article (March 26, 2011) describes decisions made by cargo ships, ship owners of leased ships and container owners to avoid routes and ports that might result in exposure to radioactivity.  Ships that test positive for radioactive materials would face inspections for many years afterward – thus increasing risk aversion of ship owners. As a result, many shippers are cancelling calls to ports such as Tokyo, and routing their ships to Osaka with overland truck routing to destinations near Tokyo. Container owners in turn are requiring recipients to take ownership of the containers – as any exposure would cause delays to ships carrying them.  The global impact of diversion of 40 % of Japan’s cargo from Tokyo to other ports, both for imports and exports to Japan is potentially significant and may last a long time – the radioactivity of the plant is thus a more significant deterrent to logistics than the earthquake.  What might be reasonable alternatives in the presence of such disruptions – if containers can only go in but not be returned, then should an alternative to containers be considered, even if not ideal from an handling perspective ? How will the need to truck product from Osaka to Tokyo impact delivery lead times – could increased goods laden trains enable smoother flow of product ? How should the much needed food import requirements in Japan be satisfied ?

About aviyer2010

This entry was posted in Global Contexts, Operations Management, Service Operations, Supply Chain Issues and tagged , , , , , . Bookmark the permalink.

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