The entire supply chain is under great financial stress as the spot price of WTI crude oil rose steadily to over US$110 per barrel, on March 13th of 2008 — a record-setting price.

While the price for WTI crude oil is expected to average near $100 per barrel through the rest of this year, transport companies and everybody else getting their supply through their services are bracing for the effects of higher fuel prices during the summer season, defined as the period from April 1st to September 30th.

Pricewise, let’s start with the regular grade gasoline retail prices, which averaged $2.93 per gallon last summer (of 2007) and are projected to average $3.54 per gallon during the current driving season.

The trucking business is going to be hit even harder as diesel fuel prices, which averaged $2.85 per gallon last summer, are projected to average $3.73 this summer.

In fact, the monthly average gasoline price at the pump is projected to peak at just over $3.60 per gallon in June while the monthly average diesel price is expected to peak at just over $3.90 per gallon in April.

These rather scary retail price projections reflect higher prices for the refiners’ average acquisition cost of crude oil, projected to average close to $97 per barrel, up from about $67 per barrel last summer which account for a hefty $30 price hike, per barrel. Furthermore, strong world distillate demand growth, especially in Europe and Asia, will do nothing to help the situation domestically, in America.

It is important to note, however, that even if the US national average monthly gasoline price comes to peak around $3.60 per gallon this summer, it’s entirely possible that prices, at some point, will cross the $4 per gallon threshold, severely hurting the transport industry and those who depend on it.

Countless consumers may be forced to reconsider driving their cars at all and the same kind of dilemma may happen for transport operators of all sizes as well as petroleum-based product manufacturers.

Transportation and logistics companies, especially in America, need to plan (and provision lots of “emergency money”) right now for this summer’s potential fuel price explosion.

Tags: gas, fuel, wti crude oil, oil, diesel, petroleum, pump, america, usa, transport, logistics, summer

The Government of Canada, the Province of Ontario and the City of Sault Ste. Marie today marked the completion of the new transportation corridor leading to the Sault Ste. Marie International Bridge.

The Honourable Donna Cansfield, Ontario’s Transportation Minister and Sault Ste. Marie’s Mayor John Rowswell officially opened the transportation corridor. A total of $11.2 million was shared between the Government of Canada and the Province of Ontario. The City of Sault Ste. Marie also contributed $1.4 million for construction, as well as $6.3 million for the purchase of required property.

“Sault Ste. Marie is the 9th busiest Canada-United States crossing and Canada’s new government is proud that this route could finally be completed,” said Minister Cannon. ‘”This transportation corridor is designed to ease local congestion, which will reduce emissions into the air and improve access between Ontario and Michigan.”

“Sault Ste. Marie is an important northern gateway. More than 130,000 commercial trucks carry about $3.5 billion of goods across the International Bridge every year,” said Cansfield. “The new truck route will reduce delays and save commercial carriers about $1 million a year.”

The new truck route, which will also be shared by cars, was designed to ease local congestion and improve access to the International Bridge connecting Ontario and Michigan. The new transportation corridor connects Highway 17 with the International Bridge via the Second Line Road and Hudson Street, and provides a more direct connection to Interstate 75 in Michigan. Trucks will bypass Sault Ste. Marie’s downtown area. The new route will reduce travel time for trucks and eliminate several 90-degree turns, making roads safer for residents of Sault Ste. Marie.

“This long awaited transportation corridor moves trucks out of the downtown area, allows traffic on the west side of the city to move quickly to the city’s centre, and lets us immediately advance Sault Ste. Marie as a multimodal transportation hub,” said Mayor Rowswell.

In the 2006 Federal Budget, Canada’s new government has committed an unprecedented $16.5 billion over the next four years for provincial, territorial and municipal infrastructure, including $2.4 billion over the next five years from the Highways and Border Infrastructure Fund.

This year, the Government of Ontario is investing more than $1.4 billion in highway improvements through its five-year ReNew Ontario infrastructure investment plan. The Ontario government has also invested an additional $400 million under Move Ontario, which municipalities may use for improvements to municipal roads and bridges.

Transport companies from Canada, the USA but also as far as Asia and Europe will love the significant time gains these new infrastructures make possible.

Manufactures and consumers, on both sides of the border, can now expect faster border crossings and much more efficient transit alternatives.

Everybody agreed there was a congestion problem and in no small measure, it’s been properly addressed. Another job well done!

Tags: transportation corridor, sault ste. marie, ontario, canada, usa, transit

Trade using surface transportation between the United States and its North American Free Trade Agreement (NAFTA) partners Canada and Mexico was 14.8% higher in March 2006 than in March 2005, reaching $68.2 billion, the highest monthly level ever recorded, according to the Bureau of Transportation Statistics (BTS) of the U.S. Department of Transportation (Table 1).

BTS, a part of the Research and Innovative Technology Administration (RITA), reported that total North American surface transportation trade rose 14.1% in March from February (Table 2). Month-to-month changes can be affected by seasonal variations and other factors.

The previous monthly high was $64.0 billion in October 2005. Surface transportation consists largely of freight movements by truck, rail and pipeline. About 90% of U.S. trade by value with Canada and Mexico moves on land.

Total North American surface transportation trade value in March was up 35.8% compared to March 2001, and up 100.5% compared to March 1996, a period of 10 years (Table 3). Imports in March were up 114.6% compared to March 1996, while exports were up 84.8%.

U.S. Surface Transportation Trade with Canada

U.S.–Canada surface transportation trade totaled $44.0 billion in March, up 11.4% compared to March 2005 (Table 4). The value of imports carried by truck was 8.6% higher in March 2006 than March 2005 while the value of exports carried by truck was 13.3% higher.

Michigan led all states in surface trade with Canada in March with $6.7 billion (Table 5).

U.S. Surface Transportation Trade with Mexico

U.S. – Mexico surface transportation trade totaled $24.2 billion in March, up 21.5% compared to March 2005 (Table 6). The value of imports carried by truck was 18.1% higher in March 2006 than March 2005 while the value of exports carried by truck was 21.9% higher.

Texas led all states in surface trade with Mexico in March with $7.7 billion (Table 7).

The Transborder Freight Dataset is a special extract of the official U.S. foreign trade statistics. The data are tabulated for BTS monthly by the U.S. Census Bureau’s Foreign Trade Division. March transborder numbers include data received by BTS as of May 15.

Tags: surface trade, canada, mexico, usa, foreign trade, statistics, transborder, bts

The World of Asphalt 2006 Show and Conference was a great success!

If asphalt is your trade, you should already prepare for the next World of Asphalt that will be held March 19-22, 2007 in Atlanta, GA.

Their web site should be updated soon with the relevant information about the upcoming 2007 Edition.

Looking at the 2006 Edition:

More than 4,145 asphalt, highway and maintenance industry professionals attended World of Asphalt 2006, a 26-percent increase compared to the last show, held in 2004, and more than two-and-one-half times the attendance at the inaugural 2001 event. Attendees came from companies large to small and from businesses in the United States and worldwide.

The international scope of World of Asphalt continued to grow, with visitors coming from more than 50 countries outside the United States, accounting for almost 19 percent of total show attendance compared to about 10 percent for the last show.

The show attracted a highly qualified audience, with a majority of attendees in management roles – with titles including president, owner, vice president, general manager, chief financial officer and purchasing, sales or marketing manager.

Tags: asphalt, trade show, audience, attendees, management, atlanta, georgia, usa, business, construction

The US Department of Transportation has made a significant announcement for the future of the Myrtle Beach Airport:

U.S. Secretary of Transportation Norman Y. Mineta today announced plans to spend $43 million over the next eight years to help Myrtle Beach International Airport pay for construction of an apron and new taxiways supporting the new terminal to handle growing business and attract new customers.

The investment will allow the airport to accommodate up to 14 new gates by 2022 needed in anticipation of an increase in traffic at Myrtle Beach, Mineta said.

He noted that improving capacity at smaller airports is vital to serving the increased number of travelers and businesses coming to the area.

“Our airport investment strategy must include smaller facilities that are starting to see more traffic,” Mineta said.

The Secretary also said the first installment of $4 million would be available later this year.

Myrtle Beach International Airport is one of the faster growing airports in the south handling over 785,000 passengers in 2005, an increase of almost 20,000 passengers from 2004, he said.

This announcement for Myrtle Beach International Airport is one of four financing pledges Mineta has unveiled in the past few months.

The remaining three include over $337 million for expansion at Chicago O’Hare International Airport, $200 million for a new runway at Washington Dulles International in Virginia, and $26 million for a new taxiway at Atlanta Hartsfield-Jackson International Airport in Georgia.

Tags: myrtle beach airport, taxiway, usa, airport expansion, airlines, passengers, investment, strategy