Tariffs, Tugs, & Icebreakers: Surviving the Maritime Mess

In the finale of our Best of 2025 series, we’re highlighting the modes and legalities that usually stay "out of sight, out of mind." We start with Jason Aristides of Open Tug, who is bringing tech to the 12,000 miles of US inland waterways. Then, maritime law expert Lauren Beagen joins us to break down the residual effects of the 2025 port labor strikes and the new Office of Shipbuilding. We wrap up with Grace Sharkey, diving into the "Icebreaker Race" in the Arctic and the shady reality of celebrity private label brands.

Key Takeaways:  

• Why barges are 85% greener than trucks (and 70% cheaper). 
• The truth about the "Hub and Spoke" model in carrier alliances. 
• How the US is falling behind in Arctic "chess" with only two functional icebreakers. 

Timestamps:

• 03:50 – Open Tug: Standardizing the River System 
• 39:51 – Port Strikes & Automation 
• 1:39:51 – The Polar Silk Road & Arctic Shipping 
• 2:09:49 – The Private Label Paradox

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Transcript

Blythe Brumleve Milligan: 0:42

Blythe, welcome into another Best of edition of everything is logistics, a podcast for the thinkers in freight. I am your host, Blythe Milligan, and we are proudly presented by SPI logistics. And in this final part of our best of series, this is actually part two of the Venn diagram of your favorite topics and interviews, plus my favorite topics and interviews. And it's my birthday week, so I get to kind of had the final say on what episodes appeared in this list, because it was a lot to choose from. I am very lucky that I get to talk to so many smart people, and this episode is no different, because we are starting off strong talking about unlocking freight capacity on our inland waterways with the company open tug, which is super fascinating. I haven't heard really any other show talk about this, but the country of the United States has this vast inland waterway system that starts in the Gulf of America. Don't hate me, that's the name of what it's actually called, but the Gulf of America all throughout the central part of the United States, and it allows for a tremendous amount of freight movement through these inland waterways. And open tug is the first company that's trying to standardize the tracking and the booking of different vessels along the inland waterways. So really super cool interview with that gentleman over at open tug. And then next on the conversational list that we have our conversational whatever the next step in the episodes that we are going to be playing is talking about the port labor strikes, the tariffs and automation all within the maritime sector, with maritime law expert Lauren biegan. Now she has her own podcast, and so she's knee deep in all of this different types of news that's affecting the maritime industry, and this year was a lot because, like I said, Port labor strikes, tariffs like those. In and of itself, could be multiple, multiple episodes, but Lauren does a fantastic job of breaking that down for us in one episode, and then third on the list of our best of series. We're bringing gray Sharky back for one of those segments that we covered earlier in the year, talking about icebreakers and these giant ships that are in the polar regions of the planet, and their main job is to break up these frozen ice sheets in order to allow for other ships to make safe passage. It's really cool to watch some of these ships and just learn where the US kind of stands in regards to the rest of the world when it comes to icebreakers and how many we have and how many we really need. And so we talk about that in one of our deep dive sessions, and then finally, in another deep dive session between Grace and I, we talk about return logistics in private labeling, and how that sort of part of the supply chain all works. And so these were, you know, some of our other, you know, favorite episodes, some of your favorite episodes. And so I hope you enjoy this final part of this series. And so as soon as this is done, we're going to get going and get cracking on the new episodes for 2026 and so we can continue bringing you this best of content. So thanks to all of you for tuning in and listening along. I will link to all of the other best of episodes in our show notes, in case you want to, you know, keep the party going. So thanks for listening. Cheers to 2025 and let's kick off 2026 with a bang. Today, we're talking about one of the most underrated parts of the US freight system, the inland waterways. You know, that 12,000 mile network of rivers and canals that quietly moves hundreds of millions of tons of cargo every year. Yeah, that one Joining me is Jason Aristides. He is the CEO of open tug, a company that's bringing modern tech, think booking platforms, AI and GPS tracking to the tug and barge world. Jason's on a mission to make marine freight more accessible, efficient and a whole lot smarter. So we're going to be diving into how this part of the supply chain works and some of those interesting factoids that surrounds the US inland waterways system. So Jason, welcome

Unknown: 5:08

to the show. Thank you very much for having me. You certainly know your barges, and you know how to introduce them as well. So yeah, honored to be on here and really looking forward to diving in deep, but not too deep, only to the depth of the Mississippi River. We're not going blue water today.

Blythe Brumleve Milligan: 5:24

Nice, awesome, awesome little segue there, because as we before we hit recording, or before I hit record, we were talking about a previous episode that friend of the show, Grace Sharkey and I have done an episode on sort of the underrated modes of shipping. Bly, and it was tugs. It was a TUGS and barges, Folch focus feature, and that was how we got introduced. Grace Sharkey was kind enough, you know, to point you guys out, and we were able to, you know, sort of showcase the software live on on the show. So it was really interesting. She sent that episode over to you guys, over at open tug, and now we are making this conversation happen. So before we get into sort of the software visibility and inland waterways issues, give us a little or maybe a background of how you got into this industry because you were, you were explaining how to pronounce your last name before we hit record. And so I'd love for you to share that with the audience.

Unknown: 6:17

Yeah, certainly. Well, my road to my river, to getting into the barging world, is relatively long. And I, you know, started growing up in Seattle, and around that time, I was really focused on, on trying to build something really great around helping improve the way America does business. So my best friends and myself, who are now my two co founders, we started working on trying to predict things that were hard to predict, one of those being stocks. We originally started building like trading algorithms to try to predict the stock market, although there was some bigger players in the game, and we realized it was somewhat of a futile effort, so I started to shift my focus. And my freshman year of college, I got an opportunity to work at a great company, FOSS maritime, which is a leading tug and barge company on the West Coast. And we'd be moving barges to and from Alaska, and they would always come back one way empty. And you know, across the board, this is a massive problem, huge numbers of assets. They go on a one way move, and they always come back empty because there's very little information systems and very little technology connecting parties to the availability of these assets. And the CEO of the company said to me, you should fill, build a platform that connects cargo to the empty space in the barges. It's an open tug. And ultimately that put together the idea for creating open tug. And I went to my co founders. We couldn't predict stock, so we thought, hey, we see this huge opportunity where barges are moving some of the most important commodities across the US, almost in a forgotten mode of transportation. People aren't thinking about, Hey, how can we make this better? Because we can move cargo 85% more like green compared to trucking and rail, and significantly cheaper. But people lack the understanding of how to do it efficiently, where they can find barges. How much does barges cost? And we wanted to bring that all into a software platform. So I worked on that through college. We started building the building blocks behind it. And once I graduated, I realized that I had just fallen in love with the barge industry, and I was ready to do whatever it takes to build the best platform to help America leverage barges.

Blythe Brumleve Milligan: 8:41

So for barges in particular, what type of commodities are mostly shipped using barges?

Unknown: 8:47

So yeah, that's a great question. Barges move all types of commodities, but specifically it moves 70% of America's grain is all moved on barges, a huge amount of oil, liquid products, all the chemicals that make gasoline, like Nashville, Tennessee, 40% of their gasoline is come is shipped by barge. So all of the heavy products, products that you can't count, are primarily moved on barges, but you also have barges moving like military equipment, generators, heavy over the road like oversized cargo, because when shipping a load that's too heavy for standard road weight. You don't need a permit to go by barge, but you need a permit for every state you cross via truck. So anytime people can get stuff on the water, they want to do it, I would say the largest thing that barges are primarily not shipping on the inland waterways are containers, although we hope to help change that one day.

Blythe Brumleve Milligan: 10:41

Oh, that's super interesting. I would just have imagined that. You know, most of our freight system, especially in the US, is built, you know, whether it's a cargo ship, intermodal or by truck. They're all outfitted for, you know, a container, but not necessarily for barges, is what you're saying.

Unknown: 10:57

Bar so there are, there has been some grassroot movements to start shipping barges full of containers. New Orleans has invested, like 80 billion, I believe, to build this new container facility at the mouth of the Mississippi River, which will effectively give it access the river system, access to a huge volume of containers that need to go direct all the way from St Paul, Minnesota to Pittsburgh, Tennessee, Pittsburgh, Pennsylvania to like Missouri, and that potentially could kick start a great opportunity to. Move more containers on barges, because it goes straight through the heartland and actually aligns really well with the cargo flows. You know, we export commodities for the most part, and those travel south on barges loaded, and then those same barges go north, empty, but we import tons of finished goods, and those could be moving on those empty barges at effectively half the cost of taking the barge one one way.

Blythe Brumleve Milligan: 11:59

And so for maybe folks who are unaware of shipping through the inland waterways, it's mostly the Mississippi River and its canals that are all connected through sort of the middle of the United States. And so for a lot of these commodity flows of what you're talking about, you know, the cargo ship comes into maybe the port in New Orleans, and they offload there, and then the freight moves on a barge from there. Is that? Is that what you're I guess the hypothesis, or that's what is actually happening, yeah.

Unknown: 12:31

So today, I mean, barges are receiving bulk vessels, like, whether that's bulk dried cargo or liquid that comes into, say, the Port of Houston, and then it might need to go somewhere inland, such as St Paul or Nashville. The barge would go receive cargo directly from the ship. It's effectively a middle mile, and bring it all the way inland, or vice versa. If your farmers loading grain in the bread basket of America, and that needs to go over to Europe, it comes down, transloaded into a ship, and then so forth. So effectively, you know, when it comes to containers, the idea would be, as those same ships are unloading in New Orleans onto trucks, like 80 trucks. Effectively, one barge would be able to carry those. There's that equivalent of containers, and you can fit up to 40 barges together, and which would be, you know, the equivalent of three to 4000 truckloads?

Blythe Brumleve Milligan: 13:32

Oh, wow. So what I'm curious, if you I'm not sure if you know the answer to this, but as you were talking, I'm thinking that for a lot of maybe the inland waterways, the the water is much smoother. It's much more calmer than, say, the open ocean. So are a barge is able to travel in the open ocean pretty easily, or those maybe like a different constructed type barge, right? You haven't,

Unknown: 13:56

oh, go ahead. Oh, yeah, you would be using a, like an ocean going vessel. There's a some of them. Some of them are ocean going barges. You get them certified to go on the ocean. And we actually work with several companies that are doing barge transportation to Alaska, Puerto Rico. Those are all an ocean going barges. And today, those move containers already in those regions, the inland side, those all say on the inland you would have to get it certified if you wanted to go between inland and ocean. So most of the inland river barges, they're all staying on the inland rivers.

Blythe Brumleve Milligan: 14:33

That makes sense because, because my first thought was, why don't why don't we just build smaller cargo ships instead of a barge? But I think a barge would give much more flexibility in the type of freight that you can haul, instead of just being reliant on just containers. Is that an accurate assumption.

Unknown: 14:51

Yeah, that's an accurate assumption, along with a couple other benefits of the barge. So barges, they move in effectively these toes where you'll have 40 barges strapped to one tugboat. And what that lets you do is effectively move 10 acres worth of cargo with one four man crew on the boat, and then you you don't have to have all that cargo for one person. You can stop and drop one barge at a specific terminal and keep moving up and down the river. And the barge effectively acts as floating the storage. It's unmanned as well, so it's a similar relationship between a truck and a trailer. If there was many more trailers attached to that one truck. So you, if you were looking at it from a trucking standpoint, you have one trailer or one truck cab pulling 40 trailers, and then it just stops, drops them off as it goes and continues on its route.

Blythe Brumleve Milligan: 15:48

And so how does open tug play a role in this definitely.

Unknown: 15:53

So one of the great things about barges is they're significant, they're very cheap and cost of effective, but they're rarely just in time. And the reason is, is because there's lots of unpredictable factors that occur on rivers. So we have, and if you want, I can share a screen and visualize what that looks like. Let me see if I can share a screen.

Blythe Brumleve Milligan: 16:19

Hopefully you should have the option at the bottom. There we go.

Unknown: 16:21

Let me, are you able to see my screen?

Blythe Brumleve Milligan: 16:24

Let's see. There we go. Perfect.

Unknown: 16:27

So this is a look at the river system. It's. And barges. While they're very cost effective, there's a lot of uncon unpredictable things that occur. So we have these things called locks and dams, and you can see that many times there'll be delays that occur at the locks and dams that can potentially last this one is like 20 hours. So that's a pretty large delay. In addition to that, you'll see here there's some flooding going on in the river system, actually quite a few floods right now. Here you can see an overview of the core inland waterways, Missouri River, the Mississippi River, the Ohio River, Arkansas intercoastal waterways, and all of these are affected by things such as visibility, water levels, lock delays. So open tugs goal is to help bring just in time supply chains to barge transportation by predicting all of the conditions that will affect the barges voyage, and help ensure that that's known before the shipment occurs, to enable large companies to set up just in time supply chains by barge.

Blythe Brumleve Milligan: 17:44

And so for folks who are just listening and not able to see the screen right now, what we're looking at is a, you know, a map of the United States, but mainly focused on the inland waterways. So you think of, you know, Louisiana, the Port of New Orleans, where this, you know, these commodities are offloaded and then added to a barge. And then what you're showing us now is different filters on top of those inland waterway routes, which are showing the different dams that you're talking about, potential flooding that could impact your shipping. And then also, like, weather patterns, is that what you were also the filters on the map of what you were showing? Yeah.

Unknown: 18:19

So when wind gets too high, like, as in all forms of transportation, a barge may stop and wait, and that obviously adds time and money. So one of the parts we do is we provide instant quoting, so we predict the cost of the trade or the shipment by barge. And we're using all these factors. So if you think you're shipping today for 10 grand, but you don't realize that, say there's two days of wind that could add, let's say, another 20% so we're using all these data points to predict. You know if you want to move a barge like move it on this day, because you won't be subjected to these wind delays and or if you do have to, at least, you know how much is probably going to cost with that in account. So as you can tell people who are using barges, they're unlocking major value for their company, because they're able to ship it at almost 70% less price than using another mode. But it requires, like, a high level of knowledge to know how to use barges.

Blythe Brumleve Milligan: 19:24

And what are some of those? Maybe those little points of you know a high level of knowledge is that you know some of the data points that we were seeing on the screen, or maybe

Unknown: 19:33

certain like, data points regarding that you know, like, how much cargo Are you able to load in the barge when the water level goes down, it's like, what if water levels are low, you can't put as much cargo in the barge. Or if you are shipping not a specific area, and you don't pay attention to what lock closures are going to be, or lock delays, which is like the dams I was showing you, then you could be subject to paying a lot more money than you anticipated, if you were unaware of like, how the locks and the water levels occur, or if you're unaware that when visibility gets below a certain level, the barge won't move. So all these different pieces of knowledge go into figuring out how you can ship affordably by barge, and because a lot of it is just scattered across many different websites, not even on websites altogether, it makes it daunting for a supply chain manager to say, hey, I want to start looking at using barge for our company like they need to come from the barge industry to a degree, or have a mentor to can teach them about it. And our goal is to, like, democratize barge by putting everything into one place where any supply chain or logistics manager can pick up and instantly know, like, hey, what does it look like to start leveraging barge in my supply chain, and have a lot of the answers.

Blythe Brumleve Milligan: 20:58

And so essentially, if you're not in a rush to ship, or maybe you have a couple of weeks timeline where you don't have to worry about maybe different weather patterns, you can prioritize a more cost effective route using a barge versus other traditional, you know, sort of transportation models, like over the road or, you know, intermodal. Is that just sort of the goal of open tug?

Unknown: 21:19

Yeah, that's definitely the goal of open tug. And even if you do have time sensitivity around products, the goal is to enable you to plan effectively. So like it can show. Up on time, but you just like, it's the transit will take longer, if that makes sense. It does. It's like, not a longer transit time, but if you're planning on it to show up at like, ahead of time, at that end of the transit, it can still be just in time, and we want to bring the predictability, but it does take a large, a longer lead time from when you get it out the door.

Blythe Brumleve Milligan: 21:54

What was crazy about, what you were you were going through the demo, is that you were talking about how one tug can have several barges, you know, hooked up to it. Essentially, are most barges the same size. Yeah.

Unknown: 22:08

So barges are in a pretty much a common size there. There's several types. So you could have basically a hopper barge, which is generally moving grain. They're 195 feet long by roughly 35 feet wide. Carries about 1500 tons of cargo, and most of them will be between 200 feet, 195 feet on the inland side. Then for tank barges, which is for liquid, you have like three standard sizes, 10,000 barrel, 30,000 barrel, and sometimes 25 on the ocean. They're all different types of sizes, and they don't move as frequently in what they call a tow, which is a group of barges and a boat.

Blythe Brumleve Milligan: 23:00

And so would you with open tug in particular? Are you I noticed in one of the videos prepping for this conversation that you guys have GPS trackers that you're putting on the barges? Is Is that accurate? Yep.

Unknown: 23:12

So here's an example of one of our GPS devices, or satellite transmitted. So one of the things about barges, like a trailer or a container, is that like they're untracked, but they move across different boats. So you'll have one boat moving a barge, and then it'll switch off to another boat. So if you're a shipper of this barge, or even the barge owner, you can lose visibility of it, like you can't just track the boat to know where your barge is, because it probably it could have gotten dropped off. And the whole industry prior to open tug traditionally, was trying to track their barge based on the boat. Somebody tells them it's on. So one of the things you want to do is bring people that real time visibility of where their barges are. So we're deploying tracking devices. It's really easy to put it on, like with a magnet, and we actually work with a network of contractors and surveyors who can place them for us, for our customers, at any of their facilities. So across the Inland system, we already have people with our inventory who can go put it on your barge.

Blythe Brumleve Milligan: 24:19

Oh, that's super interesting. And so you're able to provide that, that real time visibility, which is, I think, you know, lots of companies talk about visibility. It's mostly on the cargo ship side of things. But for for trucking, there's unless you have, you know, sophisticated tracking, ELD, you know, things like that, which some carriers do, but majority of trucks don't have any kind of, you know, visibility, unless the driver is is being tracked. And so for this, it sounds like it's much more efficient. Why do you think that more companies, or maybe more brokers, or, you know, more shippers don't use, you know, barge traffic, or barge shipments. Or, well,

Unknown: 24:58

I mean, it sounds silly, but I believe it's a huge lack of understanding of what the rivers have to offer. I'll give you an example. So I was at a trade show in Houston, at a shipping conference, and I was talking to a major ocean line, and I asked them, like, do you guys ship containers on barges ever? And they respond to me was, you can't send a barge to Chicago, so No, and I know that to be false. We're moving barges to Chicago all the time from Houston, and we were in Houston at the time, so there's a large misunderstanding of, like, where these rivers can serve, what the density of is. There's like 40,000 barges moving at any given time on the river system. And like I mentioned before, most people, they go through like, supply chain school and they learn about truck, rail, ocean. But nobody's talking like people just don't really talk about barges a great deal. They, just as you mentioned, are quietly moving millions of tons of cargo, but they're just out of sight, out of mind, and yeah, historically, I feel like has been just overlooked, although, I will say, with regard to containers there, I think one of the main reasons that we're not using tons of barges container barges is like there's not as many terminals on the inland side set up to handle containers. So unlike Europe, in Europe, they use barges, and they barge. Containers all across Europe, and they have basically more container ready terminals to load and unload those along the rivers. But in America, it hasn't come yet. Like I mentioned, I believe the Port of New Orleans new container investment might spur that though. Oh, that's interesting.

Blythe Brumleve Milligan: 26:48

So they're the only port that is really investing in this.

Unknown: 26:51

Well, there's quite a few more ports, but port in New Orleans is effectively like the gateway to every part of the river. So all you really need is New Orleans to, like, bring the container volume, and I think the rest will follow.

Blythe Brumleve Milligan: 27:06

Now what is, I guess, sort of the furthest, I guess, maybe east or west that you can go by barge, or does it really depend on the water flows?

Unknown: 27:16

So I am actually starting a a I'm starting an initiative that I know will take me years to accomplish, but I'm, I'm looking to bridge effectively, the Snake River with the Missouri River to enable you to cross the country via water, to go from Pittsburgh to the Pacific Ocean via the river, it would require a 200 mile canal between the Snake River and the Missouri River, but China made a 1200 mile canal. So I feel like we might be able to do it our mind to it. But as of right now, you can go as far east as Pittsburgh, Pennsylvania, as far north as St Paul, Minnesota, and as as far west. It depends on which rivers you're looking at, but for the most part, you can make it all the way to past Omaha, Nebraska, Sioux City, Iowa, would be the furthest west you can go on the Missouri River right now

Blythe Brumleve Milligan: 28:27

and then. That's the I would imagine for the rest of those terminals. So that would be ideal spots for those terminals to start to pop up, where you can start transloading some of those shipments from the barge over to probably truckload Intermodal Freight, that kind of thing. Yeah.

Unknown: 28:42

And, I mean, there are lots of terminals, but they just don't all have container grains. Like most of them don't have container cranes. There's like, tons of terminals, so they just need to crane. But, you know, if the volume is there, like, they'll go buy a crane. So I think that that's kind of what I'm I'm anticipating as New Orleans starts to bring in more containers, those like that, will open the doors for the ocean lines to start having those conversations, Hey, how can you get my product, like, all the way inland with in bulk, without having to take it off the water. And they probably, they're more than likely. And I've spoken to many of the terminals myself, and I know they want to do it. So it just depends. It depends, like, can they find the right shipper for it?

Blythe Brumleve Milligan: 29:28

Are? Do you consider open tug more of a visibility platform, or, like a TMS platform, maybe, like a, I don't know, BMS, like barge management system. Like, what is that? What is, I guess, the the tech stack look like, and who is the ideal user? Is it a shipper? Is it a broker, a carrier?

Unknown: 29:49

Yeah, so I would, I would consider us an optimization and visibility platform and automation platform. Effectively, we work with both the shippers, the barge lines, and we work with third parties involved in the transaction, because on every barge shipment, there's many parties who are involved. You have two terminals on either end, you have a barge line, a tugboat company, a shipper and like an inspector or a surveyor, all of those people, they need to know when the barge will arrive in order for them to do the job right. And everybody's subject to the weakest link. So if the terminal doesn't know that you're showing up, even if the inspector was efficient, the shiver was efficient and the carrier was inefficient. Like, you're still stuck because the terminal didn't know you were coming. And that happens a ton in the barge industry, because they're not tracked and people aren't sharing information. So we lose barge days all the time. Like there's lost barge days because nobody told the terminal that it was coming, and the barge shows up, and the terminal is like there. So part of what we're doing on the visibility side is helping align all the stakeholders and effectively enable them to amp it up by creating more barge days, giving them everybody who needs to know the information, the information and a prediction of when it'll arrive, to create more barge days, make more barge capacity. And then on the optimization side, we're effectively pulling in all the data about like, water levels, locks, traffic, helping recommend to shippers and operators, like if you don't. Ship until tomorrow, you'll save, you know, X $1,000 because you won't be waiting for wind. So that is effectively more on the optimization side.

Blythe Brumleve Milligan: 31:40

Well, that's super interesting, because I where it is. I guess that almost sounds like a routing guide, where you would need to, you know, be included in a shippers routing guide or in a broker is routing guys, and then that way, they are making sure that, depending on the freight, that they could save a bunch of money if they just move it in a different way, versus what they're typically, you know, using trucks for,

Unknown: 32:02

yeah, and we definitely, we definitely have, like, route planning, and we also have built an AI that reads through all of the emails from that people are sending to each other, and keeps the platform always up to sync with all the emails that are happening. So they may be scheduling an order via email and a carrier is sending them update via email. The AI effectively, like reads, it extracts all the events to help with like auto payment with like demurrage claims with general tracking, and then we try to recommend them a way to save in that process.

Blythe Brumleve Milligan: 32:41

So when it comes to maybe some case studies or like shipping stories, are there any interesting case studies that you know open tug has participated in maybe one of your customers has that you can share with us.

Unknown: 32:56

Most of the stuff we do is like pretty much covered under non disclosures for the most part. But we are working with some of the largest oil and gas companies in the world and some of the largest barge lines in in the system and and helping them optimize their barge supply chains. So what does too much more specific around like those companies? Sure.

Blythe Brumleve Milligan: 33:21

So, so give me, I guess, maybe some examples of some more interesting freight that you've seen hauled on a barge, maybe during your previous days, or, you know, current days?

Unknown: 33:32

Yeah, definitely. So, I mean, people are moving all types of stuff on barges, like we've helped folks move entire trains on a barge down the river system, where they're transloading, like a rail, like a train car, onto a barge and and taking it all the way down the rivers. That's, I mean, it's in Europe, they like the guys driving the barges there will have their entire families living on the barge. And I saw a child's playset on top of an oil barge, which I don't think that would pass the mustard for regulation in America, but it's cool that they do it out there.

Blythe Brumleve Milligan: 34:13

Well, that brings up an interesting thought is, does an open tug exist in, say, Europe or South America? Or is this really like this visibility approach into tugs and barges? Does that really only exist within your company?

Unknown: 34:30

I mean, I would say we are a very unique company focusing on bringing predictability to river transportation. And they don't exist in Europe and South America yet, but they're about to soon.

Blythe Brumleve Milligan: 34:44

Yes, well, that's it's interesting. You say that because Grace, Grace and I have done a show on South America, South American logistics, and they have the Amazon River, right? And so for a lot of shipments, they are hauled into, I think Peru had just opened up one of the biggest mega ports in South America. And so they're, they're transloading all of that freight off of, you know, the port in Peru, and then they ship it over to the Amazon River, and then it they're, you know, barges down in there. They're, they're using different trucks and all different kinds of methods of shipments.

Unknown: 35:19

It's really quite incredible. They have a vast river system, and one that we definitely want to help, help amp up. I think that there's a lot of opportunity in the South American markets. They're starting to become more and more prevalent and like the grain commodity world. And I think in order for them to fully maximize, like their output for exports, they need to like maximize their usage of barges. And I think barges is one of the reasons that America is the top exporter of those seven commodities, because we have such great access to move huge amounts of cargo directly from their source out to port on barges.

Blythe Brumleve Milligan: 36:02

So what does, what does expansion look like for open tug? What? What? What's in the future? Maybe planned that that you could share with us?

Unknown: 36:10

Certainly so when it comes to to American barge operations like our goal is to effectively remove any empty miles and unused barge days by optimizing, like I mentioned, the entire system of all the parties that are involved on the barge. Transaction, and we want, as part of that, we want to deploy trackers across every barge in America. And, you know, bring visibility to the barge market. As we expand there, we're already in the process of getting into Europe, South America will be next. And once we have brought this level to the the our existing stakeholders, we're going to be effectively automating the barge logistics as a whole, so recommending, once an order comes in, which barges are doing this job for the most efficient price, and helping orchestrate which barges provide what service.

Blythe Brumleve Milligan: 37:13

That's awesome. I mean, logistics has obviously been around since the, you know, the dawn of humanity, and so the fact that we have this incredible system to use and transport goods all throughout the world, and no one has put any kind of visibility solution in place until your company, I think it's really fascinating. You know what you guys are doing, and hopefully, you know, you can get into those different markets and be able to share some of that insight and some of that data, you know, with us all, because it's truly fascinating how we can trans the creativity, I think, behind all of these different shipment options. So anything that you feel, Jason, that that's important to mention that we haven't already talked about,

Unknown: 37:52

well, I think we've covered a lot of great stuff. I mean, some of the things that are also on our roadmap is helping bring, like, autonomous barges into the market. So, you know, barges they like. I think moving them on a boat is great long term. When you're doing a long haul like you can put 40 barges on a boat and move them all together. But once you actually get within the ports, you need, like these other shift boats to move the barges around. And I think bringing autonomous barges that can shift themselves will really speed up the entire system, because you don't have to be waiting around for boats to come and be ready to move you to the terminal. So an area I'm really excited about, if you know any series B investors who want to help us fund that have them call me, I'm joking, not so much. And then, yeah, I think that was like, one of my final thoughts, but one I'm really excited about,

Blythe Brumleve Milligan: 38:47

for sure. And then I would imagine, you know, the unsung heroes that the tugboats in all of this, how does the area? And we didn't even get to touch on that, but I would love to hear, you know, sort of a brief overview of how do tugs play a role in this, or is same tracking software utilized for those as well?

Unknown: 39:04

Yeah, everything that we're doing for barges is applicable for the tugs, minus the tracking devices, because the tugs themselves have already have AIS data, but we're providing the same technology. They always basically move together until the autonomous barges come into play. But as of now, anytime a barge is moving, it's hopefully because a tug is pushing it and it's not floating down the river, right? So I would say it's pretty much the same for the tugs as well, for

Blythe Brumleve Milligan: 39:36

tugs as well. That's good to know. So I guess you know one last question, where can folks follow you? Follow more of your work. Get in touch with open tug for some transportation solutions for their own company.

Unknown: 39:48

Yeah, thanks. I I'm on LinkedIn, and I'm relatively frequent on LinkedIn. Also we can be reached anytime via our website, at open tug.com or people can call me directly too, and I'm happy to talk with them. Awesome.

Blythe Brumleve Milligan: 40:05

Yeah, well, perfect. This was a fascinating discussion. Thank you so much for joining us, and we'll be sure to put all of those links in the show notes so folks can reach out so appreciate what you're doing and sharing your insight here.

Unknown: 40:16

I really had a great time. Thank you for taking the time and helping us share the wealth of barges with the world.

Blythe Brumleve Milligan: 40:24

Heck yeah. More, more people need to know about the unsung heroes of freight

Unknown: 40:31

doing the Lord's work there. There we go. Welcome

Blythe Brumleve Milligan: 40:35

into another episode of everything is logistics, a podcast for the thinkers in freight. My name is Blythe Milligan. We were actually just talking about this ahead of time of trying to keep your new last name straight anytime you do public appearances or podcasts or anything like that. But now that I got that little, I guess, almost slip out of the way. We are proudly presented by SPI logistics, and we've got a great episode for y'all today, because we are talking with Lord biegan. She is the founder of the maritime Professor Squall strategies, and host of by land and sea. And we are going to be talking about all maritime topics today, and this is, frankly, a segment of the logistics industry that I'm not the strongest in, and so I love learning for people like Lauren. And so Lauren,

Unknown: 41:21

welcome back to the show. Thank you. So happy to be here. And you know that's why I'm here, right to help break all this down I'm trying to bring to bridge the gap between surface transport. And ocean transportation, because I'm still learning the surface side, and I'm learning from you and all the other voices. And, you know, that's, that's it. We're all just working together, trying to get better educated on what the heck's happening.

Blythe Brumleve Milligan: 41:44

It's definitely a lot, because I wanted to record this show actually, you know, towards, you know, late 2024 early 2025 just because everything that was going on with the porch strikes, and is there going to be one? Isn't there going to be one? Or, you know, nobody really knows. And so we avoided it. But are there any sort of residual effects of what has happened since the port strike was avoided in January 2025

Unknown: 42:11

I mean, oh, god, yes. And no, I we were talking about this. I think I talked about this with everybody, like the word unprecedented has taken on a more neutral tone to me these days, right? Because, like, everything is unprecedented these days, we are just in once you hit a series of unprecedented times, does it just become the times like, does it just become normal? So I think that that's part of what's happening. So yes, the port strike was a big deal. We almost had a port strike, if you remember, on the west coast just a few years ago, and then we did have the three day port strike on the East Coast. I think that there will just continue to be the conversation of how much tech and advancement can we have at the port to make us efficient and competitive on the global stage, paired with the the need and desire to keep people real people working at the ports, right? I mean, it's an incredibly dangerous job, you don't just get hurt, you get killed. And so that's the thing about working at any port, is if we can find tech advances that help with safety and security and just ways of making sure that people don't get hurt, slash killed, that's a good thing. But on the other hand, at some point, you have to also be a business, and you have to make sure that you're still being competitive on a global stage, because every port is competing against the other port next to them, that how can you have that competitive advantage? And some of it is through Port throughput and efficiency. Some of that's paired with labor, and some of that is alternative advances. So that will continue to be the conversation. And I think that now that there's a master contract in place for the six years with some kind of protections for I think there's like a group that can review and, quote unquote, like, approve some of the new tech advances. There's at least some buy in from the Labor when tech starts coming to the ports and when that efficiency conversation starts happening.

Blythe Brumleve Milligan: 44:11

And so what were some of those things, I guess, that were a major hang up, because for folks who, I guess, to put it in perspective, from what I understand, the ports are all around the country, not this country, but all around the globe, I should say it's almost eerie that you can go and see a port and there's no humans working. It's all automated for everything from the cranes to the trucks to everything is automated and really controlled by people sitting in almost like a room full of video game controllers, and they're just operating the port that way, versus an American port where there's probably 1000s of workers everywhere. And to your point, you know, sometimes very dangerous situations. Are port workers wanting to work in those dangerous situations, or is that a situation where they would want to have, you know, automation, takeover or technology come in and help or do they maybe get more money if they work in those dangerous jobs? Like, what? What is the incentive of, I guess, keeping some of this tech out? Yeah, I mean, so

Unknown: 45:12

I think there's two points that I want. That I want to bring on. This one is fully automated. We right. We have long beach container terminal out in Long Beach, so that is pretty close to that's very automated port. And then we also have another one, I believe it's in Virginia. But in general, across the world, we only have about 7% that are fully, fully, fully automated. So we don't have people, you know, it's a little bit of a misnomer to think that everywhere else is fully automated, and we're not, because, for the most part, right? 93% then the other side of that would be, are not fully automated. But then I think you also start to talk about there's probably a generational split, and maybe it's a split right around covid pandemic, of those who want butts in seats, right or like, want to be in person, seven to three, you know, it matters if you show up. And then we kind of have this new generation of people who want the flexibility and the work from home and the, you know, they doesn't have to always be in incredibly dangerous positions, and there's a camaraderie that you lose with that. Sure, I totally agree. I teach organizational behavior as one of my classes at Massachusetts maritime Academy's master's program, and that's one of the biggest things that comes up, is, what do you lose from not being in person? Because some of these students that are coming out have never had an in person job. They've. Only had internships that were virtual, or they've only had, now entering the workforce, real jobs that they're still entirely virtual. So like they may never know that camaraderie. And I think it looks like we're having a shift back towards in person, right? We're five years post pandemic, or five years since pandemic started, almost to the day. Oh, that's a little eerie, right? I think it was Friday the 13th that that New England shut down, so right

Blythe Brumleve Milligan: 46:55

around St Patrick's Day, we're recording this on on March 11. So yeah, almost five

Unknown: 47:00

years wild, but, but I think that we have a little bit of a generational divide on people want a little bit more flexibility, if it's possible, and so remote control might be that that, like, kind of that, like, break in the chasm of of trying to figure out, how do you in an otherwise have to be there in person position? How do you find a way to have a little bit more flexibility? I think that's going to be balanced with just general workforce and general labor practices that are happening across the board. Are we going to continue to push for work, for work from home, or are we going to move more toward everybody's in the office as a default? I think it's going to be a balance, right? Everything's going to be a pendulum swing for a while. But that being said, the new generation might not be, and I don't know this for sure, but they there might be an opportunity where they see some benefit to some of this tech advancement, so that they can have the flexibility, you know, that otherwise wasn't there. You had to be there in person, steering that wheel, perhaps now, like you're saying, you could be on a remote control, you know, and working from home, at least in, like, a few of the jobs. And I don't know if that's you know, that certainly wasn't the message coming out. But there's something to be said about a generational divide.

Blythe Brumleve Milligan: 48:10

So it's a generational divide that's going on with a lot of the workers. What is sort of, can you give us a sense of, maybe, and I don't know if you know this, but maybe, like, the average age of a port worker, because, like in trucking, it's that big debate that goes on between, like, younger drivers and trying to get younger drivers to even be interested in truck driving as a profession. But the average age of a truck driver is like 56 years old. Are we seeing some of those same I guess discrepancies in age range for port workers too.

Unknown: 48:38

You know, I think that we have similar I think it's a parallel industry where you tend to have an aging workforce. We certainly see that a maritime generally across the board. So I can only imagine that it's equally true for port workers. But, I mean, I think that you still have a large desire for port orders, to enter the port field and to enter the maritime workforce, because I think that there's this sense of adventure and kind of, you know, maybe the danger is a little appealing too, right? I mean, I can't say it enough. It is incredibly dangerous job. I mean, these giant boxes, whether they're empty or filled, if they fall on you like that, that's it, right? And I have many, many friends who have said, the first day they started on the job, somebody died, or, you know, just, it's wild, how? And perhaps that, security, safety, advances that have happened in the past, you know, 2030, years, have helped alleviate some of that, but it's still, I think there's still this kind of adventure. You're outdoors right there. There's kind of all those good things that are associated with some of those more have to be in person positions. I think that we still see a desire to work in the industry. But, yeah, I think, I think that that's across the board. We're having trouble filling all roles, right, with the younger generation.

Blythe Brumleve Milligan: 49:53

So where we talked a little bit about, you know, sort of the technology aspect of, you know, I guess the dispute between port workers in, in, whoever they were, whoever they are negotiating with,

Unknown: 50:06

yeah, so it's the employers, so the, yeah, yep. So basically, that's kind of how you generally capture it us. Maritime Alliance was the East Coast. Pacific maritime association was the west coast. But you basically, kind of say the workforce versus the employers.

Blythe Brumleve Milligan: 50:19

And then how did those, how did those two associations? Because I heard you say on another interview, and I know I'm kind of jumping around here a little bit, but it just popped into my head that there's something like 200 maritime associations within the maritime industry.

Unknown: 50:33

Oh, like, what kind of associations? Do you mean, like, all

Blythe Brumleve Milligan: 50:36

different kinds of associations. So you just mentioned, like, the East Coast and the West Coast. But I imagine some of the other associations maybe aren't as powerful as those two, and they just exist to, you know, sort of be an informational resource or a networking resource, yeah?

Unknown: 50:51

So those associations, so yeah, the US maritime Alliance, or Pacific maritime Association, those are kind of associations or alliances of of the employers themselves. So, you know, that's how they're they're kind of the counterbalance. But similar to surface transport, there's associations for all sorts of subcategories within the maritime industry, right? I mean, we have ports associations, we have regional ports associations. We have commodity based associations and councils, right? I mean, any just similar right to to maybe trucking associations that might be regional or national. So you certainly have that on the maritime side. And I think that it's important to have that, because sometimes you have. Are broad brush stroke things that are happening, which is kind of taking it a little bit away from the US maritime Alliance conversation, but more into like the value of associations based on commodity or similar workforce, because there's issues that come up that, you know, sometimes it takes a larger collective. I mean, you have to be very careful, though, because at some point that turns into collusion, that turns into monopolistic behavior, if you start to get that competitive advantage because you're sharing trade secrets or some of that confidential business information, not legal advice, but just be very careful, but that, but that's where you know the associations do well, because they can take some of those trends that are happening across the industry, maritime, or wherever, whatever subset, and raise those as larger issues that should be addressed.

Blythe Brumleve Milligan: 52:19

And so, were there any, I guess, permanent changes that happened after the negotiations outside of technology and, you know, just, you know, maybe allowing those that those advancements on a case by case basis. Was there anything else that came out of the negotiations that now affect the industry today?

Unknown: 52:35

I mean, the increased wages is going to have, you know, it was. It was a very valuable thing for the workforce. They haven't had an increase in the past six years, right? Because every these master contracts are negotiated over six years, so the the increases are built in, but they're kind of stagnant within the contract. So certainly salary increases is good for the immediate workforce. But then also that means that that port and that workforce now is a little bit more expensive, and so that does impact the rest of the industry of Okay, now we have to kind of absorb that. So whether that's the ocean carriers or the terminals, or even the shippers and the bcos, the Chicago owners actually moving the goods anytime, anywhere, as you know, right in the supply chain ecosystem, anytime anywhere, gets a little bit more expensive, then that can have a knock on effect, and it gets shared around. We're probably seeing it similarly with with some of the tariff scares and some of the actual tariffs going into place.

Blythe Brumleve Milligan: 53:27

Well, speaking of tariffs, I mean, that's a good segue into the next question I wanted to talk about, because you just got back from TPM, and TPM is from what I've never been but I've always heard that this is one of the best conferences to go to. You know, we were talking before we hit record on on all of your videos that you posted from it looks like a super fun event. So for folks who don't know what TPM is, can you kind of give us an overview, and then what your your first time experience was like,

Unknown: 53:54

yeah, so Trans Pacific maritime is what the the conference is called, but TPM, everyone just calls it TPM. It's a conference of Joc or SMP global. So it's an S and P Global tends to be kind of more shipper focused, but it's basically all ocean shipping related issues. So there's some surface transport, but it really stays focused on the ocean shipping side of things. This conference is so good. I'm telling you, like, this conference was top life experience. While I was there, I kept saying, this is ocean shipping nerd camp. I never want to leave toward the end of the week. You know, like when you were a kid and you were kind of like, Oh man, I've had so much fun at this like, sleep. This, like, sleepway camp. That's how I felt. And I was like, lamenting that it was coming to an end, and then, you know, you kind of have like, one or two last events. And there was a co hosted event by the Port of LA and the dcsa Digital container shipping Association. And it kind of felt like that last lunch that your mom lets you go to with all of your friends from camp and, like, it's, it's like, the best lunch. That's kind of how that last event felt, that it just was the best, the overall best experience. I'll tell you that I got years worth of networking done within a few days. That's how amazing this conference has become. I've heard that it's always been amazing, but every year it gets a little bit more impactful and really kind of dynamic, I guess is as terrible as that word is, but it really, I mean, like the truest sense of that word, this is such an all encompassing everybody in the industry of ocean shipping is there, and if they're not, they're staying closely engaged on LinkedIn to kind of create the illusion that they're still there. I have so many special LinkedIn friends, is what I was calling them, that I was finally meeting in person, that, you know, I had close relationships with some of these people, and I just never met them in person. And so it was, it was almost like, Oh, I didn't realize they were so tall, you know, like, because I just never met them, I didn't know how tall they were.

Blythe Brumleve Milligan: 55:52

So Steve Herrera, shout out to him. Yeah,

Unknown: 55:56

I didn't know he was super tall, but I, but I've kept in touch with him for the past four or five years. Like, I feel like we're special, LinkedIn, friends. Yeah, it was, it was, I mean, like, I'm not even being overly boastful. I am not a paid advertiser. Like, that's just truly my experience. It was phenomenal.

Blythe Brumleve Milligan: 56:13

That's it. So is it just, I don't want to say just the US community, but it feels like it's more of a global community, because I echo your statements every time I leave manifest. And like I'm walking out of the last session, I feel kind of sad, because it's like all the signage and all of the other thing you're just walking out and you're seeing it for the last. Last time, and it's like, oh, you have so many good memories. So I imagine that that experience is the same at TPM. And is it more of like a global audience, or is it mostly US based,

Unknown: 56:41

yeah, global. I mean, we had, you know, some of the ocean carriers CEOs were there in person, giving presentations on panels. I mean, we had store and talk to while all these, all this tariff news, and all this ocean shipping and shipbuilding, right? We have the joint session present speaker speaking to Congress. When Trump went and spoke to Congress, that happened in the middle of TPM that, like, the very next day, everybody was like, did you hear there's an office of shipbuilding going to be stood up? And everyone's like, this is the most maritimes ever been in a you know, address to Congress, like, you know, just like nerding out on the little things that. Like, had you been back at your own house? Like your kids, your parents, you're like your husband, wives, they don't want to hear about that. Like, they're like, oh, cool, the ship building.

Blythe Brumleve Milligan: 57:24

Let's talk about some of those, I guess, bigger topics that you experience or were discussing with other people, Office of shipbuilding. What exactly is that going to be? Because I saw the announcement too. Friend of the show, Sal marcogliano, was very excited. John Conrad, of course, as well, big movers, and I guess online with facilitating that discussion to the forefront of people. And so it's cool to hear that it was just as exciting for the folks at TPM. So what is the office of shipbuilding?

Unknown: 57:52

Yeah, so it's still being stood up, so it's kind of a little bit amorphous now on what it's ultimately going to be, but, and there are people you know, being stood up in the office, but until it kind of gets its like formal announcement and formal here's our mission. It's hard to totally say, but how, I mean, the thing about maritime shipbuilding in the US is we have fallen so far off the map on kind of a competitive player of us built ships that we are down to, I want to say we have maybe 60 or less ships that are us, flagged us, like, you know, us, built or manned, or any of that. So, you know, we get to this point where it's very much like, if we don't have ships, we're not prepared. And it used to be, if you ruled the seas, you ruled the world, right? And that was kind of like all these Netherlands at one point. They ruled the seas because they ruled or they ruled the world because they ruled the seas. We just don't have the capacity. We do have ship building, it's still happening, but that's something that we just don't have the capacity anymore to turn vessels around and really get them out there. And so that's not even just from a military perspective, but that's kind of the part that's been attached to why maritime security is national security. Because if we don't have vessels to either, we're still creating and building naval vessels, and so that's happening, but we need vessels to support that. And that's where you build into sea lift operation sealed capabilities, which is basically the support vessels that go out and help the military vessels that are out there. And so if we don't have our own vessels to go out and do that, then you know, we're at a at a military competitive disadvantage. But then that's not even speaking about the commercial side. I mean, the US flag fleet, we talked about all the ocean carriers, and they have, and I think, unfairly, been clumped into these foreign bad guys, right? I mean, they're, they're, they're the only ones out there, and we don't have a US presence in in a significant way for this kind of commercial fleet. So everybody, of course, is going to be a foreign guide us. Wouldn't it be wild? And I think that's part of the directive here, is if we became not only like a competitor again, but like a competitive competitor, where we had US flag vessels and now all those foreign ocean shipping companies. Maybe it's just all the ocean shipping companies in the US is one of them, right, like so then you get, you kind of control, a little bit of the messaging here. And I say, I don't think that the ocean carriers are necessarily the bad guy. I think there's been differences of opinion on how, you know, charges and surcharges and things like that, and it's being worked out, right? That's part of what the FMC is working through, is making sure that surcharges are appropriately assessed in a way that everybody kind of understands is the appropriate way, right? There's a little bit of incentive principle and like making sure that it's for the fluidity of the movement of the goods. But you could almost distill it down that some of the disagreements over the years have been just differences of interpretation. Should it be for lost business? Should it be for, you know, if they still need the box, or they still need the equipment moved, you know, if it's sitting there with somebody else's goods in it, is that a competitive disadvantage for that ocean carrier who's trying to, you know, continue to get business and continue to move stuff? So, you know, I've kind of segued into a little bit of the side here, but, you know, that's where the alliances are important, because they really are a way to monitor the movement and creation of the ocean shipments and the ocean carriers in a way that we can see. Because the alternative is then they all start buying each other up, and then that's mergers and acquisitions. Then you really do have monopolistic behavior. So But getting back to it, us being a competitive player in that field, like we used to be, and we used to have sea land, APL, you know, we have a certain a couple of others that are that are in the world, but we just need more vessels. And so where do you start? Is ship building. We also need more vessels to train more mariners, because we have a significant, severe Mariner shortage right now, and but you can't really train the the mariners unless you have the ships. You can't really have the ships unless you have the mariners. So it's kind of a, often said, a chicken and egg problem. So just the fact that we're taking steps forward with the we will have ship building as a priority of this White House is, I mean, mind blowing, because maritime has rarely been talked about. I remember when Biden, under one of his congressional addresses, said, you know, the ocean carriers. And this is probably why I was talking about ocean carriers so much. He said, I want to bop in the nose. And everybody was like, I don't even care what he said. He mentioned maritime like, This is so amazing. And so, you know, that was wild, and that was kind of like a negative connotation. Here we are moving, you know, a couple years forward, and we have, like, something that we're building, something that we're creating. You know, how it's going to happen, all of that still kind of being worked out, but just the intention of we will be a shipbuilding nation. Again, it's wild. I love it. I mean, anytime that you are pumping money into maritime, and for us, fleet is going to be something that will will, in my opinion, bring dividends back to the country.

Blythe Brumleve Milligan: 1:03:03

And that's such a great point to bring up, especially among the relationships, because it's completely opposite of what sort of trucking is in the US, where there are so it's, I think it's 93% of the carriers in this country have seven trucks or less. And so it's very few companies that control a lot of the trucks on the road, where it's the inverse, on ocean, on the ocean carrier side, where it's a handful of companies that control all of the ships. And so I'm curious, Why would, why would the United States ever like, I guess, look away from that strategic advantage? Why did they let the time program and ship building kind of fall to the wayside over the last, I guess, few decades? Yeah.

Unknown: 1:03:46

I mean, there's a lot of different reasons, but I would say part of it is it was cheaper labor, less stringent workforce requirements, right? I mean, there was probably some, some bottom line decisions being made around there, and there's other reasons too, but, I mean, that was part of it as everybody was moving toward this, like, cheaper, faster, you know, model. Part of that became offshoring, and then moving it faster and cheaper, and it just kind of all snowballed into it became more expensive to have, you know, good paying jobs, or American, you know, American levels of wages, American levels of workers. And you know, that's where the Jones Act sometimes comes into the conversation of where it's it falls on both sides, right? I think there's arguments against it, there's arguments for it, but really what it does is it ensures that we have this American workforce on American vessels. But in order for the Jones Act to really be successful, you have to also fund it. You have to also have the industry funded behind it. And so as funding kind of dried up for shipbuilding programs, and, you know, kind of that long term viability, I think that the Jones Act kind of suffered through that. But, and, you know, I think that we're going to see, we're going to see this continue to move forward. And I think that the shipbuilding initiative is, is really such a significant and successful step one. The only

Blythe Brumleve Milligan: 1:05:15

thing that worries me, I guess, about it, though, is that is this just going to be a priority for four years, and is the next administration going to come in and, you know, completely gutted again, because it takes a while to build these ships, right?

Unknown: 1:05:26

Oh, yeah, yeah. I mean, yeah, we're not going to have 100 vessels in four years, right? So, but then having CMA CGM come out the other day and say that they're investing $20 billion through kind of different initiatives of investing in the US flag fleet and shipbuilding and kind of different areas that is money that they're not soon going to be turning away from in four years, right? So I think that there's, it's It's everybody's like, Why is everything moving so quickly. And I think, to me, that's part of the the theme, right? I see, when we change administrations, you know, I try not to get too worked up about, okay, what is the change? Because, look, it's the administration like we're moving forward. Let's, let's see what's going on. When we switched from to Biden last administration, it was okay, so what's the new theme that's happening here? It was going to be diversity. It was going to be environment. We're environment. Now we're switching over to Trump. And okay, what's the new theme here? What's going to be appealing, kind of, what's the theme that you want to tag on to seems like it's if it makes business sense, it makes overall sense to him, right? Like creating the business case, and that USA first seemed to be the kind of two major themes that I'm seeing. And so. Bringing it back around. I think that that's part of it is, okay. So CMA CGM is, is investing $20 billion into this USA I don't want to say USA first, because they're, they're a foreign company, but like this USA initiative, and so if there's going to be a further increase in the USA flag fleet, now they're part of it, right? And now they can continue to be part of it. And so I don't think we're going to end the at the end of this four years. I don't think we're going to end at this 60 vessels only. I think we'll have kind of sufficient contracts in place so that those vessels, once they're built, have a place to go, have things to do, and have kind of a smart business case associated with them so that they can sustain

Blythe Brumleve Milligan: 1:07:15

and who is this company, I guess, what country are they from?

Unknown: 1:07:20

Yep, CG CMA, CGM. They're out of France. So they're out of Marseille. Yeah, so there's a few different, yeah, like, MSC is Swiss. Yeah, there's, there's a few different. If you look at these ocean carriers, I mean, they're, yeah, they're Costcos from China. They're, they're kind of associated with with countries. They're not only that country, right? But, you know, I mean, but wouldn't that be wild if the US can now be like, Oh well, you know, I don't know if we're going to continue to call it sea land, because sea land actually got bought by Mayor square back when, but maybe we'll kind of come around to like, I mean, let's be silly here. Maybe it's the the Gold Group. I feel like everything Trump's creating is like gold. So maybe it'll be like the gold fleet. Oh, they're based in the US, you know, like, red, white and blue fleet. Or, you know, something red, white and blue fleet, yeah, but, I mean, but that's it. Like, it we've gotten so far away from that. And I think that's why Sal really kind of digs in on this. Is like he even said it the other day. It's been outside of his lifetime that we've been a competitive force in shipbuilding or just sailing on high seas. And so to be able to get back to that just creates so many more opportunities. And when things go real wild in the industry, you can still, I mean, you have to be careful, because you're not going to the FMC is flag neutral. So that's important to note. So the federal Maritime Commission that I often talk about, who's really kind of the competition authority for ocean shipping, they're flag neutral. So even flag neutral to us, flag they're just looking for competition things. And so they are for the promotion, or they're for the benefit of the US, importer, exporter and consumer. So that's really who they're focused on, who they're trying to protect, but that's flag neutral. So, you know, I just say that because I think that we still need to, even if the US were to become become a competitive player in this field, it wouldn't be able to now all of a sudden, be like, Oh, rates are high. We're only taking us cargo and we're going to just protect our like you still have to be careful there.

Blythe Brumleve Milligan: 1:09:14

And so if you if everything goes to plan, and I guess tentatively right now, what is a realistic expectation of how many ships we could see from this administration at the end of year four?

Unknown: 1:09:28

Hard to say, because I also, I'm waiting for, potentially, a conversation about tech advances, because I've also heard that he doesn't just want paperweight vessels, right? Like he doesn't just want, like the big steel hold. I think that there's a push for research and development for tech advanced vessels, so that it's kind of like the coolest ships out there. And obviously those are going to be more expensive and take more time, but maybe they won't, right, like, maybe there's something that we're not even really talking about on a larger scale that could make this faster. I I don't know, right? I don't know. I mean, he's got some big tech names associated with him these days, and they make things. I mean, Elon makes spaceships. So, you know, a spaceship laying down is kind of like a vessel in water. I I don't know, but I mean all that to say I wouldn't be surprised if we heard some some announcements or something along the lines of, like, there, there's also, as we're doing the ship building, we're going to recreating some of the regular vessels that we've come to know and love. But then there might also be some advanced vessels that I don't know, I don't know.

Blythe Brumleve Milligan: 1:10:36

Hopefully it's a good variety, you know, of the big vessels the smaller vessels you know, to be able to compete with all the different ports, because not every port can take you know, some of the giant vessels that you know have been created in the last couple of years, but, but then some of them are, you know, cater to smaller ships. I think we, we saw a lot of that during, you know, just that all the shipping drama that's happened in the last like five years,

Unknown: 1:10:58

yeah, well, and that was part of the diversification of entry, right? And being able to go to, instead of just shipping all of your goods out of the largest ports in the country, going and finding some of the smaller to medium port size ports, so that way, you can control a little bit of that backlog, if there's, if there's congestion, or, you know, they may be those smaller or medium ports might be less likely to feel the congestion when it hits big time. You know, the other thing that this administration keeps talking about is icebreakers, and I know that you and Grace are particularly, particularly. Interested in the ice breaking. Actually, I am too. I used to work a little bit on extended continental shelf project of the Arctic, and that is something that we desperately need, right? Because there's only the two icebreakers, large icebreakers, and really one, and she's often in and out of dry dock getting fixed up anyway, so like, we have a desperate need for icebreaking and ship building in the icebreaking category. And I don't think that he said specifically. I maybe he said 30 very large icebreakers. It was, it was a little bit of kind of a general statement. But, yeah, I know that there's an intention for icebreaking capability as well.

Blythe Brumleve Milligan: 1:12:08

Well, you, because you worked on, I think mapping like the Arctic shipping lanes, is that? Am I getting that right?

Unknown: 1:12:14

No, yeah, that's yeah. So it wasn't the shipping lanes, but it was so I actually teach law of the sea at Roger Williams School of Law. So that's partly why the maritime professor came in, because I'm, like, teaching all these courses anyways. But yeah, I used to work on the US extended continental shelf project, and so it was a contracted position, but what that position was, was looking at the underwater. So like, you have the water, and you have the land, and then you have the continent, basically dips under, and that's where the sand is, and then it keeps going out, and then at a certain point, it dives even further out, and that's the extent. So you got the continental shelf, and then beyond that, it's the extended continental shelf, and there's some numbers associated with how far out, 200 nautical miles, and then up to 350 nautical miles, but like, really far offshore. But in those areas, that's where they're finding manganese nodules, that's where they're finding diamonds. In some respect, that's where they're finding some of those, potentially oil and gas deposits, all sorts of things that we don't even know what's out there. But that was part of the project was kind of mapping what we have, the hydrography, the geological sediment that's under there, kind of making the case for how far out. And it wasn't just in the Arctic. It was basically anywhere we have a continental shelf. So us, East Coast, West Coast. I mean, everywhere, Hawaii, so yeah. So it was, but it was the Arctic that was, like, I was particularly interested in, but so, yeah, I got to know kind of the the the world of Arctic and icebreaking and the need for it. Oh, my God. And that was 1015, years ago, and I'm like, we still need to be having these conversations, right? Like we still need these icebreakers, like we needed them yesterday, but also today.

Blythe Brumleve Milligan: 1:13:53

And that's because, I guess, for folks who may not understand, a lot of the Arctic ISIS melting, so it's opening up new trade lanes that could drastically reduce the shipping time from, especially from East Asia and Russia over to the United States and vice versa. Do I have that kind of, right?

Unknown: 1:14:12

Yeah, but the trouble is, there isn't a lot of search and rescue operations that are available up there. But then also, you know, if, if you have an oil spill, it's a different salinity, it's a different density. You know, just the environment that you're in up there is a lot harsher. So the commercial viability of new shipping routes is probably not quite there yet, mostly because I think you have to really be careful of, like, Well, what happens if, and you know, anywhere, right? You don't want oil to go anywhere, but it's they kind of has this connotation of pristine up in the Arctic, right? And so you don't necessarily want that's just a concern. But then also, I mean, if you get stuck right, like, if, if something happens, there's not a lot of options for being able to just, kind of, like helicopter you in and out, like medi vacuum. So that's also, it's, it's incredibly dangerous without the support that you might need. So there are, I've been hearing of, there's here, and there cruise ships that are going through, but I think they're kind of on a limited basis, and there's interest in it certainly, because it would cut down time. But I don't know, I don't know the viability of, like tomorrow, all of this just switching over, but it's certainly something that people are looking at,

Blythe Brumleve Milligan: 1:15:28

and especially from the, I guess, the Greenland aspect, to which obviously, we were recording this in the middle of March. So who knows, you know what, what has happened by the time that you listen to this? But there's also the, I guess, the Greenland argument too, that kind of ties into, you know, the Arctic shipping lanes, and wanting to secure those natural resources, and, I guess, more solid land. Because, to your point, if something does happen in the Arctic, you can't get a truck up there because the roads are, roads are too sloshy, and then the closest thing that you can get is another ship. And if you don't have any icebreakers, and you're stuck in the ice, like, what are you going to do? So it's kind of this, you know, I guess, combination of a bunch of different terrible things that could go on. But hey, there's, there's tourists that are paying a lot of money, you know, to, I guess, to go on one of these icebreakers and to get off and kind of walk on the ice for a little bit.

Unknown: 1:16:16

Yeah, yeah. They call it the God was it's something like the polar bear walk, or something like to be able to get out, yeah? I mean, that's the thing is. So, you know, the Greenland conversation is so interesting, because when that was first. Presented, maybe a lot of people thought about Greenland, is maybe this, like, Okay, what do we need about Greenland, right? There's no major cities. Like, what are we talking about Greenland for? Because of my, I guess, exposure to the Arctic and the vastness of the of the resources. I mean, my instant thought was, oh, my God. Like, that's, I mean, if that happens, that's wild, like there's so much opportunity and availability. I'm not getting into the geopolitics, right? Like, I don't you know that that's for everybody else to figure out whether Greenland wants to or doesn't want to, and you know, all all of that kind of how that politically works out. But just from a land mass perspective, there is so much that Greenland has available to it in natural resources, and there's, like, political positioning and all of that. But, I mean, like, we're saying anything that's up in the Arctic is really kind of this untapped resource, and I think it feels like we're moving closer and closer to the Arctic becoming more of a central playing zone than we ever had in the past. I mean, it's still permafrost, right? I mean, it's still going to be significantly ice laden. But wouldn't you rather have all the preparations made, right? Like going back to the icebreaker conversation, wouldn't you rather have all those kind of pieces laid out in advance before we need them? And I think that's part of the conversation for why Shipbuilding is so important in general, right? If we ever need more vessels across the world, that might be something that, let's make sure that we have those vessels now and they're ready to go, then when we need them, and they take, you know, couple years, five to 10 years, to get the fleet going. So yeah, I mean, all of this is, it's just so exciting to have maritime in so many large conversations. And I'll tell you, I have not talked about maritime more with my family than I have in the past year or so. It's making national news, which it never used to do that before. I mean, even the porch strike, it took until one or two days before the actual strike, and everybody in the industry was like, Oh, my God, I think, I think we're going to have a strike on the first time.

Blythe Brumleve Milligan: 1:18:36

Yeah, I think it was like, even, like, a poly market bet as well, where you could bet on if the port workers were going to strike or not. And so I think a lot of people lost money if they voted in favor of a strike. But I mean that, you know, teach their own so we Okay. So we've talked about, we talked about TPM. We've talked about Greenland. We talked about ship building, um, icebreakers, uh, for the fifth, I guess, sort of, um, complicated topic. Let's talk about tariffs. Who knows what's going to happen by the time that you actually like listen to this conversation, the tariffs are very much like, on and off again, versus Canada versus the Mexico versus the rest of the world. How are you helping? I guess maybe your clients navigate some of these, just confusion and just Yeah, I think confusion is probably the best

Unknown: 1:19:25

word for it, yeah. I mean, right now is a very sticky time. Right there's a lot going on, and I think there's a lot of political posturing that's happening from tariffs. And I think that we're seeing that play out, right? I mean, one day we have tariffs, the next day, you know, there's been a new political positioning taken from the administration because of the tariffs. So, you know, getting into the actual specifics of what's good and what's bad, I tend not to do that, what I do. And I think I kind of mentioned this when administrations come in, I always kind of advise my clients to look for the themes, right. Look for the themes. And instead of pushing against what's happening, find opportunities with those new themes. And so, like I said, it was, it was previously, it was environment, it was diversity. Was very much the theme of how you can, you know, kind of create business opportunities under the Biden administration. Now the business opportunities are going to be coming in the form of making business cases, right, like running things true to businesses, running the what we're seeing it looks like is the United States being turned into a business and kind of running it so that it no longer runs at a deficit. And so, you know, the argument is, okay, so the tariffs are going to be doing that. I'm not saying whether that's good or bad, the right decision or not, but what I'm advising my clients is try to find those themes and try to find ways to parallel with them, because you'll find less resistance. You'll find, hopefully, opportunities in those areas. In the meantime, though, like, what do you do tomorrow? It makes it really tough because there's a lot of uncertainty. We said unprecedented times are now just becoming precedented times. And so what does that mean? I mean, in general, right? The way you run a business during unprecedented times or uncertainty, diversification, that's that's always right? We were saying diversification of incomes. You can't always do that with with a business, but sometimes when the port congestion was happening, maybe diversification of the ports of entry might be one way to start looking. So that way, if one port has something that gets impacted, you have other options. Or East Coast versus West Coast, right when you're having the labor discussions trying to diversify some of those ports of entry to either side of the US might be a. Avenue. It might be more expensive one side or the other, but if one side goes down with a port strike, you have the other side to kind of rely on. We're at least four years away from the next conversation about port strikes, but now might be the time to start having those conversations about diversification of how you kind of approach that, you know. But the other thing is, it's easy to say diversification of ports of entry, but some of these commodities need certain warehouses or need certain systems around the port that they only get in certain areas. And so maybe now part of the conversation is increasing engagement with some of the other areas that you might want to diversify your ports of entry to, and saying, Hey, what do you have to offer this industry? Right? This is an area that we would like to diversify where we come in. You know, are there any opportunities to do that? We have a lot of infrastructure development happening around the ports in general. So I think that we're still going to see port infrastructure development happening with this administration. I think that we're probably going to see perhaps a little bit more towards strategic ports, which is money, funding toward ports that they can be turned into military or military helpful ports. That's something that strategic ports is kind of a term of art. So that's something that's already available. Not every port out there has the strategic ports, but there might be some funds available along those lines. One thing that we saw there's the ships for America Act that came out. It was the Kelly waltz bill. Previously it, but it turned into the ship's act. So that was Mark Kelly, Democrat senator from Arizona, and Mike waltz, a Republican congressman from Florida. Ultimately, when the bill was presented, Mike waltz had turned into the National Security Advisor to the Trump administration. But it also says to me, when he was working as a congressman on this bill, it was a lot of push toward military readiness. Military security is national security, right? That's one of the themes that I keep seeing, that if you're moving toward military assistance or military promotion within the industry, that's going to be supported, it seems like by this administration, especially because he became the national security advisor. So at the time, I was like, well, at least we know maritime will come up in the conversation. Now we have, you know, now we have the maritime I think there's an actual maritime person in the national security advisory area. Then you also have this off the ship building. You have so much maritime so just a few weeks, but all that to say. So what do you do with the tariffs? I mean, obviously, continue to watch them, but it's going to be, it feels like it's going to be a little bit of a wild ride for the time being. Maybe some of the best things that you can do is, like I said, I mean, you don't want to overreact right there. And I say that very cautiously and carefully, because I don't want to say that reacting at all is overreacting, because some of these things are might put people out of business, right? I mean, that's that's part of the if you weren't able to sustain some of this movement, then some of these are going to have some major impact. It feels like in the short term, though, it feels like the conversation keeps coming back to this is going to be a short term thing for a long term gain. So what do you do? Find ways of aligning with the theme, right? Find ways of, kind of creating new business opportunities where you can align with what's going on, so that you know if, if and when. I mean when, right. We can't have presidents that stay forever. So when we have the next administration change same thing. Don't fight against the grain there, right? Go with the theme that's developing, and find ways of really, kind of aligning and finding business opportunities there. I mean, it's, it's gonna, it's gonna feel a little wishy washy, right? It's gonna feel a little pendulum really swinging. And so maybe you just kind of stay in the middle of it all and keep your head down. I mean, maybe, if it's not affecting you directly, maybe just kind of continue business as is, and then hopefully you find more business opportunities when the dust settles a bit. I'm, you know, I'm not saying anything people don't know, right? It's, it's, it feels like a wild time. But you also want to assume that the administration that's in is doing the best they can and trying to help the overall American people. And so whether that was the Biden administration or now the Trump administration, you know, maybe it's looking at it with, Okay, what does success look like to them? What does winning look like to them as the administration and finding ways of meeting them at the finish line there. I don't know, just different ways of looking at it.

Blythe Brumleve Milligan: 1:25:54

Well, I think it kind of all sounds like, whenever shit hits the fan like this, that it really comes down to finding really great, maybe consultants, really great internal, you know, experienced employees, probably also technology and combining all of those to, you know, try to stay ahead and and create contingency plans. Is all of that sort of playing a role when, when stuff like this happens like because I would imagine this is a perfect use case for AI to, you know, find different sourcing of your materials, find the ports with the warehouses that are close by that can store those. Goods trying to avoid as many tariffs as possible. Is that, does that solution exist on the market, or is it really just combining, like the consultants with the subject matter experts and technology?

Unknown: 1:26:42

I think it's all right. I think it's all of it. I mean, obviously AI feels like it certainly, I mean, significantly speeds things up. But on the other hand, you have to know what you're talking about, because it could be speeding up bad data, right? I mean, I've, I've looked through and, you know, I'll admit to it, I when I'm doing some of my podcasting, if I'm kind of struggling with how I want to word things, I'll throw it into AI, see what it comes up with. And then sometimes, I mean, it even just the other day said, well, the FMC, Dan, Chairman, Dan mafet. And I was like, that's bad information. Like it's, it's Lou sola. He's been the chairman for a while now, you know. So it's if you didn't know that, you would have just taken that as truth. And so creating a business based on AI outputs is a dangerous game if you don't know the game. And so that's where having the consultants if you don't know the game yourself, bringing consultants in to help augment your your expertise in the game, because you can make pretty bad mistakes by just not quite knowing what the heck's going on. And you have to follow it pretty diligently and obsessively, almost to really kind of know what's happening. And that's where you know even, even me as an ocean shipping consultant, and really kind of helping, I help my my clients, kind of navigate global ocean shipping regs. That's not tariffs, right? That's not necessarily customs, that's not all these other places that feel like they're all part of the same thing. And I kind of obsessively watch ocean shipping, and that's why I love TPM last week, but that's it, is finding people who are, I mean, pretty connected to what's happening, pretty clued in to what's happening. Maybe connected is not the right word, really clued into what's happening and watching it, almost in this obsessive sense, so that you can have the best information around you for you to make that business decision. Because the consultants don't make the business decisions for you. They just give you a larger like coloring of the of the coloring book so that you can fully understand, okay, I know that Santa's belt is black. You might not have known that had you not known. Maybe it's red. No, his jackets red, right? Like, that's kind of the consultants help you find out what you firm up, what you may or may not know, so that you can make a business decision in somewhere that like might not be totally clear.

Blythe Brumleve Milligan: 1:28:58

That makes a ton of sense. And I feel like that's such a great soundbite, like waiting to happen. You see me like riding off to the side. I'm writing down timestamps of every time you said something good. And we're running out of room over here on on the post it note. Okay, last couple questions here. Is there anything else that it was a, I guess, an important topic to your clients, also at TPM. Is there anything else that is going on in maritime right now that other factors of the logistics audience or segments should know, whether it's warehousing or trucking, because they all, you know, intertwine and play a role together. But was there any other themes or takeaways that you thought were important? Yeah.

Unknown: 1:29:39

I mean, I think every obviously, everything, right, everything that's happening out there, I think the biggest thing that anybody can do is just educate themselves on what's going on. So whether that's hiring consultant or, you know, maybe shameless plug here, but I'm going to have E courses coming out on just general information about what I do. So my consultancy is really the direct application, right? It's that. That's where you bring the lawyer in the direct application of what the ocean shipping regs are doing and how that relates to the specific environment that your company is going through. But then sometimes you just want to know, like, Who the heck is the federal American commission anyways, right? Like, who might have just started in the industry? And you're like, there is no reliable one on one. Like, what are alliances? Why are they better than the alternative? So you know that that's part of the classes that I'm going to be pushing out with the maritime professor. I do live webinars on that, and that's just so that you can kind of have a first stop approach. Of, I want to know a little bit about ocean shipping. I don't necessarily need to hire somebody directly, but I do need to stay informed on what's happening out there. And so that's where I, you know, I've kind of found a an opening where there really wasn't that available, and we have surface transport, kind of, but there's this world of, I just want good information, and I need it to still down so that I don't have to listen to somebody, you know, ramble on about a topic for four hours in a class. I just want, like, half hour, 45 minutes of what's going on. What do I need to know? And so that's part of what I do with the maritime professor, is finding those trends and help saying, Hey, pay attention to this case, right? Holidays and weekends is one thing that's happening at the FMC right now. They've been working through whether or not you should be charging for demurrage or detention. There's a case TCW versus evergreen. It's still very much fluid. It went out to US Court of Appeals for the DC Circuit. So. It's come back to FMC. Now, FMC just recently put out a decision saying that they kind of double down saying, you know, if you're closed, it's, it's, it's not aligned with the incentive principle. And that's one thing that the FMC has been saying, is, look, fluid, fluidity of movement is the incentive principle. You should not be charging. This is what the FMC kind of is arguing you should not be charging for detention. For detention and demurrage unless it's actually providing that incentivization of the movement of goods, like so if your box is sitting there, and, I mean, the assumption is you don't care about it, unless you start getting charged for it. Now, all of a sudden it becomes top of mind, and you're like, Oh, I got to get that out. I you know, I'm getting charged. But like the FMCS argument here is, if the port is closed on a holiday or weekend, you can't get it anyway. So no amount of of demurrage or detention is going to actually get you to move it, because you're like, dang it, it's a Saturday. I want to move my stuff, but I can't. So that's the FMC side of it, the other side of it. The the argument on the other side is that, well, isn't that an incentive itself? Because now you know, if it's a weekend plus a Monday Holiday, if you don't get it out on that Friday, you're going to have three days of charges that you really don't want, and so it makes you move even faster to get it out on Friday. So that's the crux of what's going on with this holidays and weekends case worth paying attention to. That's something that I think will really have some strong operational impacts. Of, are you going to be charged the detention demurrage? Because that's been one of the biggest issues since covid congestion, of, how do I mitigate or how do I plan for detention and demurrage? Or how do I get out so that I'm not part of the detention and demurrage world? Because it adds up quickly. And if you have more than 10 boxes, and then per box every day, I mean, those are big charges, and at some point you come to a point of, well, the merge, or the detention is more than the contents of the box itself, and so you might have abandonment. That's the balance effect of detention merge. But that's something definitely worth watching. It wasn't totally talked about at TPM, but also, there was a lot going on at TPM. There's just in general, you know, I think there was some talk about the new alliances and how those are structured. The Gemini cooperation has more of a hub and spoke model. That's kind of a newer is it? You know, the question is, is it more of a marketing thing, or is it an actual new operational you know, the idea is they come to, kind of the hub ports, and then they transload and move it around. From there, they're saying that they have 90% 90% reliability in their schedule because of the hub and spoke model. And that was the whole promotional piece of trying out the Hub and Spoke bottle, they were saying, we will have significantly increased reliability in rivals and your goods moving. So that was a big conversation. Piece is, is this Gemini cooperation, you know, working the new kind of reshuffling of some of the alliances? What that means, what those Alliance reshuffles mean? I think one of the biggest things over the past few years for ocean shipping and the alliances, though, is the realization that, and it's not always clear, not all of those companies fleets are part of these vessel sharing agreements. And that's what these alliances are, is they're vessel sharing agreements. So like MSC came out, I think there was a report saying that they have 900 vessels. Not all 900 vessels were part of that 2m alliance that they were part of and that, because you kind of see, okay, well, they're 40% or 50% market like that. You know, as a company, they had a large significant portion of the of the market share, but it wasn't, it didn't go into the whole Alliance. And so that's why that alliance probably isn't as nefarious as people were saying, right? Like, oh, they're just guys. Like, they're all just combining. And this is just another name for a monopoly. It really wasn't. It was really the intention was that they were trying to get better service availability. You know, instead of five vessels going across the same route, now you have two vessels going across the same route with some of their competitors cargo on it. They're just sharing vessel space, so that you have two full vessels instead of five, not as full vessels, and then the other three can now go to smaller ports. And there you have it, some of that diversification of ports of entry or availability of ports. So that might be great for companies too, because it might be closer to their warehouses, you know, if they're able to go to these smaller, medium ports abroad.

Blythe Brumleve Milligan: 1:35:52

And I think it just speaks to your your earlier point about the importance of diversification, and, you know, protecting your own business. And you know, if you got cargo waiting around for a while, plus tariffs, plus, you know, all of these other different, you know, things that are impacting, you know, global shipping, it can get expensive really quick, and then who pays for those things at the end of the day? It's the US consumer, or maybe it's the carrier. You know, probably not the carrier. It's probably going to be the consumer at some point or another. Lauren, this has been an incredible discussion, and I think it just sort of really rings home true of, you know, paying attention to consultants like yourself, professionals. Like yourself. I'm curious, as we kind of round out the this conversation, you know, are there any besides yourself, of course, which we'll put links in the show notes to where you can watch all of your content and sign up for the maritime Professor all that. But I'm curious, are there any other, I guess, sort of sources that you pay attention to as well, or other, you know, creators that can explain things in a way that you do, which is, you know, an easier way to understand it, and also, you know, make the business case too, yeah.

Unknown: 1:36:55

I mean, obviously all your stuff, right? I mean, you're, you're right on the heart of it, and you're helping me to learn a lot more about the surface transportation side, which I totally appreciate. Grace Sharkey, right? Obviously, she does a great job with the tech side of things. And any freight waves is wonderful. Joc is wonderful, any of those major publications, but Sal marcogliano. We've talked about him a few times. He does such a good job, and he's a professor himself too, that he does such a good job of just distilling down what's going on, and he's a maritime historian, so he really kind of increases the understanding by coloring the rest of why is this important? What happened in the past. How does this all relate now, you know, he's much more precise on some of those numbers. Of you know why we had vessel fleets in the certain number before, and now what they look like and where things have gone. So he is a phenomenal source to follow himself so, but there's all sorts. Matt Leffler does a really good job. He's often talking about chassis and trailer maintenance and surface transport and tech. And, you know, we actually used to talk quite a bit. My podcast is called by land and by sea. At one point he was helping to bring in some of that by land conversation. So that was kind of the intention of bringing over that podcast really does mean I, obviously, I focus a lot on federal Maritime Commission, but part of the podcast is really kind of helping, as I said at the outset, bridging that gap between surface transport and ocean transport, I was getting a lot of questions right around that pandemic of what happens on the other side of the gate, right? You're either on one side of the gate or the other, and so what happens on the other side? And so I'm still learning the surface side, although I have a much larger appreciation for the warehousing and the rail and the drainage providers and everything that happens on the other side of the gate, and that was kind of my personal interest in learning more there, but on the ocean side of things, what happens inside the port, what happens on the other side once it gets on the vessel? How does all of that work together? Because it was kind of this black hole, but as long as it showed over the port, people didn't really care once covid congestion happened, and we were getting detention, demurrage, all these different things. And wait a second, I want to know more. And they kept peeling back the onion. You know, it was, it was this, how do I learn more? What? What is there to learn? How do I become a better educated just user of the industry, and really, that's the name of the game. Is educating yourself on as you can so that you're in the best position to make decisions when you need to.

Blythe Brumleve Milligan: 1:39:16

Oh, perfectly said, What mic drop moment like? That's such a great point to end this conversation, because I feel like I could talk to you, you know, for hours and hours more, but you know, I want to be respectful of your time. And Lauren, where can folks, you know, follow the podcast I mentioned? I'll leave it in the show notes, but, but go ahead and tell us anyway,

Unknown: 1:39:34

yeah, so go ahead and look at the maritime professor.com that's where you can find the podcast on there. That's where you can find the E courses, all of the the live webinars, all the different content that's purely based on creating open and accessible supply chain knowledge for all. But then, if you do have a legal question, if you would like to hire, you know, for legal purposes, not necessarily litigation, but kind of navigating, how to do B to B, and kind of pre litigation side of things, or how all of the global ocean shipping regs work toward you. I have client based navigation of those global ocean shipping and it's through small strategies. Amazing.

Blythe Brumleve Milligan: 1:40:08

Lauren, this was an incredible conversation. I think we both should start maybe a fan club for Sal marcogliano, so we can, you know, just, just continue, like, pumping up his his his tires, for the content that he puts out, because I think he makes all of us smarter. And then, obviously, with you and all of your content, you make all of us smarter. And this industry is just like you said, it's an onion. Every time you peel back a layer. There's several more layers to go. So appreciate your time, appreciate your insight, and we look forward to having you back on again in the future. Thanks so much. Let's go ahead and get started on icebreaker ships, because this is a very it's one of those things that you hear in shipping, and I don't know that I have the had the full grasp on it, on why people even want to establish this shipping lane. Did you? Did you know about this? I guess shipping lane, or shipping story, before you know, we were doing research for this.

Grace Sharkey: 1:41:09

I guess, no, not in particular. I mean, I know of icebreakers clearly, just like being where I'm from, and have seen them before. But no, not in particular.

Blythe Brumleve Milligan: 1:41:21

No, well, I think for the first I want to play this. I want to start off this section with why this sea route is important. Important, because essentially what we have throughout the world is that we have these shipping lanes, these big trade lanes, which are safe passages, or somewhat safe passages, that giant cargo ships, oil tankers, fishing vessels, that they can travel through and end up at their destination in the quickest, most efficient time period. And with this new route that is opening up, largely in part because of the ice melting in the Arctic region. So that's the North Pole. We're not talking about Antarctica, which is the south pole. So the North Pole is where a lot of this ice is melting, and it's starting to open up faster and more efficient shipping lanes. But that brings a whole lot of sort of discussion, geopolitical, natural resources. It brings up a whole lot of discussions. But first, before we get into some of our favorite takeaways about learning about this topic, I want to play this video that will kind of give like a good, I think, overall, arching, overarching view of what this is and why it's important. So let's play the clip.

Unknown: 1:42:33

This is the North West Passage. It's a sea passage that spans 900 miles and joins the Atlantic and Pacific Oceans through the Arctic archipelago. It may look insignificant, but the truth is, this passage has the potential to change everything. The only problem is that it doesn't exist yet. Well, sort of you see, we've known about this passage for centuries, but it's always too covered in sea ice to be used for regular marine shipping during most of the year. But now this is all potentially changing. Since 1979 the Arctic sea ice has declined by 40% with NASA saying it's currently disappearing at a rate of 13% per decade. Put simply, the Arctic sea ice is melting and also being replaced with thinner seasonal ice due to climate change. And this means that eventually, whether it be by 2050, 2100, or somewhere in between, the Northwest Passage will become fully navigable for mega container ships for at least a few months out of the year. The importance and geopolitical ramifications of this cannot be understated. In fact, the reason we've known of this passage for centuries is because of how transformative it would be. Even back then, European explorers, beginning with Christopher Columbus in 1492 searched for a direct trade route from Western Europe to East Asia, but they never found one. It took until 1850 for the first icy northern passage to be discovered or while technically invented, and until 1906 when it was finally traversed by the legendary Roald Amundsen. Since that first crossing, there have been at least 320 transits up until 2021 with 38 of them being from 2019 to 2021 showing it's still a pretty challenging passage to traverse. So I'm

Blythe Brumleve Milligan: 1:44:11

going to stop it right there, because that's a really good point to, I guess, Intro This discussion of what exactly like icebreaker ships are. Now you kind of have a a general overview of what's happening in that region and why these ships are starting to be needed. Basically, with icebreakers, there's two types of icebreakers where one has a bow that sticks out much further than, I guess, sort of the top of a traditional ship. Of what you can see, it has an underneath that sort of, you know, can bust through the ice, up to six feet of ice that it can bust through before the actual, I guess, sort of real part of the bow that you see on a traditional ship makes it has to, you know, sort of slosh through it. So there's that method of it. And then there's another method of a icebreaker ship that they almost try to go as fast as possible, so they can get up on the ice and then come down and crack it that way. And so there's a bunch of different like, videos where they can see like, especially in this region of cargo ships and or mostly like oil and gas ships that are being caught in this ice up north in the Arctic, and these icebreaker ships have to go through and do one of those two methods in order to carve out a path for those ships to make it through. So it's all, I'll stop right there, since we, you know, had the the video and explained it a little more. But what, I guess, what are your first thoughts when you know about that, when you learn about this history, when you in the region that you're in, what are, sort of your, I guess, favorite takeaways about icebreaker ships?

Grace Sharkey: 1:45:49

Well, in general, I think it's, it's interesting for just trade domestically, in the US, how much of it is dependent on this as well, let alone what we'll see in the future. I think the stat I pulled for this lane in particular was by 2050 I believe this will be the primary point of transit between Europe and in Asia. So clearly, huge impact it's going to have on on global trade, let alone what we see just domestically as well. I want to, I'm trying to look at the stat right now. I think it was around, yeah, just in Great Lakes, icebreaking alone. So. Towards over 90 million tons of cargo annually. So imagine what that number is going to look like, especially once it becomes such a mean trade line. I mean, here it's, it's interesting kind of, I wish I would have pulled some soda charts from this, and might be able to send you some later. But Well, theoretically, we don't really have much right for this lane, but it's, you know, one of my favorite things, favorite sonar charts we do at freight waves, is the Panama Canal index. It's not exactly what it's called, what's kind of what we call internally, and it helps you kind of see right the rates between going to LA ports compared to going to someone like Houston based on the availability of going through the pan like canal at that time, right? So it gives you like this flux of a different option that that's why we see so much investment in Dallas and Houston etcetera, because of that path, because at the Panama Canal, of course, was widened, which led for more of that option. So I get really excited, just from like, a data standpoint, to see, like, how that would affect overall, like, what we see on trade lanes right now, even through the United States and and so on. So, yeah, I get, I think it's really cool to like, consider and think, right, like, just because of these icebreakers, the the global ramifications of it. I think I wonder if you're going to get to it. But, I mean, we have a whole pack, right, based on this lane. It's called the ice pack, and it's between, I believe, the US, Russia,

Blythe Brumleve Milligan: 1:48:07

in us,

Grace Sharkey: 1:48:09

it's, I believe, no, sorry, United States, Canada and Finland and so they, yeah, the between the three of us, there's the US Coast Guard has two main icebreakers that they're starting to use as of July of this year to start cutting that ice that you just went over, right?

Blythe Brumleve Milligan: 1:48:28

Well, so it's a little complicated in that regard, because we've only had two of icebreaker ships, and they're decades old. So meanwhile, like Russia, has more than 50, and a few of them are nuclear. One of them in the Arctica, I believe, is the name of the ship, and it's nuclear powered, so it doesn't have to go back to port. Yeah, it can just patrol, it can traverse. And so what's happening with a lot of this polar or Arctic ice melt is that it's exposing more, you know, shoreline and more land, especially like Canada, for example. And So Russia has essentially, you know, claimed a lot of this, these passageways, and this, these routes, and are like, No, you have to pay a fee. And Canada's like, No, you are going to there, because this is all like,

Grace Sharkey: 1:49:16

go talk to NATO. Yeah.

Blythe Brumleve Milligan: 1:49:19

Like, we're going to friends. And, yeah, this and,

Grace Sharkey: 1:49:23

but, you know, a big, a big issue that we do have outside of this slate in particular, is there's not many United States owned cargo carriers, right as part of so it's, it's interesting, like, Could this be a lane that finally gives the United States an option to to gain some traction on that fact right to to have more carriers under the United States sale. And I think that also could be interesting, right? The political ramifications are something that clearly is going to have to be discussed at some point. But it's, it's almost like, if you've played not war, what's the game if you haven't played it so long, we're going to different countries now, all of a sudden, there's just a different path for you to take. How much that could change, like trade relationships, right? Like, maybe talk about Russia. I mean, maybe that is a relationship we grow even more so just knowing that the economic ramifications of ignoring that relationship, right? So, I mean, it's that's this, it sounds like we'll probably air after the election, but like, whoo. Like, it's crazy to think like that could be an election topic, right?

Blythe Brumleve Milligan: 1:50:34

Yeah, couple years. Well, it's, uh, it's to your, your earlier point about the Panama Canal, and for cargo companies, or for cargo ship companies, carriers, the route from San Francisco to Rotterdam, Netherlands via the Arctic route would take about 7000 nautical miles, while San Fran to Rotterdam via the Panama Canal is about 9000 miles. That's about a 40% difference in nautical miles by taking the Arctic route versus taking the Panama Canal canal route. And you can have more weight if you take the Arctic route, because you're limited when you go through the Panama Canal, you have to have certain weight restrictions, yeah. And then there's also this initiative, because I'm sure most people have heard about the, you know, the China Belt and Road Initiative. They have another initiative called the polar Silk Road. And so if you know your history, you know that Silk Road was this, you know, major, you know, I guess trend. Road from the East Asian countries over to over to Europe. And, you know, Western Asian, Asian countries that are, you know, partaking in trade. It was one of the first, I guess, human civilization. I guess not tactics. Maybe tactics is the right word for here. But it was mostly human trade was set up in a variety of ways. Human trade and commodity trading was set up through this Silk Road. And so they're calling this the polar Silk Road. And so it's because of no restrictions. You can get there faster. So it brings up a lot of, I guess, sort of environmental debate too, like, because of global warming, because of, you know, everything that's going on in the Arctic with this ice melting, you almost have to ask yourself too, like, are we even going to need icebreakers in the next couple decades? Because you have Russia that has more than 50 of these icebreakers. You have China that's building out a ton of icebreakers, and they're doing it to, you know, take advantage of this new trade route that is starting to open up. And they believe that they will, that it's estimated by like 2035 that we're going to have just a huge section of this Northwest Passage route that's going to be completely open for anyone to use. And so now, from a geopolitical standpoint, you have Canada that's like, No, we're going to start charging fees, sort of like Panama or Egypt. You know, they're charging fees to go through the Suez Canal, to go through the Panama Canal. Canada wants to do the same thing, because there's not that much economic activity going on up there, which is another sort of, I guess a negative aspect of this polar trade route is that there aren't many ports, and that a lot of for the Inuit people that have been there for they're called, like the first, Canada's first peoples, and there's so many like livelihoods that are set up in these northern Like regions, and their way of life is melting away before their eyes. And so it brings up like these conversations of, okay, if you're going to establish these trade routes, and you're going to maybe start building ports along these trade routes, because right now, there are hardly any ports along this trade route, like you should be involving these people who are already having their lives impacted. And then also think about it from the lens of, if one of like, an oil taker goes down in the Arctic like that is devastating to these communities, because you can't even clean up the oil because it's the ice makes it incredibly difficult to be able to use, you know, sort of modern we had a spill in the Gulf. What like horizon, Deep Water Horizon, or something like that, I think. But they can use these large sort of nets in the ocean to scoop up all of that oil. You can't do that in the Arctic, because there's, you've got freaking floating ice going on up there. So it has, like, all of these different ramifications. And I just thought that was

Grace Sharkey: 1:54:35

even to that point, like, I'm thinking about, like, again funny or in your election season, but the migration that would need to, like, happen up there to to back a port, you know, like, do I know right now there's a number of really great like, flatbed trucking jobs in Canada and towards the Arctic and Alaska as well, just because it's, you know, they're growing communities and things need to get up there, and it's a tough drive, right? But now it's like, when you sit here and you talk about, like, putting ports in some of these areas too. It's like, they don't have, I mean, I don't know if you've ever seen like, the most northern town, but it's like, everyone there works for the oil company, and there's, there's kind of a grocery store, you know, it's like, and so think about the job creation needed to, like, support a true port community

Blythe Brumleve Milligan: 1:55:33

supplies. Like, yeah,

Grace Sharkey: 1:55:35

there was even just to live, like, putting a grocery store in there. Now you're talking about construction jobs and, like, just development of that type of infrastructure is, like, just really interesting to kind of consider, right of like, all the moves I would have to make to make sure that this investment, you could say now is really pays off.

Blythe Brumleve Milligan: 1:55:56

Well there, there was another video. It was like a CNBC video that was talking about Arctic shipping, and it was published about a year ago, and there was a gentleman that was on there talking about, he was like a captain. He was talking about, you know, the, I guess, the intricacies of sailing through some of these different issues. But he mentioned that during the time of that recording, that only 300 ships have made it through the Arctic since it was that the passage has been discovered, 300 ships. And so it's so new, it's so fresh, and it's so really like actively developing and. A or erasing, or kind of, maybe, like going on at the same time, and it's just, I it's very interesting to sort of watch that geopolitical, strategic chess pieces being made, because that's, it's something that for a lot of our borders and a lot of our, I guess, countries, and the way things have been, you know, this is a new area, much like how we've talked about, you know, sort of the the colonization that's going on with the moon. We talked about that in one of our space episodes, yeah. And that is now it. You could start to see the chess pieces being made by China, by Russia, and then some of the other NATO countries, and, you know, like Finland, Norway, Denmark, all of these huge ports. And what's crazy is that you watch a lot of this stuff, and you forget how close these countries are to each other. I think we're so used to seeing the regular map where it's like the US is on the left, and, you know, Russia and China's on the right, and it looks so far away, but, you know, sorry to the Flat Earthers out there, but with the circulation, you can look at the Arctic and just see how close Canada, Russia, like China, considers them an Arctic country, like they mentioned that in one of their I'm sure they did it for, you know, economic and political reasons, but they are, they want to be mentioned among some of these Arctic countries, which is also super interesting because their Belt and Road Initiative, which, for folks who may not know, that's China's initiative, to sort of have soft power throughout the rest of The globe by building ports and roads and just like logistics infrastructure in all of these different countries, and they'll do it, and they'll pay for it, but if you don't pay them back in, you know, a set amount of time for these loans, then they get to seize those ports. They seize the that infrastructure, which is happening in some African countries, it's probably going to happen in some South American countries. So it's a very it's an interesting thing to watch play out that will likely be decided in our lifetime, that this Arctic ice will largely not exist in the next 30 years, it's going to be a lot of it's going to be melted away and for the majority of the year. Because right now, it's only a few months out of the year that these icebreakers are largely being used for these routes. But it starts melting away and you have less need for icebreakers then, you know, I guess maybe the US is playing the long game. And in regards to shipbuilding, much to a grin or chagrin of you know, friend of the show, John Conrad of G captain. Yeah, if you follow him on X, he's always talking about shipbuilding, and China is pretty much kicking our ass in that regard of shipbuilding, and a good portion of their Shipbuilding is for icebreakers. So maybe that's a good thing for the US. In the end, there's also a tourism that's kind of taken off for that region too. You have icebreakers, I think, from Norway, that will go into the ice you can pay, you know, 1000s of dollars and go on this ship, and then you can get off the ship and go just walk around on, like, the different ice sheets. And I watched this video of this family. They, this guy put on a suit that's, like, meant to help you if you fall into, like, prevent, you know, hypothermia, yeah. And he can they let people wear these suits and jump into the Arctic if you want to. And I thought that was pretty cool, too. So there's some tourism aspect that's going on there as well. But I just that the idea that it's called, like, the polar Silk Road, I think it's crazy and it's not crazy fascinating, I guess not like crazy and like, ah, like, you know, I'm gonna pull my hair out kind of way. But, like you said

Grace Sharkey: 2:00:25

in our lifetime, that stat said by 2050 I mean, that's not incredibly far away. Like that could be a main, the main line between, you know, US and in Europe. That's crazy kind of consider so again. And just like, I mean, I'd love to, like, have Lauren on this show, to be the maritime professor, Lauren biegun and like, the alliances have already changed with carriers. Just like, how would that change carrier alliances? And how would that shape just global pricing and add the security level to it all too. It gets, like, super interesting

Blythe Brumleve Milligan: 2:01:06

if you're if you're watching the video version of this, I just pulled up the graphic that shows what I was referring to, as far as, like, map purposes wise, like, how close all of these countries are for this one trade lane area. And you can see, like, it's gonna pull like a Sarah Palin, like, I can see Russia in my backyard, which the United States is literally right. There, right next to fucking Russia or freaking Russia. It probably shouldn't cuss like that on the show, but yeah, close. It's close. But you can see on this map all of the different trade lanes that have been established, the trade routes, and then all of the yellow dots are ports that are currently already existing in this area. And so as this ice melts more and more, you're going to see more ports pop up, especially on the Russian side of things, because this was a major initiative, a major focus of the country, from what I understand, before the Ukraine invasion. And so since then, their supplies and their budgets and their focus have been on that, less on this. And so this, arguably, I guess, depending on which way the war goes in the future, this is going to be a focus again for Russia. Another graphic that I wanted to bring up, too is the economic exclusive economic zone. And so this is an area of that same map I just showed you, of which the US has rights to from an economic perspective. And so that's more along the lines of just, I guess they can drill for, like natural resources, natural gas, oil, things like that. And so that is, yeah, that's another concern, I guess, is the economic zone, and who controls these different areas and who doesn't? And it sort of brings up the earlier point of, like Canada, like some of this shoreline, or is starting to even emerge for them. And so that's a territory that they have to claim. And, you know, very like it's with Antarctica at the South Pole. All of the world's nations kind of have a pact. Have an agreement. They have their own little sections of Antarctica, where the Arctic, it's still very much like up in it's it's up for debate, I guess, and where those where those borders are, and where it's being contested, and some countries recognize certain borders, and then other countries don't recognize those borders. And so it's just, I think it's just a really fascinating topic that I'm glad we got to cover in this show. I do wonder, though, is there any difference between some of these Arctic, I guess, icebreakers in, I guess, strategy versus the Great Lakes area. Like, is it largely the same? Is it maybe just the Great Lakes shippers kind of all stay within the Great Lakes. Or what is, do you know any of I guess that routing that goes on up there, like, are these Chinese companies coming in?

Grace Sharkey: 2:04:16

Or it doesn't? I don't think so. I know most of them are ran by the US Coast Guard. There's I want to see. I was just looking at the number of them here in the United States, most of them are used so of all the ships, icebreakers that the United States own, most of them, which I had that number. Where did it?

Blythe Brumleve Milligan: 2:04:41

We only had two. Maybe it's just two Arctic.

Grace Sharkey: 2:04:44

We have two that, that was, that was the point I was gonna make. We only have two that. We have 12 total, only two are functional for the Arctic, where as Russia has 41 in particular, Finland, it looks like 11. Canada has 20. Again, not all of those are for the Arctic, though it sounds like some of that's for, I think, the Hudson Bay up there and but they are. They're building more out of Canada and then China has just five. But again, they're so close to Russia to say that they would never work together on that it's, it's silly. So they're, they're building, it looks it sounds like two more here in the United States. Current or no, sorry, they're building more. The number's not on here right now of how many they're looking to build, but yeah, the ones that are are in the Great Lakes. Are just like nowhere near the the type of icebreaker that you would need for that type of ice in particular. But it does make me wonder with but they aren't like they are. I will say they are Coast Guard run. So there's no like entity

Blythe Brumleve Milligan: 2:05:56

that commercial operation, yes, yeah.

Grace Sharkey: 2:06:00

Well, they're technically a navy ran, I guess, if you looked at it that way.

Blythe Brumleve Milligan: 2:06:04

Because the reason I asked about that is because my brain goes to, well, China's kind of doing the same thing with Mexico right now, where they're just sending a lot of freight into Mexico and then just trucking it in, like, would they do the same thing with Canada, and then just truck it in on the other side? So I was just curious about that, which I'm sure would especially that was rail lines.

Grace Sharkey: 2:06:26

I think the big problem there would be, yes, you have rail lines, but. But they're like, how covered in snow are they at different there are certain times of the year, I think the infrastructure is nowhere near that of Mexico. So, but like, again, it depends on if you, I'm sure if you built a port somewhere between, like Alaska and so, like, a Canadian port, right? Like that could be an option, depending on the times of the year, but I know, again, ice road trucking, it's really dangerous up there. So I would a lot of times there's just there. Those guys are just driving that ice right? So I would just, if anything, though, I don't think you're wrong. I think again, goes back to my statement. On like, this lane, like, think of the trickling effect of the economy it could do. I mean, there would need to be more truckers up there. They would need to be more towns and settle settlements, right for for those people that are helping move any of those goods. So again, I don't think out of the question, especially because if we're losing that much ice, I would assume at some point we're going to see less snow in some of those areas too. So a lot of a lot of what ifs right,

Blythe Brumleve Milligan: 2:07:41

and there's, as I was watching a lot of these videos too, just breaking down, like what icebreakers are, what why this Northwest Passage is, is so important, and why it could change things from a geopolitical perspective. And a lot of the videos were showing like these, you know, chips that are coming from China and leaving the East Coast, and they're going all the way up to the Northwest Passage, or they're going all the way through, like, the Panama Canal. Like, why don't they just go to LA like, why are you going all the way around? And apparently, it's the from what I understand, the Malacca Strait is where a lot of the Chinese ports are located. And if the ships come out of those areas, that's where there's a lot of geopolitical tension, because of Taiwan, because of Japan, like the Philippines, and that's a lot of contested waters there. And so that's why these other routes where China either goes north or they go through the Panama Canal. That's why it makes much more sense for them to avoid the drama in the Malacca Strait, or the potential of drama in the Malacca Strait, and take these routes to the US instead. So it also has some US implications too, like, you know, is the Port of LA is Long Beach? Are those going to, you know, be impacted by the Northwest Passage as well. And so lot of these questions we can't answer today, but fascinating discussion regardless.

Grace Sharkey: 2:09:00

You know, I do want to throw out some numbers on here, though, because it is, like, kind of crazy. Like, what this would cost when we talk about, like, where is this money going to come from, too? So looks like the Coast Guard has they call a PSC program right now, a polar security cutter program that would aims to acquire four or five new heavy polar icebreakers and an acquisition of a new Arctic security cutter. So a medium polar icebreaker

Blythe Brumleve Milligan: 2:09:31

Is that what you're saying a cutter, like they cut through the ice, I guess? Yep.

Grace Sharkey: 2:09:36

So, like price breaker. That's basically like a heavy duty one and a medium sized one, or a medium effort, I would assume. I mean, and it looks like estimated cost for the big one is so one is, I gotta move things over $1.2 billion for the first ship, 921 million for the second ship, and$1.1 billion for the third ship. So again, it's just, it's just so crazy, right? Another, another thing we're going to have to figure out taxpayer wise, right? But it's just the money behind it. It's crazy. There's, like, a whole report, I'm sure you probably have some of the data from that too.

Blythe Brumleve Milligan: 2:10:26

On your there's so many, like, just, it's untouched land too. So it's the minerals, the natural resources, I'm sure, like lithium deposits and things like that, that, you know, wars are being fought all over the world for, and so it's just an unfortunate reality that that's going to be something that they fight over next, and how are they going to pay for it? Well, probably through some of those natural resources, I would imagine or securities budgets, I'm sure they can justify a lot of things for securing that oil.

Grace Sharkey: 2:10:57

There's there's oil somewhere, you know, oil pay for

Blythe Brumleve Milligan: 2:11:04

it. All right, let's move into our next topic. Blake Milligan, here with grace. Sharkey, this is everything. Is logistics, presented by SPI logistics, and we're going to get into a little bit of drama around the private label paradox. And the reason I wanted to bring this

Grace Sharkey: 2:11:20

up, yes, and that's because a strong word, maybe we shouldn't say hate right now, but. It we fascinated. We're fascinated. Yes, we're we're negatively fascinated.

Blythe Brumleve Milligan: 2:11:37

And so when the reports came out. Now, for those of you who may be living under a rock, Megan is technically a duchess of Sussex, which is a part of England that she no longer lives in, that she said goodbye to with her spineless husband, Harry, and then they moved to the United States under the guise of wanting a private life, and has since launched several different high profile Netflix shows, Oprah specials, Spotify podcasts, and then now a company. So she's gone through a little trouble as an entrepreneur. An entrepreneur. She tried to, you know, get That's the American dream. Well, speaking of American dream, she tried to trademark American Riviera orchard, I think is the exact phrase. But according to trademark law, you cannot trademark a specific place. So her trademark was rejected. She can't, you know, be two and, oh, for trademarks on like me, like your girl over here, she doesn't have the staff to do it. She's probably too mean to them and bullying them. So she started up another company called as ever. And as ever is essentially unlike what she builds herself on this Netflix cooking show that's filmed not in her house. She doesn't she doesn't live in that house. It's not her garden, it's not her honey bees. But yet, she's portraying that. She's selling all of these products, her raspberry jam and her honey and flower sprinkles, as if they come out of her garden. None of that is true, because she's using a private label company, probably Netflix, but Netflix doesn't want to promote her brand on their website. I checked last night that I find that very interesting Netflix.

Grace Sharkey: 2:13:19

You think it's Netflix jam. So

Blythe Brumleve Milligan: 2:13:24

the way it works is that for their popular franchises, Netflix offers a store, a brand, that you go and you can sell some branded merch for, like, Stranger Things, for example, like a perfect example, yeah, where they have all of the Stranger Things, merch that they've created, the rumors are that the people on the show get a get a kickback. You know, some of those products that are sold, what is streamer, and they offer this as an additional, an additional, how do I want to say this additional perk of hosting a show that is successful on their platform, since it's not that successful of a show,

Grace Sharkey: 2:14:03

yeah, how do we milk this?

Blythe Brumleve Milligan: 2:14:09

So the route that she took for her business is going the private label route. And the private label route is very common among major retailers who will partner with so say, like great value with Walmart. I believe you have some information on Trader Joe's, costco's, Kirkland brand. These are all very successful private label companies that source their products from a co manufacturer, and that person or that business, that manufacturer is making the same products. Let's use like Kleenex. For example. Kleenex is going to make their product, and then Costco will come in and say, Okay, we want you to make the same product for us, and you were just going to do a small markup on it, and you're going to put the Kirkland brand on it, and so they'll work out a partnership deal where they there's a lot of this stuff is hidden. So a lot of these retailers don't even reveal on who their manufacturing partner is. There's been a long standing rumor that gray goose, the famous vodka maker makes the Kirkland brand vodka, even though gray goose has denied it in reports, they're under no legal obligation to admit it. But I've always, I was former cashier at Costco, but that's always what I heard is that the Kirkland brand of vodka is made by allegedly gray goose. So that is sort of the private label paradox of, you know how to position how these companies, especially like celebrities, when they're pitching like, I think it's Kendall Jenner that and the rock as well. Like, they pitch themselves as being like tequila company owner, but all they're doing is going down, if they are even doing this much, but going down and finding a farmer who's already growing the agave, who's already has, you know, some kind of tequila manufacturing that he's doing for some kind of companies, and then they just partner with them and slap their own label on it. That's essentially what Meghan Markle has done with her as ever brand. And one of the quotes that I wanted to bring up, which is a little spicy, and I think I tagged you in it on Twitter, is that the reason her company, her rebranded company, is failing is because the quote was, is that she spent millions on PR instead of supply chains. And so when I see that, I say, this is a gold mine. We got to cover this in the future show. So that's how we arrived here. Sure. Now we're going to tell you some of the success stories of some of the the the more popular private label brands, and what makes them popular. And so I think you have Trader Joe's as an example. So tell us why Trader Joe's and their private label has been so successful.

Grace Sharkey: 2:16:48

Well, I do want to say too I got a nice list of some, some private label behind the scenes for you, too. So you brought up Costco, right? They do private label a bunch of other stuff. So one is their coffee is actually from the Starbucks manufacturer. Duracell does the Costco brand batteries? Bumblebee does the tuna for Kirkland or Costco? Walmart's known for doing this too. Tyson Foods is most of their chickens. So if you're buying Tyson chicken, it's the same as your Walmart chicken. Now, the reason I brought up Trader Joe's is because Trader Joe's everything is private label. That's what they that's what they're built upon. So pretty much all of Trader Joe's food comes from the actual like focus product. If you've been to Trader Joe's, even, I think they, they have pretty close to the Girl Scout cookies too, because they're buying those directly from the same manufacturers that make the Girl Scout cookies. So you see this all over, but yes, Trader Joe's does this as their actual like, you know, I guess strategy to to existing today. 80% of their products are private labeled. A lot of it is like Frito Lay does those? Does their pita chips? And so when you go and you see these better prices, know that they're coming. They're because they are technically some of the regular items that you're actually buying. And what I think is interesting is I've always, like, heard this, and I've thought to myself, like, Well, why would, for example, like, why would Duracell do that? Why would Duracell also put their same batteries on a shelf next to them that they know is probably going to sell for less, right? It doesn't seem odd, right? And, and the reason for it, though, is, if you like, mathematically, think about it. For them, it's about being able to produce higher volumes and bring those margins down no

Blythe Brumleve Milligan: 2:19:02

matter what. And it's also an additional revenue stream for them, exactly.

Grace Sharkey: 2:19:06

It's a way for them to basically compete with themselves on a shelf, and at the same time I can do that, because likely that price difference between the Duracell battery and the Walmart battery is still more than what you get from producing a larger scale. But I think it's interesting, like I always when I really started learning about private brands, and specifically started learning about Trader Joe's, I would tell you to like, go to because they do hide it, but honestly, a lot of them do put it on their packaging at the end of it. So I would really push you to like, I do this with pretty much all foods I buy now is if they're pretty close, if I'm looking at a regular brand and a private label, why not look at the well, first off, I'll look and see if it showcases where it's coming from. If it's in the same city, it's likely the same manufacturer. If it doesn't have that information on there, I go immediately to the ingredients, because the ingredients will read exactly the same. And if those ingredients read exactly the same, honey, save $1 get the Walmart brand. And so I, when I first started, I think I saw a video on Trader Joe's, like, over a couple years ago, and it and one reason I started looking into it was because it was like, Well, why would you do that? Right? You're competing with yourself that same stuff. But then I started learning about that, and now as a consumer, it's like, I will gladly buy a private label, especially if things are looking the same in general. So yeah, that's why I think people love Trader Joe's so much. They love the one. You're getting things a little bit cheaper, but you're also getting the things you're already planning on buying at a little bit cheaper as well. So, yeah, so,

Blythe Brumleve Milligan: 2:20:53

well, there's even, like, the the Costco route, where I was watching this, this video on, like, the history of, like, the Kirkland brand, and at first, so to back it up, a little bit like retailers like Amazon, and I know target in particular, they have multiple private label brands inside of their own, you know, sort of digital, whether Amazon, digital e commerce stores or within target itself, and you would never know that that brand is owned by target, because it looks completely different their packaging and all of that stuff. So Costco followed a very similar route in their early days. Or they had a bunch of different private labels, but quality control became a concern. And so what they did is they created the official, like Kirkland brand, because it was based in the the town that they had their home offices in, and so they called it Kirkland, and then they developed these relationships with these different suppliers that were already in their stores. And so they'd created, like, a pricing structure where they agreed that, first of all, it's quality plus pricing. And so for the pricing there, these brands that they partner with are not allowed to sell it for like a, you know, a certain percentage above, like, I think, 10% so they have to keep their pricing pretty stable, and then the Kirkland brand will always be cheaper and but also with the Kirkland brand, they they partner individually for each of their their like coffee. For example, they partner with one company for coffee, whereas, you know, maybe Amazon is partnering with several different companies for their battery production. So there's a level of like you scratch my back, I scratch yours with the Kirkland brand for someone, maybe like a Duracell to create like a and I don't know if they have like Kirkland batteries, but them just going with that example. But also, they have an additional layer of quality control, where no Kirkland brand is approved for a new product unless the CEO is actually testing it. And so they have this, like several layers of quality control that will always, you know, sort of permeate throughout the company. And so I think that that's where you know everything from what you said to the success of the Kirkland brand, because I have a couple graphics here that it is just it's ginormous of how much this brand has grown, the Kirkland brand in general, like, look at these numbers. So Campbell's, Hershey, Kellogg's, McDonald's, Nike, Kirkland has more revenue. And this is a chart from 2021 but you could argue that a lot of these numbers have stayed the same, if not, maybe Kirkland has grown more market share because, you know, obviously McDonald's has struggled in the last couple of years, Nike has struggled famously in the last couple of years, but they have more revenue than all of the rest of the companies combined.

Grace Sharkey: 2:23:48

Yeah, which is crazy, yeah. And you know, the fun one for you personally, I actually learned it's kind of the same thing. Do you know who the Try Guys are? The name sounds familiar? Yeah, they're the well, they try,

Blythe Brumleve Milligan: 2:24:08

go figure, yeah.

Grace Sharkey: 2:24:10

So they're, like, it's a really popular YouTube channel. They try a bunch of things. And I like watching there, of course. Like, they go to, like, Disney World, you know, and like, try all the fun foods and stuff like that. One of the episodes Keith goes into because, just because he's tried food at so many locations, he's he's starting to figure out, like, all of the Disney food is just craft, interesting, yeah. So it's like, I think some of it's grown right, and you can usually tell, but it's like, like, universal uses the same stuff, like, in, you know, I'm trying to think of what the food is that he usually gets that he's like, I know how this is going to taste, because it's craft. But, you know, amusement parks are doing this all the same thing too, right? It's like, there's only he brings this up, and one of the episodes, there's only truly, in terms of, like, like eating at schools, eating at amusement parks, eating at, like, public places, like three manufacturers of wholesale for this, and like, the whole United States. So it's like, if it's not craft, I think he said it was like GFS or someone else, but it's the same thing. Like, a lot of that food you're eating is like the same in all those places. So have

Blythe Brumleve Milligan: 2:25:23

you ever seen that image of all of the businesses that and I'm going to share it, yeah, really quick. But if you're just listening, I'm sorry, but it's like this giant web of we have 123456789, about 10 companies, but all of these different brands that are under those 10 companies is just astounding. Like, I can't even like, zoom in enough on this photo for you to be able to see all of the labels that are associated with these 10 big companies are probably all using the same that's why our food system is shit, because they're all using the same BS, allegedly, and they're in all of their products, and then they feed them to us. And you know, we're all have gut health issues because of it, yeah,

Grace Sharkey: 2:26:14

except for, like, we love you, Coca

Blythe Brumleve Milligan: 2:26:18

Cola, some brands in there that I do, like I do, and I'll get more into this, you know, a little bit in in our last segment. But I'm on, like, a big, like, health revitalization journey. I mean, you know, I'll talk more about that here in a bit, but it's just the more with our food system, the more layers you peel back. It's like, wow, everybody is really, like, full of shit, except for Kirkland and Aldis and Trader Joe's. Like, that's what it feels like, is that all of these companies are just out here, you know, trying to kill us. But then on, I think to kind of, you know, bring it full circle. The shop, the modern shopper is savvier, and they can see right through the bullshit. And I think that that's where, you know, companies like Costco, with their Kirkland brand, are succeeding, versus like, the Meghan Markle like as ever brand, where, you know, she's launching like a new bottle of wine on Princess Diana's birthday. No lie, what?

Grace Sharkey: 2:27:21

Yes, wow. She just loves to piss us off, doesn't she?

Blythe Brumleve Milligan: 2:27:28

You know, it's at that weird moment where, like, you know, she's pissed off everybody in her personal, like family, close circle life, because none of them come to the wedding, besides her mother. She disowns her father, who she still hasn't spoken to. She forced Harry to disown his entire family and all of his traditions. And you know all of that, and you know now, bringing it sort of full circle, it's like, you're not a stay at home mom, you're not a stay at home wife. Yeah, you're kind of a fraud. Because she's picking all of these products that she's she's portraying herself as almost like a Trad wife, and she is none of those things. And she's filming a reality show inside of a house she doesn't own from a garden that's not hers. Honey bees that are not none of this is hers.

Grace Sharkey: 2:28:17

He's not touching people. My best friend is a B gal. Shout out to Bellwether bees. If you need honey, go to their website. But she ain't, she ain't touching no bees.

Blythe Brumleve Milligan: 2:28:30

That's the thing, like shoppers can sniff this kind of stuff out. So she's kind of like 510, years too late on being like the Pinterest food influencer vibe, yeah. Why she even needs to do this career path is beyond me, but it's the the private labeling of her brand is never going to work, because shoppers are much more savvy now, yeah, and they can seek out the brands that they truly resonate with or that they truly find value in. Yeah, and that's the Trader Joe's, that's the Kirkland brands, maybe not so much as like, you know, great value, or even, like, Amazon Basics, because there's some questionable things going on with Amazon Basics that I don't necessarily agree with, with their private labeling, where they essentially, you know, there was, like, there was this bag manufacturer that spent like, I think it's called like Peak Design or something like that. But they make, like, travel camera bags, and they've been spent 10 years developing the concept around this bag. And then they want to add another revenue stream. They want to add another outlet. Where are people shopping? Of course, on Amazon. So they start selling their products on Amazon. Well, what does Amazon do? They completely rip off his design that he spent 10 years getting all of the, you know, the due diligence and the product testing and the customer feedback, and tweaking all of the things and supply, and doing all of the things to get a successful product to market. And they rip off his design. And if it wasn't for and he says it in the CSC NBC video, that if it was early on in their business, they would have been crushed. And so now what they do is they make sure that they have a design patent on everything, so that Amazon can't come in. Because what happens is that if Amazon has all of this data, and allegedly, they can go and see certain products that are selling very high, that have a low return rate, kind of bring it all full circle with this episode, and they could use that data to then go and make their own products and then shove your product way down on the search result rankings and push their product to the top. And if it wasn't for him going to the media about this, about what Amazon was doing to him, then he says that his company would have been wiped out. Luckily, his fan base was built up and that it was stronger, so they a lot of these users went and left bad reviews on that Amazon product, and Amazon stopped making it. So that is a minor like success story, and sort of a David versus a Goliath kind of battle like that. But there are countless other people. My uncle was a victim of this. He was selling office products. He had the full like, you know, in person, store that people would go to. Obviously, when time shifted, he moved his business online. Time shifted again, so he started selling his products that he was sourcing, that were really good sellers, that his customers loved. Started selling them on eight. Amazon. And there was one, like ladder in particular, that was, like, their number one seller. And then one day, that business just gets cut off, and Amazon's ladder from Amazon Basics is shot to the top of the rankings, and his is nowhere to be found. And so that is a major he pulled all of his business off of Amazon because of it, because it was so pissed off and like, rightfully so. But that's kind of shady practices, like consumers are getting wiser to these things. Hopefully will spend unless they need it. You know, in two days, hopefully you're making smarter shopping decisions because of all of the information that we have at our fingertips. Of the brands that do it right, like, yeah, goes in Kirkland versus laziness or the outright theft, yeah, what some of these other companies are doing,

Grace Sharkey: 2:32:19

it's almost like, back to what I was saying about the AI stuff. It's like, I think how much AI has grown, we've quickly started to realize, like, what's real and what's not. And I think, as much as you know, I don't want to make it like a political thing, but like, I think we're seeing the same thing with our food as well, right? It's like, okay, we're understanding labels. We have the internet. We can easily look up what these ingredients are. The other thing too about it as well, and because we used to talk about this on Freightways, stock out. Show is, it's not hard for a lot of these companies to switch, because they're already making these products and for Europe, right? So it's like, what

Blythe Brumleve Milligan: 2:33:03

you're talking about, like the red dye, yeah, things like that that are being that are in our food system for who knows?

Grace Sharkey: 2:33:09

Yeah, they're always just kind of taking advantage of maybe the ignorance of America Americans and the lack of regulation in that space. So it's like, I think the same thing is happening, right? Like with our food, where it's like, no, we we're going to figure out kind of what you're doing, and we're we're going to make better decisions as consumers as well because of that, right and more. So we know that you can pivot, if you need to, and still make a healthy margin because of our abilities to get our hands on those documents to know that the ingredients are different and you're still able to be a profitable at the end of the day, right? So I like, I like it. We're almost, like, going through this, like, like intelligence, maybe, like revolution, where it's, I mean, we see a bullshit detector is getting better, exactly, but I think that that's because we're getting smarter in a way, right? So longer that we have bullshit detectors, we just know it's not true, and, and, and so, yeah, it's fun to, like, see how that's going to affect consumerism throughout the next couple of years.

Blythe Brumleve Milligan: 2:34:22

Yeah, because, I mean, I'll definitely say, like, after like, all of the sort of the the tariff drama, it's, I've cut back on a lot of my just, I guess, dumb spending, like that level of like consumerism, where it's like, you know, I'll buy, you know, spend 100 bucks at temu, and I'll get 100 products. And, you know, who cares? I'll just, you know, throw it away if I don't need it. You know, it doesn't matter and doesn't want it back. And so they're willing to let me keep it if I don't want it, and or the product breaks within a, you know, two months, and it's like, who cares? I'll just get another one for $6 like, it's that kind of mindset that I think is shifting in larger scale. And I, you know, I don't know. I think for some of this stuff, if I would, if someone would have told me some of the things that are coming out of my mouth, even, like, five, six years ago, I would have rolled my eyes at myself, like, who cares? Like, go save the planet, you know, whatever kind of like, I guess, sarcastic remark. But I think that a lot of these like, we just to bring it back, like, we're just getting more savvy as a customer, and we're able to be maybe more intentional about where we spend our money. Is it, you know, with small businesses, or is it something that's more of a quality item that's been handcrafted? Is it something you know? Is it, you know, honey from a local you know, bee farm like that, feels better to spend your money there. And I think where, you know, I I kind of still have to make improvements, is, like the convenience factor, and, you know, some of these items, I just need it in two days, like, you know, and I'm willing to, you know, look the other way of some of these practices based on needs, but I am trying to shift my consumer behavior into healthier options, more sustainable options, and just trying to be a better person. I guess overall,

Grace Sharkey: 2:36:22

the one thing I will say to that though, and this is why I've always been bullish on more of like micro fulfillment and more. Of, like, how close are we to? Kind of, the things that we want is, is, can, what they say, convenience is the price of community, right? So, you know, consider that aspect Right? Like, the fact that if we can actually get to a point where we feel like we're buying more community like, basically, can we get to a point where we're ending that, where it's not a price right, where we can create fulfillment centers in a way that we can buy clothes? We don't have to worry about shipping our clothes from for $12 across the United States, but there's just, you know, a short distance for that return. And so I think that that's probably, that is probably what more the reverse logistics, right is trying to do is like, well, can we figure out a way to make this all right, sustainable, in a realistic, more modern setting?

Blythe Brumleve Milligan: 2:37:23

So yeah, and if you're just listening to the the isolated segment, because what you know, sort of peek behind the curtain a little bit we are, yeah, it's in the it should be a link in the show notes for you to be able to listen to that other conversation. And so on YouTube, we are still uploading this show in full to both the podcast and then also as a live video to YouTube. But then YouTube, the algorithm just likes it more. Likes it better if some of these segments are split up, and so if you missed any part of that return versus reverse logistics that is in another show, it should hopefully be, you know, recommended to you algorithm wise, but if not, just check out the playlist over on YouTube. Thanks for tuning in to another episode of everything is logistics, where we talk all things supply chain. For the thinkers in freight, if you like this episode, there's plenty more where that came from. Be sure to follow or subscribe on your favorite podcast app so you never miss a conversation. The show is also available in video format over on YouTube, just by searching, everything is logistics. And if you're working in freight, logistics or supply chain marketing. Check out. My company, digital dispatch, we help you build smarter websites and marketing systems that actually drive results, not just vanity metrics. Additionally, if you're trying to find the right freight tech tools or partners without getting buried in buzzwords, head on over to cargorex.io where we're building the largest database of logistics services and solutions, all the links you need are in the show notes. I'll catch you in the Next episode in go jags. You you.