Optimization Model for Global Container Supply Chain: Imports to United States

The Transpacific trade in container between Northeast Asia and North America is one of the world’s highest volume arterial trade lanes. In comparison with Transpacific trade route, the Transatlantic trade route between Europe and North America is small and has been growing slow. Import container movement in these international trade lanes are the primary sources of United States container import activity. Container movements are heavily concentrated at a number of major gateways. The high concentration affects traffic and congestion at seaport as well as associated major transportation corridors. Concerns over potential long term congestion and large-ship draft restrictions have led shippers to seek alternatives. The all water routing through the Panama Canal to the East Coast is expected to grow to avoid potential congestion at West Coast. Canadian container ports are being developed and provide congestion free service and an interesting option for importers to reach U.S. markets. This paper analyzes the supply chain network with primary focus on import container to United States. An optimization model that integrates international trade and U.S. inland transport networks is developed. The supply chain channels include container import from Northeast Asia through the West Coast to U.S. inland markets of U.S. (defined by Business Economic Area), to East Coast of United States. via the Panama Canal, and European imports to U.S. markets through Gulf and East Coast. This study accounts for container imports to U.S. markets through existing and newly opened container ports in Canada. The model includes capacity restrictions at ports as well as capacities on the inland transport networks. The estimated container traffic flows are reflective of current traffic flows. Heavily concentrated corridors are indentified. Sensitivity analysis was performed to evaluate impacts of congestion on capacity constraints. The optimization model presents a framework for capturing impacts on the supply chain network due to underlying cost structure changes and potential infrastructure constraints.