Containerization provides increased efficiency and reduced cost. It is not a technology that will reduce logistics demand, but is still a tool that, properly applied, could continue to have an increasingly significant positive impact on the Army logistics enterprise. Containers come in a variety of types, including the following:
• Dry—a fully enclosed weather-tight container;
• Reefer—an insulated container equipped with refrigeration machinery, for carrying frozen and/or perishable cargoes;
• Flat rack—an open platform with rigid or foldable ends;
• Tank—a rigid tank fitted into a container frame for carrying liquid cargoes;
• Open top—a container with solid sides and a tarp roof, used for cargoes lifted with an overhead crane;
• High cube—a container higher than the standard 8 feet, 6 inches; usually 9 feet, 6 inches; and
• A variety of specialized containers.
Containerization has had a profound impact on all forms of transportation. Industry has enjoyed many benefits of containerization, such as lower terminal and warehousing costs, less packaging, less pilferage, faster throughput, lower insurance costs, simpler documentation, faster ship turnaround, less cargo damage, greater efficiency, and dramatically lower shipping costs.
The U.S. military has taken notice and has adopted many aspects of containerization. The U.S. Transportation Command (TRANSCOM) employs many commercial shipping companies to fulfill its logistical needs. However, the intense competition in the commercial container field and its steady expansion have led to rapid innovation and increased efficiency in the manufacture and use of containers. There are more than 35 million 20-foot-equivalents of containers currently in service.1 The Army has only a small share of these. The Army could find it useful to more closely monitor and track much of what is done by commercial shipping companies. Where appropriate to the Army’s mission, new intermodal shipping techniques could bring improvement to the Army’s container programs. Commercial companies are quick to adapt new methods. The Army may want to consider how they can be more agile in adopting innovation. Improvements in Army logistics could be realized if many of the techniques common in commercial service were adapted to fit the Army’s objectives and needs.
For example, in established port facilities, an extremely efficient way to lift containers into and out of ships with a crane is to attach the containers vertically, so they hang one above the other when the crane lifts them. Lifting two or more containers this way is called vertical tandem lift. Although this technique had been banned by the Occupational Safety and Health Administration, the ban was revoked in court in April 2014, and this technique again became permitted after July 21, 2014.2 It may be worthwhile for the Army and TRANSCOM to investigate the use of this technique where appropriate.
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1 Twenty-foot equivalent is standard measure of container volume. The volumes of different sized containers are related to the volume of a standard 20-foot container.
2 29 CFR 1917.71 (i), revised.
Visibility into the container standard-setting process would also be beneficial. Army or TRANSCOM representation on the U.S. American National Standards Institute Technical Advisory Group committee to the International Organization for Standards (ISO) TC-104 container standards committee would prove useful. The Army and TRANSCOM are major stakeholders, and changes to standards have major impacts on their container assets. More importantly, representation on both the main committees and particularly on the four subcommittee working groups would give the Army insight to potential changes and the underlying problems driving changes in standards. It would be worthwhile for the Army to monitor industry practice, both in the United States and abroad, and, where practical and appropriate, adopt any innovations to meet their logistical needs.
Today, TRANSCOM and the Army and Navy appreciate the potential for containers to augment and support logistics, with a four-decade commitment to using containers. Currently, however, TRANSCOM relies heavily on a number of U.S. subsidiaries of foreign-flagged shipping companies for the transport of sustainment cargoes in containers. In the case of an all-out conflict, or a conflict on multiple fronts, the demand for container transport may overwhelm the capacity of the limited number of U.S. flagged commercial vessels that TRANSCOM currently relies on. In this case, the Army and TRANSCOM might have to turn to foreign flagged shipping, with all the attendant risks. There are currently a number of foreign flagged, U.S.-owned tankers and cargo ships. They are crewed by foreign nationals. While the United States would have access to these ships in time of conflict, crewing the vessels might be problematic, as occurred during the Vietnam War.
ROLL-ON/ROLL-OFF VERSUS CONTAINERS
A basic philosophy of the Army and Marine Corps has been, and to a great extent today still is, to put wheels under everything. The purpose is obvious in theater-opening expeditionary operations, to have everything mobile and able to advance rapidly. For invasion and advance inland, both the warfighting and initial supply chain needs to be highly mobile and agile. This dictates that sealift capability and initial supply must provide mostly roll-on/roll-off (RO/RO) transport and discharge capability. Unfortunately, it is the nature of RO/RO transport that there is an abundance of broken stowage or wasted space on RO/RO ships. Nevertheless, with limited U.S. sealift capability, it is the committee’s opinion that RO/RO has priority over other cargo transport and cargo handling needs. In the commercial arena, the efficiencies inherent in containerization quickly displaced commercial RO/RO ships, palletization, barge carriers, and other competing shipping modes.
In Vietnam, tedious break-bulk ship unloading at overcrowded waterfront facilities resulted in arriving ships waiting an average of 30 days at anchor for a space at a dock. In 1966, an experiment was performed. A container ship, the SS Fairland, equipped with its own shipboard gantry cranes, was brought to Cam Ranh Bay. In 1 day, the ship completely discharged and was even able to return some empties to the ship. This eye-opening demonstration was a watershed event and broke the logistical log jam in Vietnam. The Army in Vietnam was quick to see the potential.
So, containers are more efficient for the shipping of materiel. But RO/RO ships are necessary to meeting military needs in theater opening expeditionary operations. It might be possible, however, to develop techniques to create temporary decks on container ships to store RO/RO cargo in their large holds using readily available container flats. This could allow these ships to take full advantage of the efficiencies of containers and could be especially helpful in surge situations.
Containerized cargo is stowed in vertical cells in container ships. Different mission scenarios will likely call for different mixes of cargo. This would likely apply especially in the case of removing equipment from prepositioned equipment stores. Retrieving a container from further down in the cell necessitates removing the containers above it. This is an arduous and time consuming task. Improving the ability to selectively retrieve specific containers without having to first remove the containers above them holds the promise of significantly improving the efficiency of operations.
CONTAINER COSTS
There is the potential to save money by reexamining how the Army procures and uses containers in initial theater-opening phases. Opportunities exist in considering where standard industrial containers may be used, the use of second-hand containers instead of new ones, and in managing the decision whether to buy or lease containers. During the sustainment or resupply stages, the use of commercial carrier containers simplifies decision making on these points.
Military Specifications Versus Standard Industrial Containers
It is worth asking whether special-use containers for the Army need to be built to military specifications, or whether standard industrial containers could be modified for these special applications. The 35 million containers in commercial service are durable (with physical lives in excess of 15 years) and function well in both developed and developing countries. Such containers are very inexpensive. It would be advantageous to the Army to use these containers where possible instead of specialized containers built to military standards per MIL-STD-648D (DoD, 2008).
Possibly complicating the use of standard industrial containers are buy-American requirements for containers built for the military. Currently, however, “U.S. made” containers for the military are only assembled in the United States—not constructed in the United States from basic raw materials (e.g., sheet metal, rolled sections). The components and assemblies are fabricated in China and shipped knocked-down. So, the final cost of “U.S. made” containers in current use is higher than industry pays for its containers. Containers made entirely in China are cheaper than “U.S. made” containers. The committee recognizes that this is an issue of national policy, but feels compelled nonetheless to point out that “U.S. made” containers are more expensive, even though they are still mostly manufactured overseas.
New Versus Second-Hand Containers
Even less expensive than new industrial containers are rugged second-hand containers with considerable physical life remaining. These can be purchased at very low cost, especially in the United States. Due to the imbalance in trade, the cost for commercial shippers to return empties from the United States to Asia is prohibitive, and they tend to stockpile in the United States. It is sometimes cheaper for commercial operators to build a new container in China than to send an empty back to its point of origin. Further, shipping containers are put to many alternate uses by innovative soldiers as shelters, workshops, and so on (see below). Sending second-hand containers into settings where this is likely to happen could free up capital that would otherwise be used for costly new containers or avoid demurrage (detention) charges for leased containers that are not returned to the vendor.
Another point of difference between newer and older containers is quality. The quality of newer containers is less than that of older containers. Manufacturers of new containers are using cheaper construction materials. For example, some newer containers have 4.5 mm corner posts rather than the 6.0 mm posts on the older containers. Newer bamboo plywood floors delaminate and are less durable than older hardwood floors. Also, some newer corner castings are of questionable quality.
Commercial operators constantly face the question of lease versus own. The same market considerations should drive government decision-making on this subject. Once leased containers move into theater, there is a chance they may not return for a variety of reasons. The purchase price and lease rates for commercial containers fluctuate based on a number of factors, including supply and demand, availability of second-hand containers, interest rates, and steel prices.
Many of TRANSCOM’s and the Army’s needs, especially during conflict, have containers moving one way, to the front. Also, as mentioned above, soldiers find innovative uses for containers. Obviously, if leased and carrier containers are used this way, significant costs will be incurred. To try to
prevent this, Army policy is that “all commanders in theater must return containers as soon as they are emptied” to assure that they do not incur demurrage charges (DA, 2013). Nonetheless, it appears that containers are being retained in forward areas. USA Today reported in 2011 that the Pentagon has “spent more than $720 million in late fees for storage containers.” (Vanden Brook, 2011) The Surface Deployment and Distribution Command claims that the annual demurrage costs have dropped significantly since 2004 through better management. For example, only $30 million in 2010 (Vanden Brook, 2011).
The Inefficiency of Small Containers
Army policy, currently, is to restrict containerization to 20-foot containers. The 40-foot variation is being used for sustainment by TRANSCOM (DA, 2013). Commercial container ships, RO/RO ships, developed port handling equipment, and developed infrastructure are capable of handling 40-foot and larger containers. It costs nearly the same to move one 20-foot container through a terminal and onto or off a ship as it does for a 40-foot container. This is true even if the gantry cranes are equipped with twin-lift capability. A high-cube 53-footer, which is now the most common trailer size on U.S. highways, has 50 percent more volume than a 40-foot container and three times the capacity of a 20-foot container.
While recognizing that the larger 40- and 53–foot containers do not serve every situation (i.e., high-density cargoes) the enormous economies attendant with large containers, where appropriate, should not be ignored. In the opening and advancing phases of a conflict, a military force must be agile, flexible, lightweight, and fast moving. It is in the resupply and sustainment phases where large unit loads may be practical. Using larger containers also depends on adequate availability of infrastructure, such as container cranes, roads, and so on. TRANSCOM and Army logisticians may find a way to reap some of these benefits of using larger containers. It is axiomatic in materials handling to use the largest unit load appropriate to the circumstances.
USING CONTAINERS TO MEET OTHER LOGISTICS NEEDS
Among the various logistics needs is providing shelter for soldiers and facilities for base camp operations. A number of innovative containerized shelters are, or are about to come, on the market. These can be transported by truck, flatbed chassis, or helicopter and set up in minutes. Often, military resources are used for humanitarian purposes. Containerized shelters would be of great value in humanitarian relief missions, which is expected to be a predominant mission in the Asia-Pacific Theater.
The permanent prepackaging of various types of camp equipment, such as reverse osmosis water purifiers, diesel generators, waste treatment plants, incinerators, and so on, in containers to reduce transport costs is laudable. However, it is not always necessary to mount this equipment permanently in containers. It might be preferable to skid-mount the equipment for easy removal, allowing the container to be repurposed. While there is abundant anecdotal evidence of shelters being built into units that conform to ISO handling requirements, knock-down kits consisting of insulation, bunks, climate control, and lighting units, and so on could be made up so as to permit troops in the field to adapt empty containers into shelter or work spaces if required. Containers can be stacked, put into blocks, arrayed end-to-end, spaced apart with joining roofs, and generally assembled into a great variety of configurations. Many of these modifications can be readily made using common hand tools.
OBSERVATIONS
Container industry practices are constantly and steadily improving. Many of these improvements could be of use to the Army. For instance, in ports, it is more efficient to employ vertical tandem-lift
procedures, especially when moving empty foldable platform containers. Also, the commercial container industry has overwhelmingly adopted 40-foot and larger sizes for reasons of economy and speed of handling. The Army might find it useful to monitor industry practice, both in the United States and abroad, and, where practical and appropriate, adopt any innovations to meet its logistical needs. This would include container design, repair, refurbishment, container operations, container refrigeration, container terminal operations, container handling, inventory control, and container tracking and monitoring. Army logistics might also benefit from the development of flooring techniques to create temporary decks in container ships so they could carry more RO/RO cargo.
It may be more cost-effective for the Army to use second-hand containers in some applications rather than purchasing new containers. Further, the quality of newer containers is generally lower than that of older containers. Ordinary, standard dry containers can fulfill many very useful alternative functions in forward areas. Second-hand, older, non-leased containers can readily be used to serve these needs. Soldiers should not be discouraged from the innovative use of containers.
Finally, progress is being made in reducing container demurrage costs. This is something that has been a drain on Army budgets for a number of years. Clearing the backlog of containers on which the Army is paying demurrage will improve the logistics picture.
REFERENCES
DA (Department of the Army). 2013. Army Container Operations. ATP 4-12. http://armypubs.army.mil/doctrine/DR_pubs/dr_a/pdf/atp4_12.pdf.
DoD (Department of Defense). 2008. Department of Defense Design Criteria Standard, Specialized Shipping Containers. MIL-STD-648D. http://www.chassis-plans.com/PDF/MIL-STD-648D.pdf.
Vanden Brook, T. 2011. “Pentagon Pays $720M in Late Fees for Storage Containers for Iraq and Afghanistan.” Wounded Times (blog). August 29. http://woundedtimes.blogspot.com/2011/08/pentagon-pays-720m-in-late-fees-for.html.
