By Paul Page 

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The debacle of the Hanjin Shipping bankruptcy may be coming to a slow conclusion for shippers in the U.S. Some Hanjin ships are moving to docks at U.S. ports as court rulings provide the foundering South Korean carrier protection for its ships. The WSJ's Kwanwoo Jun reports that one vessel, the Hanjin Greece, started unloading containers at the Port of Long Beach over the weekend, and officials say three more container ships that have been stranded at sea are due to berth in the coming days. One hurdle for shippers as peak retail selling season approaches: funds approved for spending will cover handling for only four ships while 13 Hanjin ships are bound for U.S. ports. Money to handle those vessels may be in the pipeline soon. Hanjin shareholder Korean Air has agreed to provide funding to get more ships moving, but it looks like unwinding the Hanjin fiasco may take several weeks.

E-commerce is changing more than retail shopping patterns. The widespread availability of a wide array of goods is transforming rural America, bringing small-town residents staples at a cheaper price and goods that can't be found at Dollar General and creating new economic opportunities and challenges. The rush to online retail is also raising new challenges in the delivery business, the WSJ's Laura Stevens writes, since rural consumers are the most expensive to serve both for retailers and parcel carriers. One United Parcel Service Inc. driver in rural Oklahoma says his business has shifted from goods like specialized farm equipment to mostly routine consumer products, creating a tough financial proposition. The delivery cost in sparsely-populated areas can surpass the cost of the goods themselves. That leaves retailers struggling to solve a tough economic puzzle even as the communities themselves cope with the pressure local businesses face when competition can come from thousands of mile away.

Two of the world's biggest electronics companies are adding critical flexibility to their supply chains by working together. Intel Corp. is providing wireless chips in some models of the new iPhone 7 that Apple Inc. rolled out this month, with its baseband modern semiconductors replacing those sold by Qualcomm Inc. The WSJ's Don Clark reports Intel is making a breakthrough in the chip giant's lengthy quest to find a foothold in the big smartphone market. That will give Intel important new flexibility and new scale for production -- and minimize its risks by reducing the chip maker's dependence on the struggling personal computer market. Apple also reaches a milestone in making its own supply chain more flexible. Analysts say the company, like many electronics makers, wants to establish at least two suppliers for key components so that it can have a backup in case of emergencies and to keep prices down.

TRANSPORTATION

Google parent Alphabet Inc. and Chipotle Mexican Grill Inc. are the latest unlikely pair to team up on drone delivery. Alphabet's research lab, which is called X, is undertaking a test at Virginia Tech in which drones will ferry burritos from a Chipotle food truck to a distribution point for customers, the WSJ's Jack Nicas reports. It may seem a frivolous use of cutting-edge technology, but the researchers say there's method behind the choice. X chief Astro Teller says prepared food poses important delivery challenges, including how to handle busy spikes in demand and how to protect the cargo. The Virginia Tech campus is also no accident: the school has a nationally-known engineering program to go with a population of burrito-loving students. That will help researchers see how people interact with the technology, and help shape use of the drones for bigger missions like delivering supplies to areas hit by natural disasters.

The fallout from Hanjin Shipping's bankruptcy may have surprised players in the global supply chain, but imagine how it shocked absurdist filmmaker Rebecca Moss. The 25-year-old is one of four artists chosen for an "artist in residency" program on container ships, and WSJ Logistics Report's Erica E. Phillips writes that her "23 Days at Sea" has taken a new, even absurd, turn. Ms. Moss is trapped off the coast of Japan aboard the Hanjin Geneva, one of dozens of vessels that have been stranded at sea since the South Korean shipping giant filed for bankruptcy protection. Ms. Moss said she and the crew -- and two American passengers -- have little idea when they will be able to come ashore. But for program director Kimberly Phillips, getting caught up in the seemingly absurd events "is probably the best thing that could happen" to a program meant to shine a light on the largely invisible global shipping system.

QUOTABLE

IN OTHER NEWS

Wal-Mart Stores Inc. will stop selling Egyptian cotton sheets made by Welspun India Ltd., saying the supplier can't guarantee the products were legitimate. (WSJ)

Italy's Fincantieri SpA and Dutch counterpart Damen Shipyards Group are in the running to buy STX France from South Korean debt-ridden parent STX Offshore & Shipbuilding Co. (WSJ)

U.S. consumers' credit balances increased in July, a sign of steady household spending. (WSJ)

The World Trade Organization ruled against U.S. tariffs that target subsidies benefiting South Korean rivals to U.S. appliance maker Whirlpool Corp. (WSJ)

China's car market jumped 26% year-over-year in August, as consumers took advantage of a tax break to buy vehicles. (WSJ)

Kroger Co. cut its full-year outlook as sliding food prices stoked a price war and intensified competition among U.S. grocers. (WSJ)

The Federal Highway Administration sent $2.8 billion in unused federal highway aid to states, with the largest share of $291.1 million going to California. (Engineering News-Record)

Massachusetts will get $42 million in federal funds to upgrade Boston's Conley container terminal to handle bigger ships. (Banker & Tradesman)

Jon Slangerup resigned as chief executive of the Port of Long Beach to take a post leading an aviation technology company. (Long Beach Press Telegram)

Carload traffic for U.S. railroads fell 6.6% year-over-year in August, the slowest rate of decline this year as volume reached its highest level of the year. (Logistics Management)

China's Best Logistics Technologies raised $760 million in a new funding round that included investment from Alibaba Group Holding Ltd. logistics affiliate Cainiao. (Investopedia)

Chinese domestic carrier YTO Express Airlines will start international freight service with backing from the Shaanxi province government. (Aviation Week)

The administrator of the Panama Canal Authority insists the canal will not be drawn into a price war with the Suez Canal. (Splash 24/7)

SEKO Logistics named James Gagne president as the freight forwarder set a succession plan under Chief Executive William Wascher. (American Shipper)

China Cosco Holdings will sell five older ships for scrap for $14 million. (Fairplay)

U.K. industrial developer Peel Logistics took over warehouse business Evander Properties. (SHD Logistics)

Amazon.com Inc. is launching one-hour delivery to buyers at tailgate parties at San Francisco 49ers home games. (Internet Retailer)

ABOUT US

Paul Page is deputy editor of WSJ Logistics Report. Follow him at @PaulPage, and follow the entire WSJ Logistics Report team: @brianjbaskin, @lorettachao, @RWhelanWSJ and @EEPhillips_WSJ, and follow the WSJ Logistics Report on Twitter at @WSJLogistics.

Subscribe to this email newsletter by clicking here: http://on.wsj.com/Logisticsnewsletter .

Write to Paul Page at paul.page@wsj.com

 

(END) Dow Jones Newswires

September 12, 2016 06:47 ET (10:47 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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