Ask Ahab 84

Issue 84

Dear Ahab:

I’ve seen some stories about AI technology being applied to customs brokerage tools. It sounds interesting, but I’m curious: Is AI at a place where it can be trusted with a process as critical as customs brokerage?

– Trying To Compute

Dear Trying To Compute:

While there are exciting developments in AI technology almost daily, applying it to a process like customs brokerage is tricky. For starters, customs entry must be performed on U.S. soil by a U.S. employee. That’s not an industry standard, that’s not a trend, that’s a legal requirement from U.S. Customs.

Now, that doesn’t mean AI is completely banned from your brokerage division, you just need to be careful where you use it. You can use an AI tool to transpose a twenty-page invoice document into an entry form, but the key word there is “transpose.” If you start using an AI tool to do any sort of classification or value determination on goods, you’ll run afoul of that customs entry requirement I mentioned above.

Finally, there’s a records component here: You can store your records digitally, but regardless of how much AI you’re using you’ll need to make sure the servers you’re storing records on are on U.S. soil.

In short, are there processes you could automate to streamline your brokerage operations? Absolutely. But there are also some clear-cut guardrails on where you can and can’t use AI in the brokerage process.

Dear Ahab:

I read recently that there’s congestion at most North European ports, including Antwerp-Bruges, Bremerhaven, Gothenburg and Hamburg. Why are we seeing more congestion and how can I minimize the impact of those delays?

– Balticking Clock

Dear Balticking Clock:

As is often the case, the first explanation that comes to mind isn’t necessarily the right one. It’s easy to try and tie this congestion to tariffs, or the rush to beat them, but those explanations would ignore a larger trend in logistics across recent years:

People want more stuff!

There’s plenty of new vessel capacity hitting the market right now, and that doesn’t just mean more vessels, it means bigger vessels. As we’re now seeing, the increase in vessel size and capacity has not been accompanied by an increase in infrastructure volume.

The ports these vessels are calling—like Antwerp-Bruges, Bremerhaven, Gothenburg and Hamburg—are the same size they’ve always been; the railroads and highways out of these ports have the same capacity as they ever have. 

So, unless the amount of things people order decreases drastically in the coming years (don’t hold your breath on that one), we’ll probably see more congestion at ports across the globe in the coming years, which means more planning involved in your supply chain.