About Rojda Akdag

Rojda is originally from Turkey and after getting his BA from Koc University in Istanbul, he moved to New York to get his MBA at Baruch College. He has been working at MTS Logistics since 2003 and has held many positions from Operations to Development Manager. He is currently residing in Los Angeles where he is the Managing Director of MTS.

Fun Fact(s): Rojda is an avid golfer, a martial art practitioner, and a motorcyclist!

China’s Effect on The Global Commodity Prices

March 18, 2013 By Rojda Akdag Leave a Comment

Globalization has been the driving force of developing countries for the last decade or so, and trade from these countries flourished as a consequence of China’s close to double digit growth numbers. Although Chinese suppliers rely mainly on local companies to supply the raw materials, a significant number of raw materials are also outsourced by other countries. Top commodities that make up the list consist of: plastics (where it’s widely used almost in every sector), metals (silver, copper, steel), rubber and paper. If we look at the numbers per industry, where most of the imports of raw materials are used, the electronics industry tops the list with 30% of all raw materials used are imported from another country. Given the large amount of electronics shipped from China to all parts of the world, 30% seems to be a highly significant number where even small changes in demand effect the prices of commodities. Another interesting statistic is that per IMF numbers 40% of the world’s base metals (aluminum, copper, lead, zinc or nickel) is consumed by China to manufacture new products. [Read more...]

Filed Under: China, Global Trade, Shipping Trends

Mega Ports of the Future

November 26, 2012 By Rojda Akdag Leave a Comment

Recently, we’re seeing a lot of news about large container vessels being built with over 15,000 TEU capacity, and it seems with the technological advancements every year the capacity to make bigger ships will continue. However, there is a direct correlation between the capacity of these increasingly large ships and the capacity needed to handle these types of large vessels, and with capacity I mean the terminals. The challenge that port designers face is to constantly watch the new trends in ship building and make sure they update the necessary infrastructure needed to handle these kinds of vessels.

The containerization, as I explained in one of my previous articles, is a growing trend and more and more vessels are built in accordance with the demand of containers. With this upward trend in mind, I explored what kind of advancements there will be in terminals to keep up with the changes, here are the ones that caught my attention:

1. Mega ports will be built offshore…

…probably on artificial islands where the layout will be much larger. These ports will be supported with feeder terminals where excessive supply is also diverted when necessary. The container size and types will be similar, however different materials may be used. Containers may also be designed as FOLDABLE so that space in the terminals may be optimized as well. Also, containers may have chips inside where content and journey details can be accessed easily. [Read more...]

Filed Under: Global Trade, Shipping Trends, Supply Chain Planning

Is India the China 2.0?

September 24, 2012 By Rojda Akdag 2 Comments

From the day China decided to enter into World Trade Organization, it changed all the dynamics in global trade entering with its $500 million workforce with cheap labor and “stole” a lot of production business from all cheap labor countries. However over time with close to double digit growth nr’s, the workforce became more demanding and wages slowly started to increase, and even a massive $500 million workforce could not offset this increase. Another problem that hinders the growth is out of all emerging cheap labor markets, China has the oldest population now with a median age of 34 thanks to the one child policy.

Table: Median Age by Country (in years)
Pakistan 21
Cambodia 22
Philippines 23
Bangladesh 25
India 25
Malaysia 26
Indonesia 28
Vietnam 29
Sri Lanka 31
Thailand 33
China 34

After China, India is the most populous nation in the world, and expected to become number 1 in terms of population by 2030. India also has one of the youngest work forces with almost half of the nation being under 25 years old, making the labor abundant and cheap however India has different dynamics in terms of its trade structure. [Read more...]

Filed Under: China, General Business, Global Trade, Shipping Trends, Supply Chain Planning

How Dock Strikes Have Effected the Economy Historically and Today

July 23, 2012 By Rojda Akdag Leave a Comment

Labor stoppage, which is also known as a strike, is the problem aroused by the tension between a labor force and management. Tension usually starts with the conflicting view points of each party, labor wanting the maximum for the service that they provide while management is willing to pay the minimum for the same service. In general strikes are quite rare whereas 98% of the union contracts in USA are settled without a strike every year, however when a strike does occur the effects are quite damaging.

The origins of dock strikes in the US (especially West Coast) go back to Longshoremen (also known as dockworkers) unions. They were originally unorganized labor that were selected by a hiring party and with the effects of the Communist party in the 1920’s and other unions they became more demanding, and started the first strike on 1934, which is called the West Coast Longshoremen’s strike that lasted 83 days.

It started in San Pedro, LA then affected port operations in Oakland, Portland & Seattle as well. Two people were killed in the demonstrations (Bloody Thursday) and all other unions in San Francisco decided to go on strike for four days due to unfortunate events. Arguably, the biggest dock strike that hit the economy bad was in 2002, also called the West Coast Dock Strike of 2002. When longshoremen decided to go on strike the estimated effect to US economy was $1 Billion per day! [Read more...]

Filed Under: General Business, Global Trade, Regulations, Shipping Trends

Containerization

June 25, 2012 By Rojda Akdag 1 Comment

The origins of Containerization go back to 18th century where coal traffic in England was handled with some sort of containers (more like wagons) and they were shipped from horse drawn carriages to barges. Originally they were made of timber with rectangular shapes and due to durability reasons, iron replaced timber in terms of raw material around year 1850. The use of standardized equipment like containers revolutionized the design of ships, where new ships were designed to handle maximum capacity of containers and rail systems where rail cars are designed to handle from single to double stack equipments. Various types of containers were used until 1955 where an engineer called Keith Tantlinger first designed the modern day container. It was his design first that utilized the durability of steel as raw material and it included a twistlock mechanism allowing the container to be easily secured and handled during transportation. The original design of a container (it was called “transporter” at that time) was allowed to handle maximum 9,000 lbs and was 8.5 feet in length, compared to modern day equipment this was quite simple but revolutionized the trade and military at that time.

The first vessels to handle this kind of equipment were designed in Denmark around 1950. The maximum capacity was 600 containers and its first voyage was from Vancouver to Alaska. [Read more...]

Filed Under: Global Trade, Shipping Trends

Interplanetary Resources

June 1, 2012 By Rojda Akdag 1 Comment

Growing up I was always fascinated with Sci-Fi movies, and recently I’ve been reading more news that recent investments in space exploration may turn those fantasies into reality. The most recent and exciting news is the partnership of visionary director James Cameron (Avatar, Titanic) with the Google billionaires as financiers. It is called “Planetary Resources” and the vision is simple: mining the asteroids for their resources like gold and other valuable metals and transporting them back to Earth. It is an immensely costly project with complex logistics involved, and this has scared many government agencies (including NASA) all these years, so private enterprise backed by billionaires invested in this high risk – high return project.

This kind of deep space exploration also involves changing the way we think about fuel, logistics etc. so in order to make this kind of project possible scientists are already working on the feasibility of interplanetary gas stations. [Read more...]

Filed Under: Casual Friday Corner!

Oil Prices and The Shipping Industry

February 27, 2012 By Rojda Akdag 1 Comment

Crude oil prices have many affects on our daily life from gas that we use in our daily commute to commodity products that we frequently buy in our neighborhood market. Not many of us were paying much attention to oil prices until 2004, since the average of crude oil was trading between $22 to $26. In 2004 the big climb started with double digits reaching $50 average in 2005, $71 average in 2010 & above $90 average in 2011. But what happened during this period that drove the prices 2-3 times higher than its trading average? The Iraq war of course has its effects, but it is not the sole reason for this global development. After researching this issue, I found out that the increased influence of OPEC as the monitor of production capacity, as well as increased interest in oil futures drive the oil prices upward. Currently there are 12 member countries of OPEC, and most members are unsurprisingly from Gulf states and Africa. Again, the addition of oil prices in futures also brought the speculators where the higher prices meant better returns, one recent estimate suggests that speculation in prices is effected at 40% by speculation – in other words if the speculation is banned, the oil prices are estimated to be between $50-$75 per barrel.

In shipping terminology, Bunker is the term that is used relating to oil prices, and Bunker fuel is now a considerable expense to shipping lines. Ship owners started to use fuel surcharges to recoup some of the increased costs that they face so that they pass some of these costs on to the importers. [Read more...]

Filed Under: Global Trade, Shipping Trends, Supply Chain Planning

Is Manufacturing Coming Back to USA?

December 26, 2011 By Rojda Akdag 11 Comments

More and more, we start to read news like some US companies are bringing jobs back to USA so I decided to investigate this in depth to see if this a trend that we will see in long term. The last decade was a paradise for many Chinese factories as cheap labor was abundant, credit from banks & government were limitless and RMB (Chinese yuan) devaluation was all in their favor. Labor rights, collective bargaining, strikes were all concepts of the developed world where they did not mean much in the cheap capital & labor abundant land. For a long time, every party involved in the supply chain from the local factory worker (who earned cents an hour) to the end consumer in a local suburb USA (who saved significant dollars) were happy with the new business model however the rules of economics especially in the long term is not a win-win but a zero sum game. By zero sum game, I mean in the long run the winnings of one translate into the loss of the other. [Read more...]

Filed Under: General Business, Global Trade

Search For Efficiency

July 25, 2011 By Rojda Akdag 2 Comments

This year compared to 2010 was not a good one for both shipping companies and forwarders as steamships could not act together like they did last year to control the capacity thus the shipping rates are approximately half of what it was same time last year.

Companies like Hainan po shipping, Grand China and Ts Line entered the transpacific trade as they expected good return on investment after the high rates last summer however given the uncertainty of US economy as well as increased capacity led some steamships to either quit the race (CSAV suspended its USEC and USWC service) or file bankruptcy (TCC is one). Rising Bunker surcharges along with uncertainty with long term fuel prices also pushed steamships to order bigger ships so that cost per unit (container) goes down thus most carriers expecting over 12,000 Teu vessels to be delivered starting from end of this year.

Steamships are trying to minimize the number of variables (like fuel cost) so that they can make more accurate forecast models about the future however bigger ships come with more capacity which in turn drives the prices downward in a slow economy making it a vicious circle. [Read more...]

Filed Under: Shipping Trends