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April showers bring…higher diesel exhaust fluid (DEF) prices? An early end to winter across much of North America has driven up agricultural demand for urea – the key ingredient in DEF – and in many cases has translated into higher DEF prices.

“An early planting season in some areas of North America has really put a strain on urea suppliers and therefore has pushed prices up quite considerably,” said Monica Bianchi Baker, senior analyst with Integer monitors the fluid’s prices around the world. “The fertilizer business is a highly seasonal business, but the season came earlier than planned so the upward pressure on urea pricing has been very strong.”

About 88% of the urea produced globally is used as fertilizer, with the remaining 12% divided among industrial uses including the production of DEF. Only high-grade urea can be used in the production of DEF, which means not all urea suppliers can meet the demands of DEF producers.

Industrial urea consumers typically take into account the agricultural demand cycles for urea when sourcing product but those expectations went out the window with this spring’s early planting season.

“Normally, industrial users look at the seasonality of the agricultural industry to understand where they could see some pressure on prices during the year, but this year because there’s been a mild end to the winter and an early planting season, the pressure on urea itself has been quite exceptional,” Bianchi Baker explained. “From February onwards we’ve seen prices escalating.”

That hasn’t gone unnoticed by fleets that consume large amounts of the fluid. Rob Penner, executive vice-president and chief operating officer with Bison Transport, said his company is keeping a close eye on the cost of urea and DEF.

“We’re certainly seeing that urea prices have skyrocketed,” Penner told Trucknews.com. “DEF has lagged a bit but we’re starting to see that come up pretty aggressively to the tune of 10 cents per litre. Given DEF is 2-3% of our actual fuel consumption, it’s certainly significant to see that cost rise so fast.”

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Prices appear to be softening now, but Bianchi Baker said another high-demand period is about to begin and so any pricing relief could be short-lived.

“The next planting season in some parts of the US will get underway soon, so we don’t expect prices to crash,” she said.

The fierce competition for urea has translated into higher prices and in turn, has affected DEF prices in the US and Canada, Bianchi Baker explained. Urea makes up 32.5% of diesel exhaust fluid.

“What we have noticed is that in April and May, DEF suppliers have tabled some pretty hefty price increases, which to our knowledge have filtered through to the end users,” she said.

Chris Goodfellow, emissions analyst with Integer Research and editor of DEF News, said price increases generally ranged from 15 to 21 cents per gallon but in Canada, he said, the cost increases were “slightly lower” and with “less uniformity” than in the US.

Bulk DEF prices at US truck stops “at the pump” increased seven cents a gallon between April and May to $2.81, or 73 cents a litre. That’s still seven cents per litre less than the average cost “at the pump” in Canada, Goodfellow pointed out. In the States, there are more than 400 truck stops offering bulk DEF while in Canada there are only five locations – all of them in Ontario and Quebec – with an average price of 80 cents per litre, which has remained unchanged through the spring. By comparison, DEF deliveries to fleets via 1,000-litre totes averaged 65 cents per litre in May while packaged products cost about $2.21 per litre, Goodfellow noted.

“Buying in bulk does offer significant savings,” he said. “A lot of the fleets in Canada at the moment are using the tote solution.”

Carriers looking to protect themselves from pricing volatility can purchase DEF in bulk and negotiate fixed supply contracts with suppliers. While it’s not practical to purchase DEF only when agricultural demand is at a low point, Goodfellow said “Fleets that require higher volumes of DEF are in a position to negotiate medium- or long-term supply contracts to reduce their per gallon costs. In this case the ability to store and take deliveries of larger quantities of DEF will play a factor, and in some cases suppliers may be willing to assist with capital investments for storage facilities in an effort to secure high-volume business.”

Shelly Hubbard, brand manager for H2Blu with Wakefield Canada, said fleets that purchase in bulk are better protected from price swings.

“They need to buy DEF as efficiently as possible and plan their needs,” she said. “If they can get into a bulk supply situation versus a jug, drum or tote, they’d be in a better position to have the best price. Being able to obtain and then dispense their DEF from a bulk container would be in their best interest.”

Suppliers including H2Blu offer large polytanks with several thousand litres of capacity, which can be dropped at a fleet’s yard and then refilled as needed, she explained. This offers better value than the 1,000-litre totes that have become so popular.

John Lounsbury, director of marketing with Terra Environmental Technologies, suggested fleets may also want to ask where their supplier is sourcing its urea.

“Fleet should structure contracts with a producer that actually makes the urea and demonstrates controlled supply chain integrity from production to the tank of the vehicle,” he advised.

Buying DEF at major truck stops is a last resort for most large fleets.

“There’s a significant difference in price when you buy totes to begin with (compared to truck stops) and the retail market changes a lot faster than wholesale,” Bison’s Penner said. “We buy very little of it on the road.”

He added the company is considering installing storage tanks at all its terminals so it can buy DEF in even greater quantities.

The increased competition for urea may have affected prices, but there has not been a shortage of product available. According to the Web site DiscoverDEF.com, at the end of April there were 6,796 retail locations offering packaged DEF, including 635 in Canada.

http://rightnowloads.com/

April showers bring…higher diesel exhaust fluid (DEF) prices? An early end to winter across much of North America has driven up agricultural demand for urea – the key ingredient in DEF – and in many cases has translated into higher DEF prices.

“An early planting season in some areas of North America has really put a strain on urea suppliers and therefore has pushed prices up quite considerably,” said Monica Bianchi Baker, senior analyst with Integer Research, which through its DEF Tracker Web site (www.DiscoverDEF.com) monitors the fluid’s prices around the world. “The fertilizer business is a highly seasonal business, but the season came earlier than planned so the upward pressure on urea pricing has been very strong.”

About 88% of the urea produced globally is used as fertilizer, with the remaining 12% divided among industrial uses including the production of DEF. Only high-grade urea can be used in the production of DEF, which means not all urea suppliers can meet the demands of DEF producers.

Industrial urea consumers typically take into account the agricultural demand cycles for urea when sourcing product but those expectations went out the window with this spring’s early planting season.

“Normally, industrial users look at the seasonality of the agricultural industry to understand where they could see some pressure on prices during the year, but this year because there’s been a mild end to the winter and an early planting season, the pressure on urea itself has been quite exceptional,” Bianchi Baker explained. “From February onwards we’ve seen prices escalating.”

That hasn’t gone unnoticed by fleets that consume large amounts of the fluid. Rob Penner, executive vice-president and chief operating officer with Bison Transport, said his company is keeping a close eye on the cost of urea and DEF.

“We’re certainly seeing that urea prices have skyrocketed,” Penner told Trucknews.com. “DEF has lagged a bit but we’re starting to see that come up pretty aggressively to the tune of 10 cents per litre. Given DEF is 2-3% of our actual fuel consumption, it’s certainly significant to see that cost rise so fast.”

Prices appear to be softening now, but Bianchi Baker said another high-demand period is about to begin and so any pricing relief could be short-lived.

“The next planting season in some parts of the US will get underway soon, so we don’t expect prices to crash,” she said.

The fierce competition for urea has translated into higher prices and in turn, has affected DEF prices in the US and Canada, Bianchi Baker explained. Urea makes up 32.5% of diesel exhaust fluid.

“What we have noticed is that in April and May, DEF suppliers have tabled some pretty hefty price increases, which to our knowledge have filtered through to the end users,” she said.

Chris Goodfellow, emissions analyst with Integer Research and editor of DEF News, said price increases generally ranged from 15 to 21 cents per gallon but in Canada, he said, the cost increases were “slightly lower” and with “less uniformity” than in the US.

Bulk DEF prices at US truck stops “at the pump” increased seven cents a gallon between April and May to $2.81, or 73 cents a litre. That’s still seven cents per litre less than the average cost “at the pump” in Canada, Goodfellow pointed out. In the States, there are more than 400 truck stops offering bulk DEF while in Canada there are only five locations – all of them in Ontario and Quebec – with an average price of 80 cents per litre, which has remained unchanged through the spring. By comparison, DEF deliveries to fleets via 1,000-litre totes averaged 65 cents per litre in May while packaged products cost about $2.21 per litre, Goodfellow noted.

“Buying in bulk does offer significant savings,” he said. “A lot of the fleets in Canada at the moment are using the tote solution.”

Carriers looking to protect themselves from pricing volatility can purchase DEF in bulk and negotiate fixed supply contracts with suppliers. While it’s not practical to purchase DEF only when agricultural demand is at a low point, Goodfellow said “Fleets that require higher volumes of DEF are in a position to negotiate medium- or long-term supply contracts to reduce their per gallon costs. In this case the ability to store and take deliveries of larger quantities of DEF will play a factor, and in some cases suppliers may be willing to assist with capital investments for storage facilities in an effort to secure high-volume business.”

Shelly Hubbard, brand manager for H2Blu with Wakefield Canada, said fleets that purchase in bulk are better protected from price swings.

“They need to buy DEF as efficiently as possible and plan their needs,” she said. “If they can get into a bulk supply situation versus a jug, drum or tote, they’d be in a better position to have the best price. Being able to obtain and then dispense their DEF from a bulk container would be in their best interest.”

Suppliers including H2Blu offer large polytanks with several thousand litres of capacity, which can be dropped at a fleet’s yard and then refilled as needed, she explained. This offers better value than the 1,000-litre totes that have become so popular.

John Lounsbury, director of marketing with Terra Environmental Technologies, suggested fleets may also want to ask where their supplier is sourcing its urea.

“Fleet should structure contracts with a producer that actually makes the urea and demonstrates controlled supply chain integrity from production to the tank of the vehicle,” he advised.

Buying DEF at major truck stops is a last resort for most large fleets.

“There’s a significant difference in price when you buy totes to begin with (compared to truck stops) and the retail market changes a lot faster than wholesale,” Bison’s Penner said. “We buy very little of it on the road.”

He added the company is considering installing storage tanks at all its terminals so it can buy DEF in even greater quantities.

The increased competition for urea may have affected prices, but there has not been a shortage of product available. According to the Web site DiscoverDEF.com, at the end of April there were 6,796 retail locations offering packaged DEF, including 635 in Canada.

http://rightnowloads.com/

The Federal Motor Carrier Safety Administration on Monday, June 11, issued its final rule that eliminates the requirement for drivers operating intermodal equipment to submit – and intermodal equipment providers to retain – driver-vehicle inspection reports when the driver has neither found nor been made aware of any defects in the IME.

FMCSA’s action responds to a joint petition for rulemaking from the Ocean Carrier Equipment Management Association and the Institute of International Container Lessors concerning an earlier final rule. That rule’s requirements for intermodal equipment providers to have in place inspection, repair and maintenance programs, and a process for receiving and taking appropriate action in response to DVIRs on which damage, defects or deficiencies are reported, remain in effect.

The original final rule, effective Dec. 29, 2009, made intermodal equipment providers subject to the Federal Motor Carrier Safety Regulations for the first time, and established shared safety responsibility among intermodal equipment providers, motor carriers and drivers. FMCSA said the new rule would enhance the safety of the nation’s intermodal transportation system by improving maintenance, which would result in fewer breakdowns and crashes involving intermodal chassis and fewer chassis being placed out of service.

Each IEP that offers intermodal equipment for transportation in interstate commerce was to file an Intermodal Equipment Provider Identification Report (Form MCS-150C) by Dec. 17, 2009. By completing and submitting Form MCS-150C, the IEP took the first step toward complying with the FMCSRs. After FMCSA received the completed MCS-150C Form, the IEP would be assigned a U.S. Department of Transportation number that serves as a unique identifier when collecting and monitoring a company’s safety information acquired during audits, compliance reviews, crash investigations and inspections. As an IEP, the company’s safety information would be acquired through roadability reviews, crash investigations and inspections.

On March 31, 2011, OCEMA and IICL submitted a joint petition to FMCSA requesting the repeal of the provision of the FMCSRs that requires motor carriers to prepare and transmit a DVIR to the IEP at the time the IME is returned to the IEP even when no damage, defects or deficiencies are noted, referred to as a “no-defect DVIR.” The petitioners contended that requiring the preparation and transmittal of these no-defect DVIRs imposes an undue burden on drivers, motor carriers, IEPs and intermodal facilities nationwide.

The petitioners estimated that a no-defect DVIR requirement would necessitate the completion, transmission, review and retention of more than 38 million unnecessary reports annually, and argued that the added administrative burdens of the requirement to file no-defect DVIRs actually could undermine the goal of safe IME.

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New York legislators are fuming over the state thruway authority’s consideration of a 45 percent increase in commercial tolls, while the Maine Turnpike Authority has scheduled meetings this month concerning a relatively smaller toll hike proposal for truckers.

New York Assemblyman Frank Skartados blasted the state thruway authority’s preliminary approval May 30 to raise tolls 45 percent on trucks with three or more axles.

The assemblyman, a Democrat, said the hike would hurt truckers. Howard Milstein, authority board chairman, had described the increase as “modest.” It also would affect consumers and businesses that ultimately would pay higher prices to compensate for greater transportation costs.

Republican Sen. James Seward said this proposal also would increase traffic for small towns along the thruway because more truckers would seek alternatives to the higher tolls. The authority board is required to conduct an environmental review and hold at least three public hearings before a rate change, Seward added.

If approved, the round-trip cash toll for a five-axle truck crossing the Tappan Zee Bridge would increase from $32.75 to $47.49. The authority last raised rates 25 percent in 2010 for all drivers.

Also at the authority board meeting, Milstein summarized an independent review he requested after he began oversight of the state’s 570-mile thruway and 525-mile canal system.

On an annual basis, commercial traffic decreased 4.2 percent while total traffic dropped 1.8 percent between 2005 and 2011. Still, the authority outspent revenue “to an alarming degree” and bridged the gap with what the reviewers called “potentially risky” financial practices.

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Yesterday’s ruling by an Ontario Justice of the Peace who tossed out a ticket under the province’s speed limiter legislation does not change the enforcement of the Highway Traffic Act (HTA) law whatsoever, according to the Ontario Trucking Association, adding that the organization is “not at all concerned” with the decision.

“People challenge traffic tickets every day and sometimes they win,” said OTA president David Bradley. “It means nothing; the law stands.”

According to a statement by the Missouri-based Owner-Operators Independent Drivers Association (OOIDA), the group funded a driver’s challenge of the law in a Welland, Ont. court. The Justice of the Peace sided with the driver and, according to reports, he interpreted the rule to be at odds with the Charter of Rights.

“Contrary to some reports, the lower court ruling isn’t binding and the law hasn’t been struck down; nor does it require any amendments to the HTA legislation,” the OTA said in a release.

Bob Nichols, spokesman for the Ontario Ministry of Transportation, told TruckNews.com that while the group would not comment on the specifics of the case, he noted that, “This case doesn’t change the law, and we’ll continue to enforce the law.”

Nichols said that the positive safety benefits that speed limiters have had since they were first introduced has been considerable.

“When we introduced speed limiters for trucks in 2009, we saw an immediate 24% drop in fatalities involving trucks. We’re committed to road safety. Ontario has the safest roads in North America,” he said, adding that the MTO would continue to work with its partners in the industry, like the OTA.

Over 8 in 10 truck operators are in compliance with the rule, says the OTA, however, those found in violation will remain subject to the speed limiting system requirements under the Act and will continue to be charged with the applicable offence(s).

“It’s ironic that news of the ruling comes days after the latest Ontario Road Safety Annual Report (ORSAR) stated that truck speed limiter legislation has helped make Ontario the safest jurisdiction in North America by reducing the province’s total road fatality rate to its lowest level in nearly 70 years,” says Bradley.

The report found that in 2009, large truck fatalities dropped by 24% year-over-year, despite a 59% increase in the number of large trucks registered in the province.

“This proves that the assertions of the US-based critics who bankrolled this challenge are absolutely baseless,” said Bradley. “In fact, truck safety has never been better since the speed limiter law took effect.”

“Safety is without question the number one priority of the trucking industry and the speed limiter law is certainly having an impact on reducing crash rates of both trucks and cars and helping truck drivers as a class continue to be the safest drivers on the road.”

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The Federal Motor Carrier Safety Administration is giving carriers more time to comment on the proposed changes to its Safety Measurement System.

SMS is the workload prioritization tool that helps FMCSA identify motor carriers for safety intervention under its Compliance, Safety, Accountability system.

The changes, part of an ongoing CSA revision process, touch on several of the BASIC (Behavioral Analysis Safety Improvement Categories) that are at the heart of the enforcement system.

The agency plans to move cargo and load securement violations out of the Cargo-Related BASIC and into the Vehicle Maintenance BASIC.

This is in in response to concern in the industry and enforcement community that flatbed carriers are getting significantly higher Cargo-Related scores than other types of carriers, simply because their load securement issues are more apparent during inspections. The agency said that in its analysis it found that the new approach corrects the bias against flatbeds and still identifies carriers that have cargo securement problems.

In another move, the agency is changing the Cargo-Related BASIC to a new category, the Hazardous Materials BASIC, and is changing the way hazmat carriers are identified.

The rationale is that the system has not done a good enough job of finding carriers with hazmat compliance issues, because they have been undercounted in relation to carriers with load securement issues.

To be identified as a hazmat hauler, a carrier must have at least two inspections on a vehicle carrying placarded hazmats within the past 24 months. One of those inspections has to be within the past year and must make up at least 5% of the carrier’s total inspections.

In other changes, the agency:

* Will start applying carrier violations of intermodal chassis requirements to the Vehicle BASIC.

* Will eliminate vehicle violations from driver-only inspections, and driver violations from vehicle-only inspections.

* Will no longer use the terms “inconclusive” and “insufficient data” to describe a carrier’s CSA performance. Instead, the agency will use specifics, such as “fewer than five inspections,” or “no violations within one year.”

The SMS Preview comment period has been extended to July 30. FMCSA will review comments and make any necessary changes prior to implementation. Carriers can access the SMS Preview through two FMCSA websites:

– Visit the Compliance, Safety, Accountability website and log in with an FMCSA-issued U.S. Department of Transportation number and a personal identification number, or
Log in to the FMCSA Portal and select the “CSA Outreach” link.

On the CSA Website’s Resources page, visitors can access a foundational document that provides additional information about this first set of SMS changes. A Federal Register Notice outlining the changes is also available for review.

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The U.S. Government Accountability Office again has recommended the Federal Highway Administration restructure federal surface transportation programs and address risks posed by partnerships with state transportation offices.

The independent agency, often called the watchdog for Congress, released the report May 29 in response to language in a long-term transportation funding bill approved by the Senate in March.

If the Senate legislation becomes law, it would mandate the Federal Highway Administration establish a more performance-based highway program, demanding significant change in FHWA’s oversight. The agency and state transportation offices would need to develop measurable goals to improve the nation’s highway system and the FHWA would be required take action when these performance measures are not met on federally-funded highway and bridges.

Agency officials would likely use these state partners to implement a performance-based system, as the administration’s state division offices do have some positive oversight practices of state DOTs. However, these partnerships pose risks that can result in poor funding and the loss of independence necessary for effective oversight, the GAO stated.

The federal Highway Trust Fund provides infrastructure funding to states through taxes on motor fuels, tires and trucks.

The GAO has expressed previous concern before about FHWA’s partnerships, and, in 2008, it recommended Congress consider refocusing surface transportation programs. That report cited as an example of weakness the agency’s partnership with Boston’s Central Artery/Tunnel, nicknamed the “Big Dig” and considered the largest public works project in U.S. history.

The GAO had noted significant cost hikes and weakness in FHWA’s efforts to hold its Massachusetts DOT partners accountable. A 2000 project FHWA Task Force Report concluded that “officials failed to adequately perform their duties because they acted more as partners with Big Dig officials than overseers.”

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WOODSTOCK, Ont. — Contrans has announced it has acquired bulk trucking firm Peter Hodge Transport.

The deal is expected to generate annual revenues of about $20 million. Peter Hodge runs 92 highway tractors and 140 trailers and provides bulk hauling using open-top dump trailers and liquid tankers.

“The managers, staff and drivers at Peter Hodge Transport have spent over 40 years building a great company,” said Contrans’ chairman and CEO Stan Dunford. “This is a unique opportunity for us to strengthen our dump and tank hauling presence in Ontario by adding such a well-respected, service-oriented business to our group. For many years, we have operated a similar business in the Great Lakes region, but the shipping lanes and trailer types have differed from those typically handled by Peter Hodge Transport. This is a complementary addition to our service offerings.”

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The cost of ground transportation for Canadian shippers decreased 1.7% in March when compared with February results, according to the latest results from the Canadian General Freight Index (CGFI). The results mark the first decrease the index has seen since February 2011, however, costs are still up 8.1% year-over-year.

The Base Rate Index, which excludes the impact of accessorial charges assessed by carriers, decreased by 1.77% when compared to February 2012.

Average fuel surcharges assessed by carriers have seen an increase from 20.42% of base rates in February to 21.9% in March.

“The results in this month’s index were driven by a downward trend in the domestic truckload and transborder LTL, while domestic LTL saw a marginal increase,” said Doug Payne, president and COO of Nulogx.

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