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Though there have been rumblings in Congress about altering or delaying the Department of Transportation’s electronic logging device mandate for truckers, the regulation is currently set to take effect on Dec. 18 of this year.

If it does go into effect, experts are predicting that some trucking companies will go out of business, some truck drivers will leave the industry and truck rates will certainly climb.

“We expect rates to skyrocket,” said James Caperton, technology product manager for the National Association of Small Trucking Companies. “They could easily go up 50 to 60 cents per mile.”

He reasoned that it is a supply-and-demand business and the new regulation will definitely reduce the amount of freight that can be picked up on a daily basis. In almost every discussion of the new mandate that has been published, observers note that transportation of perishable commodities, such as fresh fruits and vegetables, are going to be hit very hard by the new rules. Multiple drops and pickups, as well as excess wait times for loading and unloading, are exceptionally difficult obstacles when trying to comply with the new electronic logging measure.

Electronic logging itself is not going to create the problem, but it will force truck drivers to follow the letter of the law more closely than they are today. As a point of fact, hours of service are not changing on Dec. 18, but truck drivers will have a much more difficult time bending the rules, and enforcement officers will have a much easier way to catch them.

Under the new regulation, each truck must be equipped with either an electronic logging device or an automatic on board recording device. Each device prevents the driver from altering his log, creating a relatively fool-proof and accurate record of his drive time. If stopped by an enforcement officer, a quick look at the device will reveal if the driver is in compliance with the hours of service rules.

The regulation was enacted as a safety measure with many industry experts arguing that a major cause of trucking accidents is fatigue caused by drivers breaking the rules with regard to the number of hours that they drive each day and the number of hours of breaks that they take. With the current written log system, there is greater potential for cheating, if you will.

The rules state that a truck driver can only drive 11 hours in a 24-hour period, and he must accomplish that task in a 14-hour segment beginning with his initial start time. Along the way, a 30 minute break, with the engine idled for the full 30 minutes, must occur at least every eight hours. And when the 14 hours are up, there must be a consecutive period of 10 hours with the engine off and the truck parked.

Opponents of the strict hours of service regulations tend to be against electronic logging simply because it creates a paper trail for violations that they believe are restrictive, but not always safer. Caperton explained that 11 hours of drive time in a day is sufficient to get the job done and most people are not against it. But requiring those 11 hours to take place in a 14-hour time slot, he said doesn’t always make sense. “I have older drivers tell me they like to drive no more than four or five hours at a time and then take a four hour break before going another four or five hours.”

Currently a driver might alter his books a bit to allow for a few more hours of driving after his second break so he can get in his 11 hours. When using an electronic device, he is going to have to push his driving time during both sessions a bit longer than he is comfortable with and then take a shorter break in between to secure 11 hours of driving in 14 hours. Caperton said a case could be made that that scenario is less safe.

He noted that for the produce industry problems are inherent. A trucker could drive an hour to a pick up spot in the morning and take an hour to get loaded. Two more pick ups in the area could easily exhaust four to six more hours. Now fully loaded, he has only gotten one hour of driving in but could have easily used more than half of his available 14 hours. That load is going to have serious issues reaching its destination on time. Add in multiple drops and an impossible picture tends to emerge.

Livestock haulers, who also are typically plagued with multiple pickups and drops, are fighting for an exemption and did get language inserted into the DOT’s budget bill by the House Appropriations Committee granting them a compliance exemption if that budget language is enacted unaltered. But Caperton said multiple pickups and deliveries cut across many different industries and are especially utilized by small companies that rarely sell a full load.

As August moves toward completion and the December effective date moves closer, Caperton said more and more truckers are equipping their trucks with electronic devices. Even a delay of implementation of the mandate is not going to help a lot of truckers at this point. Voluntary use of ELDs began in December of 2016. Anyone that has already installed such a device would be hard pressed to remove it. The NASTC executive said while there were truckers who were hoping the mandate would be eliminated, at this late date most are moving toward compliance.

It has been a relatively steady summer with regard to the transportation situation, but you can’t talk to a produce truck broker without the topic of electronic logging devices being brought up.

“We’ve had a fairly steady situation this summer,” said Robert Silva, who runs the Salinas, CA, office of A.T.S., which is headquartered in Visalia, CA. “But we have an eye opener coming when the ELB (electronic logbook) goes into effect.”

Pam Young of Pam Young & Co. Inc. in Salinas, CA, said the topic is top of mind for both truck drivers and truck brokers. “Everyone is talking about it,” she said.

Both Young and Silva agreed that it has been a relatively quiet summer on the transportation front. Young noted that she has been working on some other transportation and food-safety issues and doing a bit less truck brokering per se so does not quite have her finger on the pulse. “I’m mostly going to Texas for one customer, loading from the Northwest and California. For the most part the rates have been steady between $4,200 and $4,400 on a consistent basis. We haven’t seen the extremes this summer.”

Young said she talks to others in the transportation industry on a continual basis, and consistent supply and rates appear to be the order of the day.

Silva said the same thing. “Around the Fourth of July the holiday pull tightened up capacity, but the rates have been status quo since then — they are not as bad as they were in summer prior. Truckers are doing okay.”

He anticipates the situation will remain fairly steady through the summer and fall but again notes that the new electronic log mandate will take its toll. He estimated that only about 50 percent of the truckers that he contracts are currently ELD-compliant. “Most of the smaller carriers — the guys with five to 10 trucks — seem to be waiting. The truth is we just don’t know what’s going to happen when the times comes. Nobody knows.”

Young predicts that a significant number of truckers will get out of the business. “We are going to lose some very good owner-operators. They just aren’t going to put up with it.”

Young said the big carriers are in favor of the electronic logging systems as a way to keep tabs on their drivers and make sure they are putting in the hours and are not violating the rules. She noted that it is no longer acceptable to “push” a driver to make a delivery. Consequently without the electronic logs, you can’t be sure they are putting in the miles. And you certainly don’t want them violating the hours of service rules as the fines are expensive.

It is the two sides of the same coin as many have argued that the new rules will prevent owner-operators, and aggressive company drivers, from making a good living by limiting how much they can work. On the other end of the spectrum, several industry experts did say there are new drivers coming into the industry — and typically working for big companies — that have a different work ethic and prefer to pull off the road after 200-300 miles. At that pace, it just takes way too long to get a load across the country.

“With the new rules it can easily take five days to get to Birmingham [AL],” Young said. “I’m not saying it’s right or wrong, but I grew up in an industry when an owner-operator would be there in two days.”

Come Dec. 18, that is going to be basically impossible. It appears to be a given that it will take longer to get from Point A to Point B, meaning it’s going to take more trucks to move the same amount of annual freight. And with the guess being that there will be fewer trucks rather than more, the law of supply and demand will kick in, and the rates will climb.

At least that’s the theory. “Nobody knows for sure,” Silva repeats. “We are just going to have to wait and see.”

The Dallas Fresh Food Association is holding a preliminary membership drive with a social event in Dallas on Sept. 13.

Michael Grinstead of The Grinstead Group said that his firm was among seven in the Dallas area to create the organization. At the meeting, a schedule of bi-monthly luncheons will be presented to prospective members.Michael-GrinsteadMichael Grinstead

The association will be open to companies handling any fresh foods. This includes fresh fruits and vegetables as well as firms in the business of items like poultry, meat and dairy. The participants are not required to be based in the Dallas-Ft. Worth metroplex but would be expected to be regular attendees to the bi-monthly luncheons. 

Grinstead said the Dallas group is using the Houston Fresh Fruit & Vegetable Association as its model.

The Grinstead Group set up the initial legal framework for the Dallas association and Michael Grinstead is, for now, serving as its treasurer.

Other early leaders in the group are Craig Slate of SunFed, Jeff Fugate of Kroger, Steve Monson of Robinson Fresh, Mark Austin and Jim Kasko of Hardies Fresh Foods, Dan’l Mackey of DMA Solutions and Dale Long of the North Texas Food Bank. The food bank facility has a meeting room and is hosting the Sept. 13 Dallas Fresh Food meeting, which will be from 5 to 7 p.m. at 1010 S. Pearl Expressway in Dallas.

Grinstead that large perishable distributors, like Hardies Fresh Foods, are expanding product lines that include produce and chilled foods. Thus, an inclusion of a varity of fresh foods is seen at a strong strategy for the future of the new group.

An association board of directors will be elected subsequent to the initial meeting.

 

As sustainable real asset investor Agriculture Capital positions itself for accelerated growth, the company has appointed Darren Filkins to its leadership team as president of its Dinuba, CA-based operations subsidiary.DarrenF

In Filkins' role, he will have oversight over Suntreat sales and marketing, Central Valley farming operations, Tree Source Nursery, and AC Foods Legacy packing and shipping in Dinuba, CA, and AC Foods Lindsay packing and shipping in Lindsay, CA.

"AC is taking a hands-on operator approach to responsible growing, harvesting, packaging, and marketing of fresh fruits and nuts that support healthy people and healthy communities," Filkins said in a press release. "The company's vertical integration investment model creates an opportunity for seasoned operators, like me, to lead diverse teams with a shared commitment to excellence, accountability, transparency, and stewardship. It exemplifies the type of progressive agriculture company that I wanted to be associated with."

Filkins brings a proven track record to the company from his time at Fresh Choice Produce, D'Arrigo Bros., Tanimura & Antle and Bolthouse Farms, as well as his tenure with the Nickel Family as chief executive officer. Filkins officially joined the AC team on May 1.

"Darren joins our team with extensive knowledge of the grower side of the business, as well as packing, processing, and distribution experience across several different types of produce," Principal Tom Avinelis, said. "Darren has traversed the agricultural landscape from citrus, almonds, lettuce, and carrots to tomatoes and alfalfa. His experience in sales, farm management, and organization systems management, as well as his track record of building trust and respect are the cross-range of skills that we have been looking for to lead our operations group."

Filkins joins the company just as its packing and shipping facility, AC Foods Legacy, is undergoing a citrus line automation project. The new state-of-the-art sorting and packaging technology will make AC Foods Legacy a premier packing and shipping facility in the fresh produce industry.

Filkins will also work closely with AC Foods farm managers as Suntreat increases its Sumo Citrus acreage, Cara Cara, and Blood Orange acreage, as well as its high-Brix Navel and Valencia program.

"We are in a great position for the future," Filkins added. "We control every aspect of the process from seed-to-fork. We could not be better setup for success. It is a privilege to lead this team."

 

It is an ongoing problem in the United States. Tons of aesthetically unappealing (yet completely edible) produce is thrown away by retailers every year. Rodney McMullen, Kroger's chief executive officer, talked to the Wall Street Journal about what Kroger does with its “unsellable” produce as well as the company’s effort to cut down on food waste.

“Over the last four years, we've partnered with local food banks and provided over 1 billion meals,” McMullen told WSJ. “In some of our fresh departments, that would have been product we'd have thrown away. We were able to partner with local food banks [and donate] fresh product that is still high quality to eat, but you wouldn't sell from an appearance standpoint. We legitimately believe we will be able to get every store to be zero waste.

“I grew up on a farm,” McMullen told the Journal. “Last Sunday, I went out to see my parents and their garden, and I find the produce that looks the ugliest tastes the best.”