Supply Chain Security, Port Security, Cyber Security and Gantry Cranes

Hi guys, Arthur O’Meara here coming to you from beautiful Lake Travis. Today we’re going to hit 80 plus degrees today in February–you got to love it–so we’re going to talk about supply chain Security in general and CTPAT in particular and Port Security in par- par- particular.

Why? Well, two things happened recently that were a response to a perceived threat to the United States infrastructure by China. Some background: recently Japan had a port hacked and held ransom for two days—the cyber infrastructure of the port was hacked by China. 

In the United States we have these things called gantry cranes. They are large monstrosities that pick up the containers and move them on and off the giant container ships. These gantry cranes move up and down the waterfront. We’ve got about 200 of them in the United States and the problem is that of these 200 gantry cranes around 80% were made in China. 

The problem on that is that these gantry cranes are remotely operated. You know what that means: remote controls, operating from a desktop, anything like that means that it can be hacked, and we don’t want our gantry cranes hacked because if that happened it would shut down a port.

Now, after the attacks of 9/11 some studies were done to estimate the impact to our GDP of shutting down the ports of LA/Long Beach. Now, depending on whom you listen to, the Congressional Budget Office or the National Association of Manufacturers, the economic impact to our gross domestic product or GDP would range from $150 million per day to $500 million per day just for shutting down LA/Long Beach.

Okay, so what are we going to do about it? Well, a couple of things happened. Number one, the Biden Administration signed an executive order releasing $20 billion in funding to improve port security in general and cyber security for gantry cranes in particular. Number two, the US Coast Guard was given increased authority to investigate cyber threats along our port infrastructure. 

Now, I think there’s a third thing that’s going to happen, and that is going to happen in

CTPAT, the Customs Trade Partnership Against Terrorism. As you recall, CTPAT is open to importers and exporters, freight forwarders, customs brokers, NVOCCs, 3PLs, air, rail, and ocean carriers. It’s also open to marine port authority and terminal operators (those are the folks who are operating the gantry cranes). 

There is a section in the CTPAT minimum security criteria for all the participants: importers, exporters, customs brokers, etc. etc. etc…so, what I think is going to happen is the section on cyber security is going to be beefed up because of this perceived threat from China hacking our gantry cranes and shutting down our ports and causing economic disruption in the United States. 

Let me know what you think all right? 

Take care.