The "Chemical Working Group" established within the "Physical Internet Realization Conference" led by the Ministry of Economy, Trade and Industry and the Ministry of Land, Infrastructure, Transport and Tourism conducted a joint logistics demonstration experiment on the routes from Yokkaichi to Ichihara, Chukyo to Hokuriku, and Ichihara to Tohoku from September to December 2024, confirming effects such as improved truck loading rates and reduced CO2 emissions, and announced this on December 23 today.

Currently, the "Chemical Working Group" consists of 78 organizations mainly comprising shipper operators and logistics operators, the Japan Chemical Industry Association, the Petrochemical Industry Association, various relevant departments of the Ministry of Economy, Trade and Industry and the Ministry of Land, Infrastructure, Transport and Tourism, and Mitsui Chemicals serves as the secretariat along with Mitsubishi Chemical Group, Tosoh Corporation, and TORAY INDS INC.

Please refer to the attached materials for details.

Physical Internet Realization Conference

Chemical Working Group

Towards solving logistics issues in the chemical industry, effects were confirmed through a joint logistics demonstration experiment, aiming to build a joint logistics platform using DX.

In the "Chemical Working Group" within the "Physical Internet Realization Conference" led by the Ministry of Economy, Trade and Industry and the Ministry of Land, Infrastructure, Transport and Tourism, we are addressing logistics challenges such as the lack of transportation and storage capacity symbolized by the "2024 Logistics Problem" together with companies participating in the Chemical Working Group, as these issues are difficult to solve individually.

This time, among the companies participating in the Chemical Working Group, Mitsubishi Chemical Group, Mitsui Chemicals, Tosoh, TORAY INDS INC, and Main Board Polymer conducted a demonstration experiment utilizing the logistics data platform (PF) and logistics information standard guidelines promoted by the government in the Physical Internet Realization Conference from September to December this year, utilizing subsidies from the Ministry of Land, Infrastructure, Transport and Tourism and the Ministry of Economy, Trade and Industry. In addition to practical verification involving actual goods and transport connecting the complexes from Yokkaichi to Ichihara, simulations of joint logistics between Chukyo and Hokuriku and analysis of transportation efficiency between Ichihara and Tohoku were conducted to verify the effectiveness of joint transportation and the usefulness of the joint logistics platform. Notably, in the practical verification, significant effects were noted on the truck loading rate (improvement of 20 points) and CO2 emissions (28% reduction).

■ Objectives of the demonstration experiment

1. Demonstration that joint transportation is possible among multiple shippers and multiple logistics providers in the Chemicals industry for the first time.
2. Verification and evaluation of the effectiveness of the joint transportation model that includes joint collection and delivery focused on regular trunk services.
3. Confirmation of the utility of the 'logistics information standard format' for the Chemicals industry, in accordance with the 'joint logistics platform' and logistics information standard guidelines to conduct various data exchanges among multiple shippers and logistics providers.
4. Verification of the possibilities and effects of joint logistics through simulations based on transportation performance data from multiple shippers.

■ Effects of the demonstration experiment (quantitative)

■ Future plans

In this demonstration experiment, the feasibility of collaborative logistics and the efficiency of logistics were confirmed, so from now on, the target range will be expanded sequentially to increase the scale benefits through digital means. It was also understood that for implementing collaborative logistics, standardization of logistics operations among multiple consignors and multiple logistics providers, as well as a review of business practices, are crucial. Based on the insights gained this time, we will promote the execution of the action plan in accordance with the self-action plan published by the Chemicals Working Group.

In the future, by aiming to build a transportation model that can be deployed nationwide in Japan, we aim to contribute to the sustainability of Japan's chemical industry through reductions in GHG emissions in logistics and the realization of sustainable logistics.

※1 Physical Internet Realization Conference

This organization was established in October 2021 by the Ministry of Economy, Trade and Industry and the Ministry of Land, Infrastructure, Transport and Tourism with the aim of formulating a roadmap for the realization of the physical internet in Japan.

※2 Chemicals Working Group

Established in June 2023 as the fourth industry working group of the Physical Internet Realization Conference. 78 organizations are participating, mainly consisting of consignor companies and logistics providers (77 companies and 1 University, as of December 2024).

・Chair: Professor Hiroji Yano of Ryutsu Keizai University (Dean of Department of Distribution Information Studies, President of the Japan Society of Logistics)
・Secretariat: Mitsubishi Chemical Group, Mitsui Chemicals, Tosoh, TORAY INDS INC

・Observers: Related departments of the Ministry of Economy, Trade and Industry, Ministry of Land, Infrastructure, Transport and Tourism, Ministry of Health, Labour and Welfare, Japan Chemical Industry Association, Petrochemical Industry Association.

Deloitte Tohmatsu Consulting and Fujitsu are participating in the demonstration experiment.

・Announcement on December 20, 2023: Voluntary action plan aimed at optimizing logistics related to Chemicals and improving productivity.

※3 Subsidy name.

1) Ministry of Economy, Trade and Industry's Agency for Natural Resources and Energy: Fiscal Year 2024 transportation sector energy usage rationalization and non-fossil energy conversion promotion project subsidy (Trucking energy conservation promotion project).

2) Ministry of Land, Infrastructure, Transport and Tourism: Logistics standardization promotion project subsidy (Support project for constructing an open platform for promoting logistics data standardization).

※4 Logistics information standard guidelines.

The "Strategic Innovation Creation Program (SIP) Phase 2 Smart Logistics Services" by the Cabinet Office was formulated and announced after discussions with industry stakeholders in October 2021. The 'Physical Internet Roadmap' compiled by the Ministry of Economy, Trade and Industry and the Ministry of Land, Infrastructure, Transport and Tourism (formulated in March 2022) also positions the use of the 'Logistics Information Standard Guidelines'. By utilizing this guideline, it is expected that various services such as joint transportation and joint storage can be developed, making logistics more efficient due to the promotion of data standardization, reducing cumbersome adjustments and running costs caused by differing data between companies, and lowering system-related costs.

■ Results of Field Verification

As a result of the field verification, the truck loading rate improved by 20 points compared to the current status to 89%, and the CO2 emissions were reduced by 28%. Through the demonstration experiments, results were obtained for improving the truck loading rate, reducing CO2 emissions, reducing the number of trucks, and reducing driver working hours, etc.

Additionally, in the actual joint transportation, there were no incidents such as misdeliveries or delays, and products from various consignors were successfully delivered to the customers, demonstrating that joint transportation is viable and that there is utility in a joint logistics platform.

■ Results of Desk Verification

In the Chukyo to Hokuriku lane, a desk verification was conducted with the cooperation of Universities utilizing past transportation data for transportation efficiency simulation and analysis. As a result of simulations conducted for joint transportation based on the transportation performance data of multiple consignors, it was found that there is a 13-point improvement in loading rates, with a potential 16% reduction in the number of trucks.

Additionally, in the Ichihara to Tohoku lane, an analysis was conducted using a year’s worth of transportation data from a logistics company that is already implementing mixed transportation. It was estimated how much efficiency would have been lost if mixed transportation had not been carried out. As a result, it was found that implementing mixed transportation leads to a maximum reduction of 34% in total travel distance, a maximum reduction of 22% in driver labor hours, and a maximum reduction of 24% in CO2 emissions.

Having clarified the direction for promotion toward implementation, we will further accelerate collaborative logistics initiatives based on the results obtained from the desktop verification.

■For your reference

Regarding the commencement of a proof of concept for collaborative logistics in the Kanto and Tokai regions by the 'Physical Internet Realization Conference and Chemicals Working Group' dated June 11, 2024.

Regarding the establishment of the 'Chemicals WG' at the 'Physical Internet Realization Conference' dated June 13, 2023.

That's all.