![Deciphering the Supply Chain with Satellites Part 2](/namoImgView.do?nfile=/images/000082/f249c805-d450-4bf7-ab2e-f253e853efcc.jpg)
(Due to copyright issues, satellite imagery discussed in this paper has been replaced with images. The original source and link of these images are detailed in the references section, allowing readers to access the specific material.)
1. Utilization of Satellite Imagery in Ports Ten years ago, the European Space Agency (ESA) implemented the “I-PORT system” using GPS and satellite-based AIS (Automatic Identification System) to establish a seamless flow of container cargo and an efficient transportation system for container trucks within ports.[1]. The I-PORT system aimed to adjust vehicle schedules early based on ship arrival schedules, thereby reducing non-productive waiting time for vehicles.[2]. Now, to achieve these objectives more effectively, as mentioned in Part 1, satellite imagery analysis is also being utilized in ports. Monitoring work processes in ports using satellite imagery enables the assessment of congestion levels in yards and terminals, thus maintaining the efficiency of the entire port supply chain. Various research and applications are being conducted in this regard.As an example of such research, Murata et al. (2023) conducted a study[3]using high-resolution nighttime satellite imagery of eight terminals in Tokyo Port, Japan, to assess the operational status of container terminals. This study demonstrated the possibility of regularly observing the operational status of ports worldwide. With the capability of satellites to capture high-resolution images of nighttime lights (NTL), it is possible to evaluate the operational status of container terminals even during nighttime. Through such observations, it becomes feasible to identify terminals that are relatively less congested, thereby supporting decision-making in maritime supply chain networks. Additionally, analyzing the operation status of container handling equipment such as gantry cranes and transfer cranes at container terminals during nighttime becomes possible.
![a view of the earth from space](/namoImgView.do?nfile=/images/000082/f90458f6-9ab3-40f3-aade-6426aa0c794f.jpg)
![Area Difference Before/After the Drought of Alajuela Lake](/namoImgView.do?nfile=/images/000082/0627c9d7-a095-40a0-9467-c4711ebc84d0.jpg)
Analyzing trends of vessels through satellite imagery can aid in predicting such freight indices. Taking a closer look at the three sub-indices that constitute the BDI—namely the Baltic Capesize Index (BCI), Baltic Panamax Index (BPI), and Baltic Supramax Index (BSI)—we see that in calculating the BDI, the BCI is given a weight of 40%, while the BPI and BSI each contribute 30% to the calculation of the BDI.
One of the important factors in predicting such freight indices is ship supply. To begin with, looking at the BCI, the prediction involves understanding the size and quantity of Capesize vessels operating worldwide. Capesize vessels mainly transport iron ore and coal and have relatively simple O/D (Origin/Destination) compared to other vessel types, making it relatively easier to track their routes.
The figure below depicts the status of Capesize vessels transporting iron ore in October 2019.
Through satellite data and imagery, it's possible to track the direction, position, and quantity of all Capesize vessels in operation on a daily basis. The types of Capesize vessels shown in the figure include Small Cape (100-139K), Cape Size (140-214K), and Large Cape (215-999K). As depicted in the left figure, during laden voyages, Capesize vessels loaded with cargo from Brazil and Australia can be observed transporting goods to Korea, China, and Japan. Conversely, the right figure illustrates the tracks and total number of vessels moving from Korea, China, and Japan to Brazil and Australia without cargo (unladen), in preparation for loading iron ore and coal.
![Operational Status and Vessels of Iron Ore-transporting Vessels](/namoImgView.do?nfile=/images/000082/4c2f0330-5f42-48f8-8e02-a65f90c73a04.jpg)
The image depicts a satellite photo of Caofeidian Port, one of the prominent ports for iron ore imports within China. As indicated in the image, it becomes possible to monitor the size of the iron ore stockyard within the port and the quantity of iron ore stored in real-time. When the inventory of iron ore in the stockyard decreases or the turnover rate is high, it signifies an increase in China's demand for iron ore, which could lead to an increase in freight rates. Previously, China's iron ore demand was assessed using data on iron ore inventory in Chinese ports released by organizations like the China Iron & Steel Association (CISA). However, this data had a lag as it was not real-time and involved aggregation and publication delays. With satellite imagery, more accurate and real-time analysis of China's iron ore demand can now be conducted.
![China Caofeidian Port and Iron Ore Container Yard](/namoImgView.do?nfile=/images/000082/ba902f7c-a8da-4e45-891c-3ada3d66b45b.jpg)
In the context of agricultural supply chain management, a notable case of utilizing satellite imagery is the sustainable palm oil supply chain established by Unilever. Since 2014, Unilever has been monitoring palm oil production areas and related deforestation sites using high-resolution satellite data, tracking distribution networks, and integrating satellite imagery with AI, geolocation data, data science, and other technologies to enhance traceability and transparency and promote the development of a deforestation-free supply chain[10]. Additionally, Unilever, in collaboration with Orbital Insight, collects various supply chain information such as deforestation status, soil modification status, and fire occurrences at palm oil factories in Indonesia and mills in Brazil. This allows them to have a comprehensive view of activities within the supply chain, predict and immediately address issues[11]. ]. like deforestation, and improve the coffee supply chain through the utilization of technologies like wireless sensor networks, cloud computing, IoT, and image processing[12], Furthermore, the integration of satellite imagery and blockchain technology shows potential for redesigning supply chains to address issues in the fish supply chains of developing countries[13]. 5. The Fields of Humanitarian Logistics and Relief Supply chains Satellite technologies can assist relief actors in addressing key logistics issues they face[14]. Indeed, during the 2010 Haiti earthquake, artificial satellite imagery was utilized to assess damages and prioritize the allocation of relief supplies for reconstruction efforts. Drones and satellite imagery can aid in damage assessment, search and rescue operations, allowing for faster and more accurate responses to disasters after their occurrence[15]. Furthermore, during the 2018 floods in Kerala, India, dubbed as the worst in a century, real-time weather information and geospatial data were analyzed based on satellite big data, enabling the establishment of logistics plans and execution of rescue missions, thus enhancing the agility of relief and logistics supply chains in India.[16]. 6. Management of Core Mineral Supply Chains Efforts and initiatives to utilize satellite imagery in mineral resource exploration continue to progress, and advancements in processing technology for remote sensing imagery, coupled with the development and enhancement of artificial satellite-based remote sensing, are increasing the likelihood of success in mineral resource exploration. The utilization of satellite imagery allows for the exploration of mineral resources, understanding of mining sites, and observation of mineral resource transportation activities. Furthermore, by analyzing changes in production and stockpiles of minerals and metals, it is possible to conduct analyses linked to global demand data, not only for the supply of mineral resources but also for global demand data[18].
Furthermore, with the increasing importance of securing critical raw materials for implementing technologies related to the Fourth Industrial Revolution, efforts have been made in various countries to ensure stable supply and procurement of essential critical raw materials for advanced industries and renewable energy technologies. In the United States, four key items—semiconductors, large-capacity batteries, pharmaceuticals, and critical minerals (rare earth elements)—have been selected for continuous review of the supply chain situation to establish a stable supply chain (as of 2021). In Europe, the adoption of the EU Critical Raw Materials Act (effective April 2024) aims to reduce the dependence on raw material imports from third countries, including China. This legislation seeks to strengthen manufacturing capacity within Europe and promote diversification of supply sources to lower raw material dependence by 2030[19]. In this context, the utilization of satellite technology for mineral exploration is expected to become even more active. Mineral exploration can be conducted not only through artificial satellites but also through aircraft, unmanned aerial vehicles (UAVs), and drones. These technologies can analyze hundreds of wavelengths and rays emitted by different minerals to identify their types and locations[20]. Therefore, satellite imagery information will play a crucial role not only in exploring critical mineral supply chains but also in managing the supply chains of mineral resources. 7. Establishment of Green Supply Chain The satellite imagery is also being utilized for tracking carbon emissions. Climate Trace, an environmental organization, utilizes artificial satellites to directly aggregate greenhouse gases emitted from individual supply chains such as component suppliers, or to track the actual carbon footprint (CFP) of steel plants. Additionally, with information collected through satellites, it becomes possible to track methane emissions from oil and gas production facilities worldwide and monitor changes in emission patterns over time. By the end of 2025, it is anticipated that methane emissions from major oil and gas production zones worldwide will be clearly identified. [21]. While efforts have been made in the past to analyze and optimize logistics routes using past satellite data to reduce fuel consumption, now satellite imagery enables the optimization of the locations of factories, warehouses, and distribution centers. By minimizing overall transportation distances, satellite imagery can ultimately help reduce carbon emissions. Given that carbon emission reduction is considered a crucial task in the field of global supply chains for sustainability, satellite imagery is expected to be utilized for tracking emissions along the supply chain in the future.
![An illustration of the green supply chain, an image with grass in the background](/namoImgView.do?nfile=/images/000082/9bd15ee8-578e-4215-b60a-7be87a867b6e.jpg)
![Wide and Blue Farmland Image](/namoImgView.do?nfile=/images/000082/52aea4fc-e7cd-4b22-82c6-d13be6ee7dc3.jpg)
Through this paper, we have observed that satellite imagery is being utilized to mitigate supply chain risks and enhance supply chain efficiency. While the acquisition of satellite imagery still poses challenges from a cost perspective, it enables the early identification of potential obstacles and risks in the supply chain, allowing for proactive responses even in global crisis situations, thereby contributing to stable supply chain operations. Satellite imagery analysis can integrate various factors such as weather patterns, transportation routes, and geopolitical events comprehensively. Furthermore, satellite imagery not only enhances the agility and resilience of supply chains but also plays a crucial role in environmental regulatory compliance, significantly contributing to the improvement of supply chain sustainability. As a result, the future utilization and analysis of satellite imagery will continue to be crucial in supply chain management. # Reference [1] European Space Agency https://business.esa.int/projects/i-port-0
[2] Meyer-Larsen, N., Müller, R., & Köhler, T. (2015). Optimisation of Intermodal Transport Using Satellite-based Services. In Operational Excellence in Logistics and Supply Chains: Optimization Methods, Data-driven Approaches and Security Insights. Proceedings of the Hamburg International Conference of Logistics (HICL), Vol. 22 (pp. 379-389). Berlin: epubli GmbH.
[3] Murata, H., Shibasaki, R., Imura, N., & Nishinari, K. (2023). Identifying the operational status of container terminals from high-resolution nighttime-light satellite image for global supply chain network optimization. Frontiers in Remote Sensing, 4, 1229745.
[4] Chosun Biz, “[Economy seen from satellite] Panama Canal disrupted by drought”, (2023.07.10)
[5] Posco Newsroom, ““Why POSCO invested in Australian iron ore mines”, expert report, (2020.09.24)
[6] [Tailings dam collapse area (Feijao mine location))] New York Times, “A Tidal Wave of Mud”, (2019. 02.09)
[7] [Satellite images before and after the Tailings dam accident] The Weather Channel, “Before and After Images of Brazil's Disastrous Dam Collapse”, (2019. 02.07)
[8] Korea Maritime Institute, “[Shipping Market Status 2020] Capesize Market Outlook for 2020”, (2020.01.03)
[9] Arkeman, Y., Hidayah, N. J., Suharso, A., Adhzima, F., & Kusuma, T. (2023). Implementation of artificial intelligence and blockchain in agricultural supply chain management, 29(1), 135-149.
[10] Unilever, “How we’re using tech for more transparent, traceable supply chains” (2022.11.25)
[11] Impact On, “Unilever combines AI and data to monitor Indonesian supply chain”, (2020.08.31)
[12] Kittichotsatsawat, Y., Jangkrajarng, V., & Tippayawong, K. Y. (2021). Enhancing coffee supply chain towards sustainable growth with big data and modern agricultural technologies. Sustainability, 13(8), 4593.
[13] Sengupta, T., Narayanamurthy, G., Moser, R., Pereira, V., & Bhattacharjee, D. (2022). Disruptive technologies for achieving supply chain resilience in COVID-19 era: An implementation case study of satellite imagery and blockchain technologies in fish supply chain. Information Systems Frontiers, 1-17.
[14] Delmonteil, F. X., & Rancourt, M. È. (2017). The role of satellite technologies in relief logistics. Journal of Humanitarian Logistics and Supply Chain Management, 7(1), 57-78.
[15] Faster Capital (2024), “The Role of Technology in Enhancing Community Resilience Initiatives” (2024. 04.24)
[16] Nagendra, N. P., Narayanamurthy, G., & Moser, R. (2022). Management of humanitarian relief operations using satellite big data analytics: The case of Kerala floods. Annals of operations research, 319(1), 885-910.
[17] ' Saefarm’s agricultural and forestry satellite technology brings smart changes to open field farming
[18] DEEPBLOCK, “How AI Revolutionizes Asset Management and Market Research”, (2023.08.16)
[19] EU, “European Critical Raw Materials Act”. https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/european-green-deal/green-deal-industrial-plan/european-critical-raw-materials-act_en
[20] Kyunghyang Shinmun, “New mission for ‘old soldier reconnaissance plane’ after taking off military uniform.” (2023.11.19)
[21] Korea Economic Daily, “Moonshot” satellite that will thoroughly identify the main culprits of methane emissions will be launched next month” (2024.02.15)
[22] https://www.lgcns.com/blog/cns-tech/blockchain/2498/
▶ This content is prohibited from secondary processing and commercial use without prior consent.