MH Daily Bulletin: April 11
April 11, 2023 • Posted in Daily BulletinNews relevant to the plastics industry:
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Supply
- Oil fell slightly Monday after rising for three straight weeks, a response to concerns over further U.S. interest-rate hikes that could curb global demand.
- In mid-morning trading today, WTI futures were up 1.9% at $81.23/bbl, Brent was up 1.3% at $85.29/bbl, and U.S. natural gas was up 0.6% at $2.19/MMBtu.
- Citigroup expects oil prices to fall below $80 due to a slower-than-expected recovery in China and additional supply from Iraq and Venezuela.
- U.S. gasoline prices are up for the second week in a row to an average of $3.64 per gallon, according to AAA.
- U.S. production of diesel hit 5 million gallons per day for the first time ever in January, extending a two-year biofuel business boom.
- Shares of Pioneer Natural Resources jumped 8.5% Monday following a report that Exxon Mobil is in talks with the U.S. shale producer over a potential acquisition.
- Occidental Petroleum is spending more than $1 billion to build the first in a planned fleet of plants using direct-air capture to pull CO2 out of the air, a bid to allow the company to keep operating as a crude driller decades into the future.
- An expansion of Canada’s Trans Mountain crude pipeline, set to begin in 2024, will cut producers’ reliance on U.S. refiners and potentially lead to better prices, experts say.
- Russia cut its crude production by 700,000 bpd in March, new data shows, exceeding a planned cut of 500,000 bpd announced the month before.
- More Russian diesel is being sent to Latin America, as the nation’s exports seek new markets outside Europe.
- Japan is slashing its reliance on Russian coal as buyers source more fuel from suppliers in Indonesia and South Korea.
- India’s fuel demand jumped by an annual 5% in March to a record-high as consumption in the world’s third-largest crude importer continues to grow.
- India proposed a $2 billion subsidy scheme this week that aims to push domestic production of hydrogen fuels.
- Installers of U.S. residential solar units are bracing for a slowdown this year as California, the sector’s biggest market, prepares to slash subsidies underpinning more than a decade of high growth.
- China’s state-owned energy firm Sinopec announced plans to build a pipeline to transfer hydrogen from renewable projects in Inner Mongolia to cities in the country’s East.
Supply Chain
- Major U.S. ports are projected to import 1.68 million TEUs in March, up 8.9% from February but 28.2% below the level from a year ago, according to the Global Port Tracker:
- The port of entry in Laredo, Texas, regained its top spot among the nation’s 450 international gateways for trade in February, recording $24.6 billion in two-way trade.
- CMA CGM ordered 16 container ships from China State Shipbuilding for a total of $3.1 billion.
- Walmart executives say they will need at least the same number of workers for order fulfillment even as the retailer scales up automation.
- The U.S. Postal Service is seeking approval to hike the price of first-class mail stamps by 5.4% to 66 cents, effective July 9.
- Boeing resumed deliveries of 767 freighters after a multi-week pause to address quality issues.
- Manufacturing disruptions at Conagra Brands led to stock shortages for some products last quarter, executives said.
- Prices for widely used DRAM computer chips could fall as much as 10% in the current quarter due to a global supply glut, analysts say.
- Taiwanese chipmaker TSMC is in talks with the White House over concerns about rules attached to U.S. subsidies for domestic chip development, including sharing excess profits.
- In the latest news from the auto industry:
- China’s auto sales were flat in March from a year earlier, while total first-quarter sales fell by 13.4%.
- Auto production in Mexico rose 13.12% in March from a year earlier, new data shows.
- Trucks, vans and SUVs now represent the majority of cars on the road in every U.S. state.
- Chinese electric-vehicle giant BYD launched a new, homegrown chassis suspension system this week as the automaker ramps up efforts to sell more premium cars.
Domestic Markets
- Bank of America says the U.S. economy is at risk of shrinking in the second quarter on new data showing higher interest rates are cooling the economy.
- American’s inflation expectations for a year from now rose to 4.7% this month, the first increase in inflation expectations in five months, according to a widely tracked survey:
- The U.S. dollar rose Monday after new jobs data pointed to a continued tight labor market, heightening expectations of another Federal Reserve rate hike in May.
- Americans say access to credit is at its most difficult in nearly a decade, according to a new survey from the New York Fed.
- Overall U.S. bank credit has been stalled at about $17.5 trillion since January, raising the potential for a worse-than-expected credit crunch if the Federal Reserve continues with its path of interest-rate hikes at its next meeting in May.
- Online prices in the U.S. dropped 1.7% in March from a year earlier, the seventh straight decline and the sharpest retreat in four months, according to Adobe’s Digital Price Index.
- The percentage of Americans working from home surged from 5.7% in 2019 to 17.9% in 2021, highlighting the pandemic’s upending of work habits across the country.
- Prospects for more union gains at Amazon have faded since a labor organizing victory at a Staten Island warehouse last year.
- Amazon-owned Whole Foods Market is exploring building commercial kitchens that would make prepared meals for the grocer’s supermarkets.
- Tupperware Brands has engaged financial advisers and is seeking new financing, according to reports, sending the firm’s shares down 49% Monday.
- Retailer Shoe City filed for bankruptcy protection and plans to close its 39 stores.
- About 150 employees of a Tyson Foods chicken plant in Arkansas went on strike Monday as the company preps to shut the facility.
- Thousands of professors and staff at Rutgers University went on strike this week for the first time in the school’s 257-year history, protesting pay and working conditions.
International Markets
- The World Bank revised its 2023 global growth outlook slightly upward to 2% this week from 1.7% forecast in January, although officials warned of greater possible pressure from debt crises in developing countries.
- New leadership at the Bank of Japan indicated the country’s ultra-loose monetary policy will remain in place for now as inflation has yet to hit 2% as a trend.
- Economists expect Canada’s central bank to leave interest rates unchanged at its meeting on Wednesday despite recent data showing surprising economic gains.
- Annual inflation in Egypt climbed to 32.7% year over year in March, just shy of an all-time record, following a series of currency devaluations and other monetary challenges.
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