MH Daily Bulletin: August 24

August 24, 2022 • Posted in Daily Bulletin

News relevant to the plastics industry:

At M. Holland

  • M. Holland’s latest logistics outlook examines current challenges and industry trends that are impacting shipping, trucking and rail. Although the plastics industry is faring a little better than earlier this year, M. Holland’s experts predict disruption to continue well into 2023. Click here to read the full outlook for the remainder of 2022.
  • M. Holland will be attending the North American Detroit Auto Show on Sept. 14-15. This annual showcase for emerging automotive technologies will be held at Huntington Place in Detroit, Michigan. If you’re attending, please RSVP for M. Holland’s reception or contact Mike Gumbko, Strategic Account Manager, to set up a meeting with our Automotive team.
  • Market Expertise: M. Holland offers a host of resources to clients, prospects and suppliers across nine strategic markets.

Supply

  • Oil prices surged 4% Tuesday on news of tighter supply in the U.S. and possibly Saudi Arabia.
  • Crude prices continued rising Wednesday morning on fears that OPEC could cut production, with WTI up 0.4% at $94.18/bbl and Brent up 0.4% at $100.60/bbl. U.S. natural gas futures were up 0.9% at $9.28/MMBtu.
  • The American Petroleum Institute reported a larger-than-expected crude draw of 5.63 million barrels last week, putting upward pressure on prices. U.S. government data will be released today. 
  • Freeport LNG pushed back the timeline for partially resuming operations at its fire-damaged Texas export facility from October to November
  • California lawmakers are working on deadline to pass a bill extending the life of the state’s last nuclear power plant, a response to fears of potential power shortages for years to come.
  • Multiple factors, including unusually hot temperatures and declining coal capacity, led to record levels of U.S. electricity generation from gas-fired power plants this summer:
Daily U.S. electricity generation from natural gas hit a record in mid-July

Supply Chain

High Prices, Range Anxiety Holding Back EV Adoption

Domestic Markets

War & World Economy Spark Mass Tech Layoffs
  • U.S. college endowments lost 10.2% in the 12 months through June, the steepest loss since 2008’s financial crisis amid stock market upheaval. 
  • Over one-fifth of U.S. home sellers dropped their asking prices in July, the highest share since online real estate firm Redfin began tracking the metric a decade ago. 
  • Sales of new U.S. homes fell 12.6% in July, their sixth decline this year to the slowest pace in 6.5 years, as high borrowing costs and lower demand fuel a cooldown in the housing market. 
  • A Wells Fargo index of U.S. homebuilder sentiment fell below the breakeven level of 50 in August for the first time since the beginning of the pandemic, the bank said. 
  • Toll Brothers, the largest U.S. luxury-home builder, reported a 60% plunge in quarterly orders and cut its sales outlook as rising interest rates challenge buyers at the high end of the market. 
  • Global auditing firm KPMG will cut its office space in New York by more than 40%, part of a growing trend that has left Manhattan’s office market with record available space.
  • Ride-hailer Lyft will sublease up to 45% of its biggest U.S. offices, becoming the latest company to shrink its real estate footprint to adjust to more employees working from home. 
  • Macy’s and Nordstrom are the latest U.S. retailers to lower financial targets for the year amid declining consumer spending and fears of an economic downturn. Nordstrom shares tanked 14% on the news.
  • Dick’s Sporting Goods posted a better-than-feared 5% decline in net sales last quarter, prompting a boosted financial outlook for the year.
  • Thousands of U.S. flights were canceled Monday and Tuesday due to bad weather in the New York region. 

International Markets

  • Japan reported 343 COVID-19 fatalities Tuesday, a record. Despite the recent wave, officials still plan to ease some of the toughest travel rules among G7 nations by scrapping a testing requirement for inbound travelers who are vaccinated
  • Hong Kong reported 6,617 new COVID-19 infections Monday, the fifth straight day above 6,000. 
  • Canada will soon receive 12 million doses of an Omicron-tailored COVID-19 vaccine made by Moderna. 
  • A spate of worse-than-expected business surveys released on Tuesday suggest the global economy is growing closer to recession.
  • The World Trade Organization says global trade growth slowed to 3.2% in the first quarter from 5.7% the previous quarter and is currently stagnating. 
  • Euro-area consumer confidence unexpectedly rose in July but remained near record lows due to surging costs-of-living, according to the European Commission. 
  • Britain’s private sector slowed to a crawl in August as factory output fell sharply into contraction territory, according to S&P Global.
  • Citigroup predicts British inflation could rise to more than 18% next year, a 50-year high due primarily to soaring energy prices.
  • Argentina plans to launch new measures in the coming days aimed at restricting imports and preserving the central bank’s foreign currency reserves. Latin America’s third-largest economy is just one of many with dwindling foreign currency reserves that could lead to default. 
  • Births in China are poised to hit record lows this year as fallout from the pandemic raises costs for education and child-rearing, posing long-term problems for the nation’s economic growth.
  • Ryanair upped its full-year forecast for passenger numbers after jumping on capacity left open by British Airways, which cut 10,000 scheduled flights through next March due to staffing shortages. 

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