MH Daily Bulletin: August 26

August 26, 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.


  • Oil prices slumped about 2% Thursday on worries that rising U.S. interest rates will weaken fuel demand. After surging the first five months of the year, crude has been in retreat, with losses deepening in the summer trading months. 
  • In mid-morning trading today, WTI futures were down 0.9% at $91.66/bbl, Brent was down 0.5% at $98.84/bbl, and U.S. natural gas was up 1.1% at $9.48/MMBtu.
  • Texas is preparing to block banks and other financial firms from doing business in the state over their perceived lack of support for fossil fuels, the state comptroller said Thursday.
  • OPEC’s president became the latest to back Saudi Arabia’s suggestion that the alliance cut output to reverse a recent decline in oil prices. The group’s exports rose 200,000 bpd in August, led by a boost in Iranian production. 
  • Global oil and gas exploration firms could generate combined cash flows of a record $1.4 trillion this year, according to Deloitte. 
  • Coal-fired power generation in the U.S. surged 16% in 2021 after falling for 10 years but is predicted to fall again as more plants switch to natural gas capacity:
Owners of coal-fired generating plants seek greater fuel flexibility

Supply Chain

  • Texans have paid over $1 billion in extra power fees this year as the state’s grid operator takes more measures, including keeping larger reserves, to avoid blackouts during record demand this summer.
  • China’s Yangtze River basin has seen 70 straight days of extreme temperature and low rainfall, threatening the region that produces a third of the nation’s crops. 
  • The U.S.’s worst drought in a decade is sharply reducing corn harvests in major producing states including South Dakota, Iowa, Nebraska and Illinois. 
  • Water levels on rivers across the globe are receding due to widespread drought, posing serious risks to shipping routes, agriculture, energy supplies and drinking water. 
What Droughts Have Revealed
EVs Sending Lithium Demand Into Overdrive
General Motors' EV Sales Are Charging Up

Domestic Markets

  • The U.S. reported 90,675 new COVID-19 infections and 389 virus fatalities Thursday.
  • Almost 40% of COVID-19 hospitalizations this spring were of vaccinated and boosted people, highlighting the success of Omicron subvariants in evading immunity.
  • COVID-19 hospitalization rates in children under age 4 are up fivefold since the spring, according to the CDC.
  • Fewer than 2% of infants and toddlers in New York City are fully vaccinated against COVID-19, as demand levels remain exceptionally low. 
  • Pfizer’s COVID-19 antiviral pill appears to provide little or no benefit to young adults but is effective in reducing the risk of hospitalization and death in older populations, according to new research. 
  • Long-COVID is costing Americans an estimated $170 billion annually in lost wages, according to the Brookings Institution. 
Who Is Most Likely to Get Long Covid?
  • A Florida county started the fall school year with a shortage of over 600 teachers, up threefold from last year, emblematic of the U.S.’s widespread teacher shortage brought on by pandemic pressures.
  • U.S. Federal Reserve officials are wavering between a 50-basis-point and a 75-basis-point interest-rate hike at next month’s meeting of the central bank, according to comments made Thursday. Some have indicated the U.S. benchmark rate should hit at least 3.75% by year’s end.
  • U.S. corporate profit margins — as measured by after-tax profits as a share of gross value added — improved in the second quarter to 15.5%, the highest level since 1950, as firms managed to pass on rising costs to consumers.
  • The number of 18- to 24-year-olds out of the labor market rose by 118,000 from a year ago to 447,000 in the second quarter, the highest level of the pandemic. 
  • The average U.S. mortgage rate climbed to 5.5% this week, nearly double the same time last year, according to Freddie Mac. 
  • Home Partners of America, the single-family landlord owned by Blackstone Inc., plans to stop buying homes in 38 U.S. cities, becoming the latest institutional investor to back away from an overheated housing market.
  • The average U.S. new-vehicle loan hit a record-high $40,290 in the second quarter, according to Experian. Meanwhile, more people are financing used-car purchases compared to a year ago. 
  • In the latest news from second-quarter earnings season:
    • Dell reported its slowest quarterly revenue growth in 1.5 years after taking hits from a surge in the U.S. dollar and COVID-19 flare-ups in China, its second-largest market. The firm joined rivals in predicting slumping PC sales this year following a two-year pandemic boom.  
    • Peloton posted a $1.2 billion quarterly loss after revenue fell 30% due to plunging demand for its high-end bikes and treadmills.
    • Dollar Tree trimmed its full-year profit forecast as it struggles to compete with other retailers, including Walmart and Target, that are offering major discounts to get rid of excess inventories. 
    • Dollar General slightly raised its 2022 sales forecast after gross margins improved in the latest quarter on higher consumer demand.
    • Abercrombie & Fitch cut its full-year forecasts after reporting a surprise quarterly loss and a sharp decline in sales for its key Hollister brand.
    • Gap Inc. withdrew its full-year outlook after suffering an 8% revenue decline in the second quarter. 

International Markets

  • Global COVID-19 fatalities this year surpassed 1 million Thursday, according to the WHO. Nearly 6.5 million people have died since the start of the pandemic. 
  • China eased COVID-19 reporting requirements for cross-border travelers Thursday, marking one of its first policy relaxations in months. 
  • A recent spike in COVID-19 infections has prompted Hong Kong to renew testing and limited restrictions
  • British construction activity dipped 1.4% in June in the sharpest decline so far this year, according to building suppliers.
  • German business sentiment in August fell to its lowest reading in two years amid high uncertainty caused by Russia’s invasion of Ukraine, according to the widely tracked Ifo institute’s survey. 
  • Beijing announced over $1 trillion of government funding for construction projects in recent months, potentially giving a boost to the nation’s flagging economy, economists say. 
  • Toronto-Dominion Bank, Canada’s second-largest lender, posted better-than-expected quarterly results Thursday but warned that the U.S. and Canada will see slower economic growth in 2022 due to higher interest rates.
  • Norwegian Air saw net profit rise to $129.5 billion in the second quarter on rebounding travel demand but said surging energy costs will dent its earnings for the full year. 
  • Sony is raising the price of its PlayStation 5 console by as much as 20% in some markets to reflect rising costs, the firm said. 
  • Global spending on technology, which includes cloud services, is expected to rise about 3% this year, well below the 10% annual growth rate of 2021 and the 7% gain from 2020, according to research firm Gartner. 

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