MH Daily Bulletin: September 29

September 29, 2022 • Posted in Daily Bulletin

News relevant to the plastics industry:

At M. Holland

  • M. Holland is a Gold Sponsor of the SPE Automotive TPO Engineered Polyolefins Global Conference on Oct. 2-5 in Troy, Michigan. If you’re planning to attend, please stop by M. Holland’s booth to meet our Automotive team!
  • We are sponsoring MAPP’s Benchmarking & Best Practices Conference in Indianapolis on Oct. 5-7! If you’re planning to attend, don’t forget to stop by M. Holland’s booth and tune in for our session featuring Debbie Prenatt, Market Manager, Sustainability. Click here to read more.
  • Come see us at the IWCS Cable & Connectivity Industry Forum in Providence, Rhode Island, on Oct. 10-13! M. Holland is a Gold Sponsor. If you are attending, please stop by Booth #113 to discuss our materials and offerings serving the wire and cable market.
  • At our Plastics Reflections Web Series event on Oct. 13, M. Holland will host panelists from Maersk and Bank of America to discuss the macroeconomic factors influencing global and domestic economies, including impacts on the plastics industry. Click here to register.
  • M. Holland Company, a leading international distributor of thermoplastic resins and ancillary materials, is offering up to 100% PCR content resin that helps brands utilize sustainable innovation in the plastics industry. Click here to read the full press release.

Supply

  • Oil rose for a second day Wednesday, gaining over 3.5% on a decline in U.S. inventories, a sign of rebounding demand.
  • Crude futures were marginally lower in mid-morning trading today, with WTI futures at $82.03/bbl and Brent at $89.12/bbl. U.S. natural gas was down 3.5% at $6.72/MMBtu.
  • U.S. crude stocks unexpectedly fell by 200,000 barrels last week, mirroring draws in gasoline and middle distillates, according to the EIA.
United States Crude Oil Stocks Change

Supply Chain

North American Transborder Freight up 19.1% in July 2022 from July 2021
  • Total inventories held by S&P 500 companies hit $1.17 trillion in the second quarter, up 19% from a year ago. U.S. wholesale inventories rose 1.3% in August, their 25th straight monthly gain.
  • The market for microfulfillment centers, which expanded during the pandemic as online retail sales demand grew and companies looked for new ways to ship goods, is now shrinking as merchants focus on in-store automated fulfillment and other distribution strategies.
  • Costco expects supplier wage increases to perpetuate high product prices even as commodity and other supply-chain costs ease. The retailer’s comparable sales jumped 14% last quarter.
  • Amazon is raising pay for warehouse and transportation workers while planning to close several U.S. call centers in a move toward remote working.
  • In the latest news from the auto industry:
    • Ford delayed deliveries of some vehicles due to a shortage of blue oval badges for the front end.
    • GM is investing $760 million to prepare an Ohio plant for production of drive units for electric vehicles.
    • U.S. new vehicle sales are poised to hit almost 960,000 units this month, a 5.4% increase from the same time last year in what would be a new September record.
    • Tata Motors launched India’s lowest priced electric vehicle (EV) at a little over $10,000 this week, cementing its hold on the nascent Indian EV market.
    • Volkswagen priced the initial public offering of Porsche at the top end of its targeted range, putting the IPO on track to become one of Europe’s largest in more than a decade at roughly $73 billion
    • Five major firms including Ikea, Unilever and Maersk pledged to phase out their use of gas-powered trucks in China and India by 2040.
    • Peru is forming plans to produce more lithium batteries domestically, joining other Latin American nations with ambitions to take advantage of surging demand for electric vehicles.
  • Cotton prices fell 25% the past month as concerns over slow demand overshadow a potentially poor U.S. harvest.

Domestic Markets

  • The U.S. reported 86,496 new COVID-19 infections and 1,260 virus fatalities Tuesday.
  • COVID-19 cases rose by 8% in New York state last week, led by an increase in cases outside New York City.
  • First-time jobless claims fell to 193,000 last week, a five-month low and well below the 215,000 expected by economists, indicating continuing tightness in labor markets.  
  • The average office occupancy rate in 10 major U.S. cities remained mostly unchanged at 47.3% last week.
  • The U.S. trade deficit in goods narrowed for a fifth month in August amid a decline in imports.
United States Goods Trade Balance
United States Pending Home Sales MoM

International Markets

  • Reported COVID-19 cases fell 11% globally last week while virus fatalities dropped 18%.
  • Travel during China’s Golden Week holiday, which begins this weekend, is poised to hit its lowest level in years as authorities urge people to stay at home to protect against the spread of COVID-19.
  • Economists expect Germany’s inflation rate to hit 9.5% in September, up from the 7.9% pace of August.
  • Consumer sentiment was down across the euro zone’s three largest economies of Germany, France and Italy in September, the latest in a string of monthly declines. 
  • The European Central Bank could raise interest rates by another 75 basis points at its October meeting, adding to its fastest pace of policy tightening on record.
  • Italian officials slashed the country’s 2023 growth forecast from 2.4% to just 0.6% due to sky-high energy costs.
  • On Wednesday, China’s currency dropped to its lowest level against the U.S. dollar since 2008, pressured by expectations of more U.S. rate hikes.
  • The U.S. began its first-ever summit with 12 Pacific Island leaders this week, an effort to expand economic cooperation in the region.
  • The U.S. and EU will in the coming days propose new economic sanctions on Moscow in response to its escalating annexation schemes in Ukraine.
  • Taiwan’s China Airlines finalized a $4.6 billion order for 16 Boeing 787 Dreamliner jets with an option for eight more.
  • Lego saw its first-half revenue rise 17% on a surge in store openings and robust demand for its toys despite rising inflation.

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