COVID-19 Bulletin: February 10

February 10, 2021 • Posted in COVID-19

Good Afternoon,

More news relevant to the plastics industry:

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Supply

  • Crude prices rose for the eighth consecutive day, the longest upward streak in two years, on reports of declining stocks.
  • Crude prices were higher in mid-day trading today, with the WTI up 0.6% at $58.73/bbl and Brent 0.7% higher at $61.49/bbl. Natural gas was 1.9% higher at $2.89/MMBtu.  
  • National oil companies are on a collision course with sustainability trends, with plans to invest $400 billion in oil and gas projects over the next decade that may only break even if the world exceeds Paris climate agreement targets.  
  • Shale pioneer Chesapeake Energy emerged from bankruptcy yesterday with a renewed focus on gas production.
  • The Texas Railroad Commission, which regulates the state’s energy sector, is tightening restrictions on natural gas flaring under pressure from environmentalists.
  • BASF and Siemens Energy are partnering to cooperate on projects to reduce carbon emissions.
  • LyondellBasell lifted its force majeure on PP products but warned of continued supply tightness.
  • Covestro declared force majeure on certain TPU products due to raw material supply shortages.
  • Borealis declared force majeure on certain PP products made at its Kallo, Belgium facility due to an equipment issue.

Supply Chain

  • Annual U.S. imports on a TEU basis rose 1.9% in 2020, setting a record and portending higher retail sales and employment activity. Imports at the largest U.S. retail container ports are expected to set new monthly records from now into the summer.
  • Global trade rose 5% last year on a strong second-half rebound after a sharp decline early in the pandemic that forced shippers to sideline capacity, causing severe disruption and congestion at global ports. Maersk, the world’s largest container shipper, reported strong fourth quarter results and forecast a return to industry normalcy after the current quarter, sending its stock price lower.
  • Sky high container shipping rates are expected to fall by summer, with many shippers adding capacity and ports prioritizing vaccinations for workers.
  • Ocean carriers are signaling they will be specifically taking aim at reducing contracted free time in 2021-22 contracts, a result of equipment shortages caused by extended possession of containers by many U.S. importers last year.
  • Freight traffic through the U.K.’s Port of Dover is running at 90% of usual levels, better than was feared amid post-Brexit red tape and burdensome new customs requirements.
  • The computer chip shortage impacting the automotive industry is deepening:
  • Old Dominion Freight Line is building or enlarging nine freight handling facilities in new and existing markets, bringing the carrier’s total network to 245 sites.
  • Amazon expanded the square footage of its fulfillment and logistics network by 50% in 2020.
  • Logistics conditions remain strained, with trucking demand exceeding availability, continuing congestion at ports, and backlogs at warehousing and packaging facilities due in part to operating challenges related to the pandemic. Shipping containers are in short supply, with demurrage charges rising. Clients are advised to provide expanded lead times on orders to help ensure delivery dates.

Markets

  • There were 95,360 new COVID-19 cases in the U.S. yesterday and 3,131 fatalities.
  • The pace of new COVID-19 infections has fallen 56% over the past month, and hospitalizations are down 38% since Jan. 6.
  • COVID-19 cases are rising in U.S. Hispanic communities, with the latest data showing a 55% greater virus presence in the population.
  • Uber and Walgreens are partnering to provide rides and access to COVID-19 vaccine shots for minority communities ahead of the expected Feb. 11 vaccine rollout for retail pharmacies across the U.S. The Walgreens sign-up page for vaccinations crashed amid heavy volume.
  • Data suggests that a single dose of the Pfizer-BioNTech vaccine is 65% effective against COVID-19.
  • The FDA granted emergency use authorization to Eli Lilly’s combination antibody treatment for COVID-19, providing doctors with a new weapon against variants of the virus.
  • The White House announced a 5% hike in vaccine allocations to states yesterday, the third boost in as many weeks, bringing total increases to 30%.
  • The White House is launching a public awareness campaign to promote social distancing and the use of masks but will not advocate for vaccines because of supply limitations.
  • Researchers are finding similarities between the lungs of severely infected COVID-19 patients — i.e., those who were on a ventilator or required high levels of oxygen — with those of habitual smokers.
  • People with gum disease who contract COVID-19 are nine times more likely than others to die from the virus and three times more likely to end up in intensive care or on a ventilator.
  • Black workers, women and low-wage employees were more likely to lose jobs during the pandemic, faced greater health risks if they kept working and are exiting the labor market at faster rates, according to the Federal Reserve Bank of New York.
  • Among the many anxieties spawned by the pandemic is “coronaphobia,” an acute fear of contracting COVID-19.
  • The CDC faces strong industry opposition as it considers whether to require COVID-19 tests for passengers on domestic flights.
  • U.S. home prices in urban markets rose 15% in the three months through late January, slightly ahead of the annual pace in suburbia and a marked shift from the early days of the pandemic.
  • The pandemic is threatening the rent-sublet business model of co-working firms.
  • Salesforce plans for most of its employees to work remotely part- or full-time after the pandemic as it seeks to reduce expenses and its real-estate footprint.
  • 2021 is shaping up to be the most profitable year for farming in five or more years, with prices on many staples rising after years of sluggish markets that left farmers dependent on government payouts.
  • Toyota and longtime supplier Denso Corp. are partnering with self-driving car startup Aurora to develop and build autonomous minivans for ride-hailing networks.
  • Daimler Trucks expects to have a full line of zero-emission commercial vehicles ready by 2027, an unusual instance of a product being widely available before the product’s fueling infrastructure.
  • Revenues from Apple’s iPhone 12 mini were just 5% of overall sales of new phones during the first half of January, reflecting consumer demand for larger devices.
  • Boeing delivered 26 aircraft in January, double its deliveries of January 2019.
  • This month, Coca-Cola is rolling out its first batch of 100% recycled-plastic soda bottles in select states in the Northeast, Florida and California.
  • Walmart entered a seven-year deal to package fresh produce from suppliers in reusable plastic containers (RPCs) that can be used up to 100 times before being reground into new RPCs.
  • Mondi introduced AegisPaper, a line of flexible barrier paper packaging that replaces plastics.

International

  • Mexico has become one of the hardest hit countries for COVID-19:
    • The nation is approaching nearly 2 million confirmed COVID-19 cases and 175,000 confirmed fatalities, although officials say the real tallies are significantly higher.
    • The nation’s president returned to news conferences Monday after a bout with COVID-19 but remained adamant about not wearing a mask or mandating mask use for the population.
    • Fewer than 1% of Mexico’s 125 million people have had access to a vaccine after the rollout fell into disarray, despite earlier government promises that frontline health workers would be vaccinated by the end of January.
    • Capacity limits and shortage of resources, meanwhile, are causing some patients to be turned away at the doors of hospitals — even when they face life-threatening conditions.
    • Mexican manufacturers have struggled to supply needed PPE, with 84% of hand sanitizers produced there containing toxic, unlisted ingredients not in compliance with U.S. FDA standards, prompting a federal alert.
  • German officials are expected to keep national COVID-19 restrictions in place until at least March 1. The restrictions were first imposed on Germany’s 16 states in November and were tightened in mid-December.
  • Austria is isolating the entire province of Tyrol amid the European Union’s worst outbreak of the South African coronavirus variant, with all travelers leaving the region required to show a negative test result as of Friday.
  • Britain’s strict quarantine restrictions, punishable by fines or jail time, require those arriving from countries with highly infectious COVID-19 variants to pay for 10 days of isolation in hotels. The rules will go into effect next week. The nation is also investigating two new variants of the virus found in Bristol and Liverpool that appear to have similarities to the South African and Brazilian variants.
  • South Korea’s prime minister issued a public plea to more than a half-million restaurant and business owners in the greater Seoul area to cooperate with social distancing rules ahead of Lunar New Year festivities.
  • The greater Athens, Greece, region, which houses nearly half of the nation’s 11 million people, is under full lockdown until the end of the month after an uptick of coronavirus cases and hospitalizations.
  • The head of the World Health Organization’s investigation into the origins of COVID-19 in Wuhan, China, says it is unlikely that the virus came from a laboratory leak there. The most likely theory is that the virus originated in bat populations and was spread by frozen food packaging.
  • After suffering its worst ever recession in 2020, Singapore is unveiling an expansionary but trimmed down budget to support struggling businesses next fiscal year.
  • France’s economy is on course to rebound 5% this year despite continued uncertainty created by the coronavirus pandemic and widespread lockdowns.
  • German exports rose slightly in December, up 0.1%, on solid trade with China and the U.S., as the nation’s monthly trade surplus rose to 16.1 billion euros.
  • Japan’s currency in circulation and bank deposits rose at a record pace in January, suggesting companies and households continue to hoard cash due to economic uncertainty caused by the pandemic.
  • The size of bad loans at Chinese banks shrank at the end of last year as the nation’s economic recovery gathered momentum.
  • Smartphone shipments in China nearly doubled in January 2021 versus a year ago, suggesting the nation’s mobile device sector has returned to pre-pandemic health.
  • Honda raised its full-year operating profit forecast by 23% as demand in China gains momentum, especially for electric and autonomous vehicles.
  • Volkswagen started a feasibility study of “vertical mobility” vehicles — flying cars — in China, joining a growing number of companies looking into the technology.

Our Operations

  • Market Expertise: M. Holland offers a host of resources to clients, prospects and suppliers across nine strategic markets. To arrange a videoconference or meeting with any of our Market Managers, please visit our website.  

Thank you,

M. Holland Company

We will provide further COVID-19 bulletins as circumstances dictate. For all COVID-19 updates and notices, please refer to the M. Holland website.

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