COVID-19 Bulletin: July 1

July 1, 2021 • Posted in COVID-19

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Supply

  • OPEC+ pushed back a meeting scheduled for Wednesday to today, giving member nations more time to agree on further easing of production cuts for the coming months. The cartel also will consider extending its overall supply pact beyond April 2022. 
  • Energy futures were higher in mid-day trading, with WTI up 2.2% to $75.07/bbl and Brent up 1.6% to $75.82/bbl. Natural gas was 0.6% higher at $3.67/MMBtu.
  • Propane futures have reached unusual highs for this time of year, reflecting a 17% decline in domestic inventories since last year. 
  • Liquefied natural gas (LNG) developer Delfin is asking for an extension to complete an offshore Louisiana export plant, one of more than a dozen North American LNG projects revived amid higher energy prices. 
  • Gas consumption in India has returned to 90% of pre-pandemic levels after falling more than 30% last month. 
  • New Jersey approved two projects that will add over 2.6 gigawatts of offshore wind capacity in the state, bringing total capacity to 3.7 gigawatts. 
  • The U.K. announced a new goal to end its use of coal-generated power by 2024, one year earlier than planned. 
  • Spain became the 23rd nation to join a 133-member international coalition aiming to shutter coal power plants by 2030. 
  • South African state power utility Eskom is seeking $10 billion in funding to replace its coal-fired plants with renewable energy sources by 2050. 
  • Rolls-Royce formed a partnership with Shell to develop sustainable aviation fuel to help both companies achieve net-zero emissions by 2050. 
  • Our most recent list of force majeure and allocation announcements from suppliers is here. 

Supply Chain

  • While the Pacific Northwest heat wave began to wane in Seattle and Portland Wednesday, the bulk of the U.S. West continues to face extreme temperatures, with more than 52 million people under heat warnings.
  • At least 76 people in Oregon and Washington died as a result of the extreme heat wave, with hundreds more predicted to have passed in other regions of the western U.S. and Canada. 
  • White House leaders met with Western state governors yesterday to discuss measures to combat ongoing drought, heat and wildfire conditions. 
  • New York City’s power grid is being strained amid an intense heat wave in the eastern U.S.:
Earth is Heating Up
  • Due to the global chip shortage:
    • Ford will further idle several of its North American assembly plants for at least part of July.
    • Jaguar has paused production at a Slovakia factory making its Defender 4×4 model.
    • Japanese car production declined 19.4% and the country’s industrial output fell the most in a year in May. 
    • Roughly $20 billion could be shaved from operating profits of global carmakers this year, hitting production particularly hard in China and Japan.
  • The blistering pace of vehicle sales in the U.S. has slowed to roughly 2019 levels for the first half of this year, as parts shortages and shipping disruptions continue to limit dealership inventories. 
  • Freight rates are up 66% from China to the U.S. West Coast and up 92% from Asia to Northern Europe since January, shattering previous records. 
  • A global shipping backlog is driving up consumer prices for fireworks ahead of the July Fourth weekend, with some retailers raising prices by up to 35%
  • Lumber futures dropped by 42% in June, putting the commodity on track for its worst month on record dating back to 1978. 
  • The U.K. is set to extend quotas and tariffs on most of its steel imports for an additional three years.
  • An EU draft proposal could force ship owners to pay for pollution from their vessels or face bans from European ports. 
  • The EU granted a three-month extension for shipments of certain meat products coming from the U.K. to Northern Ireland, with hopes for the two countries to resolve trade disputes following Brexit. 
  • Our logistics team reports that bulk trucking firms are often declining to book long-haul, out of network loads due to extreme capacity constraints.
  • Logistics conditions remain strained, with trucking demand exceeding availability and continued congestion at ports primarily due to increased volume of ships and containers. Clients are advised to provide expanded lead times on orders to help ensure delivery dates.

Markets

  • The U.S. reported 12,872 new COVID-19 cases and 240 deaths on Wednesday, with half of adults fully vaccinated. 
  • The CDC reiterated its guidance that fully vaccinated people do not need to wear face masks in most situations. 
  • Today, Michigan will unveil a lottery to award cash prizes and scholarships to vaccine recipients. 
  • After 15 months, both Maryland and Virginia ended their pandemic emergency orders Wednesday. 
  • The U.S. raised its travel warning for the United Arab Emirates to its highest level, citing a rise in cases of the COVID-19 Delta variant.
  • The White House indicated it will not require international visitors to be vaccinated against COVID-19, as the administration continues to mull the easing of travel restrictions. 
  • Roughly 47 million Americans are expected to travel for the Fourth of July holiday between July 1-5, with auto-travel volume expected to surpass the 2019 level and set new records. 
  • Moderna will continue testing its COVID-19 vaccine on new variants of the virus as they emerge.  
  • Citigroup is breaking with JPMorgan and Goldman Sachs by offering employees remote working arrangements beyond the pandemic. 
  • New York City officials adopted a $98.7 billion spending plan, the city’s largest budget ever, that reestablishes many services cut during the pandemic. 
  • First time jobless claims in the U.S. fell to 364,000 last week, 51,000 fewer than in the prior week and well below analyst estimates.  
  • U.S. private payrolls added a higher-than-expected 692,000 jobs in June as companies moved quickly to increase production amid a rapidly reopening economy. 
  • As labor shortages grip the food service industry, some sit-down restaurant chains are implementing new technology for ordering and payments, allowing customers a completely contactless experience
  • Nearly 20% of all jobs posted on ZipRecruiter in June offered a signing bonus, up from 2% in March, as traditionally lower-wage employers resort to significant perks to help bring back workers. 
  • U.S. pending home sales rose a higher-than-expected 8% in May as more homes were offered for sale. 
  • The U.S. housing market’s median monthly rent has returned to pre-pandemic levels across most of the country; however, prices are still down in the nation’s more expensive cities after remote workers relocated to smaller cities and suburbs. 
  • The Detroit automakers and the United Auto Workers union agreed to remove mask mandates for fully vaccinated workers on July 12. 
  • American aerospace manufacturer Relativity Space is moving its headquarters to a former Boeing facility in Long Beach, California, where it will host dozens of 3D printers to build fully reusable rockets.

International

Where the Delta Variant Is Gaining Ground
  • India reported 48,786 new COVID-19 cases and 1,005 deaths Thursday as the country experiences a reprieve from a devastating second wave of infections, with cases dropping by more than 75% in June and deaths falling more than 43%. 
  • The U.K. reported 26,068 new COVID-19 infections Wednesday, its highest daily total since January, while officials plan to start a booster shot campaign in September for vulnerable populations. 
  • Portugal reported 2,363 new COVID-19 infections yesterday, its biggest jump since February. 
  • France delayed the unwinding of some COVID-19 restrictions in the country’s southwest region, expecting a fourth wave of the virus by October. 
  • Finland will begin administering COVID-19 vaccine doses to children as young as 12
  • The Netherlands will introduce a digital COVID-19 passport today.  
  • Germany has now administered at least one dose of a COVID-19 vaccine to 55% of its population. 
  • Japan will extend pandemic lockdowns in greater Tokyo by another two weeks, with new COVID-19 infections in the city rising by 714 yesterday, the most in a month. 
  • South Korea will delay relaxing its COVID-19 restrictions in Seoul amid a recent spike in infections.
  • COVID-19 deaths in Mexico are expected to be 60% higher than the official count of 233,047, health officials predict. 
  • Just 1 in 10 people in Latin America are vaccinated against COVID-19.  
  • Life expectancy in Brazil declined an estimated 1.3 years in 2020, with an additional drop during the first few months of 2021. 
  • The World Bank will increase funding for COVID-19 vaccine purchases to $20 billion, up from $12 billion, with plans to invest $712 million for the production of Johnson & Johnson vaccines in South Africa. 
  • Tourism in Caribbean nations is starting to slowly rebound, with the Dominican Republic and the Bahamas both reporting upticks in travel as more Americans get vaccinated against COVID-19. 
  • The pandemic-induced drop in tourism is expected to further batter many economies in 2021:
2021 Is Set To Be Another Grim Year For Global Tourism

Our Operations

  • M. Holland will be closed Monday in observance of the July Fourth holiday. We wish all subscribers a safe and happy holiday weekend.
  • M. Holland’s 3D Printing group offers a rapid response alternative for producing selected parts where resin availability is tight during prevailing force majeure. For more information, email our 3D Printing team.
  • 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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