COVID-19 Bulletin: June 8

June 8, 2021 • Posted in COVID-19

Hello,

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Supply

  • The WTI price briefly hit $70/bbl yesterday for the first time since October 2018 before settling to close at $69.23/bbl. Energy futures were higher in mid-day trading today, with the WTI up 0.6% at $69.61/bbl, Brent up 0.4% at $71.78/bbl and natural gas up 3.4% at $3.17/MMBtu. 
  • Many options traders are betting that oil prices make it to $100/bbl by the end of next year. 
  • Oil inventories in developed nations fell by 160 million barrels in April from a year ago, a sign that efforts by OPEC producers to support the market are succeeding. 
  • Renewables were the only energy source whose consumption rose in 2020 amid a record decline of overall energy consumption in the U.S.
  • The U.S. Transportation Department’s pipeline regulator sent an advisory bulletin to pipeline operators urging them to comply with the PIPES Act, a law signed late last year to curb the release of methane gas by natural gas pipelines and transmission systems. 
  • The pandemic mitigated carbon pollution only briefly, as global atmospheric carbon dioxide hit an all-time high in May. 
  • Our most recent list of force majeure and allocation announcements from suppliers is here. 

Supply Chain

  • A service disruption this morning at Fastly, a behind-the-scenes content delivery network, shut down many prominent websites and briefly sent futures prices dipping in pre-market trading.  
  • A record-breaking heatwave has put roughly 24 million people from Montana to Texas to New England under heat advisories. 
  • The wildfire season is beginning, with a fire in Arizona spreading to more than 60,000 acres yesterday and logistics managers in California preparing supply chains for what is expected to be a worse wildfire season than in record-breaking 2020. 
  • The COVID-19 outbreak in Taiwan continues to spread among chip manufacturers, with one company expecting June production to decline by 35%, while a subsidiary of Foxconn temporarily suspended operations
  • Despite the recent outbreaks, Goldman Sachs is predicting that the global chip shortage will diminish in the second half of 2021. 
  • Commodities prices continue their rise, with prices for lumber, iron ore and copper hitting fresh records, while corn, soybeans and wheat have hit their highest levels in eight years. 
  • The commodity price surge comes after producers slashed capital spending by nearly half over the last decade, leaving them unprepared for the pandemic recovery. 
  • Cost still trumps proximity for supply chain managers of major companies deciding whether to re-shore production.  
  • Marginally viable ship operators were hit hard by the pandemic, causing a more than doubling of ship abandonments in 2020 versus 2019 to a record-high 85. 
  • Texas lawmakers passed new measures requiring power plants to ensure their fleets can function during extreme cold snaps after February’s winter storm wreaked havoc on the state’s power grid. 
  • 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 15,496 new COVID-19 cases and 324 deaths Monday. More than 302 million vaccine doses have been administered, with 42.6% of the population fully vaccinated. The country is administering under 1 million shots per day, down by more than two-thirds from the April peak, putting at risk the White House’s goal of administering shots to at least 70% of the population by July 4. 
  • Roughly half of the U.S. supply of Johnson & Johnson’s single-shot COVID-19 vaccine remains unused as people opt for alternatives on concerns about rare blood clots linked to the jabs. 
  • New York will lift all remaining COVID-19 restrictions when 70% of the state’s adult population receives at least one vaccine dose. The Big Apple plans to celebrate the city’s reopening with a large Central Park concert in August. 
  • California’s seven-day COVID-19 case rate per 100,000 people stands around 11, among the lowest in the country
  • South Carolina has ended its pandemic state of emergency. 
  • Texas businesses that require COVID-19 vaccinations will be denied state contracts and potentially lose their operating licenses under new legislation signed into law yesterday. 
  • Hawaii announced plans to resume interisland travel, removing all testing and quarantine restrictions beginning June 15. 
  • Carnival Cruise Line has confirmed plans to resume sailing operations in the U.S. for fully vaccinated people starting in July. 
  • A new study shows how the Alpha variant of COVID-19 first identified in the U.K. became the dominant variant in the U.S. through its ability to disable the body’s first line of immune defense, providing the strain more time to multiply. 
  • The pandemic freeze on student loan payments is set to expire on Oct. 1, requiring more than 40 million borrowers to restart their monthly installments, potentially causing a delay in the post-pandemic consumer recovery.
  • Job openings in the U.S. soared to a record 9.3 million in May, double the level of the pandemic low and 1 million higher than in April as employers struggled to fill openings and employees were quick to change jobs.
  • A new survey shows that employers in the financial-services industry expect 61% of staff to be back in offices by the end of September, up from 50% in March. 
  • More than a million federal government workers are expected to be back in the office by July 19. 
  • Many companies are relaxing dress codes to ease the return to offices, leading fashion brands and retailers to adjust their product designs and offerings.  
  • United Auto Workers members at a Volvo Trucks plant in Virginia resumed a strike Monday following failed contract negotiations over wages and contract language. 
  • Tesla has cancelled plans to build the Model S Plaid+, a longer-range version of its high-end sedan, prompting speculation over the company’s plan to produce a larger, more energy-dense battery. 
  • General Motors’ autonomous vehicle arm has been given the green light to begin driverless vehicle testing with passengers in California. 
  • A new study from the Pew Research Center shows that 47% of U.S. adults prefer phasing out production of gasoline-powered vehicles in favor of electric vehicles, while 51% oppose the idea. 
  • Golfers played over 500 million rounds last year, the most in 15 years, prompting a spate of new apps and devices for the game.

International

  • Over 2 billion COVID-19 vaccine doses have been administered globally since they were introduced just six months ago.  
  • India recorded 86,498 new COVID-19 cases and 2,123 deaths yesterday. 
  • Indian doctors have linked the pervasive Delta variant of COVID-19 to hearing impairment, severe stomach upsets and even gangrene, leading some to believe the strain could increase hospitalizations. 
  • Brazil, with the third-highest COVID-19 infection rate in the world behind the U.S. and India, continues to struggle to control the pandemic, recording over 1.8 million infections and nearly 54,000 fatalities over the past month. 
  • Canada is set to ease border restrictions, which currently include strict testing and two-week quarantine requirements, for people fully vaccinated against COVID-19. After hitting a COVID-19 vaccination rate of 60% ahead of schedule, the province of Ontario will begin easing pandemic restrictions three days early on June 11, increasing capacity limits on indoor and outdoor dining as well as retail. 
  • New Zealand has recorded 100 days without community transmission of COVID-19, a record. 
  • Citing improved availability of COVID-19 vaccines, Germany’s health ministry is expecting roughly 80% of its adult population to be fully vaccinated by mid-July. 
  • The U.K. reported more than 5,600 new COVID-19 cases Monday. 
  • The World Health Organization is urging G20 countries to boost contributions to the COVAX vaccine-sharing initiative. The agency is also scouting potential manufacturing sites in Africa to increase inoculations on the continent, a bid to reduce vaccine inequality between rich and poor nations that has created a “two-track” pandemic. 
  • Uganda has ordered a six-week lockdown due to rising COVID-19 infections. 
  • A new report from Reuters shows that over 173 million people have been infected with COVID-19 throughout the world while more than 3.8 million have died, with infections reported in over 210 countries and territories since December 2019. 
  • Moderna is formally seeking both European and Canadian approval for its COVID-19 vaccine for use within adolescents. 
  • Tight supply and increased demand have stymied Thailand’s rollout of its locally made AstraZeneca COVID-19 vaccine.
  • China is hoping to have 70% of its “target population” vaccinated against COVID-19 by the end of the year. 
  • With an unstable political climate and the pandemic taking a toll on the city’s economy, Hong Kong is facing an exodus of multinational companies considering relocating to Singapore and Shanghai, aiming to profit from China’s vast economy. 
  • Fueled by strong global demand and rising commodity prices, China’s exports grew 28% in May from a year earlier while imports soared 51.1%. 
  • German industrial output unexpectedly fell 1% from March to April, a result of continued supply bottlenecks and shortages of timber and semiconductor chips. 
  • The Eurozone economy saw a smaller-than-expected contraction in the first quarter, just 0.3% quarter on quarter and 1.3% year on year, as increased inventories and investment offset reduced consumer spending. 
  • Japan’s economy shrank at an annualized rate of 3.9% in the first quarter, a smaller-than-expected contraction as the country shows mixed signals of a broad economic recovery. 
  • British retail sales saw their highest growth of the pandemic in May, up 10% over the same time in 2019. 
  • Airlines have issued a joint plea to the U.S. and the U.K. to lift restrictions on air travel between the two countries. 
  • Traffic in major European cities reached 2019 levels last week for the first time during the pandemic.  
  • Electric vehicle sales in Germany surged in May, capturing a 23.4% market share compared to just 7.3% the same time last year. 
  • Airbus delivered 50 airplanes in May, up 38% from the same period last year. 
  • A new trial program in the U.K. allows owners of the Nissan Leaf, the only electric vehicle with vehicle-to-grid connectivity, to register their cars as energy storage devices to help balance the power grid when the cars are not in use. 
  • The EU announced plans to establish a $21 billion Just Transition Fund to help fossil fuel-reliant economies in the bloc move to greener energy. 
  • In their pursuit of a low-carbon economy, roughly 80% of multinational companies surveyed plan to cull “slow-to-transition suppliers” in favor of those who can help them meet sustainability goals. 
  • A U.K. architecture firm has announced plans to build a luxury floating hotel made from recycled ocean plastic off Australia’s western coast. 

Our Operations

  • 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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