Good Afternoon,
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Supply
- Following today’s OPEC+ meeting, where members agreed to lift their production ceiling by 75,000 bpd, Saudi Arabia announced it will voluntarily cut its production by 1 million bpd in February and March. News sent oil prices sharply higher in mid-day trading, with the WTI up 5.0% at $49.99/bbl and Brent up 5.0% at 53.65/bbl. Natural gas was 3.8% higher at $2.68/MMBtu.
- Saudi Arabia and Russia disagreed Monday over whether OPEC+ should boost crude output amid rising global COVID-19 infections, with a second meeting scheduled Tuesday to iron out internal divisions.
- Japan’s largest steelmaker announced plans to gradually replace coal-fired furnaces with hydrogen technology as part of a 30-year net-zero carbon emissions timeline.
- Shell is closing its Convent, Louisiana, refinery as part of its plan to reduce carbon emissions, impacting 700 employees.
Supply Chain
- Container freight rates from Asia to the U.S. are soaring as severe congestion clogs the ports of Los Angeles and Long Beach.
- European freight forwarders are rejecting U.K. deliveries over fears of post-Brexit border chaos that could prevent shippers from returning with a backload or delay drivers with long lines at new customs checks. Spot shipping rates from France to the U.K. quadrupled last week.
- The U.S. Postal Service continues to report delivery delays of up to several weeks, a result of unprecedented amounts of volume led by a boom in online commerce.
- Amazon purchased seven passenger jets to be converted into freighters ahead of a new $1.5 billion air cargo hub opening at the Cincinnati/Northern Kentucky International Airport.
- With omnichannel shopping increasing 50% last year and likely persisting beyond 2021, Nielsen data shows that grocers and retailers must increasingly adopt an online presence as an essential business component.
- Truck maker Hino has suspended operations potentially until October after failing to meet tightened CO2 and greenhouse gas emissions standards for heavy trucks.
- 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 180,477 new COVID-19 cases in the U.S. yesterday and 1,903 fatalities.
- U.S. COVID-19 deaths rose 16.5% last week to 1 in every 930 citizens.
- U.S. COVID-19 hospitalizations topped 128,000 yesterday, a record, after more than 2,800 new patients were added in a single day. Rising hospitalizations continue to strain the healthcare system, with more and more hospitals treating patients in hallways and waiting rooms after reaching capacity.
- California recorded more than 74,000 new COVID-19 cases yesterday, an 11% increase over the prior daily record set on Dec. 28.
- In Los Angeles County, where COVID-19 hospitalizations are up over 900% since early November, ambulance crews were told not to transport patients with low risk of survival to hospitals and to minimize the use of scarce oxygen.
- COVID-19 hospitalizations in Texas reached 12,563 yesterday, a record.
- Moderna raised its forecast for COVID-19 vaccine production from 500 to 600 million doses in 2021, with 200 million doses slated for the U.S. and at least 40 million headed to Canada.
- The FDA dismissed proposals to administer only a single dose of the Moderna and Pfizer/BioNTech vaccines in order to double the available supply pending testing results confirming a single dose can be effective.
- A Texas Congresswoman tested positive for COVID-19 yesterday after receiving the first of two Pfizer/BioNTech vaccine doses in December.
- New York hospitals could be fined as much as $100,000 if they don’t administer vaccine doses within a week of getting them, as the state’s vaccine utilization rate fell to 54%, data shows. The state also reported its first known case of a COVID-19 patient infected with a highly contagious virus strain.
- Manufacturing companies contracted to produce hundreds of millions of COVID-19 vaccine doses are struggling to find enough staff to meet this year’s production push.
- The U.S. could see an elevated mortality rate for more than a decade due to long-term economic effects of the pandemic, researchers estimate.
- Christmas and New Year’s travel set a new pandemic high last weekend, with more than 1.3 million people traveling though U.S. airports Sunday.
- The head of the Chicago Federal Reserve bank expects super-easy monetary policies, including record low interest rates, to persist in 2021 even as vaccines bring the pandemic under control.
- The U.S. automobile industry is poised for a strong rebound in 2021 after vehicle sales fell 15% last year, interrupting an unprecedented decade of growth.
- 3D printing is penetrating operating rooms: Israeli doctors performed the first ever augmented reality, three-dimensional eye surgery, where a 3D printer was used to recreate a man’s damaged eye socket.
International
- European governments, notably the U.K., Scotland, France, Germany and Greece, are once again extending lockdowns and restrictions to contain rising COVID-19 infections.
- Japanese officials are considering declaring a state of emergency in the greater Tokyo region after the nation reached a record of more than 4,000 daily COVID-19 cases.
- Hong Kong is extending school closures until mid-February alongside strict social distancing measures after 53 untraceable COVID-19 cases were discovered in recent days. The city-state faces an uneven economic recovery in 2021, economists warn.
- Thailand reported 745 new coronavirus cases Monday as officials imposed fresh curbs to stop transmissions in the nation’s most populous areas, including Bangkok.
- Vietnamese officials are mulling a plan to suspend all flights from countries that have discovered the highly contagious COVID-19 strain first discovered in the U.K.
- Masks are mandatory in Sydney, Australia, after several virus clusters were discovered during Australia’s peak summer holiday period.
- France’s president is under criticism about the slow pace of the nation’s initial COVID-19 vaccine rollout, aggravated by a population that is among the world’s most hesitant to receive shots. In response, the nation’s health minister announced accelerated vaccinations for hospital medical staff.
- South Korea’s population decreased for the first time in 2020, led by a low number of births resulting from job losses and delayed marriages during the pandemic.
- Big businesses in South Africa are considering funding the government’s acquisition of COVID-19 vaccines as the virus threatens to destabilize Africa’s most industrialized economy.
- U.K. scientists expressed worries yesterday that current vaccines may not be effective against a recently discovered and highly infectious virus mutation discovered in South Africa.
- The world’s major economies face $13 trillion in maturing debt this year, a 51% increase in debt rollovers compared with 2020.
- American, Asian and European factories all boosted their output in the closing stretch of 2020, led by a rise in new orders and a revival in trade despite spreading COVID-19 infections:
- China finished the year with 10 consecutive months of expansion in the manufacturing sector.
- IHS Markit’s purchasing managers index for the U.S. saw the largest month-over-month improvement since September 2014.
- Index numbers in Europe continued to indicate growth but fell slightly short of expectations.
- Canadian factory activity expanded at its fastest pace on record.
- South Korean exports rose 12.6% in December from the year-ago period.
- A record 13% of Hong Kong apartments sold in 2019 were less than two parking spaces in square footage, an increasing necessity for residents of the world’s least affordable housing market.
- Home prices in Singapore rose to their highest level in two years on record low interest rates and a better-than-expected economic recovery.
- Global tourism collapsed in 2020 to a level not seen in three decades:
- Brexit has already affected the finance industry, with a large chunk of European stock trading moving from London to venues in Amsterdam, Paris and other cities on the first trading day of the new year.
- Shareholders approved Fiat Chrysler’s $52 billion plan to merge with Peugeot maker PSA, creating the world’s fourth largest auto group that will be renamed Stellantis.
- Canadian auto supplier Magna International will develop an advanced driver assistance system with Fisker for use in SUV models to be launched in 2022.
- Electric vehicles comprised 54% of new car sales in Norway last year.
Our Operations
- As we enter a new year, our President and CEO shared this message and video with our Mployees and business partners.
- 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.
- To access 3D Printing training, order parts and seek technical assistance, visit our online resource.
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.