“Previous ‘all-time’ highs are completely irrelevant. It’s not ‘cheap’ because it is down 70%. Forget those prices happened.” – Bill Gurley, a general partner at venture capital firm Benchmark and one of Silicon Valley’s most respected dealmakers.
LOGISTICS
Maersk (Denmark) expects that the market disruptions that have driven record-high freight rates will continue through the end of the year. The company raised its full-year earnings before tax to around $37 billion, up 54% from an estimate of $24 billion at the beginning of the year.
Covid-19 restrictions are impacting cross-border truck transportation in China. The city of Shenzhen reduced the daily cross-border trucks from 3,500 to 1,500, according to UPS.
On Asia to North American routes, blank sailings remain all too common in the market, which carriers are pairing with the low spot rates and demand, said Flexport.
18 blank sailings have been reported for the Asia to Europe trade lane, representing a 14.8% reduction of normal capacity, said UPS.
From Asia to Europe there has been no peak season and demand has been slowing down. However, port congestion in Europe, particularly Hamburg and Rotterdam, has reached critical levels causing further delays and late return of vessels to Asia, said Flexport.
SUPPLY CHAIN IMPACTS
How The Bullwhip Effect Could End Inflation and Normalize Supply Chains
Could a slowdown in consumer spending and high inventory levels be the force that’s needed to right what’s gone wrong with supply chains? Read more
PODCAST
An Online Network for Tech Geeks
Where can you find a community of tech experts who discuss everything from from apps and computers to space exploration – and whose opinions you can trust?
In this podcast we hear from Lisa Laporte, CEO of TWiT.tv, a dedicated podcast network that is the go-to place for anyone with a passion for technology and innovation.
Here’s what you’ll learn:
- What differentiates TWiT.tv from the vast number of podcasts in typical podcast channels.
- The importance of having shows hosted by trusted experts.
- How TWiT.tv is bringing together its tech community with offline as well as online experiences.
MARKETS
The Bank of England has raised interest rates by 0.5 percentage points to 1.75%. Markets are now bracing for the BoE to push interest rates above 2.5% by the end of 2022, up from 1.75% currently.
- It expects inflation above 13% this year driven by surging gasoline prices.
MATERIALS SOURCING
Japanese Denim Finds Manufacturing Based Outside of Japan
Looking for an affordable place to produce its high quality denim, Kaihara considered many Southeast Asia countries. It was seeking a place that could meet Japanese quality standards, had a comprehensive domestic supply chain and access to reliable infrastructure. Read more
MATERIALS
Prices for fiber and yarns continued to soften this week on weaker demand.
Cotton prices remain fairly stable and are down about 35% from Q2 the record highs. But even though consumer demand is slowing, many factories feel that cotton yarn could be short-supplied in the current cotton season ending September 2022, which could drive up prices again.
WTI crude futures stabilized near $91 per barrel as the market faced more modest supply increases from OPEC+ against rising US crude inventories as American are driving less miles than in the summer of 2020, despite there being no pandemic restrictions now.
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