Archive for July, 2012

U.S. Container Imports Up 3.2% in June

July 31, 2012

As predicted by PIERS/JOC Economist Mario Moreno, U.S. container imports rose 3.2% in June; led by steady growth in furniture and auto parts, which contributed to an overall increase of 2.4% through the first half of 2012, according to data from PIERS.

This is in line with Moreno’s forecast of 4.1% full-year growth. Total U.S. imports in Q2, up 2.9%, and imports from Asia, up 2.7%, exceeded forecasts by 0.4% and 2.4% respectively. “Growth was modest at best,” Moreno said. “Trade with China was helped by declining import prices as the Renminbi began to lose value against the dollar. The outlook for containerized trade in the second half of the year continues to show downside risks as unemployment is stuck at +8%, and fiscal woes in Europe could escalate even more.”

Furniture continued to lead import volumes, up 7% in Q2, despite flat home sales year to date, Moreno noted. He cautioned that this momentum will not last if hiring remains stalled. However, manufacturers increased auto production, driving auto parts imports up 19%.

On the downside, demand for imported footwear continued the downtrend due to rising import prices and poor demand outlook. Footwear imports declined 18%.

More of Moreno’s trade and economic analysis can be found in his blog or by following him on Twitter @MarioMoreno_JoC.

Want to learn more about the details behind these container imports? PIERS solutions provide the support needed to accurately track vital trade intelligence around the world. Contact us today to have a PIERS solutions expert show you more.

Decreased Rain = Increased Food Prices

July 26, 2012

 

Brace yourself, 2013 will be the year of above normal food price inflation. Normal yearly inflation is about 2.8%, the USDA projects steady food price increases between 2.5 – 3.5% for the remainder of 2012.

The crippling drought that continues to have a firm grip on more than half of the country will cause an increase in food prices. The USDA states that milk, eggs, beef, poultry and pork prices will all be affected by the drought, which has pushed up prices for feed. Beef prices are expected to see the biggest jump at 4 – 5% and slightly lower increases for poultry, pork, milk and eggs into 2013.

The drought has recently sent the prices of corn, soybean and other commodities soaring (as stated in an earlier PIERS blog) as fields dry out and crops wither across much of the country’s midsection. Corn prices went from $572.88 per metric ton at the end of June to $814.30 a ton this week; soybeans $1,453.75 to $1,696.62; and wheat $702.63 a ton to $915.50. Since corn is used to fatten up livestock, some farmers are selling their stock rather than pay to feed them, while some meat companies are choosing another option – have corn imported from Brazil.

According to a recent Financial Times article citing PIERS data, “The situation – analogous to Saudi Arabia importing oil – underscores how anxious buyers of corn, particularly the livestock, poultry and ethanol industries, have become, as 88% of the domestic crop struggles in drought-hit regions… Records from PIERS, a ports database, show 2008 was the last year foreign bulk corn arrived on the U.S. mainland and then it was in the form of seeds, not animal feed.”

How will these raising food prices and depressed supply of corn and grain affect U.S. imports and exports of these commodities?  Register to learn more about how PIERS Data can show you the details behind every U.S. waterborne shipment in near real-time.

Will U.S. Import Increase This Fall

July 24, 2012

Imports normally build each year during the summer and fall months as retailers bring back-to-school merchandise and then holiday goods into the country. Technically, there has not been a traditional “Peak Season” for a few years due to the ongoing economic challenges that continue to occur. From significantly lower inventory levels, as mentioned in our blog last, relatively low retail sales growth, fluctuating fuel prices and high unemployment rates – things are light compared to the Peak Season build-up in previous seasons.

U.S. containerized imports gained 2.9% in the second quarter, led by year-over-year increases in furniture, auto parts, bananas and electronics, PIERS data show. The first half of the year, U.S. containerized imports were up 2.4%, with increases of 3.2% in June. Journal of Commerce and PIERS Economist, Mario O. Moreno, said imports from China were aided by declining prices as the Renminbi’s value decreased against the dollar. Overall increases in the second half of the year will be held down by continuing high U.S. unemployment and the European economic crisis; he forecasts a full-year increase of 4.1%.

As these events unfold, freight volumes and activity remain in a holding pattern with flat or low growth throughout the majority of domestic and global freight transportation modes. For JOC subscribers, the graphic above provides valuable insights into trends in the transportation sector for all modes of transportation.

More of Moreno’s trade and economic analysis can be found in his blog or by following him on Twitter @MarioMoreno_JoC.

For FREE, instant access to details on U.S. import shipments, register online for PIERS TI Basic.

Dry Skies and Extreme Heat Threaten U.S. Corn Crop

July 20, 2012

The U.S. is the world’s largest producer of field corn. Oppressive heat and a worsening drought in the Midwest region where corn is the predominant crop, has pushed prices near records as crops baked, burned and wilted. Concerns are growing about food and fuel inflation as drought conditions now extend over more than 60% of the lower 48 states, with no ending in sight. Crops are likely to continue to be stressed by frequent episodes of near-100-degree temperatures and limited rainfall moving forward through the middle of August. Corn prices have jumped more than 50 percent in the last month as the crop wilted in many locations during its key growth stage of pollination.

There also is a direct link between corn and ethanol prices which is exacerbated by the Renewable Fuel Standard (RFS) program regulations, which increases the volume of renewable fuel required to be blended into transportation from 9 billion gallons in 2008 to 36 billion gallons by 2022. On Wednesday, U.S. Agriculture Secretary Tom Vilsack said the situation wasn’t bad enough to warrant a reduction in government mandates for how much ethanol is blended into gasoline.

What’s next as temperatures remain high and rain clouds remain scarce? The future of this year’s soybean crop. Soy prices are on the rise as the same hot, dry weather chokes soy’s future as well. Soybeans are grown in many of the same regions across the U.S. as corn, but the key growing phase for soybeans does not start until later in the summer.

Only 40% of the nation’s corn and soybeans were in good or excellent condition at the beginning of this month, the lowest for that date since 1988 according to government data. The implications for the world food system of U.S. crop losses are massive. The United States exports more than half of all corn shipped worldwide and is a major supplier of soybeans to China. PIERS solutions provides the support needed to accurately track specific commodities, such as corn and soybean.

Transporting perishable cargo? PIERS has been a long time expert in reefer data, including temperature and humidity settings!

Contact us today to have a PIERS solutions expert show you more.

NJ Targets Foreign Investment

July 17, 2012

Lieutenant Governor of New Jersey, Kim Guadagno, recently announced the Christie Administration’s new Office of International Business Development and Protocol for the State of New Jersey. The new office will leverage the state’s advantages in these areas to attract foreign investment, expand New Jersey’s partner network to improve lead development, and increase export opportunities for New Jersey’s businesses.

“As foreign companies consider investing beyond their home countries, they look to business-friendly environments with diverse business communities,” Guadagno said in a statement. “From our highly educated workforce and thriving industry clusters to our world-class intermodal transportation system supporting a gateway to international markets, New Jersey is well positioned to promote our assets, increase foreign direct investment and increase opportunities for New Jersey businesses to maximize exports”.

The Christie Administration has been working to increase foreign direct investment and succeeded in attracting 21 new foreign investment projects .The office will work to attract foreign companies to invest in the state, concentrating its outreach efforts on New Jersey’s top investor nations – Germany, Switzerland, Japan, France, the United Kingdom, the Netherlands, and Canada – and countries where New Jersey enjoys rich relationships, such as Taiwan, India, Korea and Israel.

New Jersey remains a premier east coast distribution location, midway between Boston and Washington D.C. The New York-New Jersey metropolitan area is one of the largest most affluent consumer markets in the world. One important reason for this is its strong maritime, rail, aviation and highway transportation network. Strategically located at the heart of the mid-Atlantic corridor, the region offers efficient access to millions of consumers in a single day. It’s maritime and transportation facilities rank among the largest and most productive in the nation.

Conveniently reaching a population base of over 33,000,000 people with access to all modes of transportation; NJ Turnpike, Routes 1 and 9, Newark International Airport plus LaGuardia and JFK in New York, and multiple rail options: Canadian Pacific Railway, CSX  and Norfolk Southern in the northern half of the state; Winchester and Western Railroad and West Jersey Railroad both connect to the Conrail System providing linkage to interstate destinations.

The freight railroads play a vital role in moving goods to and from the State’s ports – about 15 percent of the Port of New York and New Jersey’s containers currently move by rail, a modal share that is anticipated to increase when the new class of post-Panamax vessels begins serving the Port.

New Jersey may be small in size but it currently boasts five Foreign Trade Zones within the state with pharmaceutical firms, food distributors, auto-makers, and oil companies currently taking advantage of Foreign Trade Zone status at the Port of New York and New Jersey.

 

Companies operating in a Foreign Trade Zone (FTZ) pay no duties on merchandise imported for manufacturing or assembling, when the final product is exported outside of the United States. Duties are only paid when these products leave the zone for the domestic market. In addition, there are no duties paid on merchandise shipped from one FTZ to another.

Interested in identifying importers and exporters in New Jersey? Use PIERS data to determine ship lines, ports, terminals, trade lanes, shippers, specific commodities and more. Visit PIERS to find the solution that’s right for you.

Florida…Ready, Willing and Able

July 12, 2012

Port cities along the Eastern seaboard are eagerly anticipating the increased logistics business expected in 2014.

The Panama Canal expansion, schedule for completion in 2014, will be a game-changer for world trade (as stated in an earlier PIERS blog); especially for coastal areas, such as Florida, that can dredge their ports deep enough to hold the megaships and then efficiently transport their freight by land to other U.S. regions.

Ports along the west coast are feeling the threat of the expanded canal. It costs much less to move cargo by ship directly to the eastern seaboard ports that serve some 60% of the U.S. population. One edge the west coast ports have, besides their tremendous size, is that train transshipment across the country potentially saves one week of time.

Large “post-Panamax” freighters will pass through the canal and deliver freight direct to the eastern seaboard of the United States. This expansion presents an enormous opportunity for the state of Florida to emerge as a major import and export state as well a national distribution center.

The expansion will bring a new wave of cargo business to South Florida!

How will you prepare for the altered pattern of trade? Use PIERS data to identify which ship lines, ports, terminals and trade lanes are being used and so much more. Visit PIERS to find the solution that’s right for you.

Wind Powered Cargo Ships?

July 10, 2012

Eco-friendly shipping is on the rise! Development is underway to design the modern world’s first 100% fossil fuel free sailing cargo ships. A design concept for a cargo ship has been created and currently a full-scale demonstration vessel has already been started. With rising fossil fuel costs and the global challenge of reducing greenhouse gas emissions, this project is set to change the shipping industry by providing efficient and affordable low-carbon shipping. 60% of the power will come from wind and the rest from engines that are powered by waste derived bio-gas. If it proves successful, the new B9 cargo ship could usher in a new era of fossil fuel–free technology.

Diane Gilpin, Director of B9 Shipping, says: “We are designing B9 Ships holistically as super-efficient new builds transferring technology from offshore yacht racing combined with the most advanced commercial naval architecture. We’re combining proven technologies in a novel way to develop ‘ready-to-go’ future-proof and 100% fossil fuel free ships.”

During the recent financial crisis, container ships began slow steaming (SS) and super slow steaming (SSS) on lines operating vessels on long routes at several knots below top speed in order to save on fuel. Another trend is megaships which allows for an increased number of TEUs per ship at reduced costs and less emissions. The next logical ship is a fossil-fuel free vessel.

From conceptual to environmentally safe seas in the near future!

The Big Bang! Commodity Tracking at Your Fingertips

July 3, 2012

Fireworks and the Fourth of July go together like global trade and PIERS Data! They are an important part of the celebration; it just wouldn’t be the same without the dazzling display.

It is believed that between 600 and 900 A.D. that Chinese alchemists unwittingly created an early form of gunpowder; first stuffing into bamboo stalks and then evolving into paper tubes. By the 13th century, gunpowder samples began trickling into Europe where fireworks became increasingly popular first to commemorate military victories and later to enhance public celebrations and ceremonies. It was in the 1830s that Italy became famous for their elaborate and colorful displays, being the first to incorporate trace amounts of metals and other additives to create multi-hued sparks and sunbursts!

Simple physics and chemistry, fireworks get their colors from the different temperatures of hot, glowing metals and from the light emitted by burning chemical compounds. Let’s breakdown the average fire work by the elements that create its “design”:
 
 
Antimony – Antimony is used to create firework glitter effects.

Barium – Barium is used to create green colors in fireworks.

Copper – Copper compounds produce blue colors in fireworks.

Lithium – Lithium is a metal that is used to impart a red color to fireworks.

Magnesium – Magnesium burns a very bright white.

Phosphorus – Phosphorus is responsible for some glow-in-the-dark effects.

Sodium – Sodium imparts a gold or yellow color to fireworks.

Zinc – Zinc is used to create smoke effects for fireworks.

PIERS StatsPlus Data, 2009-2010
PIERS StatsPlus Data, 2009-2010

 
Using PIERS StatsPlus, we are able to see that China continues to dominate the U.S. fireworks market with 93.7% market share in 2010. Germany’s 50.9% year-over-year growth from 2009 to 2010 is astonishing and seems to come at the expense of China which actually lost declined 8.5% over the same period. Value, growth percentage and market share with the click of a button!

PIERS solutions provide the support needed to accurately track vital information in global industries by helping to identify emerging supply trends. Contact us today to have a PIERS solutions expert show you more.


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