Daily briefing - Molecule shortages

And the cost of going green

First and foremost, Goldman veteran article is not only interesting, but me being smug and smirking, because, if the reader takes a couple of hours to read all my other posts, you will find that I have been talking about this same issue for months. I am glad “the experts” are catching up. Also, it is another marker/signal.

As I warned many times, both in any post with Green on it’s title or a bunch of Daily Briefings and other ones, countries won’t collapse themselves even if their virtue signaling elites pressure them. While France insists on turning it’s own nuclear plants, they would go back and find another way, either gas or most likely, coal.

Also another point I have raised a few times before, countries might start subsiding their energy costs, because no complex system can survive the EROI equation, which will affect their economy more. It’s a hard loop to get out.

I recently shared an article ( last one in this post, about protein insecurity) about energy, and food costs and civil unrest, something I have talked about, here is another good article about it, read the entire thing but here a screenshot.

To bring the point I have been saying for weeks, lower yield in crops the last few months almost everywhere, high energy costs, China buying literally half of the world’s grain, all the other variables, and we have a food inflation that didn’t reach its peak, nor it will soon enough. You can expect food to get more expensive until 2023, maybe 2024.

A good article by the New York Times ( you can read the archive here ), it explains quite decently, why the current model came to such a level of dysfunction, another angle of why warehouses lack space. It’s not merely they run lean, there is currently a lack of manpower in all stages of shipping, plus scarcity of raw materials, plus energy woes, governmental ineptitude. I said months ago there was no feasible way to solve the logistical mess in 2022.

”Experts” once again catch up and wake up to the reality that it will require new strategic thinking, realignment of allies and supply chain, huge investments. As someone else put, Just in Time will become Just in Case and everyone will now carry more inventory as a hedge against any disruption. Good choice, even though extremely expensive in the near future.

Another one of “told you so”, China keeps using their (fake) Zero Covid policy as a hybrid war instrument to hurt the rest of the entire planet. Declaring lockdown on a region that is a big producer of aluminum… something that has been “scarce” for a few months now.

The problem with doing my style of analysis and forecasting is, I will often sound like an asshole, or just repeat myself to make a point. Need to work a way around this, yet it is efficient to make a few statements.

Alas we wait, as I mentioned before, everything will start to move (and probably cascade and fracture a little from pressure), when the Chinese New Year ends and things start moving. Fast. By the end of February we might have a clear picture and possible pathways mapped out until the end of Q2, I expect merely the solidification of prior trends in regard to China and logistics… and every single shortage.

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Goldman Commodity Veteran Says He’s Never Seen a Market Like It

Jeff Currie, the closely-followed head of commodities research at Goldman Sachs Group Inc., says he’s never seen commodity markets pricing in the shortages they are right now. 

“I’ve been doing this 30 years and I’ve never seen markets like this,” Currie said in a Bloomberg TV interview. “This is a molecule crisis. We’re out of everything, I don’t care if it’s oil, gas, coal, copper, aluminum, you name it we’re out of it.”

France Coal-Fired Power Plants Get Short-Term Right to Burn More

France is temporarily allowing electricity producers to burn more coal after the nation’s grid operator warned of possible power shortages.

Italy’s Government Readies New Energy Package to Curb Bills

Italy is working on a new aid package worth several billion euros to soften the blow of soaring energy prices on families and companies, and Prime Minister Mario Draghi is resisting pressure from parties to finance it by expanding the deficit, according to people familiar with the matter.

GB News @GBNEWS

‘When the chairman of Tesco says something it really matters because it’s Britain’s biggest supermarket’ Paul Hawkins discusses Tesco Chairman John Allan has saying the ‘worst is yet to come’ in the cost of living crisis. 📺Freeview 236, Sky 515, Virgin 626 📻DAB+

Worst of Food Price Inflation Yet to Come, Tesco Chairman Says

Food price inflation could rise as much as 5% in the spring, exacerbating the U.K.’s growing cost-of-living crisis, according to the chairman of the country’s biggest supermarket chain. 

A Normal Supply Chain? It’s ‘Unlikely’ in 2022.

• The chaos at ports, warehouses and retailers will probably persist through the year, and perhaps even longer.

With the havoc at ports showing no signs of abating and prices for a vast array of goods still rising, the world is absorbing a troubling realization: Time alone will not solve the Great Supply Chain Disruption.

It will require investment, technology and a refashioning of the incentives at play across global business. It will take more ships, additional warehouses and an influx of truck drivers, none of which can be conjured quickly or cheaply. Many months, and perhaps years, are likely to transpire before the chaos subsides.

“It’s unlikely to happen in 2022,” said Phil Levy, chief economist at Flexport, a freight forwarding company based in San Francisco. “My crystal ball gets murky further out.”

For those who keep tabs on the global supply chain, the very concept of a return to normalcy has given way to a begrudging acceptance that a new normal may be unfolding.

Cheap and reliable shipping may no longer be taken as a given, forcing manufacturers to move production closer to customers. After decades of reliance on lean warehouses and online systems that monitor inventory and summon goods as needed — a boon to shareholders — manufacturers may revert to a more prudent focus on extra capacity.

BNO Newsroom @BNODesk

Chinese officials confirm fast-spreading coronavirus outbreak in Baise involves the Omicron variant, The city of 4 million is on full lockdown and sealed off.

Aluminium output stable in China's Baise amid lockdown but logistics under pressure

Aluminium production in the southwest Chinese city of Baise, which has gone into lockdown after recent COVID-19 outbreaks, remains stable though transportation disruptions are starting to weigh, the local industry association said on Tuesday.

The city on China's border with Vietnam in the Guangxi region has an annual aluminium production capacity of nearly 2.2 million tonnes, or some 5per cent of China's total. It also possesses around 9.6 million tonnes of alumina capacity.