Good evening, ladies and gentlemen. As the old order is being almost laid to rest, opportunities to try to mitigate risk and forecast change arises. Among other types of opportunities.
Give that at this point, there is not one “expert” or specialized news outlet sing the same tune, the supply chain chaos will last until the end of Q2 for the optimists, 2022 for the realists, 2023-2024 for the pessimists, the Charleston congestion is a good marke to keep in your mind. Also interesting that this is a modernization and they kept things low tech. A lot of industry still keeps it low tech, with the facade of management and high-tech.
I really gotta indulge in some laughter on how Green energy is so sustainable, ready to scale and ready they need the government to stay afloat. Another vector for… exciting ideas. Another big irony is that, for green energy to go forward they will cooper, which will need to go nuclear because of misguided regulation and the elite’s utopic desire for a clean energy earth.
Also intriguing that the fate of energy and by cascade effects raw material/metals markets tied to the incompetence of two countries. Germany, undermining the entire EU because Russia is one of their biggest trade partners. And France, because of Macron, but being realistic also because of the state of their internal market, regulations and how the french insulate and heat their homes.
Besides the Alcoa news below, the most important news today is the Brazil one. One of the world's biggest producers and suppliers of food, now see a sizable drop in its soy crops. As I mentioned months ago, and many times here on Substack. That drop will have some ramification, a further drop will have cascade effects, and may create a tipping point. Last year their corn crops already faced some challenges, and as the article tells the reader at the end.
Nature dictates the outcome. And it won’t be the one most expect for the next 24 months.
Race to Measure Supply Chain Snarls Draws a Crowded Field
The race to design economic indicators tracking the ups and downs of global supply disruptions is becoming a more crowded field.
Jumping in this month were logistics giant Kuehne+Nagel, economists at Citigroup and Morgan Stanley, and researchers at the New York Fed. Analysts at Bloomberg, Flexport and the White House have already launched such data points and are making refinements as the crisis drags on.
Bloomberg Chief Economist Tom Orlik explained that such barometers are in higher demand because gauging the health of supply chains before the pandemic was largely confined to trade and industrial organization experts. Now the broader outlook for the global economy hinges on whether supply bottlenecks loosen soon.
The New York Fed launched its pressure gauge this month
Kuehne+Nagel just published its Seaexplorer disruption indicator
Flexport has developed the Logistics Pressure Matrix
The Kiel Institute for the World Economy’s updates its Trade Indicator twice a month
The White house is monitoring a dashboard, too.
Josh Brazil, vice president of supply-chain data insights at logistics intelligence firm project44, said that even before the pandemic and the supply crisis, there was a big need for better visibility across supply chains and digitizing horse-and-buggy practices.
“For decades the industry has been heavily reliant on manual processes, telephone calls, faxes and emails, to communicate everything from documents to shipment statuses,” Brazil said. “Once the pandemic hit, everyone who carried out those manual processes went into lockdown and all of a sudden there was no way to communicate for a large swath of the supply chain.”1
Charleston port congestion could take six weeks to clear
Officials are warning that the queue of 15 container ships waiting to berth at Charleston likely will not be cleared for up to six weeks due to a backlog of more than 25,000 containers at the terminal. 2
Receding imports to ease US port congestion, but not until late 2022
Inflation, higher interest rates, and a gradual shift back to a more “normal” balance in consumer spending between goods and services will reduce import volumes in the second half of 2022, in turn relieving pressure on ports and inland supply chains. (Same source as above)
French Nuclear Giant’s Fall Risks Energy Security for All Europe
EDF’s reactors are set to generate the least power in decades
Neighbors can no longer depend on French power exports
The long decline of Electricite de France SA isn’t only a political crisis for the government in Paris, it’s a growing economic threat for much of Europe.
The giant nuclear operator, once a source of national pride and reliable low-cost electricity, has become a nightmare for investors and an increasingly wobbly pillar of regional energy security. Technical problems at some of its largest reactors mean EDF is set to produce the smallest amount of atomic power in three decades, slashing France’s exports to neighboring countries. 3
Germany cries foul over nuclear energy in EU's green investment rule book
Going Green Must Include Nuclear for EU’s Largest Copper Plant
Surging emission costs push industrials to nuclear, KGHM says
Poland’s biggest energy consumer to be self-sufficient by 2050
Surging electricity prices and ever-tighter European Union emission norms are pushing the bloc’s industrial producers toward nuclear power, according to the company that operates the continent’s biggest copper mine.
KGHM Polska Miedz SA is particularly vulnerable as the biggest consumer of Poland’s overwhelmingly coal-based electricity, and plans to introduce nuclear power into its energy mix this decade, Chief Executive Officer Marcin Chludzinski said in an interview. 5
Clean-Power Developers Warn Billions at Risk in Plea to Congress
“Each month of delay means an estimated $2 billion in lost economic activity,” the more than 260 companies said in a letter to Senate Majority Leader Chuck Schumer and House Speaker Nancy Pelosi. “The clean energy initiatives represent a once-in-a-generation opportunity for Congress to take big, bold action to deliver the clean energy future Americans want and deserve.”6
Brazil drops soybeans production estimates
Brazilian soybean crop estimates dropped sharply last week because of weather concerns. A mix of conditions that are too dry in some areas and too wet in others means the Brazil crop will no longer be a record-setter. Successful Farming says the crop should come in around 133.4 million metric tons, down from a previous forecast at 144.7 million metric tons.
Rio Grande do Sul, the third-largest bean producer in Brazil, recently saw nine out of the ten hottest temps in the country during the previous week. The top temperature was 102.2 degrees. About 15 percent of the soybeans are blooming going into the key crop development period in January and February. In Parana, the second-largest producing state in the country, only half of the crop is pod-filling and big losses are ahead. USDA expects Brazil to produce 144 million metric tons of soybeans, but that estimate came from the December 2021 WASDE report.7
https://www.bloomberg.com/news/newsletters/2022-01-24/supply-chain-latest-how-to-measure-the-supply-chain-disruptions?utm_content=energy&utm_medium=social&cmpid%3d=socialflow-twitter-energy&utm_campaign=socialflow-organic&utm_source=twitter
https://www.bloomberg.com/news/articles/2022-01-23/french-nuclear-giant-s-fall-risks-energy-security-for-all-europe?sref=d39KtWbu&utm_content=energy&utm_medium=social&cmpid%3D=socialflow-twitter-energy&utm_campaign=socialflow-organic&utm_source=twitter
https://www.joc.com/port-news/us-ports/port-charleston/charleston-port-congestion-could-take-six-weeks-clear_20220121.html
https://www.reuters.com/business/sustainable-business/germany-cries-foul-over-nuclear-energy-eus-green-investment-rule-book-2022-01-22/?taid=61ec1c16e941150001c73540&utm_campaign=trueAnthem:+Trending+Content&utm_medium=trueAnthem&utm_source=twitter
https://www.bloomberg.com/news/articles/2022-01-24/going-green-must-include-nuclear-for-eu-s-largest-copper-plant
https://www.bloomberg.com/news/articles/2022-01-24/clean-power-developers-warn-billions-at-risk-in-plea-to-congress?cmpid=socialflow-twitter-business&utm_medium=social&utm_source=twitter&utm_campaign=socialflow-organic&utm_content=business
https://drgnews.com/2022/01/11/brazil-soybeans-estimates-drop/
The trucker mandates won't help. Interesting year coming up!
https://nakedemperor.substack.com/