COVID-19 Bulletin: January 28

Good Afternoon,

More news relevant to the plastics industry:

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Supply

• After jumping yesterday on news of a larger-than-expected crude oil inventory draw, crude prices slipped in early trading on bearish economic sentiments and a stronger dollar. In early trading, the WTI was at $52.73/bbl and Brent was at $55.73/bbl. Natural gas was down 2.4% at $2.64/MMBtu.
• The International Energy Agency is pressing for more investment in the clean energy transition of developing countries, the source of more than two-thirds of global emissions that are only expected to grow in the next 30 years.
• Amazon was the world’s largest corporate buyer of renewable energy generation in 2020, a year in which global corporate power purchase agreements hit a record high.
• Russia’s deputy energy minister says only 36% of the nation’s reserves are profitable.
• Covestro received the first delivery of 2,000 metric tons of sustainable benzene from French oil major Total, a step toward the company’s goal of a circular economy sustained by alternative raw materials.

Supply Chain

• Officials at the ports of Los Angeles and Long Beach ordered additional sea patrols as a severe two-day storm invades the area.
• Shipping carriers rejected hundreds of millions of dollars worth of U.S. agricultural exports in October and November, instead opting to send empty containers to China where outgoing rates were surging.
• High container rates, particularly in Asia, are driving freight forwarders to breakbulk alternatives and multipurpose vessels.
• Transpacific trade congestion is forcing Whirlpool to air freight critical parts and products to maintain production schedules.
• Global carmakers face a $61 billion revenue shortfall this year due to semiconductor shortages, a biproduct of lean manufacturing coupled with pandemic disruption.
• GM and Navistar are partnering to develop a low-emission, hydrogen electric vehicle for long-haul trucking.
• Exxon, facing pressure from activist shareholders and historic disruption in fossil-fuel markets, is considering expanding its board of directors, reducing capital spending and increasing environmental investments. 
• Big oil companies are exiting trade and lobbying organizations based on reported opposition to climate change efforts.
• Ratings agency S&P put oil giants Chevron, Exxon, Shell and Total on its downgrade watchlist out of concern for climate change and the push for green energy.
• 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 152,478 new COVID-19 infections in the U.S. yesterday and 3,943 fatalities.
• At least 11 states saw increases in average daily COVID-19 deaths in recent days, with numbers in the South and West rising near all-time highs, even as daily U.S. case counts and hospitalizations remain flat or decline.
• While new, highly infectious COVID-19 strains carry many of the same symptoms as previous strains, several symptoms, including a new persistent cough and rashes, point to infection with a variant.
• French drugmaker Sanofi has agreed to produce millions of doses of Pfizer/BioNTech’s COVID-19 vaccine in a bid to speed up vaccination efforts.
• In January, almost half of Americans expressed enthusiasm for getting a COVID-19 shot, up from 34% in December, survey results show.
• CVS has completed the first round of COVID-19 vaccines to almost 8,000 U.S. nursing homes and expects to be done with the second doses in four weeks.
• With long-term care homes now at the front line for COVID-19 vaccines, an end to isolation for many nursing home residents is in sight.
• The White House issued new directives allowing retired doctors and nurses to begin administering COVID-19 shots.
• The World Health Organization recommends that pregnant women forego COVID-19 vaccinations unless they are at a high risk of exposure, as there is not enough data to assess the vaccine’s effectiveness or risk in pregnancy yet.
• DNA-testing company 23andMe launched a new digital tool that can help assess a person’s susceptibility to severe COVID-19 symptoms based on genetic samples.
• An unlikely alliance between tenant groups and landlords is forming in New York, where tenants’ inability to pay rent is making it harder for landlords to pay back their loans, causing debt to pile up.
• The South was the only U.S. region with continued payroll growth at the end of 2020, bucking the trend of persistent job losses in all other areas.
• The White House issued new rules regarding what types of job offers Americans can refuse and still claim unemployment benefits.
• First-time jobless claims declined modestly to 875,000 last week as the pandemic continues to exact a toll on labor markets:

• New orders for durable goods increased slightly in December from the previous month, the eighth straight month of gains.
• More Q4 earnings reports reflect the pandemic’s impact on the economy:
  • Whirlpool reported better-than-expected Q4 earnings on continued strong demand for white goods among stay-at-home consumers but said supply chain constraints are complicating production and deliveries.
  • Apple ended 2020 with its most profitable quarter ever, recording $111.4 billion in sales led by demand for higher-end iPhones with 5G technology.
  • South Korea-based Samsung recorded a 26% boost in quarterly profit on higher demand for smartphones and memory chips.
  • Tesla posted its first full-year profit in 2020 as the company laid out plans to expand production by 50% annually.
  • Facebook posted record revenue and a 52% increase in profit from the year-ago period while warning about challenges ahead with Apple over data collection and app-store fees.
  • AT&T posted a loss after booking a $15.5 billion charge on its pay-television business, which was impacted by surging wireless streaming that accelerated during the pandemic.
  • Logistics giant C.H. Robinson Worldwide reported a 19.9% increase in revenues in Q4, driven primarily by higher pricing and volume across most of the company’s service lines.
• Deal activity in the North American packaging industry rose 59% in the fourth quarter from the prior-year period.
• Toy sales in the U.S. surged 16% in 2020 from the previous year with the pandemic prompting a shift in disposable income spending habits.
• Mall values have fallen nearly 50% since 2016, according to real estate analytics firm Green Street.
• GM will focus on its electric vehicle prominence in ads for this year’s Super Bowl.
• The U.S. is seeing larger investments to expand homegrown lithium-ion battery manufacturing, which will play a key role in the future electric vehicle market.
• Beverage maker Absolut launched a paper bottle prototype in the U.K. and Sweden this week, part of the company’s efforts to create a fully bio-based bottle for spirits.

International

• COVID-19’s recent surge in Africa has been deadlier than other regions of the world due to the continent’s lack of resources to combat the virus and vaccines to prevent transmissions.
• In the six weeks since its detection, the new COVID-19 variant in South Africa has risen to dominance, detected in 90% of those tested and sending infections and hospitalizations soaring. The variant has spread to at least 31 other countries.
• More virulent strains of COVID-19 from Britain, South Africa and Brazil could prompt governments around the world to reimpose lockdowns even as vaccines are distributed, threatening second recession risks for some nations.
• The U.K. is expected to extend a current national lockdown for six more weeks, with schools staying closed and new border quarantine rules taking effect. New daily COVID-19 cases in the nation fell 35% compared to last week as fatalities remain near record highs.
• COVID-19 was the second-leading cause of death in Mexico in the first eight months of 2020.
• Portugal recorded 293 COVID-19 fatalities in the previous 24-hour period, a record.
• Peru is imposing a lockdown in nine states, including the capital city of Lima, where COVID-19 infections are surging.
• Falling COVID-19 infection rates in Moscow led officials to ease restrictions, including a curfew and remote work requirements for employers.
• COVID-19 outbreaks are rising in Asia:

• China reported 55 new locally transmitted cases of COVID-19 as multiple recent outbreaks appear to be easing.
• The European Union is calling on AstraZeneca to commit to a previously agreed upon schedule for delivering doses of its COVID-19 vaccine after the drugmaker said production problems at a European factory would sharply cut supplies.
• Officials in Madrid, Spain, suspended COVID-19 vaccinations after the region ran out of supplies.
• With many restrictions having been eliminated after a large decline of COVID-19 cases in India, citizens remain reluctant to spend, choosing instead to save cash in case of future medical emergencies.
• Bill and Melinda Gates are warning about global “immunity inequality” that will limit access of COVID-19 vaccines only to the world’s wealthiest people and nations.
• Governments around the world are saddled with an added $19.5 trillion in debt due to the pandemic, surpassing previously set records of indebtedness set during WWII.
• The International Monetary Fund is raising warnings about the potential for a sudden drop in asset prices, a risk associated with overconfidence among investors.
• Toyota edged out Volkswagen to become the world’s largest car company in 2020 with 9.5 million vehicles sold.

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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.