COVID-19 Bulletin: July 13

Good Afternoon,

More COVID-19 news relevant to the plastics industry:

Supply

• The WTI price fell below $40 in early trading on concerns that OPEC may decide to ease production limits at its meeting this week. Russia also is poised to increase production.
• Prices were up in mid-day trading with the WTI crude price at $40.63 and Brent at $40.37/bbl.

Supply Chain

• Recent surges in infection rates are once again straining supply chains for groceries, with up to 10% of packaged goods, beverages and household products out of stock.
• The supply chain in the garment industry could shrink by 20% to 30% and be permanently reshaped, with manufacturing moving away from traditional manufacturing centers in Asia to Eastern Europe for European markets and Mexico for North American markets.
• We see the less-than-truckload (LTL) shipping sector challenged in returning to full employment as the economy recovers after making workforce cuts early in the pandemic. 
• Our Gold Standard logistics partners and U.S. ports continue to return to normal operations.

Markets

• New COVID-19 cases nationally topped 66,000 on Friday, a record and part of a string of days with 60,000+ infections. 
• New cases in Florida topped 15,000 on Sunday, a state and U.S. record and more than South Korea has suffered during the pandemic.
• New York recorded a promising milestone: its first day without a COVID-19 fatality since the pandemic began.
• The recent spike in COVID-19 infections is now being trailed by a spike in U.S. deaths, with Arizona, California, Florida, Louisiana, Mississippi, South Carolina and Texas reporting increases of 10% to 100% in the past four weeks.
• Friendlier rules for small-business bankruptcies (i.e., those with no more than $7.5 million in liabilities) are expected to prompt a surge in filings by pandemic-stressed businesses.
• With assistance and jobless protection programs expiring and stimulus checks spent, up to 23 million American renters face eviction by the end of September.
• Consumers globally are experiencing heightened anxiety about their job security and household budgets, according to a recent survey, raising concern about the pace of the economic recovery.
• Known as “long haulers,” many recovered COVID-19 patients continue to suffer severe fatigue, brain fog, body aches and spikes in other physical symptoms for months after testing negative.
• Seventeen companies globally have commenced human testing for potential COVID-19 vaccines, including at least one biotech firm that is confident it will have an approved version by year end.
• Pension funds are wrestling with how to value commercial real estate investments as the recession decimates segments of retail, such as malls, and enhances others, such as online fulfillment warehouses.
• More than 6,000 plastics firms received over $1.6 billion from the Paycheck Protection Program.
• Rivian, a startup focused on electric trucks and SUVs, raised another $2.5 billion in funding.
• Tesla cut the price of its new Model Y SUV by 6% after cutting prices on other models in May to boost sales during the pandemic.
• GM is temporarily shutting down the third shift at its Wentzville, Missouri, plant due to employee absenteeism despite strong demand for the midsized trucks made there.
• With new vehicle production still curtailed by restart challenges, demand for used cars has soared, creating inventory shortages at dealers and driving wholesale auction prices to decades highs.
• Amtrak is promoting private “roomettes” as a safe and private method for travel in a campaign to attract air travelers concerned about safety.
• Despite record infection levels in Florida, Disney opened two of its four major theme parks there to a limited number of enthusiastic visitors.
• After reporting a $4.4 billion second-quarter loss, Carnival Corp. plans to divest 13 cruise ships as it prepares to reopen initially in Germany. The company does not expect business to normalize until 2022.
• The global coffee industry, where cafes and restaurants account for 25% of sales, is on pace for its first down year since 2011 and expects a slow recovery. 
• Market intelligence firm ICIS has acquired competitor CDI.
• COVID-19 infections are approaching 13 million globally.

International

• With many regions experiencing COVID-19 spikes, we are seeing decreased vessel and container availability contributing to delays in the international supply chain.  
• We are seeing strong international demand magnified by seasonal peaks in several segments around the globe, including pipe for the construction sector, products for the agriculture sector, and goods for the coming holiday season. Some clients are increasing safety stocks ahead of the higher-than-normal hurricane forecast.
• Canada created nearly a million new jobs in June and has now recovered 1.2 million of the 3 million jobs lost during the pandemic, lowering the unemployment rate to 12.3%.
• Total COVID-19 deaths in Latin America approached 145,000 today, surpassing the North American death count and placing the continent behind only Europe for most fatalities.
• Fatalities in Mexico surpassed 35,000, placing the country fourth among countries with the highest death rates behind the U.S., Russia and the U.K.
• The U.K. is preparing to make it mandatory rather than optional to wear masks in indoor public spaces.
• Business sentiment in India fell sharply in June to the lowest level ever, according to IHS Markit, which called “the outlook for India … the worst globally.”

Our Operations

• To access 3D printing training, order parts and seek technical assistance, visit our new online resource.
• Market Expertise: M. Holland offers a host of resources to clients, prospects and suppliers across nine strategic markets. To arrange a videoconference or meeting with any of our Market Managers, please visit our website.
• M. Holland’s official status statement is available here.

Thank you,

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.