COVID-19 Bulletin: May 12

Good Afternoon,

More COVID-19 news relevant to the plastics industry:

Supply

• Oil prices, after giving up yesterday’s gains late in the day, rebounded in early trading today with the WTI up nearly 7% to $25.79/bbl and Brent up nearly 4% to $30.70/bbl.
• Saudi Aramco, the world’s largest oil company, reported a 25% drop in earnings in the first quarter and predicted further earnings erosion from the energy recession.
• Despite the oil and gas recession and a weak peso, Mexico continues to expand its oil industry, with plans to double wells drilled to more than 400.
• Some ambitious entrepreneurs are commandeering metal tanks, pools and caves to temporarily store oil until prices recover, hoping to score big from the current inventory glut. 
• Pioneer shale driller Chesapeake Energy warned that it may not survive the current downturn.

Supply Chain

• The COVID-19 crisis is prompting a shift from highly efficient supply chains to highly flexible ones, with more localized supplier networks, increased inventories and greater attention generally to supply chain management.
• Our Gold Standard logistics and transportation partners continue to operate without disruption.
• U.S. ports continue to operate smoothly:

Markets

• There is growing concern that the economy will experience a “swoosh” recovery, with a slow climb after the sudden collapse, rather than the “V” shaped recovery many hoped for. 
• April will show a drop in consumer prices of 0.8% in April, the second consecutive monthly decline, according to a survey of economists. Excluding energy, core prices are expected to show a drop of 0.2%.
• The technology sector lost more than 100,000 jobs in April, as the COVID-19 crisis has left few segments of the economy unscathed:

• Applications for Paycheck Protection Program (PPP) loans have dwindled as rules for the program evolve and larger borrowers face negative public scrutiny. 
• Tesla defied Alameda County shutdown orders and resumed manufacturing at its lone assembly plant in California.
• Toyota expects to produce 800,000 cars from now through October, a 29% reduction from the prior-year period.
• Air emissions have fallen measurably around the world:
  • During its shutdown in January and February, China experienced an 18% drop in emissions, which now are rising again as the economy reopens.
  • Nitrogen dioxide emissions, a pollutant from combustion engines, fell by as much as 60% in some U.K. cities during its lockdown. 
• Confirmed cases of COVID-19 globally now exceed 4.2 million.

International

• Deflationary pressures greeted China’s reopening factories as the company’s Producer Price Index fell a more than expected 3.1% in April compared with the prior-year period.
• China will test all 11 million residents of Wuhan after six new cases of COVID-19 were confirmed. 
• China’s month-over-month automobile sales rose in April for the first time in two years, but remained lower than the year-ago period.
• Despite a rising COVID-19 infection pace, Russia, with the third highest death rate and fourth highest infection rate in the world, announced a lifting of its lockdown.

Our Operations

• Our Color & Compounding team has introduced an expanded linecard of pulverized products for compounders.
• We issued protocols for a resumption of limited client visits to our commercial and technical teams yesterday.
• To access 3D printing training, order parts and seek technical assistance, visit our new online resource.
• M. Holland is fully operational and prepared to meet client needs for materials, material selection, logistics services and technical support.
• We have issued the following status statement:

In accordance with the guidance provided by the U.S. Department of Homeland Security Cybersecurity & Infrastructure Security Agency (CISA), M. Holland Company is considered a member of a critical infrastructure industry and will therefore remain operative. As such, with any necessary accommodations made to ensure the health and safety of our staff and business partners, we will continue to fully perform our normal business operations.

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.