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Shifting Food Supplies; Steeling for Expansion; Gender in Supply Chains
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A Roundy's Supermarket distribution center in Oconomowoc, Wis. PHOTO: MICHAEL SEARS/ASSOCIATED PRESS
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Inflation is starting to reshape consumer-goods supply chains. Cost-conscious consumers are buying more store brands at the supermarket, the WSJ’s Annie Gasparro reports, turning away from the big-name food companies and putting more pressure on suppliers that are dealing with their own rising costs. A shift in market share began in March with the onset of rising gas prices that has been coupled with growing costs for raw materials. The pivot marks a reversal from the past two years, when big food companies like Kraft Heinz and General Mills captured more consumer dollars as private-label manufacturers struggled with supply-chain problems. That tide appears to have turned,
with stores restocking shelves more quickly just as consumers are looking for ways to beat decades-high inflation by buying similar but cheaper products. That is elevating suppliers like TreeHouse Foods that supply private-labels to retailers including Walmart and Kroger.
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Consumer-goods supplier Helen of Troy is reducing purchase orders as its retail customers report excess inventories. (Supply Chain Dive)
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A Nucor steel mill under construction in Sedalia, Mo. PHOTO: LAWRENCE BRYANT/REUTERS
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U.S. steel companies are preparing to bulk up their production capacity. Major companies including Steel Dynamics and Nucor say they are ramping up investments in new mills and side businesses, the WSJ’s Bob Tita reports, signaling that a sector battered by global events is preparing to feed more products into crucial industrial supply chains. The companies appear to be brushing aside signs of weakness in the broader economy and looking at resilient construction and automotive demand. The companies say demand for commercial buildings including warehouses is strong while steel producer Cleveland-Cliffs is also counting on increased auto production in the U.S.
after supply-chain problems left that market undersupplied. Steel shipments have wavered so far this year. Rail carloads in the primary metals category that includes steel fell 11.6% in June, in the fifth decline in the first six months of the year, according to the Association of American Railroads.
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A natural gas tanker at a liquefaction facility in Cameron, La. PHOTO: MARK FELIX/BLOOMBERG NEWS
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Growing global demand for U.S. natural gas is testing the ability of American exporters to deliver. The push for American gas has stepped up since shrinking flows of Russian supplies left Europe scrambling to fill the gap. The WSJ’s Benoît Morenne and Benoit Faucon write the rising European demand for U.S. gas is reshaping global liquefied natural gas markets and helping elevate U.S. energy exports as a significant geopolitical and economic tool. The U.S. sits on vast reserves of natural gas that can be extracted at low cost and moved through an integrated network of pipelines. This supply resulted in low gas prices relative to international markets, putting U.S. exporters at an advantage. But there are limits
to how much gas the U.S. can provide to the world. Experts say U.S. exporters have maxed out their capacity and it will take years to add new, multibillion-dollar export terminals.
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The deal between Moscow and Kyiv to allow the shipping of Ukrainian grain is helping push global prices lower but will take time to trigger new exports. (WSJ)
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Russia is considering a retaliatory ban on the entry of European trucks starting Oct. 1. (Automotive Logistics)
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“It’s the time for U.S. LNG to shine.”
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— Anatol Feygin of Cheniere Energy, America’s top exporter of liquefied natural gas.
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In a supply chain simulation, participants trusted women more. ILLUSTRATION: SONIA PULIDO
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A new study suggests companies can gain significant benefits from advancing diversity in supply chain management. Researchers looking at collaboration between retailers and suppliers found that women performed more efficiently than men when they were put in charge of logistics planning. Suman Bhattacharyya writes in a WSJ Leadership report that the findings in the study by the University of Arkansas and the University of Akron strengthen the case for greater gender diversity in supply chains, according to Arkansas professor John Aloysius, one of the study authors. The details carry important guideposts for companies looking to improve efficiency in a supply-chain sector that
has struggled with diversity. Researchers found, for instance, that female retailers were significantly less likely than male retailers to inflate product demand forecasts. A similar dynamic was seen among suppliers, with male suppliers more likely to underproduce than female suppliers.
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$7,280
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Drewry Shipping Consultants’ index for container rates from Shanghai to Los Angeles the week ending July 21, down 33.6% since the week of March 10.
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Purchasing manager surveys show U.S. and global business activity falling sharply in July. (WSJ)
South Korea’s Daewoo Shipbuilding reached a deal with subcontract workers that will end a weekslong strike that has pushed back deliveries of new vessels. (WSJ)
Hyundai Motor says it has “no evidence" substantiating published allegations that a subsidiary of the Korean auto maker used child labor at a factory in Alabama. (WSJ)
Independent truckers suspended their protest at the Port of Oakland over the weekend but signaled they would resume their blockade in the coming week. (Reuters)
European auto-parts giant Continental is seeking alliances with Asia-Pacific startups to quickly develop technologies for next-generation automobiles. (Nikkei Asia)
India may allow sugar mills to export more than previously permitted to help them prevent defaults on contracts. (Bloomberg)
Lebanon’s prime minister says the ruin of a massive grain silo at the Beirut port is at risk of total collapse. (Associated Press)
Container throughput at the Port of Rotterdam fell 4.4% in the first half of the year. (Journal of Commerce)
Truck drivers for the Sainsbury’s chain in southern England agreed to a contract with a 12% pay increase. (Motor Transport)
Australia will introduce a national ID system for sheep and goats as it braces for an outbreak of foot and mouth disease. (Financial Times)
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