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LogisticsLogistics

China’s Digital Silk Road; Cracking Nut Exports; Covid-19 Tests Falling Short

By Paul Page

 

A container ship operated by China’s state-owned Cosco Shipping at the UK’s Port of Felixstowe. PHOTO: MATT CROSSICK/ZUMA PRESS

China’s expanding grip on data about the world’s cargo flows is sparking concern in security and commercial circles. The country has sophisticated data systems that track shipments moving far from China, the WSJ’s Daniel Michaels reports, as it has built out its trillion-dollar international infrastructure Belt and Road Initiative and an accompanying project dubbed the Digital Silk Road. Leading China’s cargo-data systems is Logink, a digital network that describes itself as a “one-stop logistics information service platform” including public databases and information from users in China and at world-wide ports. Logink’s connections to overseas logistics networks are drawing attention in Washington, where one official says they could provide “a treasure trove of intelligence of national security and economic interest.” To Western supply-chain technology experts, Logink’s expansion shows what is possible in digitizing logistics even as it demonstrates the concerns over the availability of detailed shipping operations.

 
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Economy & Trade

Hazelnuts drying at a nut orchard in Turkey in October. PHOTO: OZAN KOSE/AGENCE FRANCE-PRESSE

Turkey’s currency crisis is triggering collateral damage in an unusual set of supply chains. Farmers who produce most of the world’s hazelnuts are reeling from the actions set in motion by President Recep Tayyip Erdogan, the WSJ’s Jared Malsin reports, as the effort to encourage exports by driving down the lira undercuts their business. The plummeting lira is driving up the cost of their imported materials, hurting their production and potentially leading to a hazelnut shortage. That may hit consumers in the form of higher prices for goods such as Nutella as suppliers pass along their rising costs. The impact on Turkey’s hazelnut industry highlights the conflicts in the Turkish president’s currency gamble. The weaker lira has boosted outbound trade flows. But some exporters say the sharp fluctuations in currency have made it nearly impossible to set prices and do business with overseas buyers.

 
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Quotable

“In logistics today, the flow of information is as important as the flow of money or goods.”

— Inna Kuznetsova, chief executive of 1010Data
 

Supply Chain Strategies

A drive-up Covid testing facility in Gaithersburg, Md., on Dec. 20. PHOTO: JIM LO SCALZO/SHUTTERSTOCK

The U.S. is facing a new shortage tied to the Covid-19 crisis, but this time it’s not over vaccine supplies. Waiting times for Covid tests are growing across the country, the WSJ’s Brianna Abbott and Sharon Terlep report, as concerns over the Omicron variant and the coming holidays outstrip the availability of tests. Worker shortages and strains at CVS Health and Walgreens pharmacies are also straining the availability, and health officials expect demand for tests to rise further in the weeks ahead. The shortfall comes even though capacity to manufacture and process Covid-19 tests in the U.S. has increased significantly during the pandemic. Yet rising demand is straining testing infrastructure again, in part because many mass-testing sites that collected large numbers of patient samples have closed over the past year. The Biden administration has committed an additional $1 billion with a goal of quadrupling the supply of fast-acting tests.

 
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Number of the Day

2,854,305

U.S. container imports in November, in 20-foot equivalent units, down 4.7% from October’s record level and up 6.3% from November 2020, according to Panjiva.

 

In Other News

The Conference Board’s index of leading economic indicators rose a sharp 1.1% in November. (MarketWatch)

The Biden administration pushed back the date for compliance with its Covid-19 vaccine mandate to Feb. 9. (WSJ)

The U.S. Environmental Protection Agency raised fuel-efficiency standards for passenger cars and light-duty trucks, part of a bid to nudge the auto industry toward electric vehicles. (WSJ)

Apparel retailer Levi Strauss is using artificial intelligence built on a growing repository of data to help manage inventory and shipping decisions. (WSJ)

Mediterranean Shipping Co. has made a $6.4 billion offer to buy the African logistics assets of French operator Bollore. (Reuters)

Multinational companies long focused on lean supply chains are shifting to “just-in-case” strategies to insulate operations from risk. (Financial Times)

The redeployment of container ships to high-demand trans-Pacific routes has left African exporters without needed capacity. (Washington Post)

The U.S. won’t appeal a World Trade Organization ruling in favor of the European Union in a complaint regarding tariffs on Spanish olives. (Bloomberg)

Toyota is cutting production in Japan by 20,000 vehicles next month. (Nikkei Asia)

Meera Joshi is leaving her position as acting administrator of the Federal Motor Carrier Safety Administration to become a deputy mayor of New York City. (Commercial Carrier Journal)

Canadian National said it expects to name a new CEO in January as TCI Fund favorite Jim Vena withdrew from consideration. (MarketWatch)

The Senate confirmed Democrat Karen Hedlund to succeed Republican Ann Begeman on the rail-regulating Surface Transportation Board. (Railway Age)

Australia’s government is forecasting recovering demand in China for iron ore and metallurgical coal in 2022. (Lloyd’s List)

Maersk Line is eliminating some trans-Atlantic port calls because of delays from rough winter weather. (The Loadstar)

Clarksons says spending for new cargo ships and second-hand capacity exceeded $147 billion this year. (TradeWinds)

The former CEO of carbine blades supplier Tigra USA was charged with embezzling $15 million from the manufacturer. (Charlotte Observer)

 

About Us

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ  @LydsONeal and @pdberger. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
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