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LogisticsLogistics

Restricting Russian Trade; Target’s Delivery Aims; Boiler Room Logistics

By Paul Page

 

The Mendeleev Prospect oil tanker operated by Russia’s state-owned Sovcomflot. PHOTO: ALEXANDER RYUMIN/ZUMA PRESS

The trade map for Russia’s shipping operations is shrinking. The Biden administration is expected to ban Russian-flagged ships from entering U.S. ports, the WSJ’s Nancy A. Youssef and Costas Paris report, in a move that follows a similar ban by the U.K. Russian commercial ships represent less than 1% of cargo volumes to the U.S., so the action would be largely symbolic. But it adds to the growing sanctions over Moscow’s invasion of Ukraine that are making commercial connections to Russia more complicated and pushing more Western companies to withdraw from dealings with the country. New restrictions on technology sales are contributing to the uncertain climate for businesses. The WSJ’s Kate O’Keeffe reports the export controls restrict shipment of semiconductors, lasers and other technology to Russia’s defense, aerospace and maritime industries. Experts say the controls are so broad and complex that some companies are simply suspending exports altogether.

Here are other recent developments following Russia’s invasion of Ukraine:

Russian forces pounded Ukraine’s second-largest city as the offensive toward Kyiv stalled amid fierce counterattacks and logistics mishaps.

Toyota stopped production in and exports to Russia because of difficulties in obtaining parts needed for manufacturing.

Banking sanctions from Seoul will leave Russian shipping companies struggling to pay for new vessels on order from South Korean shipbuilders.

Germany's Siemens halted all new business and international deliveries to Russia.

Airbus joined Boeing in suspending support services to aerospace customers in Russia.

Nike stopped taking online orders on its Russian website because it can’t guarantee delivery.

Most-actively traded corn futures touched their highest levels since March 2013.

For the latest updates from Russia and Ukraine, click here

 
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Supply Chain Strategies

A Target distribution center in Shafter, Calif. PHOTO: MARK J. TERRILL/ASSOCIATED PRESS

Redesigned post-pandemic supply chains for big retailers are starting to take shape. Target is expanding its logistics footprint across the U.S. with new distribution centers and sorting sites, the WSJ Logistics Report’s Lydia O’Neal writes, as part of an aggressive plan to speed up the flow of goods to its stores and to online customers. The plan marks a refinement of the omni-channel strategy that has seen Target stores serve double-duty as fulfillment centers to handle e-commerce orders. The retailer says its new sites will make that distribution more efficient and work in concert with the Shipt last-mile delivery business it acquired in 2017. Target hadn’t added distribution centers for a decade, even as its sales expanded. Walmart has its own plan to expand home delivery and handle its online inventory more efficiently, a sign that competition between retail rivals is increasingly playing out in logistics operations.

  • Amazon will close dozens of bookstores and other retail locations as the company resets its physical retail strategy to focus on grocerty stores and technology. (WSJ)

 

 
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Quotable

“You have a lot of distributors that are almost panic buying just to get as much stuff on the shelves as they can.”

— Brian Blaushild of Ohio-based Famous Supply
 

Supply Chain Strategies

A worker installs an industrial heating and air conditioning system at an Islip, N.Y., commercial site. PHOTO: AL BELLO/GETTY IMAGES

Supply-chain snarls are making it tougher to keep heating and cooling systems running. Service companies are facing record backlogs, longer wait times and rising prices for parts and equipment, the WSJ’s Stephen Council reports, as manufacturing issues and high consumer demand persist through one of the industry’s busiest times of year. That has left repair companies struggling to quickly fix and replace furnaces, boilers and other in-demand climate-control technology for residential and commercial clients. The troubles in the furnace room highlight how the past two years’ supply-chain disruptions are affecting a wide range of businesses. Heating and cooling supply chains are far from dynamic, but some businesses are rethinking how they manage inventory after struggling with creative workarounds to parts shortages. One contractor in Ohio ordered an entirely new boiler model just to get a circuit board that was on a lengthy back order.

 
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Number of the Day

21.3%

Year-over-year increase in coal carloads carried by U.S. railroads in February, according to the Association of American Railroads.

 

In Other News

The Federal Reserve says the U.S. economy grew at a modest to moderate pace from mid-January through early February. (WSJ)

The eurozone’s annual inflation rate accelerated to 5.8% in February. (WSJ)

Ford is reorganizing to create separate divisions for its conventional gas-engine business and its electric-vehicle operations. (WSJ)

Apparel retailer Abercrombie & Fitch says the worst of its inventory and supply-chain issues have passed. (Dow Jones Newswires)

Uber Technologies is expanding a network of "dark stores" in Japan to boost its rapid grocery delivery business. (Nikkei Asia)

The operator of a pipeline off the Southern California coast is suing Mediterranean Shipping Co. and Cosco Shipping over the line’s rupture last year. (Maritime Executive)

Shipping services group Clarkson named Laurence Hollingworth to succeed​ Bill Thomas as chairman. (Dow Jones Newswires)

Electric-vehicle maker Arrival expects to sell between 400 and 600 delivery vans this year. (Industry Week)

Freight forwarder Kuehne+Nagel’s fourth-quarter operating earnings jumped 300% to about $1.2 billion and revenue nearly doubled to more than $6 billion. (ShippingWatch)

A coalition of Chicago suburbs says it would cost up to $9.5 billion to mitigate the impact of the Canadian Pacific-Kansas City Southern merger on their communities. (Trains)

Latin American e-commerce logistics startup 99minutos raised $82 million in a Series C funding round. (TechCrunch)

Pallet-management company 48forty expanded its network with the acquisition of Nazareth Pallet. (DC Velocity)

 

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, @pdberger. and @LydsOneal. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
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