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Supply-Chain Challenges Fade; U.S. Stifles Moscow Trade

By Liz Young

 

An Under Armour store in Houston. PHOTO: BRANDON BELL/GETTY IMAGES

Supply-chain issues are waning for U.S. businesses. The WSJ Logistics Report’s Paul Berger and Liz Young write that easing freight congestion, falling shipping costs and Asia’s emergence from Covid-19 lockdowns are benefiting importers of finished goods. Executives at game company Hasbro, Sharpie pen maker Newell Brands and sportswear manufacturer Under Armour have recently pointed to the supply chain as a bright spot as rising interest rates and a pullback in consumer spending present bigger challenges. Hasbro’s CEO said that while the company had to push back two big game releases last year because of supply-chain delays, he doesn’t expect that to be an issue again this year. Manufacturers such as Airbus, Boeing and Ford Motor still sound cautious as shortages of key parts hold up production lines and hurt productivity. But some companies such as apparel maker VF are optimistic improving lead times will lead to more on-time deliveries.

  • Raw material and component costs rose in February at the slowest pace since the fall of 2020, according to surveys from S&P Global. (WSJ)
  • Walmart reported U.S. comparable sales rose 8.3% in the latest quarter. (WSJ)
  • Home Depot forecast a drop in profit this year on flat sales as consumers spend less and become more sensitive to inflation. (WSJ)
 
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Government & Regulation

The port in Vladivostok, Russia. PHOTO: TATIANA MEEL/REUTERS

Washington and its allies are cracking down on companies and countries helping Russia evade sanctions. The Biden administration is expected to impose fresh sanctions on about 200 Russian individuals and entities this week as it looks to increase pressure on the Kremlin a year after the invasion of Ukraine. The WSJ’s Vivian Salama and Laurence Norman report the new tranche comes as the U.S. and allies search for more ways to cut Moscow off from access to critical materials that bolster its military and technology sectors. Washington also plans to step up efforts to identify and sanction intermediaries helping Russia work around an oil-price cap. Trade has increased between Russia and some nearby countries, raising concerns that Moscow is circumventing sanctions by importing restricted goods via neighboring territories. Some European countries are considering creating watch lists of sanctions-busting companies and reducing trade with jurisdictions that ignore sanctions.

 
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Quotable

“We feel like we’re pretty well ahead of our supply-chain issues.”

— Chris Cocks, chief executive of Hasbro
 
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Number of the Day

$73.9 Billion

Total value of North American transborder freight that moved by truck in December, down 6% from November and up 5.8% compared with December 2021, according to the Bureau of Transportation Statistics.

 

In Other News

U.S. home sales fell for the 12th straight month in January, with sales of previously owned homes down 0.7%. (WSJ)

United Airlines Holdings is launching a $100 million fund to invest in startups aiming to produce sustainable aviation fuel. (WSJ)

Chesapeake Energy is selling its oil assets to a division of U.K. chemical maker Ineos Group for $1.4 billion. (WSJ)

An explosion at a metal factory outside Cleveland sparked a big fire, killing one person and injuring at least a dozen others. (WSJ)

The Environmental Protection Agency issued a formal order requiring Norfolk Southern to clean up chemicals spilled in a train derailment earlier this month in Ohio. (WSJ)

Union Pacific reached an agreement with two of its unions to provide paid sick leave. (Bloomberg)

E-commerce sales as a percentage of total retail flatlined in 2022, according to the Census Bureau. (The Information)

Maersk has sold its last two Russian logistics sites after announcing last year it would discontinue operations in the country. (The Loadstar)

New York City is auctioning off medical supplies as it works to offload a surplus of goods it over-ordered during the pandemic. (The City)

Chicago residents are calling for Amazon to open a warehouse under construction in a West Side neighborhood. (Austin Weekly News)

 

About Us

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

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

 
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