Current Affairs
June 27, 2024
Truckin’
With Rates Dropping, Operating Costs For Truckers Hit Record High In 2023
by Tyler Durden
Thursday, Jun 27, 2024 – 09:55 PM
By David Hollis of TruckersNews
Operating expenses for trucking companies increased in 2023, according to the results of a new study released today.
The American Transportation Research Institute’s 2024 Analysis of the Operational Costs of Trucking found the overall marginal costs of operating a truck hit $2.270 per mile in 2023, a new record high. While the increase was only 0.8 percent over the previous year, when surcharge-protected fuel costs are excluded, marginal costs rose 6.6 percent to $1.716 per mile, according to the study.
ATRI’s annual report analyzes line-item costs, operating efficiencies, and revenue benchmarks by fleet sector and size.
Overall, 2023 expenses rose moderately across most categories, with average costs across line-items increasing at less than half the rates experienced during 2021 and 2022, according to the study. It found:
- Truck and trailer payments grew by 8.8 percent to $0.360 per mile
- Driver wages grew by 7.6 percent to $0.779 per mile
- Repair and maintenance costs grew by 3.1 percent to $0.202 per mile
- Insurance premiums grew by 12.5 percent to $0.099 per mile after two years of negligible change
ATRI said the soft 2023 freight market — which continues in 2024 — posed many challenges for operational efficiency. Deadhead mileage rose to an average of 16.3 percent for all non-tank operations, and driver turnover rose by five percentage points in the truckload sector.
These pressures combined with low freight rates strained profitability across the industry, said ATRI in a statement announcing the release of its study.
Average operating margins were 6 percent or lower in all fleet sizes and sectors other than LTL. The truckload and specialized sectors experienced drops in per-mile or per-truck revenue, and most saw “other costs” – expenses outside of the core marginal line-items – increase as a share of total revenue.
https://www.zerohedge.com/economics/rates-dropping-operating-costs-truckers-hit-record-high-2023
June 19, 2024
European Petrochemicals
Billionaire Jim Ratcliffe Says Europe’s Chemical Industry Is a Mess
Francine Lacqua, Rachel Graham and Alex Longley, Bloomberg News
, Wood Mackenzie Ltd
(Bloomberg) — The high cost of energy and carbon have left Europe’s petrochemical industry struggling to compete with the rest of the world, according to Jim Ratcliffe, head and founder of industry giant Ineos Group.
“Europe’s a mess for petrochemicals today,” Ratcliffe said in an interview with Bloomberg TV. “Everybody’s leaving petrochemicals in Europe, which I’ve never seen in my working life before.”
Europe’s soaring energy costs after Russia’s invasion of Ukraine forced swaths of capacity to close, pressured by output from regions where production was cheaper, particularly Asia and the US. Ratcliffe said energy prices in Europe are five times higher than those in North America, making production in the region uneconomic.
Chemicals are key to the supply of plastics and products that are used in everything from textiles to electronics and construction. As well as being pivotal to industrial growth, the sector accounts for almost 10% of European manufacturing, with about 597 billion euros ($640 billion) of sales before the downturn.
Since 2022, there has been a spate of cuts to chemicals capacity in the region. BASF SE is curbing operations at Germany’s biggest chemicals site. Exxon Mobil Corp. is mothballing its operation at its biggest oil-processing plant in France, while LyondellBasell announced a review of its European operations in May.
Ratcliffe, who is Britain’s second-richest man with a net-worth of more than $15 billion, said Ineos’s own profits have mirrored the shift, with the majority of earnings now coming from the US. Twenty years ago they mostly came from Europe, he said.
Over 70 business and industry leaders, including Ratcliffe, earlier this year called on the European Union to cut energy costs and the regulatory burden of green rules to help the region remain competitive. Parts of the chemicals sector won’t currently be included in the bloc’s carbon border adjustment mechanism when it comes into effect, a scheme designed in part to protect the region’s industry.
“Energy is really important for an economy at the end of the day,” he said. “Places like America are in a great place for manufacturing because they’ve got cheap energy, they’ve got no carbon taxes.”
Permanent Closures
The comments mirror those from major industry groups, who have warned that Europe’s chemical output has plunged.
“Production has collapsed massively in the last two years,” a spokesperson for VCI, Germany’s chemicals lobby group said. Production has over the last two years fallen to levels not seen since the global financial crisis and will likely never recover to where it was before Russia’s invasion of Ukraine, they said.
It’s worth noting that the picture isn’t entirely one-sided.
Ineos is investing in an ethane cracker — one of the types of plant involved in making plastics — in Antwerp that’s set to become operational in mid-2026. Other petrochemical-focused units are also expected to come online in Europe in the next few years, according to Mohamed Chilmeran, research analyst for oils & chemicals at Wood Mackenzie Ltd.
Still, when considering Europe’s overall petrochemical capacity, closures will outpace additions going forward, Chilmeran said.
The crisis is also far from confined to mainland Europe, with the UK also seeing a collapse in its chemicals output. Ineos operates the Grangemouth chemicals plant in Scotland, but Ratcliffe said the nation’s industry has all-but collapsed.
“There’s not much chemical industry left in the UK,” Ratcliffe said. “It’s finished.”
June 5, 2024
PFA Spring Meeting
Polyurethane Foam Association Fall Meeting Addresses Sustainability, Industry Innovation
Manning and Gallagher Win Dr. Herman T. Stone Technical Excellence Award
Dr. Herman Stone Technical Excellence Award Winners: Michael Gallagher of The Mattress Recycling Council and Liz Manning of Econic Technologies were winners of the Dr. Herman Stone Technical Excellence Award for their presentations on New Markets for Recycled Foam and CO2-Based Polyols. The Award is voted on by the audience in PFA’s Technical program. Gallagher and Manning tied in the voting, so two awards were given.
ST. PETERSBURG, FL (May 31, 2024)—
The Polyurethane Foam Association’s
Spring Meeting in St. Petersburg featured a
spectrum of presentations on topics of
interest to the flexible polyurethane foam
industry, many focusing on a common
theme: Sustainability.
PFA’s Industry Issues Session provided updates on isocyanates, end use markets, sustainability programs, and “Made In USA” claims.
In the Technical Program on the following day, presentations covered foam recycling, new polyol technology, equipment for process controls, memory foam evaluations, sustainability certifications and circular economy.
Philippe Knaub of FXI, PFA’s President, recognized new PFA members including Midwest Foam and Dynamic Systems, and noted that the association’s work for its membership is more valuable than ever.
“PFA has earned a reputation as a resource for good science and accurate information about flexible polyurethane foam,” Knaub said. “This credibility is important as we address challenges such as sustainability, reliable testing and proposed regulations that may affect our business. PFA has proven that cooperative efforts by its members can be much more effective than any individual company managing such challenges alone.”
After PFA’s Technical Program, two presenters were named as winners of the Dr. Herman Stone Technical Excellence Award. The award is voted on by the audience at the Technical Program, and the vote resulted in a tie. Liz Manning of Econic Technologies won for her presentation, “Update: CO2-Based Polyols for Polyurethane Applications,” and Michael Gallagher of the Mattress Recycling Council won for his presentation, “Developing New Markets For Recycled Foam.”
The award is named for Dr. Herman T. Stone, who served as PFA’s first Technical Director. In 2007, Dr. Stone was inducted into the Flexible Polyurethane Foam Hall of Fame.
“A number of attendees told me that this year’s technical presentations were exceptionally good,” said Bill Gollnitz of Plastomer Corporation, Past PFA President and moderator of the Technical Program. “It’s very fitting that we were able to provide awards to two presenters.”
To learn more, visit www.pfa.org.
June 3, 2024
Pending Home Sales Fall in April
Pending home sales slumped 7.7% in April
By Larry Adams
May 31, 2024 | 12:59 pm CDT
Contract signings retreated in all regions compared to the previous month and one year ago. The Midwest and West experienced the largest monthly declines.
WASHINGTON — The Pending Home Sales Index (PHSI) – a forward-looking indicator of home sales based on contract signings – decreased to 72.3 in April. Year over year, pending transactions were down 7.4%. An index of 100 is equal to the level of contract activity in 2001.
“The impact of escalating interest rates throughout April dampened home buying, even with more inventory in the market,” said NAR Chief Economist Lawrence Yun. “But the Federal Reserve’s anticipated rate cut later this year should lead to better conditions, with improved affordability and more supply.”
Regional breakdown
The Northeast PHSI fell 3.5% from last month to 62.9, a decline of 3.1% from April 2023. The Midwest index dropped 9.5% to 70.7 in April, down 8.7% from one year ago.
The South PHSI lowered 7.6% to 88.6 in April, dropping 8.2% from the prior year. The West index decreased 8.5% in April to 55.9, down 7.3% from April 2023.
“Home prices are hitting record highs, but the pace of gains should decelerate with more supply,” said Yun. “However, the prospect of measurable home price declines appears minimal. The few markets experiencing price declines will be viewed as second-chance opportunities for buyers to enter the market if those regions continue to add jobs.”
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