Current Affairs

July 18, 2022

Water Level on the Rhine

Germany’s Energy Crisis About To Get Even Worse As Rhine Water Levels Plummet

by Tyler DurdenMonday, Jul 18, 2022 – 06:55 AM

What has already been a year from hell for Germany, which is suffering energy hyperinflation as a result of Europe’s sanctions on Russia, and which is “facing the biggest crisis the country has every had” according to the president of the German employers association, is about to get even worse as the declining water level of the Rhine river, which has historically been a key infrastructure transit artery across Germany, continues to fall and as it does, the flow of commodities to inland Europe is starting to buckle threatening to make an already historic crisis even worse.

The alarming lack of water is contributing to oil product supply problems in Switzerland and preventing at least two power plants in Germany from getting all the coal they need, and what’s more, the continent’s sizzling summer temperatures are forecast to climb even higher in the coming week, leading to even lower water levels.

The 800-mile (1,288-kilometer) Rhine river runs from Switzerland all the way to the North Sea and is used to transport tens of millions of tons of commodities through inland Europe. But with water levels at their lowest for the time of year in 15 years, there is a limit how much fuel, coal and other vital cargo that barges can carry up and down the river.

Low water levels on the Rhine River mean that barges hauling middle distillate-type oil products – typically gasoil/diesel – past Kaub in Germany, are limited to loading about 30% of capacity, according to maritime brokerage services firm Riverlake.

A barge loading in the energy hub of Amsterdam-Rotterdam-Antwerp (or ARA), which can haul 2.5k tons when fully laden, is restricted to taking on about 800 tons if sailing to destinations beyond Kaub. As shown below, the water level at Kaub has fallen in recent days and is at its lowest on a seasonal basis since at least 2007. According to Riverlake, further decreases in loading volumes for barges hauling middle distillates from ARA to inland destinations beyond Kaub are expected in coming days.

This – coupled with capacity issues on German railways – has meant that Switzerland is struggling with supplies of oil products, mainly diesel/heating oil, according to Avenergy Suisse, the landlocked country’s organization for fuel importers.

Low Rhine water level combined with capacity problems on German railways are the reasons, managing director Roland Bilang told Bloomberg, adding that supply problems mainly concern diesel/heating oil.

“It has happened from time to time in the past that temporarily not enough mineral oil products could be transported to Switzerland and therefore the compulsory stocks had to be tapped.” Biland recommends private households fill their heating oil tanks early.

Meanwhile, Bloomberg reports that power plants at Mannheim and Karlsruhe in Germany, operated by Grosskraftwerk Mannheim and EnBW, have been struggling to source coal because of the shallow water – just as the country frets that Russia won’t restart flows on a key gas pipeline. The companies said their generation operations aren’t currently affected.

Because of the tight coal market and low Rhine levels making it hard to deliver the fuel, only 65% of Germany’s coal capacity will be available in coming months, according to S&P Global Commodity Insights analyst Sabrina Kernbichler. This is bad news for a country whose biggest energy utilities are starting to drain natgas reserves as a result of the halt in Nord Stream 1 shipments, jeopardising millions of Germans with freezing should the country fail to restock fully ahead of the winter.

Germany also imports oil products up the Rhine, including fuel and heating oil. There’s currently no shortage of gasoline or diesel in the country, according to Herbert Rabl, spokesman for Tankstellen-Interessenverband e.V., which represents fuel station leaseholders and owners in Germany.

Shell – which owns the Wesseling and Godorf refineries along the Rhine – is monitoring the situation, according to a spokesperson.

https://www.zerohedge.com/markets/germanys-crisis-about-get-even-worse-rhine-water-levels-plummet

July 16, 2022

Fun for the Weekend

The $100 Trillion Global Economy In One Chart

by Tyler DurdenFriday, Jul 15, 2022 – 08:00 PM

Surpassing the $100 trillion mark is a new milestone for global economic output.

Visual Capitalist’s Avery Koop has covered this topic in the past when the world’s GDP was $88 trillion (2020) and then $94 trillion (2021), and now according to the latest projections, the IMF expects the global economy to reach nearly $104 trillion in nominal value by the end of 2022.

Although growth keeps trending upwards, the recovery that was expected in the post-pandemic period is looking strained. Because of recent conflicts, supply chain bottlenecks, and subsequent inflation, global economic projections are getting revised downwards.

Global annual GDP growth for 2022 was initially projected to be 4.4% as of January, but this has since been adjusted to 3.6%.

Note: This data from the IMF represents the most recent nominal projections for end of year as of April 2022.

 Gross Domestic Product (GDP) is a broad indicator of the economic activity within a country. It measures the total value of economic output—goods and services—produced within a given time frame by both the private and public sectors.

The 50 Largest Economies in the World

The United States is still the economic leader worldwide, with a GDP of $25.3 trillion—making up nearly one quarter of the global economy. China follows close behind at $19.9 trillion. Here’s a look at the top 10 countries in terms of GDP:

The frontrunner in Europe is Germany at $4.3 trillion, with the UK coming in second place. One significant change since the last reported figures is that Brazil now cracks the top 10, having surpassed South Korea. Russia falls just outside, in 11th place, with a GDP of $1.8 trillion.

While China’s GDP growth has slowed in recent years, projections still indicate that the country will overtake the U.S. by 2030, dethroning the world’s economic leader.

One region also expected to experience growth in the near future is the Middle East and North Africa, thanks to higher oil prices—Iraq and Saudi Arabia in particular are leading this charge. Regional GDP growth in the area is expected to be around 5% in 2022.

The 50 Smallest Economies in the World

Some of the world’s smallest economies were hit particularly hard by the pandemic, and have subsequently been the most affected by the inflation and food supply shortages resulting from the war in Ukraine.

Here’s a look at the countries worldwide with the lowest GDP in 2022:

The smallest economy in the world measured in the IMF rankings is Tuvalu at $66 million. Most of the bottom 50 are considered low- to middle-income and emerging/developing countries. According to the World Bank, in developing countries, the level of per capita income in 2022 will be about 5% below the pre-pandemic trends.

Some countries are actually projected to experience negative GDP growth this year, particularly emerging and developing economies in Europe.

For example, Russia is expected to experience a GDP growth rate of -8.5% in 2022, though it still remains to be seen how the cost of war and increasingly harsh global sanctions impact the country’s economic prospects.

Inflation, Stagflation, Recession – How Bad is it?

While global economic growth has already been revised downwards, it’s possible the situation could be even more serious. Organizations like the World Bank say that risks of stagflation are rising. Stagflation, which hasn’t occurred since the 1970s, is defined as an economy that’s experiencing rising inflation combined with a stagnant economic output.

Currently, global consumer inflation is currently pegged at 7%. Daily goods are becoming increasingly difficult to purchase and interest rates are on the rise as central banks worldwide try to control the situation. As recent events in Sri Lanka demonstrate, low-income countries are particularly at risk to economic volatility.

https://www.zerohedge.com/economics/100-trillion-global-economy-one-chart

July 16, 2022

Fun for the Weekend

The $100 Trillion Global Economy In One Chart

by Tyler DurdenFriday, Jul 15, 2022 – 08:00 PM

Surpassing the $100 trillion mark is a new milestone for global economic output.

Visual Capitalist’s Avery Koop has covered this topic in the past when the world’s GDP was $88 trillion (2020) and then $94 trillion (2021), and now according to the latest projections, the IMF expects the global economy to reach nearly $104 trillion in nominal value by the end of 2022.

Although growth keeps trending upwards, the recovery that was expected in the post-pandemic period is looking strained. Because of recent conflicts, supply chain bottlenecks, and subsequent inflation, global economic projections are getting revised downwards.

Global annual GDP growth for 2022 was initially projected to be 4.4% as of January, but this has since been adjusted to 3.6%.

Note: This data from the IMF represents the most recent nominal projections for end of year as of April 2022.

 Gross Domestic Product (GDP) is a broad indicator of the economic activity within a country. It measures the total value of economic output—goods and services—produced within a given time frame by both the private and public sectors.

The 50 Largest Economies in the World

The United States is still the economic leader worldwide, with a GDP of $25.3 trillion—making up nearly one quarter of the global economy. China follows close behind at $19.9 trillion. Here’s a look at the top 10 countries in terms of GDP:

The frontrunner in Europe is Germany at $4.3 trillion, with the UK coming in second place. One significant change since the last reported figures is that Brazil now cracks the top 10, having surpassed South Korea. Russia falls just outside, in 11th place, with a GDP of $1.8 trillion.

While China’s GDP growth has slowed in recent years, projections still indicate that the country will overtake the U.S. by 2030, dethroning the world’s economic leader.

One region also expected to experience growth in the near future is the Middle East and North Africa, thanks to higher oil prices—Iraq and Saudi Arabia in particular are leading this charge. Regional GDP growth in the area is expected to be around 5% in 2022.

The 50 Smallest Economies in the World

Some of the world’s smallest economies were hit particularly hard by the pandemic, and have subsequently been the most affected by the inflation and food supply shortages resulting from the war in Ukraine.

Here’s a look at the countries worldwide with the lowest GDP in 2022:

The smallest economy in the world measured in the IMF rankings is Tuvalu at $66 million. Most of the bottom 50 are considered low- to middle-income and emerging/developing countries. According to the World Bank, in developing countries, the level of per capita income in 2022 will be about 5% below the pre-pandemic trends.

Some countries are actually projected to experience negative GDP growth this year, particularly emerging and developing economies in Europe.

For example, Russia is expected to experience a GDP growth rate of -8.5% in 2022, though it still remains to be seen how the cost of war and increasingly harsh global sanctions impact the country’s economic prospects.

Inflation, Stagflation, Recession – How Bad is it?

While global economic growth has already been revised downwards, it’s possible the situation could be even more serious. Organizations like the World Bank say that risks of stagflation are rising. Stagflation, which hasn’t occurred since the 1970s, is defined as an economy that’s experiencing rising inflation combined with a stagnant economic output.

Currently, global consumer inflation is currently pegged at 7%. Daily goods are becoming increasingly difficult to purchase and interest rates are on the rise as central banks worldwide try to control the situation. As recent events in Sri Lanka demonstrate, low-income countries are particularly at risk to economic volatility.

https://www.zerohedge.com/economics/100-trillion-global-economy-one-chart

July 14, 2022

Furniture Woes

Furniture manufacturer announces changes to Mississippi facility, layoff of 300 jobs

Published 5:55 am Saturday, July 2, 2022

By Magnolia State Live

One of the largest furniture manufacturers in the state has announced that it is laying off 300 workers in Mississippi and North Carolina.

Furniture Today reports that United Furniture Industries Inc., which is known to consumers as Lane Home Furnishings, will be transforming a manufacturing factory in Amory to a warehousing-only facility; closing a metal stamping facility in High Point, NC.; and transitioning a Winston-Salem, N.C. operation to an East Coast distribution center.

Company CEO Todd Evans said the reason for the layoffs is because the industry is experiencing a drastic decrease in consumer demand.

In all, 300 employees will be laid off, but it is not clear how many of those jobs will be in Mississippi.

The changes will leave the company with 2,700 employees in three states and Vietnam.

July 14, 2022

Furniture Woes

Furniture manufacturer announces changes to Mississippi facility, layoff of 300 jobs

Published 5:55 am Saturday, July 2, 2022

By Magnolia State Live

One of the largest furniture manufacturers in the state has announced that it is laying off 300 workers in Mississippi and North Carolina.

Furniture Today reports that United Furniture Industries Inc., which is known to consumers as Lane Home Furnishings, will be transforming a manufacturing factory in Amory to a warehousing-only facility; closing a metal stamping facility in High Point, NC.; and transitioning a Winston-Salem, N.C. operation to an East Coast distribution center.

Company CEO Todd Evans said the reason for the layoffs is because the industry is experiencing a drastic decrease in consumer demand.

In all, 300 employees will be laid off, but it is not clear how many of those jobs will be in Mississippi.

The changes will leave the company with 2,700 employees in three states and Vietnam.