In the QAD Precision News Round-Up: 3 December 2021, US to keep UK
steel and aluminum tariffs; direct Ireland/EU trade volumes double;
air cargo volumes down; Gap to lose $650M in sales; Cyber Monday
sales down; plus FTZ savings for manufacturers and more.
On Wednesday, the United States announced that it will postpone
removing tariffs on UK steel and aluminum. The move comes amid
concerns about post-Brexit trade rules affecting Northern Ireland.
Previously, in 2018, the administration of former US President Donald
Trump imposed 25 percent and 10 percent tariffs on steel and aluminum
imports from the European Union. However, although removed in October
2021, the tariffs still remain in place for the UK due to Brexit.
According to a US Commerce Department official, there are concerns
about British threats to trigger emergency clause Article 16. Article
16 enables the UK or EU to seek to suspend parts of the Brexit
agreement that established some checks on the movement of goods to
Northern Ireland from mainland Britain if they produce difficulties.
For more information, please click here.
According to official data, volumes of goods shipped directly from
Ireland to the EU in the last six months have surged by 50 percent as
exporters look to avoid travelling across land through Great Britain.
The Irish Maritime Development Office (IMDO) released data showing a
major reduction in traffic on traditional routes between Dublin and
Britain. Instead, this traffic is being diverted to some of 32 new
ferry services direct to ports including Le Havre, Cherbourg and
Dunkirk in France and Zeebrugge in Belgium.
Furthermore, the IMDO report revealed freight volumes from Dublin
port to Liverpool and Holyhead in Anglesey dropped 19 percent in the
first three-quarters of 2021 compared to last year. Additionally,
volumes were down by 30 percent on the two routes from the Irish port
of Rosslare to the Welsh ports of Pembroke and Fishguard. For more
details, please see The
Air cargo volumes for November fell 1.2 percent compared to October
according to analytics firm Clive Data Services. In addition, the
November volume is also down 3 percent compared to November 2019.
Despite the fact that capacity remained flat on a monthly basis, the
average spot rate increased 8 percent. Compared to two years ago,
rates are up 160 percent. Furthermore, the increase is five to seven
times higher on routes to North America from China and Vietnam.
November is typically the busiest month for transactions and tonnage
and the drop highlights the supply chain issues facing the
transportation industry. For more information, please click here.
Due to supply chain issues in the third quarter, Gap Inc.’s yearly
sales expectations decreased. This year, it expects to lose up to $650
million in sales due to constraints on its supply chain and inventory.
The expected sales loss is despite the company spending $450 million
in air freight expenses in an attempt to avoid shipping delays.
According to Gap, major product delays in the third quarter from port
congestion and factory closures, contributed to a decline in net sales
of approximately 1.3 percent from 2020. For more information, please
Cyber Monday sales are down for 2021 with consumer spending 1.4
percent lower than last year according to Adobe Analytics. Consumers
in the US spent $10.7 billion on Cyber Monday. This is the first
decrease in consumer spending on a major shopping day since Adobe
Analytics began reporting in 2012. Nonetheless, it predicts this year
will still break records as consumers spread their spending over more days.
Consumer spending from November 1 through Cyber Monday is up 11.9
percent year over year for a total of $109.8 billion spent online. On
22 of the days, consumers bought more than $3 billion worth of goods
setting another record for this year. However, Adobe Analytics
predicts this year will continue to break records with sales from
November 1 to December 31 totalling $207 billion, a 10 percent gain
from last year. For more information, please visit CNBC.
Private hiring for November is increasing according to ADP, a payroll
processing company. Private hiring for November is 534,000, surpassing
a Dow Jones estimate of 506,000. This is a decrease from October with
570,000 positions. The services sector added the most jobs with
424,000 positions. Professional and business services followed with
However, these figures are lower than those from the Bureau of Labor
Statistics, which show a growth of 573,000 jobs in November.
Furthermore, the Dow Jones estimates the unemployment rate for
November to be 4.5 percent. For more information, please visit CNBC.
Global supply chains are facing the greatest strains seen in recent
history. Shipping containers are grinding busy ports to a standstill,
while consumer demand has resulted in higher prices and spiking
product shortages. A report from Moody’s in mid-October assessed the
current situation, stating that “things are likely to get worse before
they get better.” Experts believe that supply chain issues will
continue well into 2022.
There has been some relief in US port congestion in November. Some
experts reckon the worst of the crisis has passed, but warn that a
number of issues remain. Many manufacturing businesses have borne the
brunt of these issues. Shortages of goods critical key parts (such as
microchips for vehicles) have hampered supply lines even further, many
of which were strained prior to the pandemic. In this QAD Precision
Report, we outline how Foreign-Trade Zones can help, delivering three
key benefits to the bottom line. To read the full report please click
SANTA BARBARA, Calif.--(BUSINESS WIRE)--QAD Precision, an
industry-leading provider of global trade and transportation execution
solutions, today announced a complimentary Foreign-Trade Zone (FTZ)
Cost/Benefit Analysis. This analysis calculates the cost savings
manufacturers and distributors could realize by leveraging the
Foreign-Trade Zones program. QAD Precision is a division of QAD Inc.
For more details, please see Business Wire.
If the pandemic has taught us anything it’s this—supply chains are
brittle. If raw materials or parts don’t get to where they need to be
on time, manufacturing plants grind to a halt, orders are not
fulfilled, customers are unhappy, and the bottom line suffers. In this
article for Inbound Logistics, QAD Precision’s Anne Sexton
discusses the benefits of controlling inbound logistics. For more
details, please see Inbound