Purchasing articles from April 2008

Purchasing archives from April 2008

'Deliver those connectors on time--or else'.
April 10, 2008... By Staff Purchasing's smartest negotiators move from conflict to collaboration fast. Match your wits against these pros. Guess their strategy. Then, read what they really did at purchasing.com/negotiations . Possible Solutions: Live...

Chemical Buyers: Heed caution signs on road to e-sourcing.
April 10, 2008... By Rich Weissman Supplier relationships, compliance issues take center stage when buying chemicals online. While e-sourcing has found its way into nearly every spend area imaginable today, buying chemicals online requires significantly...

Softer domestic, export demand could cap polyethylene prices.
April 10, 2008... By Gordon Graff As crude oil and ethylene feedstock prices continue to climb, polyethylene producers are seeking to tack on another 6Acents/lb to their contract prices. But with limp demand for polyethylene and other plastic resins,...

Business Intelligence.
April 10, 2008... By Staff 9% Buyers planning to increase sourcing of plastic resins Source: www.purchasingdata.com WHAT IT MEANS: With energy prices high, resins buyers are apparently taking a break from any increased sourcing. The buying...

OEM, EMS requirements of distributors differ.(Original equipment manufacturer)
April 10, 2008... By James Carbone In some ways buyers at OEMs have different requirements of electronics distributors than buyers at electronics manufacturing services providers. OEMs frequently need distributors to provide design services, component...

The search for accurate price forecasts.(Hewlett-Packard Co.)
April 10, 2008... By James Carbone Price forecasting is becoming critical to many OEMs because forecasts often have a direct impact on the bottom line. Price forecasting of components purchased for electronics equipment is not new, but has become more...

How buyers Survive.(impact of hedging on energy industries)
April 10, 2008... By Tom Stundza Purchasing professionals are trying to save dollars by hedging the energy market, becoming off-peak rate payers and locking-in advantageous prices. They have no choice with crude oil, natural gas and electricity selling at...

Analog-chip price curve to flatten as suppliers seek profitability.
April 10, 2008... By James Carbone Buyers can expect only slight price declines for analog chips this year despite strong unit demand as semiconductor suppliers focus on profitability more and less on growing market share. While the average price of...

Business Intelligence.
April 10, 2008... By James Carbone 33% Buyers who say business has improved since a month ago Source: www/purchasingdata.com WHAT IT MEANS: The industry is feeling the effects of the annual seasonal slowdown. 28% Buyers who say they...

Electronic Briefs.(RAD Electronics acquiring RPM Technology)(Mouser Electronics stocking the Johnson line of SMP blind-mate connectors from Emerson Network Power Connectivity Solutions)(Digi-Key will carry Cynergy3 Components' line of reed relays and sensors under a new distribution agreement)
April 10, 2008... By James Carbone RAD acquires RPM RAD Electronics, a Sun Valley, Calif.-based electronics contract manufacturer, has acquired RPM Technology, a full-service contract manufacturer based in Fort Collins, Colo. RPM builds printed...

Connector prices should rise as cost of materials increases.
April 10, 2008... By Gina Roos Connector suppliers say it's likely that they will have to increase prices this year because of increased costs for precious metals and plastics. "We continue to see rising raw materials costs most specifically for gold,"...

Computer shipments torise nearly 13% in 2008.(Brief article)
April 10, 2008... By James Carbone Worldwide PC shipments will grow 12.8% in 2008 to reach 302 million units, according to researcher IDC. Growth will continue at above 11% in 2009 followed by high single-digit growth through 2012, boosting annual...

UMC, Elpida partner on foundry services.
April 10, 2008... By James Carbone Dram manufacturer elpida Memory and semiconductor foundry United Microelectronics Corp. (UMC) have announced they will jointly pursue semiconductor foundry opportunities in Japan. Under this agreement, Elpida will...

Prices.
April 10, 2008... By Staff Raw materials inflation is picking up speed (national, recent price trend) -------------------------------------------- Up Down Same Index Steel 82% 2% 16% 89.6 Energy...

TAGS for Small LCDs Increase.(Liquid crystal displays)(Brief article)
April 10, 2008... By Staff Prices for small- and medium-size liquid crystal displays (LCDs) displays will rise 22% to $6.80 from $5.60, according to researcher iSuppli, due to the growth in popularity of digital photo frames and tiny televisions. In the...

Copper Prices to Stay High.(Brief article)
April 10, 2008... By Staff With copper prices nearing $4/lb in March and supply predicted to remain tight, Goldman Sachs analyst Jeffrey Currie said "Inventories will remain relatively low, suggesting an eventual recovery in demand growth will quickly...

It's the Interest Rates, Stupid.(commodity prices)(Brief article)
April 10, 2008... By Staff Many buyers and commodity experts are struggling to rationalize how commodity prices can be increasingly volatile when demand is declining and supply is plentiful in most markets. In a recent paper, Harvard professor Jeffrey...

Corn Costs Hit Ethanol.(Brief article)
April 10, 2008... By Staff With corn prices at near-record highs and ethanol prices plunging, major ethanol producers continue to struggle and cut back capacity plans. The Wall Street Journal reports that while 2.7 billion gallons of additional ethanol...

Michelin Ties Oil to Tires.(Compagnie Generale des Etablissement Michelin)(Brief article)
April 10, 2008... By Staff With roughly 60% of the cost of making a tire coming from oil-based products, and oil prices at record highs, it's no surprise that French tire giant Michelin said effective April 1, it will adjust its prices for tires sold to the...

Economy + Supply.
April 10, 2008... By Staff Buyers remain judicious in placing orders (national, buying plans, 30 days ahead) -------------------------------------------- Up Down Same Index Steel 29% 22% 49% 53.8...

OECD: No Growth for Q2.(Organization for Economic Cooperation and Development)(Financial report)(Brief article)
April 10, 2008... By Staff If you were hoping to see U.S. economic growth in the second quarter, the Organization for Economic Cooperation and Development has bad news. The U.S. economy will fail to grow for the first time in more than six years in the...

Steel Demand Still Strong.(Brief article)
April 10, 2008... By Staff Ian Christmas, Secretary-General of the International Institute of Iron and Steel (IISI), told the Reuters Global Mining Summit that demand for steel is expected to remain strong for most of the year, globally. "In North America...

IBM Inks Deal with Hitachi.(research agreement between International Business Machines Corp. and Hitachi Ltd.)(Brief article)
April 10, 2008... By Staff IBM and Hitachi have signed a two-year joint semiconductor metrology research agreement to focus on the miniaturization of transistors, a driving force in improving the performance of 32-nm and 22-nm semiconductors.

UCLA Report: No Recession.
April 10, 2008... By Staff The quarterly anderson Forecast by the University of California at Los Angeles found that the U.S. economy will continue to slow in the second quarter, but will not go into a recession unless the current credit crisis gets worse....

No Oil Relief in Sight.(International Energy Agency)(Brief article)
April 10, 2008... By Staff The International Energy Agency is telling energy buyers to get used to high oil prices. Despite revising its 2008 oil consumption forecast downward for the U.S., the IEA said oil demand in China and other countries outside OPEC...

Carriers May Struggle.(Werner Enterprises Inc.)(Brief article)
April 10, 2008... By Staff In a recent regulatory filing, truckload carrier Werner Enterprises said "the continuation of a soft freight market and the spike in fuel prices are making it increasingly more difficult for many truckload carriers to stay in...

Taiwan Megaplant Startup.(Taiwan Semiconductor Manufacturing Company Ltd.)(Brief article)
April 10, 2008... By Staff Taiwan Semiconductor Manufacturing Co. (TSMC) and two other Taiwanese chipmakers are investing more than $14 billion into the Hsinchu Science Park, a manufacturing center in Taiwan that will include an advanced 12-inch wafer plant...

Weyerhaeuser to Buy IP Unit.(Weyerhaeuser Canada Ltd.)(Brief article)
April 10, 2008... By Staff Paper products giant Weyerhaeuser plans to sell its containerboard packaging business to International Paper for $6 billion. JPMorgan analyst Claudia Shank Hueston said the deal "shifts International Paper's earnings profile back...

Olin Shuts Plant.(Olin Corp.)(Brief article)
April 10, 2008... By Staff Chlor-Alkali Producer Olin Corp. plans to close its Dalhousie, New Brunswick, plant to streamline manufacturing operations. The plant makes chlorine, caustic soda, sodium chlorate and sodium hypochlorite and will be completely...

Port of New Orleans plans.(Brief article)
April 10, 2008... By Staff Officials at the Port of New Orleans are looking for more than $1 billion from both public and private entities in an effort to expand the port. The centerpiece is the expansion of the Napoleon Avenue Container Terminal (right),...

China Expands Chem Capacity.(Brief article)
April 10, 2008... By Staff If the Chinese government gives the green light, Shanghai Petrochemical will expand its ethylene capacity by 450,000 metric tons to a total capacity of 600,000 metric tons. Also China's biggest chemical refiner Sinopec Group said...

Arcelor Unloads Sparrows.(Arcelor Mittal)(OAO Severstal)(Brief article)
April 10, 2008... By Staff Russian metals firm Severstal is spending $810 million to purchase the Sparrows Point steel mill near Baltimore from Luxemburg-based ArcelorMittal. In December, ArcelorMittal called off a proposed deal to sell Sparrows Point to a...

LSI Buys HDD Business.
April 10, 2008... By Staff LSI Corp. will acquire the assets of the hard disk-drive semiconductor (HDD) business of Infineon Technologies. The deal includes product designs, related software, inventory and test equipment. Financial terms were not disclosed....

Toshiba Plans New Fabs.
April 10, 2008... By Staff Toshiba plans to build two new fabs in Japan, including one for NAND flash memory on the site of Iwate Toshiba Electronics Co., a Toshiba consolidated subsidiary, and adjacent to Toshiba's Yokkaichi Operations, where four NAND...

Discrete Chip Revenue Rises.(Brief article)
April 10, 2008... By Staff Seven years after the semiconductor industry suffered its worst recession ever, discrete semiconductors are on the verge of becoming the last major semiconductor market category to fully recover from the 2001 downturn. Discrete...

More Pain at the Pump.(Energy Information Administration forecasting diesel prices)(Brief article)
April 10, 2008... By Staff The U.S. Energy Information Administration forecasts that diesel prices in the U.S. will average $3.45/gallon in 2008, or 57¢ above the 2007 average price. That revised forecast came in mid-March as diesel prices hit a record...

Coal Prices will Stay Up.(Brief article)
April 10, 2008... By Staff The CEO of Rio Tinto's energy division says the current record prices for thermal and coking coal will stay high as global demand remains strong and infrastructure struggles to keep up. Preston Chiaro said prices for thermal and...

Zinc Prices will Climb.(Brief article)
April 10, 2008... By Staff The CEO of Canadian mining firm Teck Cominco says zinc prices will head up in the next two years as more zinc mines are shut down. Don Lindsay, CEO, said closing of mines in all markets except China, coupled with the possibility...

Airlines Hedge more Jet Fuel.(Brief article)
April 10, 2008... By Staff Airlines are hedging more of their jet fuel buys to use the financial gains from those contracts, when the price rises, to offset higher costs for jet fuel, typically an airline's major expense. (See "Speaking Out" in this issue...

Steel Price Hikes Hit Hard.(Brief article)
April 10, 2008... By Staff A whopping 82% of buyers polled in March report an increase in steel prices, a dramatic increase from the 67% the month before. One contracts administrator in Purchasing' s monthly buyer survey says his steel prices are up more...

NAND Prices Fall.
April 10, 2008... By Staff As reported first in Purchasing.com's Monday Midday Business Report , NAND prices on the spot market are falling because of weak seasonal demand and excess capacity. For instance, the price of an 8Gb single layer cell NAND chip...

CRU: Iron Ore will Drop in '09.(Brief article)
April 10, 2008... By Staff A new analysis by CRU predicts that iron ore prices, at all-time highs this year, will trend down after 2009, when supply matches up with demand. And after 2010 "prices will fall off moderately, but they won't necessarily drop...

Hedging is risky...Look before you leap.(impact of hedging on commodity prices)
April 10, 2008... By Tom Stundza The increasing volatility of commodity pricing calls for a risk-management strategy if you're going to hedge. High and volatile energy and commodity prices generate uncertainty for buyers. One way for supply executives...

ISM to convene in St. Louis.(nternational Supply Management Conference and Educational Exhibit)(Conference news)
April 10, 2008... By Susan Avery The state of the economy heads the list of topics, which also includes Lean, sustainability and Green. Here is Purchasing's complete guide to the 93rd Annual International Supply Management Conference and Educational...

Suppliers follow a roadmap to Lean.
April 10, 2008... By Susan Avery Aerospace and defense companies join forces to bring Lean to the supply base, and supplier performance is improving on some key metrics. Now, their tier-one suppliers are sharing what they've learned with their own...

Business Intelligence.
April 10, 2008... By David Hannon 42% Shippers expecting more LTL capacity in 2008 Source: Bear Stearns WHAT IT MEANS: While that's down from the same poll a year ago, it does indicate the shippers feel the LTL trucking market is a long way...

Land Rover leverages RFID for streamlined logistics.(Land Rover North America Inc.)
April 10, 2008... By David Hannon Radio-frequency identification (RFID) technology is not a myth. It's real and while its adoption has not turned the supply chain world on its ear like some market watchers predicted it might, it has been put to good use at...

Buyers face record-high prices as imports slow to a halt.
April 10, 2008... By Tom Stundza Steel prices in the U.S. continue to soar due to higher material costs, but prices outside the U.S. are spiraling even higher, slowing the flow of low-cost import steel to the domestic market. In the most recent...

PMA members expect business to be improved in the second half.(Precision Metalforming Association)(Brief article)
April 10, 2008... By Tom Stundza A majority of the metalworking companies polled in March expect business conditions to remain steady or improve during the second quarter as Precision Metalforming Association (PMA) survey of members finds only 31% who...

Blast furnace outage cuts Severstal production 35%.
April 10, 2008... By Tom Stundza An expected lengthy outage of one of two Severstal North America iron-making blast furnaces will reduce the Dearborn, Mich., steel mill's overall production volume by 35% this year. The parent firm, JSC Severstal of Russia,...

U.S. exports increased in January.(Brief article)
April 10, 2008... By Tom Stundza The weakened dollar has allowed U.S. steel mills to boost shipments to overseas buyers of pipe and tube and structural products-primarily to end users and distributors in Canada and Mexico. Domestic steel mills exported...

TAL to make floor beams for Boeing 787 Dreamliner.(TAL Manufacturing Solutions)(Brief article)
April 10, 2008... By Tom Stundza TAL Manufacturing Solutions of New Delhi will produce floor beams of advanced titanium and composite materials for Boeing's 787 Dreamliner airplane program "to provide for a best-value solution and significant weight...

Even with reduced production, surplus will be large this year.(aluminum)(Brief article)
April 10, 2008... By Tom Stundza Aluminum supply may exceed demand by a million metric tons this year, down from a previous forecast of 1.4 million tons as power shortages reduce global output, but still large enough to reduce world prices slightly for...

Supply issues keep sales prices high; less byproduct output a problem.(Molybdenum alloys)(Brief article)
April 10, 2008... By Tom Stundza World demand for steel-strengthening alloy molybdenum is expected to grow 5.8% this year, forecasts Catherine Virga of the CPM Group in New York. And with supply lagging demand, "present molybdenum prices (above $30/lb for...

Consumption outpaced demand in '07.(Brief article)
April 10, 2008... By Tom Stundza Global zinc consumption increased 3.7% to 11.4 million metric tons exceeded production by just 15,000 metric tons in 2007, down sharply from a 352,000 metric ton deficit in 2006, accord to preliminary data from the...

China approves more mergers to continue industrial rationalization.
April 10, 2008... By Tom Stundza China has approved two mergers involving major steel producers in a bid to further rationalize the sector, according to the Xinhua news agency in Beijing. The National Development and Reform Commission approved...

LME opens futures trading of billets.(London Metal Exchange Ltd.)(Brief article)
April 10, 2008... By Tom Stundza The London Metal Exchange (LME) has launched two steel futures contracts covering steel billet for delivery in the Mediterranean and Far East. Initial trading is on the LME's electronic platform, known as Select, and by...

Man of India is coming to Arkansas with pipe plant.
April 10, 2008... By Tom Stundza Man Industries (India) of Mumbai, India, plans to build a $100 million steel pipe plant at the Port of Little Rock, Ark., to serve the oil and gas industry. Production is scheduled to begin early in 2009. Speaking at a...

Business Intelligence.
April 10, 2008... By Tom Stundza $790 Per-ton rebar price sought Source: Nucor Corp. WHAT IT MEANS: Even though construction activity has declined, the March market price for carbon steel reinforcing bar averaged a record $720, which Nucor...

Metals Chips.(Republic Engineered Products L.L.C. creating new cold-finished steel bar products division)(Bolton Metal Products brass rod facility closed)(Pacific Coast Steel acquiring the assets of Century Steel)
April 10, 2008... By Tom Stundza Republic Engineered Products has created a new cold-finished steel bar products division made up of the company's bright bar mills in Gary, Ind.; Hamilton, Ontario; and Massillon, Ohio. The company makes cold-finished carbon...

Production resumes at Sunshine Mine.
April 10, 2008... By Tom Stundza Sterling Mining Co. has resumed silver production at the legendary Sunshine Mine in Kellogg, Idaho. The Sunshine Mine shut when silver prices averaged $4.40/oz, well below the cost of production, but has reopened now that...

U.S. demand slipped last year and may continue sliding in 2008.
April 10, 2008... By Tom Stundza Purchasing of aluminum mill products dropped by 7% in the U.S. last year and probably will slide again this year because of "what is now clearly a recession in the U.S.," says analyst Stephen Briggs at Societe Generale in...

Nichols shuts Alabama sheet mill.(Nichols Aluminum Alumi-Brite)(Brief article)
April 10, 2008... By Tom Stundza Nichols Aluminum has closed the aluminum sheet rolling mill in Decatur, Ala. for an indeterminate time, with "very weak orders" from the building and construction sector at the firm's other two rolling mills in Davenport,...

Prices around $4/lb as supplies tighten.(price and supply of copper)(Brief article)
April 10, 2008... By Tom Stundza Spot copper prices increased to $4/lb in mid-March-with futures trading in a $3.85-$4.00 range-as stockpiles monitored by the London Metal Exchange (LME) dropped to the lowest level in six months, spurring speculation supply...

It takes more than a penny to make one.(impact of metal prices on value of metal coins)(Brief article)
April 10, 2008... By Tom Stundza "Who else but the government would shell out almost two cents for a penny?" asks the NymexDirect Market Snapshot newsletter. In fiscal 2007, it cost the U.S. Mint 1.7Acents to make and distribute a one-cent coin, according...

Construction about to start on new Iceland smelter.(Nordural starting initial site preparation for primary aluminum smelter )(Brief article)
April 10, 2008... By Tom Stundza Nordural Helguvik, a wholly owned subsidiary of Century Aluminum, has started initial site preparation for a 250,000 metric ton/year greenfield primary aluminum smelter and rolling mill to be constructed near Helguvik,...

Graybar develops educational program with customers in mind.
April 10, 2008... By Susan Avery Graybar is preparing its employees to work with customers through education and training programs. One is a supply chain management certificate program, the St. Louis-based distributor of electrical and communication...

Business Intelligence.
April 10, 2008... By Susan Avery 7.6% Increase in sales of power transmission products Source: Power Transmission Distributors Association WHAT IT MEANS: U.S. distributors report that after a two-month decline, demand from buyers is back up...

MRO Briefs.(Kaman Industrial Technologies acquiring industrial Supply Co.)(MSC Industrial Direct Company Inc.)(Brief article)
April 10, 2008... By Susan Avery Kaman Industrial Technologies in Bloomfield, Conn., is acquiring Industrial Supply Co. in Richmond, Va. "This acquisition supports our corporate strategy of accelerating the growth of KIT by expanding our geographic...

Grainger adds vendor-managed inventory services to line-up.(Grainger Industrial Supply)(Brief article)
April 10, 2008... By Susan Avery Grainger developed its Inventory Solutions Service to reduce cost and improve productivity. The new value-added service provides two options to MRO buyers: The first is managed by the customer; the second, by the...

Money management becoming a critical skill.
April 10, 2008... By Paul Teague, Editor in Chief Money management is increasingly a critical skill for purchasing professionals. You see it in our articles on hedging (page 36 and page 59 of this issue), and in the general areas of finding, getting and...

Nortel pushes the outsourcing envelope.
April 10, 2008... By James Carbone Nortel Networks has taken outsourcing to a new level as electronics manufacturing services providers build virtually all of the OEM's communications equipment. But there has been a cost. Here is how the company has managed...

Business Intelligence.
April 10, 2008... By Maria Varmazis 66% Print buyers using Web-to-print services Source: InfoTrends WHAT IT MEANS: Web-to-print is fast proving to be the tool of choice for print buyers. In 2000, only 11% of purchasers reported using the Web...

Spend control, security take center stage at AIIM/OnDemand show.
April 10, 2008... By Maria Varmazis Security features and spend management/product use features caught most office technology buyers' eyes at the AIIM/OnDemand printing technology trade show in Boston last month. Major equipment manufacturers such as Xerox,...

Printing Goes Green.(Brief article)
April 10, 2008... By Maria Varmazis Print market researcher InfoTrends predicts that the Green movement will be in full force in 2008. As more consumers demand environmentally friendly paper products, producers will migrate over to more recycled products,...

Canon, Konica Minolta announce new multi-function and printing devices.(Brief article)
April 10, 2008... By Maria Varmazis Canon recently announced four new monochrome laser MFPs in its imageCLASS MF6500 series. The new models, the MF6540, MF6590, MF6595 and MF6595cx are aimed at small and home offices, Canon says. Each device can copy,...

High energy prices boost buys of pipe and tube.
April 10, 2008... By Tom Stundza Manufacturers of specialty steel tubulars anticipate strong demand this year as crude oil and natural gas gets more expensive. Also on the books is expanded capacity. Distributors report that the steel tubing bought by...

Three hats fit fine for Wingstop exec.(Wingstop Restaurants Inc.)
April 10, 2008... By David Hannon * Wingstop Location: Dallas * Size: $210 million in sales * Business: Restaurant chain If someone asked you if you could write a spec for a chicken wing, would you be able to? Does demand for your product fluctuate...

How to think about hedging.
April 10, 2008... By Hortentia Barton Think of hedging as insurance. The goal is to protect against a financially adverse event. There are several factors to consider if you're going to hedge, many of them included in the article on page 36 of this issue....

At Hewlett-Packard, procurement consolidates the meetings-management spend.
April 10, 2008... By Susan Avery Gathering data on meeting spending is a challenge, but having that information in hand can be a powerful tool for procurement when negotiating with suppliers. So says Lea McLeod, director of travel and meeting services...

Buckle up: 2008 is going to be an interesting year.(Frank Borochs forecast about airlines industry)
April 10, 2008... By Susan Avery Those are words of Frank Boroch, managing director, at Bear, Stearns & Co., speaking at the NBTA Business Travel Financial Forum in New York recently. In a forecast on the airline industry presented at the National...

Novellus realizes benefits of early supplier involvement.
April 10, 2008... By William Atkinson A number of companies make the effort to get suppliers involved early in the design process but few have been able to do so with the comprehensiveness and success of semiconductor equipment maker Novellus in San Jose,...

Business Intelligence.
April 10, 2008... By Staff 75% Buyers reporting price increases for commodities in March Source: www.purchasingdata.com WHAT IT MEANS : Driven by energy costs and value of the dollar, buyers are seeing higher prices despite declining demand in...

Buyers are concerned with supply, future higher prices.
April 10, 2008... By Staff Purchasers of industrial gases believe prices may continue to rise because of tight supply at a time of solid, if not accelerating, demand from mining, manufacturing, chemical process and energy markets. Three-quarters of the...