Purchasing articles from December 2006

Purchasing archives from December 2006

GE Plastics to move away from commodities to high-end technologies.(Brief article)
December 14, 2006... By Staff At a recent meeting with the press, executives at GE Plastics gave a brief glimpse of the company's business and technological directions in the years ahead. Brian Gladden, vice president and general manager for GE Plastics'...

At GE, joint problem solving takes the bite out of negotiations.(GE Plastics)
December 14, 2006... By Gordon Graff Novel ways of dealing with its suppliers and customers help the giant resin maker to avoid margin compression. Like most players in the chemical industry, GE Plastics finds itself caught in the middle. The Pittsfield,...

Cheaper oil will deflate elevated carbon black prices.
December 14, 2006... By Gordon Graff In the past year, the surging cost of crude oil has propelled the price of carbon black to record levels, but even though oil has recently retreated, tags for this widely used black pigment continue to remain stubbornly...

Business Intelligence.(Brief article)
December 14, 2006... By Staff 38% Buyers reporting plastic resin price hikes in November Source: www.purchasingdata.com WHAT IT MEANS: That's a 10-point drop from the previous month, indicating resins are on the decline. Only 36% of buyers polled...

Chemical briefs.(briefs)(acquisitions of FutureFuel Corp.)(Brief article)
December 14, 2006... By Staff Global capacity utilization in the chemicals market of around 92% and the rapid slide in the price of natural gas--from about $7 during the second quarter to less than $5 now--will mean "major margin expansion" for chemical...

Westlake Chemical pushes big price hikes in 3Q.(Financial report)(Brief article)
December 14, 2006... By Staff In its recent third-quarter financial statement, Westlake Chemical said its quarterly profits were up 42%, fueled primarily by price increases. The company said its average prices for olefins products in the third quarter...

Cleaning chemicals will see strong demand for next decade.(Brief article)
December 14, 2006... By David Hannon Demand for industrial and institutional (I&I) cleaning chemicals will remain strong through 2015 with growth approach 4% per year, according to a recent analysis by the Freedonia Group. According to the report,...

Specialty market sees supply consolidation in late 2006.(Chemtura Corp)(SpecialtyChem Products Corp)(Financial report)
December 14, 2006... By David Hannon The specialty chemical market in the U.S. saw a mixed bag of demand in the third quarter and several major consolidations and spin-offs that will impact buyers' supply going forward. Specialties maker Rohm & Haas in...

Methanol continues upward climb.(Brief article)
December 14, 2006... By Staff After averaging just about $2/gallon for two months, spot methanol prices have moved up to $2.25 early this month because of consistently strong demand in a market still concerned about near-term supplies. This is more bullish...

BASF expands pigments production.(Brief article)
December 14, 2006... By Staff BASF will significantly expand its pigment-products portfolio--especially for the coloration of plastics--through its ongoing integration of Engelhard, according to Reinhard Leppkes, coatings, plastics and specialties group vice...

RoHS means more electronic component obsolescence.(Restriction of Hazardous Substances )
December 14, 2006... By James Carbone Buyers have had to deal with the problem of obsolete parts for years, but the European Union's Restriction of Hazardous Substances (RoHS) law has added a new wrinkle to the issue. RoHS bans the use of lead and five...

Business Intelligence.(Brief article)(Statistical data)
December 14, 2006... By Staff 71% Buyers expecting passives prices to be the same Source: www.purchasingdata.com WHAT IT MEANS: Capacity for resistors, capacitors and other passive components is more than adequate to meet demand, which should...

Flex expands in Mexico.(Flextronics International Ltd.)(Brief article)
December 14, 2006... By Staff Flextronics has expanded its presence in Mexico through the first phase completion of its planned 1.9 million square foot facility in Ciudad Juarez. The company says its expansion in Juarez strengthens its ability to quickly...

Expect lower tags for ASICs.(Application specific integrated circuits)
December 14, 2006... By Staff Buyers can expect prices over the next several years to fall 3-5% per year as the growth rate of the application-specific integrated circuit market compared to the growth rate of the overall semiconductor market slips as other...

NAND demand grows on lower tags.(Brief article)
December 14, 2006... By Staff Global demand for NAND flash memory grew 12% in the third quarter but prices fell 22%, according to researcher iSuppli. Demand is expected to weaken in the fourth quarter--which could put more pressure on prices. However,...

Price wars hit Lenovo hard.(Lenovo Group Ltd loses profit due to pricing policies)(Brief article)
December 14, 2006... By Staff Lenovo cited price wars and supply chain issues in the U.S. market for its poor quarterly performance. Lenovo said "unusually aggressive pricing" by its U.S. competition was behind its 16% drop in profits. Shipments in the U.S.,...

Iron ore prices to rise.(Brief article)
December 14, 2006... By Staff Iron ore prices will be up next year, but how far remains a question. Rio Tinto's CEO Sam Walsh says iron ore prices will rise for the fifth straight year in 2007 after hitting record peaks in 2006. POSCO, the world's...

China's PPI rise slows.(economic aspects of petroleum industry)(Brief article)
December 14, 2006... By Staff Producer price growth slowed in China in October to its lowest rate since May, due mostly to lower oil prices, economists say. Prices rose 2.9% from a year earlier after gaining 3.5% in September. In a recent Bloomberg report,...

Sony loses on PS3 pricing.(Brief article)
December 14, 2006... By Staff Sony Corp. is losing more than $300 for every PlayStation 3 it sells. According to a "teardown analysis" by iSuppli, the materials and manufacturing cost of the PlayStation 3 is $805.85 for the 20 GB version and $840.35 for the 60...

Import prices dip.(prices of petroleum products)(Brief article)
December 14, 2006... By Staff The U.S. Import Price Index declined 2% for the second consecutive month in October, the Labor Departments' Bureau of Labor Statistics reported in November. The decrease was again led by declining petroleum prices, which fell 8.3%...

UPS, FedEx push 2007 hikes.(economic conditions)(Brief article)
December 14, 2006... By Staff UPS announced in November it was raising its average rates 4.9% for ground, air express and U.S. origin international shipments. The increase for air express and international shipments is based on a 6.9% increase in the base...

Copper prices slide down.(Brief article)
December 14, 2006... By Staff Copper prices in mid-November slid to a four-month low on the London Metal Exchange, closing at $6,920/ton after reports of increasing inventories hit the market. ABN Amro analyst Nick Moore in a Bloomberg report predicted an...

Lanxess ups plastics prices.(Lanxess Chemicals Group )(Brief article)
December 14, 2006... By Staff The Lanxess Chemicals Group is increasing its prices for engineering plastics and iron oxide pigments. Lanxess' Inorganic Pigments business unit is increasing its prices for selected iron oxide pigments up to 15%.

PDAs drop in price.(personal digital assistants)(Brief article)
December 14, 2006... By Staff The average selling price (ASP) of personal digital assistants (PDAs) in the third quarter of 2006 declined 13% from the same period last year to $351. Demand for PDAs continued to boom in the third-quarter, showing growth of 32%...

3Q aluminum ingot prices dip.(earnings of Alcan Inc.)(Financial report)(Brief article)
December 14, 2006... By Staff Alcan said its average realized price on sales of ingot products during the third quarter was up $639 per ton from the year-ago quarter but down $111 per ton from the second quarter of 2006.

3Q NAND tags drop.(Brief article)
December 14, 2006... By Staff As expected, per-megabyte NAND prices fell by 22% in the third quarter, while megabyte shipments grew by 44%. Researcher iSuppli says, "Improving margins for DRAM will compel DRAM suppliers to allocate more production to DRAM, and...

EIA sees higher oil prices.(Energy Information Administration)(Brief article)
December 14, 2006... By Staff The Energy Information Administration, the U.S. Department of Energy's data arm, said oil prices will continue to rise over the next several months. In its Short-Term Energy Outlook released in November, the EIA predicted oil...

Energy prices back as top concern heading into 2007.
December 14, 2006... By Staff (Buyers 90-day price expectations) [TABLE OMITTED]

Housing won't hit economy.(Brief article)
December 14, 2006... By Staff Housing construction plunged to the lowest level in more than six years in October, down a surprising 14.6% from September, according to the Commerce Department. But the U.S. housing slump won't spill over into the general...

Ceramic cap leadtimes out.(ceramic chip capacitors)(Brief article)
December 14, 2006... By Staff Leadtimes for ceramic chip capacitors have stretched steadily since June, with no price increases, according to Purchasingdata.com . If leadtimes continue to move out, higher prices are inevitable.

Delta to fight takeover.
December 14, 2006... By Staff Executives at bankrupt Delta Air Lines plan to fight off a surprise $8.76 billion takeover bid by rival US Airways. According to a report in the Wall Street Journal , Delta CEO Gerald Grinstein was "steaming from being blindsided"...

Truckload capacity growing.(Brief article)
December 14, 2006... By Staff A recent report from Bear Stearns shows truckload capacity is expanding dramatically, increasing supply and--eventually--impacting pricing. In a recent Bear Stearns poll, 53% of shippers said they see greater truckload capacity...

Semi growth of 10% in '07.(Brief article)
December 14, 2006... By Staff Global semiconductor revenue will grow 10% to $248.8 billion in 2007, according to the Semiconductor Industry Association's annual forecast. The industry will finish 2006 with revenue of $248.8 billion, a 9.4% increase from 2005...

Bidding war for Corus.(steelmaker Corus)(Brief article)
December 14, 2006... By Staff There's an all-out bidding war going on for London-based steelmaker Corus. After receiving an $8 billion bid from Indian steel giant Tata Steel in October, Corus has also received a similar offer from Brazilian giant Cia...

IEA cuts oil forecast.(international Energy Agency)(Brief article)
December 14, 2006... By Staff The Paris-based international Energy Agency said world oil demand growth is expected to be 1.1% for 2006, less than the 1.2% previously forecasted. Forecast growth in 2007 annual demand was left unchanged at 1.7%, the IEA said in...

Airbus slashes supply base.(Brief article)
December 14, 2006... By Staff Airbus said it will dramatically cut its supply base in an effort to reduce costs, shortly before it found out that FedEx was canceling its order for 10 A380s. According to an Associated Press item, Airbus will cut 80% of its...

Alcan cuts smelter deal.(construction of aluminum industry)(Brief article)
December 14, 2006... By Staff According to a South African trade minister, aluminum giant Alcan has settled an energy deal with South African energy supplier Eskom, which gives Alcan the go-ahead to build a $2.5 billion aluminum smelter in South Africa. "It...

China to be #1 in electronics.(Brief article)
December 14, 2006... By Staff China will surpass the U.S. by the end of the year and become the world's largest electronics manufacturer. The latest figures from a report published by Reed Electronics Research and distributed by In-Stat show Chinese...

Collins & Aikman to be sold.(mergers)(Brief article)
December 14, 2006... By Staff Bankrupt automotive supplier Collins & Aikman will be sold off either in parts or as a whole. It cannot successfully emerge from Chapter 11. The company first filed for bankruptcy in May 2005, and originally said it had a plan to...

New biodiesel from ethanol.(construction of biodiesel production plant)(Brief article)
December 14, 2006... By Staff Verasun Energy corp., the nation's second-largest ethanol producer, said in early November it plans to produce biodiesel from oil extracted from distillers' grains, a co-product of the ethanol production process. VeraSun plans a...

Buyers plan to increase sourcing of industrial machinery and tooling heading into the new year.
December 14, 2006... By Staff (Buyers' near-term buying plans) [TABLE OMITTED]

More leadtimes stretch.(Brief article)(Statistical data)
December 14, 2006... By Staff Twenty-eight of 41 electronic component leadtimes tracked monthly by Purchasing stretched last month reflecting strong demand. Sixteen megabit DRAM average leadtime stretched from 6.5 weeks to 11 weeks; 32-bit microprocessors...

Five tips to buying the right tool from the right provider.
December 14, 2006... By David Hannon Buying logistics software is getting more complicated and there's more at stake. There are a variety of factors to consider in making the choice: the functionality of the tools, the price, delivery model, the reputation of...

Business Intelligence.(Brief article)
December 14, 2006... By Staff 91% Companies say transportation technology won't meet their future needs Source: Aberdeen Group report WHAT IT MEANS: Logistics organizations are going shopping. Another 69% say their technology does not meet their...

Best in class saw freight costs reduced in past two years.(Survey)(Brief article)
December 14, 2006... By Staff A recent report from the Aberdeen Group found that 82% of companies polled saw their freight costs increase (70%) or stay flat (12%) in the last two years, while best in class companies were able to reduce freight costs in that...

China in the crosshairs as steel imports rise.(Mittal Steel Company N.V.)
December 14, 2006... By Tom Stundza As U. S. buyers continue to look offshore for supply, new lawsuits, tariffs and other protection measures aim to curb imports. Meanwhile, China is reorganizing its steel industry. Nine-month imports of foreign-made steel...

Precious metals prices will remain elevated on geopolitical concerns.(economic aspect of mining industry)
December 14, 2006... By Tom Stundza While nonferrous prices are expected to retreat in 2007 from this year's record-setting highs, precious metals prices could keep elevating. Supply isn't really an issue outside gold; and demand is erratic from industrial,...

Collaboration with suppliers is on minds of MRO buyers.(maintenance, repair and operations)
December 14, 2006... By Susan Avery It appears that it's no longer a question of whether MRO buyers and their supplier partners will collaborate to resolve issues surrounding the maintenance, repair and operations (MRO) buy. Now, it's more a matter of how much...

Business Intelligence.(Brief article)
December 14, 2006... By Staff 1,288 Pcard program managers taking part in new research Source: 2005 Purchasing Card Benchmark Study WHAT IT MEANS: This study of pcard program managers is one of the more comprehensive looks at the market, making...

Good news on the compensation front.(benefits of purchasing professionals)(Editorial)
December 14, 2006... By Paul Teague, Editor in Chief At last, some recognition! In the last few years, several studies have shown an increasing appreciation of and reliance on purchasing and supply chain management in corporations. Now, finally, with that...

Boston Scientific focuses office buy.
December 14, 2006... By Maria Varmazis Three years ago, the global sourcing organization at medical device maker Boston Scientific launched a commodity management strategy for its office buy. A major component of that strategy was equipment standardization...

Business Intelligence.(briefs)(Brief article)(Statistical data)
December 14, 2006... By Staff 3.7% Decline in printer shipments worldwide from 2006 to 2010 Source: IDC WHAT IT MEANS: As multifunction printer shipments continue to climb, their popularity is eating away at single-function printer sales. ...

Chris A. Paul, production manager, Alu"Die.(dialogue by Chris A. Paul)(Interview)
December 14, 2006... Interview by David Hannon Player: Chris A. Paul, production manager, Alu'Die Background: Paul spent five years as purchasing manager at the aluminum tooling maker and recently moved into the expanded role of production manager. ...

Purchasing paychecks get fatter.(compartive analysis of women salary)
December 14, 2006... By Susan Avery Not only is compensation going up, it's rising faster than for other professions. And women's earnings are starting to catch up. Top management is finally recognizing smart sourcing strategy (especially for indirect) when it...

Midmarket consumer products firm focuses on supplier success.(wellness products maker Melaleuca)(Company overview)
December 14, 2006... By David Hannon "Our company owner has a mandate that we protect our suppliers' margins." Not a phrase you hear often in big business today, but in the midmarket procurement model, suppliers are more often viewed as partners with...

The changing face of independent distributors.
December 14, 2006... By James Carbone Independent distributors aren't just for shortages anymore. Ten years ago, most electronics buyers would buy parts from nonfranchised independent distributors only when components were in short supply. Today, buyers...

Healthcare buyers leverage live group buying events.
December 14, 2006... By Wayne Forrest If you have ever wondered how much more efficient it would be to have all your potential suppliers in one place at one time to review and evaluate their product offerings, take note. There is an opportunity to do that--at...

Business Intelligence.(briefs)(Brief article)(Statistical data)
December 14, 2006... By Staff 19% Average savings reported from global sourcing Source: CAPS Research report WHAT IT MEANS: A CAPS study found average global sourcing increased from the 21-30% range of spend in 2000 to 31-40% in 2005 and could...

Chrysler nets Kudos from NMSDC.(DaimlerChrysler gets Corporation of the Year award from National Minority Supplier Development Council)(Brief article)
December 14, 2006... By Staff For the fourth time, DaimlerChrysler has received the Corporation of the Year award from the National Minority Supplier Development Council (NMSDC) for its long-term commitment and business development leadership of minority...

Billions to be saved by off-shoring procurement.(Brief article)
December 14, 2006... By Staff A recent report from the Hackett Group found the Fortune 500 could potentially save $58 billion annually, or more than $116 million on average per company, by off-shoring many of their back office activities--including...

Purchasing execs on the move...(briefs)
December 14, 2006... By Staff Jimmy Choi has been named senior vice president and managing director of Kellwood Global Asia. He will be responsible for leading all aspects of strategic sourcing and production for the Asia business unit and will act as a...

Downstream suppliers become bigger concern.
December 14, 2006... By David Hannon A recent story originally reported by Bloomberg and Purchasing.com highlighted the need for deep-tier supplier evaluation. Bloomberg reporters exposed a practice in South America where slave labor is used to produce pig...