Purchasing articles from January 2007

Purchasing archives from January 2007

GSK"s consumer unit leverages technology in global sourcing.(GlaxoSmithKline )(Company overview)
January 18, 2007... By David Hannon GlaxoSmithKline has a long history of scientific innovation and the procurement team at its Consumer Healthcare business is leading the way by leveraging technology in its drive towards product innovation, global sourcing...

Business Intelligence.(demand for styrene)(molded plastic prices)(Brief article)
January 18, 2007... By Staff 2.6% Increase in demand for styrene through 2011 Source: CMAI WHAT IT MEANS: CMAI's forecast calls for operating rates to continue falling, creating an amply supplied market, even before new planned capacity...

More capacity and competition should keep surfactant prices down in 2007.
January 18, 2007... By Gordon Graff Costlier oil has been at the root of rate hikes by several major surfactant manufacturers over the past year. Meanwhile, the recent opening of two new Middle Eastern plants for linear alkyl benzene (LAB), a key surfactant...

It's not just about SMT anymore.(surface mount technology )
January 18, 2007... By James Carbone Choosing an electronics contract manufacturer used to be a relatively easy task for an OEM purchasing manager involved in outsourcing decisions. "Eight or nine years ago we were just sourcing surface mount technology...

Business Intelligence.(electronics sales improves)(semiconductor price stables)(Brief article)
January 18, 2007... By Staff 40% Electronics buyers who say business is improving Source: www.purchasingdata.com WHAT IT MEANS: Fewer buyers reported business improved in December compared to November. That is an indication that business slowed...

Chip capital spending rises.(Brief article)
January 18, 2007... By Staff Semiconductor industry capital spending will close 2006 at $53 billion, a 14% increase over 2005, and then grow to $80 billion by 2011, according to market researcher IC Insights. The capital expenditure (capex) record of $60...

Vista will mean higher BOM cost.
January 18, 2007... By Staff Microsoft's new Vista operating system will result in about a $100 increase in the cost of the bill of materials of a PC, according to a new cost analysis by researcher iSuppli. An average desktop PC running Windows XP...

Digi-Key inks new agreements.(Nihon Dempa Kogyo Company Ltd.)(Brief article)
January 18, 2007... By Staff Digi-Key Corp. has signed agreements with several component manufacturers. The Thief River Falls, Minn. distributor says it has signed a global distribution agreement with Nihon Dempa Kogyo Co. to carry the company's line of...

Cell phones boost image sensor demand.(Brief article)
January 18, 2007... By Staff The image sensor market will post 27% annual growth driven by their use in camera-equipped cellular phones. Mobile phones have emerged as the single largest market for image sensors. Revenue from shipments of image sensors for...

New Avnet division focuses on small orders.(Brief article)
January 18, 2007... By Staff Avnet has launched a new division targeted at small volume buyers. "Avnet Express is for customers looking for speed, convenience and real-time information," says Beth Ely, senior vice president new channel development for...

Arrow looks to India for growth.(Arrow Electronics Inc.)
January 18, 2007... By Staff Electronics buyers who need to source components in India can expect distributors to beef up their presence in the country. India's total available market (TAM) for electronic components is estimated at $1.2 billion for 2006....

Manufacturing moves to Chennai.
January 18, 2007... By Staff Electronics buyers can expect Chennai in southeast India to become the next hot spot for electronics manufacturing. The Indian government is offering companies incentives to open facilities in Chennai, formerly known as...

Producer price index soars.(Brief article)
January 18, 2007... By Staff Bad news for buyers. The U.S. Producer Price Index climbed 2% in November, its highest one-month climb in 32 years. In the prior month, producer prices fell 1.6%. The PPI spike was driven by the energy goods price index which...

Housing DRAGS copper tags.(Brief article)
January 18, 2007... By Staff Copper inventories monitored by the London Metal Exchange gained 98% in 2006 stockpiles and will gain as much as 33% in the first quarter of next year, according to Credit Suisse Group analysts. That will result in lower prices....

Coking coal prices may drop.(Brief article)
January 18, 2007... By Staff Prices for coking coal, which is used to make steel, may drop as much as 13% by April. Charles Goodyear, CEO of BHP Billiton, said the coking coal market is softer than the past year, because "the available supply in China...

SDRAM tags fall.(Brief article)
January 18, 2007... By Staff Prices for some version of synchronous DRAMs (SDRAMs) are falling. For example, the spot market price of a 256 megabit, 16Mx16, PC133 part was $4.00 in September, but fell to about $3.30 in December, according to independent...

Silver hits Kodak.(Eastman Kodak's Health Group )(Brief article)
January 18, 2007... By Staff Eastman Kodak's Health Group cited increased silver costs in its 8-12% price increase for its film and supplies. "[2006] has seen unprecedented high costs for basic commodities such as silver. These costs continue to escalate,"...

Iron ore contracts set.
January 18, 2007... By Staff Brazilian mining firm CVRD agreed to a 9.5% price increase for iron ore with Chinese steelmaker Baosteel setting the benchmark rate for contracts in other regions. That's good news for buyers, as it's the lowest increase since...

Rubber will bounce back.(Brief article)
January 18, 2007... By Staff "Rubber may well have bottomed,'' said Michael Coleman, managing director at Aisling Analytics in Singapore. Demand in Asia and the increasing cost of oil-based, synthetic rubber might cause prices to jump 15% by mid-2007,...

Natgas up on capacity.(Brief article)
January 18, 2007... By Staff Despite warmer than expected weather in December, natural gas prices remained high in certain regions. A recent Associated Press story blames it on lack of storage and delivery capacity in certain regions, particularly in the...

Rail rates will roll.(Brief article)
January 18, 2007... By Staff Rail shippers may see rates remain high in 2007, despite an expected dip in the economy and slower volume growth. Railroads saw their first 2006 decline in volumes in December, but Edward Wolfe of Bear Stearns says that for rails,...

Further chip price erosion.(Brief article)
January 18, 2007... By Staff Semiconductor prices might continue to drop in 2007. But the picture is not yet clear. In a late-December report, Standard & Poor analyst Clyde Montevirgen, said, "We think current [semiconductor] inventory congestion, possible...

Dow hikes PE prices.(polyethylene resins )(Brief article)
January 18, 2007... By Staff Dow Chemical is pushing a 7¢/lb price increase for all grades of its polyethylene resins effective January 15. "We continue to see month over month increases in demand since September," said Howard Ungerleider, commercial...

Acetic acid prices may stay up.(Brief article)
January 18, 2007... By Staff "Supply-demand for acetic acid and vinyl acetate will be very favorable through 2009 for producers and sellers," said John O'Dwyer, acetyls president at Celanese, during a recent presentation. He said Celanese's operating rates...

Energy, machinery remain top buyer concerns.
January 18, 2007... By Staff (Buyers' 90-day price expectations) [TABLE OMITTED] [TABLE OMITTED]

3Q GDP slows.(Brief article)
January 18, 2007... By Staff Economic growth in the third quarter was revised down to 2%, the Commerce Department reported in December in its final revision of the third-quarter number. The drop in GDP was attributed to a major decline in spending for...

TTI Acquired.
January 18, 2007... By Staff Electronics distributor TTI will be acquired by Berkshire Hathaway. Paul Andrews will remain chairman and CEO. The deal includes TTI's catalog distributor subsidiary Mouser Electronics.

Butadiene demand to drop.(Brief article)
January 18, 2007... By Staff Butadiene demand will slip over the next five years. Demand for butadiene is expected to grow under 3% per year, which is slightly lower than the 3.7% experienced annually over the past five years. According to a recent analysis...

India will be big chipmaker.(Brief article)
January 18, 2007... By Staff With more ems firms looking at the subcontinent and broader technology adoption, semiconductor supply will be coming to India soon. Market researcher In-Stat says the market for semiconductors in India was $1.18 billion in 2005...

IP sells off two units.(International Paper Co.)(Brief article)
January 18, 2007... By Staff International Paper agreed to sell off two units--its beverage packaging business will be sold to Carter Holt Harvey for about $500 million and the Arizona Chemical business will go to Rhone Capital III for $485 million.

Port security Will cost.(Brief article)
January 18, 2007... By Staff A task force of government and business leaders recently called for new federal laws to ensure all cargo is inspected and said every regulated port should implement a risk-management plan. Under the proposed plan, shippers would...

Tooling spend picks up in early 2007.
January 18, 2007... By Staff [TABLE OMITTED]

Inventory Control: Treat the cause, not the symptom.
January 18, 2007... By Paul E. Teague As with almost everything else in purchasing, inventory management requires thinking out of the box and working closely with suppliers. The result: improved working capital. Of all the things purchasing professionals...

Leadtimes roll back.(Brief article)
January 18, 2007... By Staff Twenty-six of 41 electronic component leadtimes tracked monthly by Purchasing shrunk last month, reflecting fading demand. Sixteen megabit DRAM delivery times fell back from 11 weeks in November to seven weeks in December;...

Logistics market will give buyers a breather in 2007.
January 18, 2007... By David Hannon Like an athlete recovering from a long competition, logistics buyers will enjoy something of a slowdown to catch their collective breath in 2007. After a period of high demand and tight capacity, shippers across the modes...

Business Intelligence.(Brief article)
January 18, 2007... By Staff 69.5% Share of total U.S. freight hauled by trucks by 2017 Source: American Trucking Associations WHAT IT MEANS: According to the latest ATA forecast, truckers will increase their share of total tonnage from 68.9% in...

Arrow Electronics gains visibility through freight payment data.
January 18, 2007... By Staff For a long time, Arrow Electronics yearned to gain more visibility into its huge small-parcel spend. Thanks to the work of its third-party freight payment vendor, today it has that visibility and is using it to reduce its...

Look closely before buying primary metal products offshore.
January 18, 2007... By Tom Stundza It's sometimes hard to source metals from low-cost countries simply because some key commodities aren't made there. As the domestic manufacturing economy has grown since early 2002, buyers of industrial metals...

U.S. trade panel ends tariffs on imports of coated sheet.
January 18, 2007... By Tom Stundza Government trade regulators voted last month to revoke all tariffs and duties on high-end steel imports from certain countries, pulling the plug on a 13-year-old set of trade barriers on zinc-coated sheet products. The U.S....

Mexico"s steel consumption seen soaring.(Brief article)
January 18, 2007... By Staff Buyers and producers can expect Mexico to become one of the hottest growth markets in the Americas, with steel consumption growing 6% annually for the next decade. The other big growth market will be Brazil. That's the word from...

Lone Star to build large-diameter pipe mill.(Brief article)
January 18, 2007... By Staff lone star technologies has entered into a definitive agreement to form a joint venture with the Welspun Group to construct a $66 million large-diameter pipe mill capable of producing 300,000 tons annually of spiral welded tube in...

Statoil deal will spin Hydro into a major supplier.
January 18, 2007... By Staff Statoil's planned takeover of Norsk Hydro's oil and gas business will result in Hydro's aluminum and hydropower business being split off into a separate entity with sharpened focus on the light metal, suggest such Oslo-based...

Business Intelligence.(prices of nonferrous metals)(copper reserves)(stainless steel output increases)(Brief article)
January 18, 2007... By Staff 8% Nonferrous cost dip Source: Moody's Investors Service WHAT IT MEANS: Chinese demand may keep world prices above historical averages for key production-grade nonferrous metals. But prices will decline from this...

Smorgon buys Maine processor.(Smorgon Steel Group Ltd.)(Industrial Metal Recycling Inc.)(Brief article)
January 18, 2007... By Staff Australia's Smorgon Steel is buying the operating assets of Industrial Metal Recycling in Maine, to consolidate its position along the East Coast. Earlier, the Melbourne-based steelmaker acquired ITI Scrap Metal in Virginia and...

Reliance Steel buys Encore of Canada.(Brief article)
January 18, 2007... By Staff Reliance Steel & Aluminum Co. of Los Angeles, one of the largest metals service center companies in North America, is buying the Encore Group of metals service center companies (Encore Metals, Encore Metals USA, Encore Coils, and...

Price inflation won't be dulled.(Brief article)
January 18, 2007... By Staff Spot U.S. prices for high-grade zinc have tripled in the last two years--from 52¢/lb in 2004 to $1.58 last year--and the price rally won't likely end soon. Analysts now project a 37¢ increase in the 2007 transaction...

In 2006, even the lows were high.
January 18, 2007... By Staff It was a year to remember for commodities in 2006 with copper and platinum futures reaching--then falling--from never-before-seen levels. Overall, "2006 was a year of dissonance for the commodity markets," according to commodity...

Metals Chips.(aluminium production resumed after labor dispute)(steel mill construction by Minnesota Steel)(Engineered Metals Group acquires Samuel, Son & Co. of Mississauga)
January 18, 2007... By Staff Aluminum poured in December for the first time in two years at Ormet in Hannibal, Ohio, at the conclusion of a labor dispute. At full production, the plant is capable of smelting 1.6 million lb/day of aluminum. It isn't known when...

Speculators bet on long-term inflation.
January 18, 2007... By Staff Speculators are piling into copper investments that mature in December 2010 because they think prices are cheap now but will climb to reflect shifting demand and supply fundamentals over the next few years. Market sources tell...

Innovative micro mill for rebarset for the Phoenix area.(Brief article)
January 18, 2007... By Staff Commercial Metals Co. (CMC) headquartered in Irving, Texas, plans to construct an innovative "micro mill" of 280,000 ton/year near Phoenix that will produce concrete reinforcing bar. The project is expected to cost $130 million...

Chinese ministers want firms to boost high-valued exports.
January 18, 2007... By Staff Strong global demand has led to China's rapid increase in steel exports but there is an economic need to stop exporting low-grade steel (such as ingot and hot-rolled coil) in favor of value-added products (such as heat-treated...

2007 brings lower prices, and innovations from distributors.
January 18, 2007... By Susan Avery With the new year comes a softening economy, more stable prices, a smaller supply base and ideas to improve productivity and reduce cost. MRO purchasers and industrial distributors agree that the booming economy of the...

Business Intelligence.
January 18, 2007... By Staff 100% Distributor execs who expect strong sales in 2007 Source: Purchasing spot poll WHAT IT MEANS: It's good news for buyers. Healthy suppliers are more likely to invest in new technology and training. $190K ...

And now, from our Commodities Council...
January 18, 2007... By Paul Teague, Editor in Chief Nothing helps professionals of any stripe sort through complicated subjects more than the perspective they get from experts in the field. For purchasing professionals, there aren't many tasks more...

Equipment more affordable, supply prices will be volatile.
January 18, 2007... By Maria Varmazis The crystal ball is a bit cloudy for office buyers in 2007. The good news is that competition will drive down office equipment prices in the coming year. While the battleground is set for a big showdown over...

Business Intelligence.(Brief article)
January 18, 2007... By Staff $7.41 Billion in total 2005 equipment revenues for black and white printing devices Source: InfoTrends WHAT IT MEANS: Though black and white printing may have peaked in its market popularity, it still holds a major...

2007: What to look for.(Brief article)
January 18, 2007... By Staff Developments to watch as you navigate the new year. With a few exceptions, buyers could be in for a quieter year in 2007, since prices for many--though not all--commodities will stay flat or fall slightly. But "flat" and...

What you'll pay.
January 18, 2007... By Tom Stundza Prices will drop 10% on average. after an explosive 52% growth in metals pricing in 2006, buyers' costs look to drop by 10% overall in 2007. Individual metal pricing will remain unsettled--inflated for some metals,...

Why you"ll pay it.
January 18, 2007... By Staff Supplies of copper, steel, aluminum in surplus, but not zinc. Buyers can expect a modest supply surplus for steel and most nonferrous metals in 2007 due to slowing demand in key consuming regions, including North America....

What you'll pay.(electronics components )
January 18, 2007... By James Carbone Prices for most electronics components will fall. Expect prices to fall for most electronic components in 2007 because of weaker demand, ample capacity and stable raw materials costs. The exception will be DRAM. ...

Why you'll pay it.
January 18, 2007... By Staff DRAM supplies tight, other electronics components adequate. Buyers can expect weaker prices and stable leadtimes in 2007 for most electronic components as global demand for end equipment slows down and supply and demand...

What you'll pay.
January 18, 2007... By Dave Hannon Prices will stabilize due to market slowdown. Chemicals buyers will see a much more subdued market in 2007, as the U.S. economy slows and raw materials prices level out. In a recent report, Fitch Ratings said market...

Why you"ll pay it.
January 18, 2007... By Staff Demand for ethylene, polypropylene other chemicals to slow. Overall demand for chemical products will depend most on overall economic conditions. Fitch Ratings points out that in 2007, "End-users are expected to work off...

Supply chain management is key to meeting requirements of demanding customers.
January 18, 2007... By Susan Avery Harvey Kaylie sees the supply chain as a relay team, picturing each link as a runner handing off a baton to the next in line. "It's not easy to control the hand off from a supplier," says the president of Mini-Circuits in...

Team-based buying strategytakes off in indirect materials.
January 18, 2007... By William Atkinson For a number of years, companies have used team-based buying strategies to better leverage direct spend. But similar team-buying initiatives on the indirect materials side tend to be a lower priority if they exist at...

Business Intelligence.(Brief article)
January 18, 2007... By Staff 89% Respondents that say procurement has grown more strategic in the last three years Source: Aberdeen Group WHAT IT MEANS: Aberdeen's CPO Agenda report also found that only 19% of CPOs at average companies...

Tier-one auto supplier targets low-cost regions.
January 18, 2007... By William Atkinson Like any other tier-one automotive supplier, ArvinMeritor of Troy, Mich. has to meet annual cost reduction goals for customers. "At the same time, we also have returns that we need to provide to our shareowners," says...

Copper quality quandaries.
January 18, 2007... By Staff Unimaginable Regarding "Buyers want high-quality copper but high prices remain a burden" (Purchasing , October 5, 2006, Metals Edition, p. 36B9), I cannot imagine the sourcing of any product or service that would not feature...