Purchasing articles from January 2009

Purchasing archives from January 2009

How to win internal allies.(food processing industry's contract with chemical industry)(Brief article)
January 15, 2009... 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 alternatives: Teach...

Dean Foods milks strategic sourcing for all its value.(Dean Foods' Dairy Group)
January 15, 2009... By Alan R. Earls Food giant makes sure its existing plants and new acquisitions play well together in a company-wide procurement process. When Brad Holcomb looks ahead at the economic environment forecast this year, he sees...

Surfactant prices ease up as feedstock costs tumble.
January 15, 2009... By Gordon Graff Buyers in the soaps and detergents markets got pummeled through much of 2008 by a seemingly endless round of surfactant price increases. But since last summer, prices of surfactants--key ingredients in detergent, industrial...

Business Intelligence.
January 15, 2009... Staff 52¢/lb December price for natural refined glycerin Source: www.purchasingdata.com WHAT IT MEANS: That's down from its high of 78¢ in May. As prices for the oleochemical derivative decline, the raw materials...

Huntsman and Apollo/Hexion terminate merger.(Hexion Chemicals )(Brief article)
January 15, 2009... By David Hannon A year and a half after it was announced, the proposed $6.5 billion merger of Apollo Global Management's Hexion Chemicals with Huntsman Corp. has been terminated. The proposed deal dates back to July 2007, when Huntsman...

Dow to shut 20 plants, idle 180 more.(Dow Chemical Co.)(Brief article)
January 15, 2009... By David Hannon In an effort to reduce its production capacity in an era of declining demand, Dow Chemical is closing 20 facilities and temporarily idling another 180 plants around the world. As a result Dow will also cut 5,000 full-time...

NACD members meet to plan legislative priorities.(National Association of Chemical Distributors)
January 15, 2009... By Paul Teague About 550 members of the National Association of Chemical Distributors (NACD) met in Phoenix in December to discuss common issues in the industry and share best practices. Among the issues discussed was: their response to a...

Chemical trade deficit will continue in 2009.(Brief article)(Statistical data)
January 15, 2009... Staff During the first part of 2008, sales of chemicals were growing briskly, in part due to higher energy costs, reports Kevin Swift, chief economist of the American Chemistry Council. Global demand for chemicals was strong and the U.S....

Petrochemical demand will continue to slide in 2009.(American Chemistry Council)
January 15, 2009... By Tom Stundza At the end of 2008, the economic growth needed to support petrochemicals purchasing was stalled: The U.S. is in recession, economic growth in the rest of the world has slowed considerably and several emerging nations also...

Distributors face stiff competition in Asia.(electronics wholesalers faces competition from North American distributors)
January 15, 2009... By James Carbone It's no secret that many North American electronics distributors are focusing more efforts in Asia to grow sales as manufacturing has transferred to China and other low-cost countries. Many distributors are finding...

Caution!(industry forecasts of electronics industry)(Industry overview)(Financial report)
January 15, 2009... By James Carbone For electronics buyers, tough economic times require close scrutiny of chip, passives and other suppliers. Here's how some buyers are managing risk. The financial crisis and economic slowdown in the electronics...

Chip prices will fall along with capital spending.(Financial report)
January 15, 2009... By James Carbone Electronics buyers can expect another year of falling prices and short leadtimes for most semiconductors in 2009 because of the economic slowdown and overall weaker demand for electronics systems and components. How...

Business Intelligence.
January 15, 2009... By James Carbone 57% Buyers who say business is down compared to last month Source: www.purchasingdata.com What it means: The electronics industry is feeling the effects of the recession and the credit crunch . 55% ...

iSuppli: Chip inventories swell in fourth quarter.(Brief article)
January 15, 2009... By James Carbone With semiconductor sales slumping the fourth quarter of 2008, semiconductor inventory levels in the global electronics supply chain started the new year about three times as high as they were in the third quarter of 2008,...

Mouser signs agreements.
January 15, 2009... By James Carbone Mouser Electronics has signed a distribution agreement with Spansion in Sunnyvale, Calif. and will carry the company flash memory precuts. Mouser's Spansion portfolio includes high- and mid-density flash memory solutions...

Relay prices expected to be more stable in 2009.
January 15, 2009... By Gina Roos The relay market in 2008 was marked with price increases of up to 10% as a result of rising materials costs. Now, relay prices are changing due to the worldwide economic slowdown. Electromechanical relay prices have...

IDC: External disk storage capacity, demand increases.(Brief article)
January 15, 2009... By James Carbone Despite the economic downturn, worldwide external disk storage systems factory revenues posted 8.8% year-over-year growth totaling $4.9 billion in the third quarter, according to a new report from researcher IDC. ...

SEMI: Despite downturn, wafer capacity continues to grow.(Brief article)
January 15, 2009... By James Carbone The electronics industry downturn will result in worldwide fab capacity increasing only 5% in 2008 and only 4-5% in 2009, according to a new report by trade association SEMI. The fab capacity growth rates are lower...

Prices.(Brief article)
January 15, 2009... Staff Most buyers expect prices to stay depressed (National, 90-day price expectations) -------------------------------------------- UP DOWN SAME INDEX Paper 17% 39% 44% 39.0...

China Ends Taxes.(Brief article)
January 15, 2009... Staff In an effort to increase its exports of finished metals, China will eliminate taxes on import of certain metal concentrates as well as end taxes on the export of some finished metals. Effective Feb. 1, China will no longer tax...

LTL Rates Down.(Brief article)
January 15, 2009... Staff In a recent note to clients, David Ross of Stifel Nicolaus said overcapacity in the LTL market "makes for an ugly pricing picture" for carriers, especially those struggling to gain market share by reducing rates.

Gold Forecasts Down.(Brief article)
January 15, 2009... Staff Analysts are divided on the future price for gold with some seeing 2009 prices averaging as high as $897/troy ounce and others forecasting the price average as low as $838. The precious metal's price average for 2008 was $868....

Trans-atlantic Fares Cut.(Brief article)
January 15, 2009... Staff Virgin Atlantic Airways is slashing prices, offering London-New York round trips for as little as $377 to offset recent easing in business. CEO Steve Ridgway says Virgin may have to "trim seats" (i.e., cut capacity) to ride out a...

Corning Cuts Glass Prices.(Brief article)
January 15, 2009... Staff Corning Inc. a maker of glass for flat-panel televisions and computers, is cutting wholesale prices to clear out excess inventories. The downside of this rapid response is that the slowing economy won't get as much of a pop from...

Diesel Prices Stay Low.(Brief article)
January 15, 2009... Staff Heading into the new year, diesel prices continued their downward trend sitting at $2.29/gallon, according to the Energy Information Administration. That's good news for buyers paying fuel surcharges. "With the assumption of a...

Chemical Price Indexes Dive.(Brief article)
January 15, 2009... Staff Five of Purchasingdata.com's six chemicals price indexes all dove dramatically in December, some more than 50 full points. The exception was the coatings chemical price index which only declined four points in December after ticking...

Economy + Supply.(Statistical table)(Brief article)
January 15, 2009... Staff No buying surge predicted for commodities or components (Buyers' 30-day buying plans) -------------------------------------------- UP DOWN SAME INDEX Inorganic chemicals 13% 39% 48% 37.1...

Building Rebound...in 2010.(Brief article)
January 15, 2009... Staff Economists at Bank of America Securities expect housing, which has been in a slump for two years, will continue to struggle for the rest of this year. "Construction still has more room to fall," agrees economist Ryan Sweet at Moody's...

Capital Goods Weak.(Brief article)
January 15, 2009... Staff Orders for long-lasting durable goods slumped 1% in November, the Commerce Department reported recently, compared with the 8.4% decline in October. Orders for transportation equipment (cars and light trucks, especially) dropped 7.4%...

Commodity Index Dives.(Brief article)
January 15, 2009... Staff Purchasing's Commodity Price Index fell for the fifth consecutive month in December to 195.1, the lowest reading on the (100=January 1992) since 190.4 in March 2007. The index hit a record high in July before plunging 35% through...

Purchasing Indexes Plunge.(Brief article)(Statistical data)
January 15, 2009... Staff Manufacturing activity contracted at its sharpest pace in almost 30 years in December, as measured by two closely-watched purchasing indexes. The Institute of Supply Management's PMI index declined to 32.4 from 36.2 in November while...

GM Sues Supplier.
January 15, 2009... Staff General Motors is suing bankrupt molded plastic components supplier Cadence Innovation to gain access to the supplier's machinery and tooling. Cadence filed bankruptcy in August, according to Reuters , and by limiting GM's access to...

Olin Declares Force Majeure.(Brief article)
January 15, 2009... Staff Chlor alkali producer Olin Corp. declared force majeure on deliveries of caustic soda and chlorine shipments from its plant in Henderson, Nev., in late December. Company officials said the problem was due to an equipment failure...

Dow Sells TPU Business.(thermoplastic polyurethane)(Lubrizol Inc.)(Brief article)
January 15, 2009... Staff Lubrizol acquired Dow Chemical's thermoplastic polyurethane business in early January for an undisclosed amount. The deal involves two of Dow's brands, Pellethane and Isoplast, which are manufactured in La Porte, Texas.

Advantage Rental Fails.(Brief article)
January 15, 2009... Staff Car rental company Advantage is one the latest U.S. firms to file for bankruptcy as cash-strapped consumers do less traveling during a slumping economy. The company says it will close about 40% of its U.S. retail locations.

Tractor Sales Will Fall.(Brief article)
January 15, 2009... Staff Agco Corp., one of the world's largest farm equipment makers, expects flat to 5% lower sales in 2009 of its tractors, combines and other machinery in North America as the recession erodes demand. Deere & Co. expects flat sales, but...

Auto Sales Outlook Slashed.(Brief article)
January 15, 2009... Staff The blue chip Economic Indicators has written off a recovery in the U.S. market until 2010 and forecasts 11.6 million in 2009 sales of cars and light trucks. New car sales came in at 13.2 million for 2008, down from 16.1 million...

Nafta Truck Sales Down.(Brief article)
January 15, 2009... Staff After falling 21% in 2008, purchases of commercial trucks in classes 4-8 in the U.S., Canada and Mexico are expected to drop another 16% in 2009. Analysts at Global Insight say the slowdown actually became obvious in the summer when...

Palm Has Cash In Hand.(Brief article)
January 15, 2009... Staff Palm Inc. recently received a $100 million investment from major stockholder Elevation Partners, an investment house. The maker of the Centro and Treo smartphones said it will use the cash to launch a new device and operating system...

Goodbye Kinko's.(FedEx Kinko's Office and Print Services)(Brief article)
January 15, 2009... Staff Fedex has changed the name of FedEx Kinko's to FedEx Office. According to FedEx officials, the name "better describes the wide range of services available at its retail centers."

Chips Dip In 09 As Well.(integrated circuits)(Brief article)
January 15, 2009... Staff The average price for DRAM will fall by about 2% this year while flash will drop by 17% in 2009, according to researcher IC Insights. The bad news for buyers is that prices will rise again in 2010 due to lower capital expenditures by...

Suzuki Shelves Large-car Plan.(Brief article)
January 15, 2009... Staff Suzuki Motor has ended plans to launch large-sized cars in 2010 so it will delay the start of overseas factories due to the sharp deterioration in the global auto market.

Microchip Demand Down.(Brief article)
January 15, 2009... Staff Gartner Inc. forecasts worldwide semiconductor revenue will fall 16.2% to $219.2 billion in 2009, marking the first time in history the chip industry had two consecutive years of negative growth. In the U.S., DRAM maker Micron...

GDP Recovery Predicted In 2H.(Brief article)
January 15, 2009... Staff The conference board expects the recession to go deeper than forecast originally for several reasons, notably housing, consumer confidence and unemployment rates. However, "Despite significant downside risks, there is still a good...

USCG Boosts Maritime Security.(Brief article)
January 15, 2009... Staff A new long range identification and tracking system has been put into operation by the U.S. Coast Guard to track cargo and passenger ships in the U.S., both domestic and foreign-flagged, as part of an effort to strengthen maritime...

Iron Ore, Coal Prices Down.(Brief article)
January 15, 2009... Staff Fitch ratings analysts project demand for steel will remain muted through the first half of 2009. As a result, the 2009 benchmark iron ore price settlement for Asia will be 20-40% lower than last year. Fitch also expects benchmark...

Commission Wants Gas Tax.(National Surface Transportation Infrastructure Financing Commission)(Brief article)
January 15, 2009... Staff The National Surface Transportation Infrastructure Financing Commission will recommend Congress implement a 10¢/gallon gas tax and 15¢/gallon diesel tax to fund infrastructure improvements. Currently there is an...

Metals Forecast Down.(Brief article)
January 15, 2009... Staff Analyst Kuni Chen at Merrill Lynch & Co. forecasts a 26% decline 26% in aluminum prices this year and a 44% drop in copper prices. Titanium prices should also decline 19% as a result of "continued aerospace production delays and a...

Steel Prices Will Bottom.(Brief article)
January 15, 2009... Staff Some analysts expect spot steel prices may bottom out by the end of the first quarter. But "there will be little cost push or demand pull through most of 2009," says analyst Monica Bonar at Fitch Ratings, who forecasts hot-rolled...

Will Base Oil Slide Continue?(Brief article)
January 15, 2009... Staff Base oil buyers saw spot prices for 100 grade paraffin products go from $2.55/gal at the start of 2008 to a peak of $4.78/gallon in September. By December, though, spot prices for 100 grade base oil had fallen back to $2.80/gallon,...

Oil Forecasts Stay Low.(Brief article)
January 15, 2009... Staff With demand in many end markets continuing down and crude oil demand trends looking weak for most of 2009, analysts continue to revise their oil price forecasts for 2009 downward. By comparison, the price average for 2008 was...

DHL's move leaves package market share up for grabs.(DHL Express)
January 15, 2009... By David Hannon Deutsche post's decision to have DHL exit the U.S. express shipping market this month has the remaining players competing fiercely for the DHL market share, amid rapidly declining volumes. While some shippers expressed...

Parcel rates firm up without DHL.(Brief article)
January 15, 2009... By David Hannon While the remaining carriers are competing hard for DHL's business, most market watchers expect rates to firm as a result of DHL's exit. In a recent report, analysts at Stifel Nicolaous said small parcel express rates...

Truckers continue to cut costs, reduce capacity in down market.
January 15, 2009... By David Hannon As trucking firms continued to report demand declines in the fourth quarter, they were doing whatever it takes to reduce costs, including renegotiating their union wage contracts and reducing overall capacity wherever...

Government makes Hours of Service rule final for truckers.(Federal Motor Carrier Safety Administration)(Brief article)
January 15, 2009... By David Hannon It was more than a year ago that the Department of Transportation's Federal Motor Carrier Safety Administration issued its interim final rule on truckers' hours of service and in December, that rule became final. ...

Plunging freight rates have some ocean carriers in survival mode.
January 15, 2009... By David Hannon With drybulk ocean freight rates declining from all-time highs to record lows in the past six months and demand for their services continuing to drop, dry bulk ocean freight carriers are in the perfect storm and some of...

Do the math: Crashing demand oversupply record low metals prices.
January 15, 2009... By Tom Stundza The volatility in metals prices is hardly over. But, while purchasing pros look to buy less and pay less in 2009, they also don't want to antagonize their mill and distribution suppliers. Metals supplier and buyer...

Materials management's broad sweep.
January 15, 2009... By Maria Varmazis Many software programs focus on a single function. Not materials management--its focus encompasses many tasks. Part of the trouble with finding good materials management software is as basic as defining what materials...

Bear market is expected to force prices even lower in 2009.
January 15, 2009... By Tom Stundza The six-year bull run in commodities definitely is over: World prices of base metals dropped by an average 30% in 2008 as end-use markets went into a second-half demand depression. Reduced production by the world auto...

Chips.(Macsteel Service Centers)(West Irving Die Casting Co)(Monarch Steel Co.)
January 15, 2009... By Tom Stundza North American Stainless has opened its new No. 4 hot annealing and pickling line for hot-rolled stainless steel sheet in coil, one of the largest units of its type in the world. The new line at the Ghent, Ky., plants has...

New wave of merger activity on the far horizon for global industry.(Brief article)
January 15, 2009... By Tom Stundza The $800 billion steel industry may be on the verge of a new merger wave in which cash-rich major producers would swallow smaller rivals weakened by the 2008-2009 global financial crisis and economic recession. The...

More collaboration is on agenda of MRO buyers, suppliers in 2009.
January 15, 2009... By Susan Avery Under intense pressure to keep costs in line amid tight credit markets and an unsure economy, maintenance, repair and operations (MRO) buyers are renegotiating agreements with suppliers and taking a hard look at inventory...

MRO Briefs.(Airgas acquiring Gordon Woods Industrial Welding Supply)(Applied Industrial Technologies acquiring Cincinnati Transmission Co)(Graybar opening a distribution facility)(Brief article)
January 15, 2009... By Susan Avery Airgas has completed the acquisition of Gordon Woods Industrial Welding Supply , Accu Air Gases & Equipment and Summit Gas & Gear . The three companies are related but separately managed industrial gas and welding supply...

Time to work more closely with finance.(Editorial)
January 15, 2009... By Paul Teague, Editor in Chief This period in the life of our economy could certainly qualify as one of those stretches that Thomas Paine, writing in a different context in 1776, was referring to when he wrote, "These are the times that...

Material cost declines should push paper prices down in 2009.
January 15, 2009... By Tom Stundza and Maria Varmazis After a year of steadily rising paper prices, a sudden drop in demand cut prices at the end of 2008. This portends that 2009 could bring relief for office paper buyers who look to buy fewer tons this year....

Business Intelligence.(Brief article)
January 15, 2009... By Tom Stundza and Maria Varmazis $1,629 High-end price for new Lexmark family of laser printers Source: Lexmark What it means: Lexmark T650 Series of monochrome laser printers, with prices ranging from $699 to $1,629, have...

Office furniture another area for cost-reduction.(Brief article)
January 15, 2009... By Tom Stundza and Maria Varmazis Another area that suppliers expect will be hard-hit by the economic downturn is office furniture, as office product buyers leave no stone unturned in their cost-reduction efforts. The Business and...

Telecommunications changes to come.
January 15, 2009... By Tom Stundza and Maria Varmazis Tough economic times could present buyers opportunities for finding alternative suppliers that can save them money. Telecommunications attorney and consultant Martha Buyer in East Aurora, N.Y., suggests...

The next frontier in cost control: Quality.
January 15, 2009... By Tom Stundza Buyers are planning intensified reviews of quality performance by their suppliers in an attempt to reduce the cost of quality. This could lead to widespread changes in the supply base. Focus. That's what savvy buyers are...

Boyd Coffee saves with warehouse efficiency.
January 15, 2009... By Maria Varmazis - Boyd Coffee Company Location: Portland, Ore. - Size: 450 employees - Business: Specialty coffees, teas and coffee-making equipment Distribution and warehouse management pays for itself when it can greatly...

Keep outsourcing in the United States.
January 15, 2009... By Kurt Hartwig As our economy evolves into a more global and competitive marketplace, outsourcing is becoming more of a reality than an option. The extreme competitive nature on some price-sensitive products forces a company to...

Partners in money management.
January 15, 2009... By Paul E. Teague Like the phoenix rising from the ashes, financial supply chain management is taking on new life as the economy cools. And as it does, procurement and finance are working closer together. The following story is true....

Mitre engineers savings with travel gurus, employee training and online booking tool.
January 15, 2009... By Susan Avery As travel manager at the Mitre Corp., Stefanie Tretola knows that it's important to communicate well and often with internal customers. She also has a good understanding of the capabilities of the suppliers that provide the...

Costs to rise, but travelers still will take to the skies.
January 15, 2009... By Susan Avery At year end, travel management companies and other sources publish forecasts for travel buyers to consult when planning budgets for the following 12 months. One, the 2009 Business Travel Overview and Cost Forecast by the...

Tree of Life overhauls supply chain org, tools for improved product flow.
January 15, 2009... By David Hannon As a distributor of natural and organic foods, Tree of Life relies heavily on its sourcing and logistics operations to get products into its supply chain and out to its customers. And with 1,200 sales associates in the U.S....

Boeing restructures supply chain, manufacturing organizations.
January 15, 2009... By Tom Stundza With delivery of the Boeing 787 Dreamliner again delayed, Boeing Commercial Airlines is being restructured with a new boss and a new supply chain head. The parent company says the changes in executive leadership at the...

China's manufacturing slows as demand from U.S. buyers slumps.(Statistical data)
January 15, 2009... By Tom Stundza and David Hannon The contraction in Chinese industrial production deepened in November with steel production down 12.4% from a year earlier, steel mill product deliveries down 11.3%, generation of electricity off by 9.6% and...

Pulp, paper and lumber plant shutdowns will extend into 2009.
January 15, 2009... By Tom Stundza and David Hannon "The North American newsprint market continues to contract and our customers have told us they anticipate further decline." The words of AbitibiBowater's CEO David Paterson sum up the paper supply base's...

IFCO outlines lift truck procurement strategies.
January 15, 2009... By William Atkinson When it comes to making purchases, one of the most common tactics is to find a few qualified vendors, and then send them requests for proposals. This works well in a lot of situations. However, for some products, there...

Chrysler names another new CPO.(Chrysler L.L.C. appoints Scott Garberding)(Brief article)
January 15, 2009... Staff Scott Garberding has been named senior vice president and chief procurement officer at Chrysler, replacing John Campi who has left the automaker for health reasons. Garberding will be responsible for Chrysler's global sourcing...

Tiremakers cut back capacity in U.S.(Brief article)
January 15, 2009... Staff The automotive sales slump that has automakers in such dire straights is also impacting the tire market pretty heavily. According to a recent report from the Rubber Manufacturers Association, demand from automakers for passenger car...

GSK pushes Green buying backto the product design stage.(GlaxoSmithKline PLC)
January 15, 2009... By William Atkinson R. Gregg Brandyberry had a stark realization recently. The vice president, procurement, global systems and operations for GlaxoSmithKline determined that many companies--perhaps more than most realize--engage in Green...

Downturn could provide merger opportunities.
January 15, 2009... By David Hannon and Tom Stundza At a time when some of the biggest companies in the world are are begging for lifelines and the credit markets continue to tighten, it may be hard to imagine that any companies or industries could in fact...

Transportation costs plunge in December on lower fuel, demand.
January 15, 2009... By David Hannon With fuel costs getting lower by the day and demand for logistics services on the downswing in the manufacturing downturn, buyers in Purchasingdata.com 's monthly survey report that transportation costs have dropped...