Today's Top Supply Chain and Logistics News From WSJ
December 20 2016 - 06:58AM
Dow Jones News
By Paul Page
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Blockchain technology is getting a real-world test in the supply
chain of one of the world's biggest goods shippers. Wal-Mart Stores
Inc. is preparing a pilot project in early 2017 to use blockchain
to track a segment of its produce business in the U.S. along with
its pork shipments in China, the WSJ"s Kim S. Nash reports. The
project is a major test of blockchain distributed ledgers outside
the financial services industry into supply-chain management, where
companies want to digitize hand-offs between trading partners that
are often managed in paper files and subject to delays and errors.
Wal-Mart's Frank Yiannas says the high-volume product categories
the retailer has tabbed for the pilot will quickly give Wal-Mart a
sense of how blockchain works and how well it scales. Wal-Mart's
big role as a buyer suggests that successful results could
jumpstart the use of blockchain well beyond the retailer's own
distribution channels.
General Motors Co. is responding to a decline in demand for
passenger cars by cutting into production. The auto maker will shut
four U.S. assembly plants for up to three weeks next month, the
WSJ's Mike Colias reports, as it copes with swollen inventories.
The nation's largest auto maker by volume entered December with
about 873,000 vehicles on dealer lots, 26% more than last year,
underscoring the slowing pace of car sales in the U.S.. It's also a
sign of shifting buying patterns among consumers: through November,
U.S. passenger-car sales slid 8%, while sales of crossover SUVs,
pickups and other light trucks rose 7%, according to Autodata
Corp., a change that will ripple across supply chains for auto
components as more manufacturers adjust to the market. The new
moves are a big concern for GM-watchers, however, because the
company tended toward elevated inventory levels before its 2009
bankruptcy and now is coping with a similar problem.
The cattle industry may return to a one-time market staple to
get a better understanding of supply and demand: live auctions. The
Chicago Mercantile Exchange is considering reviving the auctions as
a way to tame unruly trading of cattle futures, the WSJ's Kelsey
Gee reports, by bringing better and timelier data on pricing to the
business. The exchange is responding to an apparent breakdown in
the $13 billion market, with values of cattle futures contracts
swinging wildly this year from near-record highs to six-year lows.
The idea is to base futures contracts, which ranchers use as a form
of insurance on their borrowings to feed hundreds or thousands of
animals at a time, on real trade data. The exchange also is looking
at using a new index to guide pricing of futures contracts, an idea
that some ranchers fear could make the market volatility even worse
and take away one option for settling futures contracts --
delivering actual cattle to the traders.
SUPPLY CHAIN STRATEGIES
New retailer inventory strategies are raising tough questions
for consumers as well as the stores themselves. Retailers are
increasingly turning stores into mini distribution centers for both
shipping goods and providing in-store pickup, and the Chicago
Tribune notes the tactic is adding new complications as companies
consider how to divide stock between store sales and e-commerce.
Target Corp. is shipping from stores this season and keeping extra
inventory at those sites to have goods available both for online
buyers and walk-in shoppers. Toys R Us, by contrast, says its
"first come, first served," for everyone, live or online. For
retailers, the tactics amount to a high-stakes guessing game over
both demand and the method of sale. Their success in forecasting
may only be known when the sales season begins next month.
QUOTABLE
IN OTHER NEWS
Billionaire investor Carl Icahn will sell American Railcar
Leasing LLC to a unit of Japan's Sumitomo Mitsui Banking Corp. in a
deal worth up to $3.4 billion. (WSJ)
U.S. manufacturing output is nearing pre-recession levels but
about 1.5 million factory jobs lost during the downturn haven't
returned. (WSJ)
Uber Technologies Inc. lost $800 million in the third quarter
despite boosting sales more than 50% to $1.7 billion. (WSJ)
Boeing Co. will seek voluntary layoffs and may resort to
compulsory job cuts to help trim costs at its commercial jetliner
arm. (WSJ)
Brazilian mining firm Vale SA will sell most of its fertilizer
business to U.S.-based The Mosaic Company for around $2.5 billion.
(WSJ)
BlackBerry Ltd. will invest some $76 million to develop software
for driverless cars as the company pivots away from smartphones.
(WSJ)
Middle East airlines are cutting services and jobs as weaker
demand and growing protectionism cut into their rapid growth plans.
(WSJ)
Bankrupt retailer American Apparel LLC won approval to close
nine stores by Dec. 31 and potentially shut others that aren't sold
at auction in January. (WSJ)
Hutchison Ports Holdings signed an agreement to develop cargo
operations at Ukraine's Black Sea port at Chornomorsk. (Ipswich
Star)
Recycled paper shipper Cycle Link says shipping lines have been
unnecessarily slow to adopt new systems such as blockchain
technology. (The Loadstar)
U.S. imports of Canadian wood are up 20% this year from 2015.
(Bangor Daily News)
A Mediterranean Shipping Co. container ship collided with a
fishing vessel off the coast of Peru, killing at least five people
on the smaller ship. (Port Technology)
South Carolina officials say the advent of ultra-large container
ships will leave some ports without international freight service.
(McClatchy)
Maersk Line will scrap eight panamax-size container ships at
yards in India and China. (MarineLink)
Daimler Trucks will open a 245,000-square-foot parts
distribution center outside Des Moines, Iowa. (Des Moines
Register)
ABOUT US
Paul Page is deputy editor of WSJ Logistics Report. Follow him
at @PaulPage, and follow the entire WSJ Logistics Report team:
@brianjbaskin, @lorettachao, @smithjenBK and @EEPhillips_WSJ and
follow the WSJ Logistics Report on Twitter at @WSJLogistics.
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Write to Paul Page at paul.page@wsj.com
(END) Dow Jones Newswires
December 20, 2016 06:43 ET (11:43 GMT)
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