Supply Chain by the Numbers

- April 14, 2011


Supply Chain by the Numbers for Week of April 14, 2011

  Walmart Restocks; Impact of Oil Speculation; China Trade for Once Comes Up Short; In Search of Rail Cars


The approximate amount of the current price of oil that is the result of the forces of oil speculation rather than market supply and demand, according to a report this week from the analysts at financial giant Goldman Sachs. As oil soared past $110 per barrel in the past week, Goldman said that "net speculative positions are four times as high as in June 2008," a month before oil hit its peak at more than $140 per barrel. The implication is that oil prices should be closer to $85 per barrel, not $105.




Average number of SKUs being added back to Walmart US store shelves, or an increase of about 11%. The move comes after Walmart's strategy to reduce SKU counts since 2009 appears to have been deemed a failure, with same store sales growth falling for seven straight quarters. The returning items, many geared to lower income shoppers or niche areas like fishing supplies, will be marked with in-store signage saying "It's Back."

1.53 million

Number of rail cars in use in the US as of March 1. Surprisingly, that is down from 1.6 million on the tracks in July, 2009, at what was near the deepest part of the recession. The drop is an issue, because a lack of rail cars is leaving some freight sitting on the dock or some place else. For example, about 4,000 Dodge Ram pickup trucks are currently parked at the Michigan State Fairgrounds & Exposition Center in Detroit waiting for rail car availability to be shipped, according to an article this week in the Wall Street Journal.


$1.02 billion

The size of China's trade deficit in the first quarter of this year, the first such quarterly trade deficit in the country since the first quarter of 2004. There were some seasonal factors involved, as well as surging import numbers due to rising oil and commodity prices. Some are wondering if the increase in the Yuan of about 5% year over year may also have played a factor. While imports were up 27% in March, however, exports were up 36% and most believe China's trade surplus will be huge again this year, but likely slowing a bit over the period from the levels of the past few years.