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March 4, 2022
Supply Chain Digest Flagship Newsletter


This Week in SCDigest

bullet Ukraine, the Economy and the Supply Chain Week 2 bullet SCDigest On-Target e-Magazine
bullet Supply Chain Graphic & by the Numbers for the Week bullet New Stock Index

New Chain Cartoon Caption Contest!

bullet Trivia      bullet Feedback
bullet New Expert Column bullet On Demand Videocasts



The Warehouse Management System Boot Camp 2022



Six-Part Educational Series Provides Learning

and Insight Needed to Achieve Project Success



first thought


Supply Chain Graphic
of the Week


Changing Supply Chain Priorities

This Week's Supply Chain Numbers

Oil Prices could Soar still Higher
Automobile Ship that Caught Fire Sinks
US January PMI is Strong

Target Announces Big Jump in Store and DC Wage


Feb. 2, 2022 Contest

Show Us Your Supply Chain Wit!


 This Week's SCDigest OnTarget Newsletter

Cartoon, Top SCDigest Stories of the Week

Six Ways Supply Chains Can Transform Packaging
These Trends Will Become Even More Important as Disruption Continues in the Packaging Segment


Linda Dunn

Director, Georgetown University's School of Continuing Studies

5 Steps to Reduce Your Risk of a Ransomware Attack

Security is a Journey, Not a Destination


Brian Jaenke

Director of Continuous Improvement LandrumHR Workforce Solutions

Why is the number 23,992 significant in current supply chains?
Answer Found at the
Bottom of the Page


Ukraine, the Economy and the Supply Chain Week 2

I am back for a second week with a latest look at the Russian war on Ukraine and the impact on the economy and the supply chain. Everything else kind of pales in comparison for me again this week.


And there is certainly no lack of material - the news is non-stop, and sometimes a little strange. For example, I did not know that the current star at New York's Metropolitan Opera was a Russian woman named Anna Netrebko. Or at least she was. Netrebko was forced out of the opera Thursday for not complying with the Met's condition that she repudiate her public support for Vladimir Putin.



"Supply chain leaders need to evaluate vulnerabilities based on different scenarios now, so they can start to create redundancies and alternatives," Gartner says.

Send us your
Feedback here

That as almost anything connected Russia is being cancelled. More on that in a minute


It hard to know how significant the impact on oil and natural gas is going to be, after both were soaring in price before the invasion. Brent crude oil ended the day Thursday at about $110 per barrel, up from around $98 before the invasion. Most seem to think it will go higher - maybe much higher. Gasoline and diesel price are naturally also surging.

The oil analysts at Wall Street firm JP Morgan forecast this week that oil prices are likely to rise to $185 per barrel if Russia was to cut it oil exports in half - or various sanctions reduce the amount countries buy by from Russia by a similar amount.

Either scenario seems reasonably likely.

Then there is this: well-known oil industry expert Daniel Yergin of IHS Markit warned this week all this could lead to an energy market disruption on the scale of the major oil crises in the 1970s - not coincidentally a decade of economic stagnation.

"This is going to be a really big disruption in terms of logistics, and people are going to be scrambling for barrels," Yergin said. "This is a supply crisis. It's a logistics crisis. It's a payment crisis, and this could well be on the scale of the 1970s."

Is Yergin just exaggerating to get the coverage that kind of warning can drive? Let's hope so, but I doubt it - he is a very respected oil sector analyst.

Meanwhile natural gas prices are down from a brief recent high in late January, and also well below prices seen last September through most of December. But all those prices, including the current price, which is up modestly since the invasion, have risen an incredible four times the costs of a year ago.

What is that going to do? Because natural gas is a key ingredient in fertilizers, it means costs for farmers are also going to soar this growing season. And there is really know alternative to using fertilizer. And that means costs for food are also going to soar, after already rising rapidly in the past year.

Most consumers I expect have any idea this next wave of food price hikes is coming.

Some other related news:

Oil companies BP and Shell - both based in the UK - each announced this week they were pulling out of joint ventures with Russian oil and gas companies. The moves are costly ones - as much as $25 billion for BP, and $3 billion for Shell. Also, Exxon Mobil said it is halting operations at a multibillion-dollar oil and gas project in Russia.

Global container shipping giant Maersk announced that it would temporarily suspend all shipments to and from Russia by ocean, air and rail, with the exception of food and medicine. Other major ocean carriers, have announced similar suspensions. These moves will hit imports and exports and damage the Russian economy.

DHL suspended transport of inbound shipments into Russia.

Caroline Bain, chief commodities economist at Capitol Economics, said financial sanctions against Russia were halting the trade of metals and agricultural commodities, exacerbating existing strains in global supply chains.

Ukraine and Russia are both substantial sources for palladium and platinum, used in catalytic converters for automobiles, as well as aluminum, steel and chrome.

By the middle of this week, nearly a dozen global auto makers had suspended business in Russia, some shutting factories indefinitely.

My question: Will all these companies return to Russia once the ruthless invasion is over?


After closing for now two factories in eastern Germany, Volkswagen has said production would soon be affected at its flagship plant in western Germany because of missing parts from Ukraine, notably electric harnesses.


The analysts at Gartner said this week that they see six supply chain issues organizations will face if the war in Ukraine continues on:

• Key material shortages
Material cost increases
Production capacity impacts
Demand volatility
Logistics route and capacity constraints
Cybersecurity breaches

"Supply chain leaders need to evaluate vulnerabilities based on different scenarios now, so they can start to create redundancies and alternatives," Gartner added.

There is a lot more, but think that is it for this week. I sure hope I am on a different topic next week.

And as I said previously, it now seems clear that a return to somewhat normal times after two years of pandemic-driven supply chain disruptions, wild price swings and more is now unlkely any time soon, prolonging these strange supply chain times for who knows how long.

Any reaction to Gilmore's comments? Have any of your own? Let us know your thoughts at the Feedback button (email) or section below.


See as Web page/Printable Version

On Demand Videocast:

Understanding Distributed Order Management

Highlights from the New "Little Book of Distributed Order Management"

In this outstanding Videocast, we'll discuss DOM, based on the new Little Book of Distributed Order Management, written by our two Videocast presenters.

Featuring Dan Gilmore, Editor along with Satish Kumar, VP Client Services, Softeon

Now Available On Demand

On Demand Videocast:

The Grain Drain: Large-Scale Grain Port Terminal Optimization

The Constraints and Challenges of Planning and Implementing Port Operations

This videocast will provide a walkthrough of two ways to formulate a MIP, present an example port, and discuss port operations.

Featuring Dan Gilmore, Editor along with Dr. Evan Shellshear, Head of Analytics, Biarri.

Now Available On Demand

On Demand Videocast:

A Blueprint for WMS Implementation Success

If You Want a Successful WMS Project, You will Find the Blueprint in this Excellent Broadcast

This videocast lays out the keys to ensuring your WMS implementation goes smoothly, involves minimal pain, and accelerates time to value.

Featuring Dan Gilmore, Editor along with Todd Kovi of Radix Consulting and Dinesh Dongre of Softeon.

Now Available On Demand


Feedback will return next week.

Why is the number 23,992 significant in current supply chains?

A: That is how many TEU that the world's currently largest containship, the Ever ACE from carrier Evergreen, can hold

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