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Supply
Chain by the Numbers |
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- Feb. 22, 2024
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Warehouse Space Demand Cooling, but Rates still Rising Sharply; Lithium Prices in Freefall Due to Lukewarm EV Demand; US Freight Volumes Remain Negative; Amazon Takes More Share |
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20.6% |
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| That was the average gain in US warehouse lease costs in 2023. That from a new analysis from real estate firm Collier’s. That percentage jump took rates on average across the US to a record $9.72 per square foot, though some individual markets have rates much higher or lower than that number. However, the report does say the upward momentum in rents slowed some in the second half of the year. Despite the slowdown, Colliers predicts the upward trend of warehousing rents to continue this year, pointing to still low vacancy levels. That assessment is shared by warehouse developer Prologis, which recently predicted “modestly positive” rent growth this year. |
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| That was the decline in the American Trucking Associations Freight Tonnage Index for January, the unfavorable climate for truckers continues. The January score comes after a small rise of 1.2% in December. Compared with January 2023, the seasonally adjusted index fell 4.7%, which was the eleventh straight year-over-year decrease. In December, the index was down 0.8% from a year earlier. “January’s data was a snap back to reality for anyone thinking the freight market was about to turn the corner,” said ATA Chief Economist Bob Costello, noting that “Bad winter weather in January likely hurt volumes, not to mention sharp drops in a number of drivers of tonnage including retail sales, housing starts and manufacturing output.” |
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90% |
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| That is about how much the price for lithium has fallen since the start of 2023, while the cost to buy the metal nickel has dropped about 50%. What’s going on? Lithium and nickel miners geared up capacity in recent years, expecting a surge of demand for the two metals essential for making batteries for electric vehicles. But instead, demand - while still growing - is increasing at a rate below many expectations, as several auto makers have scaled back production plans given the level of EV demand by consumers. The collapse of the prices of these metals is driving miners to cut back or cancel mine development or processing center construction. For example, a $1.3 billion investment planned to build a lithium processing plant in South Carolina, heralded as a transformation investment for the state by a company named Albermarle, has recently been suspended. Mining giant BHP recently announced it may have to shutter its Australian nickel plant. |
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That was Amazon share of US ecommerce sales in Q4 2024. That according to fresh estimates by according to JPMorgan analyst Doug Anmuth. That was once again up from the previous quarter, with Amazon seeing year-over-year share gains exceeding 1% for the sixth consecutive quarter. Meanwhile, ecommerce sales generally were also up strongly in Q4, rising 7.5% versus Q4 2022, according to the just released data from the US Census Bureau. Anmuth also estimates that ecommerce represented 23.3% of Adjusted Retail Sales in 4Q - an .84% year-over-year increase. Amazon itself reported on-line store sales of 9% in Q4, higher than the 7.5% growth in overall ecommerce.
