As I wrote last week, it has been a very strange first half of 2021, with a strong post-pandemic recovery, shortages of everything, rising inflation, a ship stuck in the Suez Canal and more. (See The Top Supply Chain Stories by Month 1H 2021.)
This week, we offer our popular look at the first six months of 2021 in numbers and charts.
Gilmore Says.... |
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| In Q1, the most recent number we have, ecommerce sales were up a huge 39.1%, according to the Commerce Department. |
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We always start with a check on the US and global economy, as that has such an impact in the end on supply chain practice.
Real US GDP was down a near record 3.5% in 2020, as reported in early 2021, though it was trending up as the year ended.
Q1 real GDP then increased a robust 6.4% on an annualized basis. The official Q2 numbers aren't out yet, but the Atlanta Federal Reserve Bank's most recent estimate is for even stronger 7.9% growth in the quarter just ended.
The International Monetary Fund expects the global economy to rise 6.0% in 2021, then falling to 3.5% growth in 2022 off of those stronger 2021 numbers.
It pegs US GDP growth this year at 6.4%, and if anywhere close to accurate it would be the first year with greater than 3% US growth since 2005, when it was once commonplace.
Consistent with GDP numbers, the US Purchasing Managers Index from the Institute of Supply Management - which fell to a dismal 41.5 in April 2020, well below the 50 mark that separates US manufacturing expansion from contraction - has been on a roll in 2021.
The PMI has been above 60 for the last five months, indicating robust US manufacturing expansion so far this year.
However, another view of US manufacturing strength is the index on US factory output from the Federal Reserve - and that tells a somewhat different story
The index for June, just out yesterday, came out at 97.9, basically flat with January's 98.2, though well above the low point in the recession in April at about 83. However, the June score is still well below the 105 level in February 2020 right before the COVID crisis.
In fact, at 97.9, it means US manufacturing is below baseline 2012 levels (index = 100) now 9 long years later.
It was an odd 1H for oil prices. The low mark for West Texas Crude was the start of January at $49.3 per barrel, and it went up and up from there, ending June on the high price for the first six months, at $75.2, for a rise of 52%. To have the low and high be the start and end is very unusual.
1H 2021 Oil Prices
Similar story for US on-the-road diesel prices, which started the year at $2.64, then steadily rose to $3.30 by the end of June, a rise of 21% and headed higher.
Freight volumes were suprisingly not that strong. Through May, the ATA Freight Tonnage Index was basically flat, down 0.4% - and well below levels before the pandemic.
Nevertheless, the Cass Linehaul Index, which tracks per mile truckload contract rates in the US before any fuel surcharge or other accessorial fees, was up 7.5% and 8.1% year-over-year in January and February even before the weak 2020 comparisons after the start of the pandemic in March. The index was then up 10-14% the last four months of the period.
It was a decent first half for US railroads, though again relative to weak volumes in 1H 2020. Total US rail traffic for 1H 2021 up 13.7%, with the intermodal component up 17.5%.
In terms of ocean container shipping rates, the China Containerized Freight Index started the year at about 1750 and ended at 2600, a rise of 48.5% to ship a container on average out of China. But the increase was really higher than that, with many shippers having to pay high extra fees to get their boxes moved, as volumes soared.
The growth of ecommerce sales in the US remained strong. In Q1, the most recent number we have, ecommerce sales were up a huge 39.1%, according to the Commerce Department. But oddly the growth of all retail sales (including ecommerce) was up 7.8% in Q1 versus Q4 2020, virtually equal to the 7.7% increase in on-line sales. Not sure I trust those numbers.
Amazon said its Q1 revenue grew a massive 44%, taking it to $108.52 billion. Amazon had net income of $8.1 billion dollars, a very respectable 7.4% of revenues, and way up from profits of $2.5 billion in Q1 2020.
I have lots more but am out of space. Hope you enjoyed all this.
What is your reaction of 1H supply chain 2021 in numbers and charts? What numbers would you add? Let us know your thought at the Feedback section below.
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