Articles in Category: Logistics

The US House voted last Wednesday to approve a short-term, $8 billion extension of federal transportation funding, which will last until December.

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House Ways and Means Committee Chairman Paul Ryan (R-Wis.) has called on the Senate to pass the House’s $8 billion transportation funding patch “without any unrelated measures.”

Exports, Imports are Not Infrastructure

Ryan said after the temporary patch was approved on a 312-119 vote in the House, that the Senate should follow suit and send the lower chamber back a clean highway funding extension with no “unrelated measures.” Ryan was referring to a Senate plan to include an extension of the US Export-Import Bank’s charter in the upper chamber’s version of a new highway bill.

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The US Export-Import Bank is closed for business and House Republicans don’t want a new charter for it attached to a Highway bill.

The Ex-Im Bank’s charter was recently allowed to expire and House Republicans have soured on the credit institution for US exporters. Many conservative groups view the bank as an outdated federal bureaucracy ready to be thrown on the scrap heap of government innovation and streamlining, believing that private banks can provide loans for exporters as they can for any other financial transactions. The Ex-Im Bank’s supporters claim it’s a vital institution needed to support US export competitiveness. Read more

The US stock market is demonstrating resilience against economic worries such as the Greek Crisis, falling oil prices, weakness in emerging markets and the recent Chinese market sell-off.

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Some argue that the bull market has already run for too long, and that concerns outside the US are putting enough pressure to make the stock market tumble. However, the opposite might be true.

The Tenacity of the US Stock Market

The unwillingness of domestic stocks to fall is a sign of strength and we could see stocks rise even further, especially if things start to calm down globally.

Dow Jones Industrial Average Index 1 year out

Dow Jones Industrial Average Index, one year out. Graph: MetalMiner.

Major market indexes like the Dow Jones Industrial Average, S&P 500 and the New York Stock Exchange remain range-bound since February. We recently pointed out that this trendless period was causing investors to  hesitate. It was hard to tell whether the market is going to roll over or continue on its way up. Some new clues are pointing to the latter.

Nasdaq Composite Index 1 year out

NASDAQ Composite Index, one year out. Graph: MetalMiner.

The fact that US stocks held their values well as Chinese markets plunged proves that Chinese financial news can only affect US stocks in the short term. In the longer term, China does not lead the US and its recent troubles do not appear to affect markets here that much.

What This Means for Metal Buyers

Moreover, the NASDAQ (a technology-focused index) recently hit an all-time high. The fact that technology stocks are leading the market is a positive sign. Lower oil and commodity prices are hurting the shares of energy and commodity producers, which helps explain why the other indexes are still range-bound. But, good earnings reports from leading tech companies are increasing the appetite of funds to buy stocks.

In conclusion, the US market is not immune to what happens outside the US. Further bearish news from outside could weigh on US shares, but, so far, things are looking good for US stocks in the second half of the year.

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My colleague, Jeff Yoders, referred last week to action taken by Alcoa, Inc. to challenge the Commodity Futures Trading Commission (CFTC) over its involvement in the London Metal Exchange’s (LME) upcoming rule changes.

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The LME is in the process of a long running review of it’s warehouse rules following industry criticism of the length of queues, particularly at it’s Detroit and Vlissingen (Netherlands) warehouses, a situation that was initially viewed as driving up physical delivery premiums. It has since been seen to be only part of a wider problem created by the stock and finance trade’s competition for physical metal.

Pile of aluminium bricks waiting for transport to the factory

Pile of aluminum ingots stuck in Detroit, even though its owners want to take delivery.

Queues have declined in nearly all locations but still remain at upward of a year in Detroit and Vlissingen, although Metro International and Pacorini, the warehouse operators at those locations, have taken steps to further limit intake while the LME’s deliberations are underway. Read more

At the Metalminer Week-In-Review, we promise to report accurate prices every day through our Indx. But what if that’s not enough? What about the add-ons, over-and-aboves and shipping charges? Buying steel? We’ve got bar fuel surcharges for eight US regions. Eight!

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We’ve been covering that pesky Midwest aluminum premium like Richard Sherman on a wideout, too. Want to know about anti-dumping and countervailing duties. You’ve come to the right place! All of these non-price inputs made our homepage this week as the gulf between the price and what you actually pay reared its head again this week.

Who Polices the Midwest Premium?

With falling London Metal Exchange aluminum prices and much-reduced physical delivery premiums even the combined, all-in price of aluminum is below cost for many smelters these days.

Pile of aluminium bricks waiting for transport to the factory

I’m aluminum, get me out of this warehouse!

That’s enough reason for smelters such as Alcoa, Inc., to question the involvement of the Commodities Futures Trading Commission in discussions with the LME on how best to reform their warehouse network and cut down the one-year-plus wait to get ingots out of the operations in Detroit (Metro International) and Vlissingen, Netherlands (Pacorini).

Higher premiums benefit producers such as Alcoa and UC Rusal, after all. Is it any wonder that producers want the CFTC to butt out? Yet, the CFTC still wants to butt in.

Don’t Let Your Profitability Drown in the VAT!

Meanwhile, over in China, rampant speculation is going on over how Beijing will replace its current business tax system with a new system of value-added taxes. A VAT taxes the difference between the sale price charged to a customer, minus the cost of materials and other taxable inputs.

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Better pay the VAT or this is going to be a short trip!

The best estimates we have seen show that the new VAT will considerably increase what US buyers pay for metals from China and likely from nearby markets trying to compete with Chinese steel. China’s VAT is just one of many ways that imports could become more expensive later this year as… Read more

Using robots that can “draw” steel structures in 3D, Dutch technology firm MX3D is planning to 3D “print” a steel bridge over one of Amsterdam’s famous canals in the center of the Dutch Capital. MX3D researches and develops robotic 3D printing delivery technology as well as projects such as the pedestrian bridge. The robots creating the will actually be large welder robots usually seen in factories rather than construction sites.

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The project is a collaboration between MX3D, design software company Autodesk, construction company Heijmans and many others. Designing and “printing” the intricate, ornate metal bridge is a test for the robots, software engineers, craftsmen and designers working on it, including designer Joris Laarman Lab.

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The planned steel pedestrian bridge in Amsterdam will be built by robot “welders” who 3D print the bridge from each side and meet in the middle. Image courtesy of Joris Laarman for MX3D.

“I strongly believe in the future of digital production and local production, in ‘the new craft,'” said Joris Laarman, principal of the Joris Laarman Lab. “This bridge will show how 3D printing finally enters the world of large-scale, functional objects and sustainable materials while allowing unprecedented freedom of form. The symbolism of the bridge is a beautiful metaphor to connect the technology of the future with the old city, in a way that brings out the best of both worlds.” Read more

Today in Metalcrawler, a major construction project in Washington will eventually require 33,000 tons of steel and a powerful lawmaker wants to tie the Highway Trust Fund to a trade bill.

Boeing 777X Plant Requires Giant Steel Trusses

About 33,000 tons of steel are needed to build the $1 billion Boeing 777X wing plant in Washington state. The building is 1,200 feet long and has two open spans of 420 feet wide and 460 feet wide.

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To support those spans, 45-foot-deep steel girders are being used. At any moment 50 trucks are on the road bringing steel to the site from Oklahoma, Arkansas and Colorado.

The $1 billion, 1.3-million-square-foot building will be where Boeing fabricates carbon composite spars and skins for the 777X wings.

Pelosi Wants to Link Trade, Highway Bills

House Minority Leader Nancy Pelosi (D-Calif.) said Democrats would be more likely to support the controversial trade bill that was defeated on Friday if Republicans would support a long-term transportation funding package, the Hill reported.

Pelosi helped sink President Obama’s trade package in a Friday vote by announcing her opposition, but she also signaled she wants Republicans to consider a deal involving highway funding in a letter to her conference. The Highway Trust Fund was extended through the end of July recently but both parties have said they desire a long-term deal that will fund federal highway maintenance through at least the next five years.

Congress has been grappling with a shortfall in transportation spending that is estimated to be about $16 billion per year, and they have not passed an infrastructure package that lasts longer than two years since 2005.

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A major aluminum producer challenged a US regulator’s authority to intervene in a foreign warehousing dispute and another nation placed tariffs on Chinese silicon this week.

Alcoa Challenges CFTC’s Authority

Alcoa Inc. on Monday challenged a federal commodities regulator’s authority to intervene in the contentious overhaul of the London Metal Exchange‘s warehouse policy that has caused an unprecedented drop in aluminum prices.

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In March, the Commodity Futures Trading Commission deferred a decision about the LME’s 2012 application to be registered as a “foreign board of trade,” telling the exchange it should do more to address concerns about long waiting queues.

Alcoa has questioned whether the agency even has the legal authority to intervene, and on Monday filed a request under the Freedom of Information Act (FOIA) to find out what had caused the CFTC to delay its decision on the LME.

“Our goal is to learn the extent to which the CFTC has engaged in substantive discussions with the London Metal Exchange,” Alcoa said in a statement. “The CFTC should examine any LME aluminum contract performance issues only through an open, inclusive and transparent process where all affected market participants have the opportunity to present their views,” it said.

The CFTC declined to comment.

Australia Puts Tariffs on Chinese Silicon

Australia has issued an anti-dumping notice on silicon metal exported from China after an investigation into dumping and subsidization.

Following the investigation the Australian Government Anti-Dumping Commission set dumping and subsidy margins for Hua’an Linan Silicon Industry Co. Ltd., and Guizhou Liping Linan Silicon Industry Co. Ltd. at 18.3% and 6.3% respectively. Both companies will be subject to an effective rate of combined interim countervailing duty and interim dumping duty of 12%, according to a statement by the MOC trade remedy and investigation bureau.

The commission announced dumping margin and subsidy margin for “uncooperative, and all other exporters” of 27% and 37.6% respectively, with an effective rate of combined interim countervailing duty and interim dumping duty of 58.3%.

Australia began its investigation in February last year after allegations of dumping and subsidization of silicon metal goods that originated from China with a total value of $12.78 million dollars, according to the MOC statement.

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When pharmaceutical manufacturer Biogen Idec planned a new headquarters building in Boston’s growing Kendall Square tech center, they knew the construction and program needs of the 325,000-square foot, five-story project would be a challenge for the architects, engineers and general contractor selected.

Why Manufacturers Need to Ditch Purchase Price Variance

Cambridge, the suburban Boston municipality Kendall Square is located in, had a zoning requirement that all projects stay under 75 feet. That meant architect Spagnolo, Gisness and Associates had to cut its original plan for a six-story building down to five stories.

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Biogen Global Headquarters, 225 Binney St., Cambridge. Mass. Photo: Peter Vanderwarker

Biogen had its own needs, too. The company wanted to break down barriers between its management and employees and encourage collaboration among its scientists and researchers through the architecture of the building.

Open Office Plan

The new global headquarters has no private offices, just individually designed workstations called “I spaces” and common “huddle rooms” for private phone calls or spontaneous meetings. The company scrapped telephone landlines for employees, who are issued laptops and headsets.

Panels in the ceilings and floors can be brought down to add soft walls and subdivide rooms for smaller group collaboration.

“The idea was to bring everyone together, no separate offices for executives or private areas for senior management, everyone has the same office in the open floor plan,” said Malisa Heiman, senior associate in the real estate and site planning for Biogen.

Biogensavings

Schedule and project savings on the Biogen project.

Construction Manager Consigli Construction co-located with SGA and several of the project’s subcontractors during the design stage of the project. All mechanical, electrical and plumbing subcontractors were on board during design meetings. Read more

A few weeks ago I had dinner at a friend’s house. The floor ended up kind of messy, so I offered to sweep the floor in gratitude for the delicious meal.

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But that wasn’t necessary because my friend had a vacuum-cleaning robot. I had heard about these robots before but never thought they would work so well. I was impressed.

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I can clean any surface and charge myself, but if you don’t empty me I WILL gorge myself on cat hair and die.

The robot, with sensors built in, was able to avoid every obstacle in the house and recognize the dirtier areas so it could stay longer in those. Finally, when the robot finished cleaning it automatically came back to its spot to recharge itself. This little vacuum-cleaning robot has become exponentially better and cheaper during the past few years and today even a cat can drive one of these. The only real dependence they have on their human guardians is to plug in the charging station and empty them. Read more

This is a fourth post on a series of posts on exponential technologies (see part 1part 2 and part 3).

Why Manufacturers Need to Ditch Purchase Price Variance

Yesterday, I realized I was running out of underwear, which means that I didn’t have any more excuses to not do my laundry. As I was walking down the street, I pulled out my phone and without clicking any button I said: “Ok Google, remind me to do laundry when I get home.”

Despite my strong Spanish accent, the phone perfectly understood what I meant to say. Four hours later, as soon as I opened the door to my apartment I felt a vibration in my pants. My phone knows where I live and it used its GPS to figure out that I had just arrived home. I looked at the screen, and saw the reminder. A couple of hours later… I had a new set of clean underwear. Thank you, Google!

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Samantha, what do my metals procurement options look like? “Her” image courtesy of Warner Bros.

This is not just an example of low-level artificial intelligence, but also a sign that AI is reaching the knee of the exponential growth curve, getting ready to run wild as a disruptive technology. AI is an exponential technology about to be found everywhere in our daily lives and jobs.

Read more