Despite the struggling global supply chain, labour shortages and economic difficulties as the world tries to bounce back from COVID, global demand for uncoated freesheet (UFS) grew last year. This is according to a recent report by OPI.

Highlights of the report include:

  • Cutsize paper demand across Europe in 2021 rose by just over 2%
  • Shipments increased about 8%
  • Capacity dropped 7%
  • Buyer inventory levels dropped to their lowest in more than a decade
  • The US market for office paper had a slight recovery versus 2020
  • For the full year of 2021, Mondi reported year-on-year revenue growth of 11% for its Uncoated Fine Paper segment
  • Sylvamo – formerly International Paper’s Printing Papers division – reported sales that were almost 17% higher
  • Portugal-based Navigator benefitted from a surge in demand for its uncoated woodfree (UWF) paper, with sales increasing 23%, while those for the Communications Paper division at Finnish manufacturer UPM grew by 8%
  • Sales at Packaging Corporation of America’s Boise division fell as it was unable to offset rising energy costs.
  • Finland-based Stora Enso reported a decline in revenues for 2021

Continuing pressure due to sustained gas and electricity price rises, supply chain issues and the war in the Ukraine has not helped matters. It appears that the paper industry in one in crisis.

Deon Joubert of Merpak commented as follows:

Our South African paper converting and printing businesses, like so many around the world, are under significant pressure to source supply.

Covid and the resultant drop in demand for, especially uncoated wood-free paper and newsprint, around the world has seen traditional manufacturers of this grade taking commercial downtime, converting paper machines to packaging grades or, in some cases even shutting down permanently.

The post Covid recovery and the return to office has seen demand for these grades grow to the point where it may be that demand now exceeds supply. Combined with the shipping crisis, the resultant explosion in shipping costs, lengthening of shipping lead times and port congestion has battered paper supply chains.

The war in Ukraine has affected energy costs in Western Europe where many of these mills are to be found.

At home, local mills have also suffered from rapidly rising input costs in pulp and chemicals. Demand has been strong and for the past few months some customers have been put on allocation by local mills.

Then the devastating KZN floods have tipped our local supply upside down with all Sappi and Mondi mills in the region suffering flood damage. Mondi has needed to declare force majeure as the Merebank mill was severely damaged and with the lack of municipal power in the Merebank area are yet to completely understand when we may see the start of paper production again.

The effect on printers and paper convertors could be devastating. Just as the world of work and traditional paper communication media was showing some recovery, the price and shortages of paper may well see an accelerated move to digital platforms. Once lost to electronic communication, it is very hard for our industry to return to print.

We are most concerned.

Source: IOL

The Meta-owned social networking sites were blocked in the country at the beginning of March and now a judge has ruled that they will remain so as a result of “extremist activities.”

In a translated statement obtained by outlet TASS, Judge Olga Solopova said: “The court has granted the lawsuit filed by the first deputy prosecutor general of Russia against the holding company Meta Platforms Inc. seeking a ban on operations on the territory of Russia.

The operations of the U.S. transnational holding company Meta Platforms Inc. to sell products, the social networks Facebook and Instagram, on the territory of Russia, is banned on the grounds of extremist activities. The court decision is to be fulfilled immediately.”

However, the ban on Meta operations does not apply to the messenger WhatsApp, which also comes under the Meta umbrella of social media apps.

Solopova added: “This decision does not apply to the operations of Meta’s messenger WhatsApp due to its absence of functions for public information dissemination.”

The ban comes just a week after Facebook issued a “temporary change” in policy as a result of the ongoing conflict in Ukraine – which was started when Russian president Vladimir Putin launched a military invasion on its neighbouring country at the end of February – and will allow users to post “forms of political expression” not normally permitted.

Meta spokesperson Andy Stone told The Verge: “As a result of the Russian invasion of Ukraine we have temporarily made allowances for forms of political expression that would normally violate our rules like violent speech such as ‘death to the Russian invaders.’ We still won’t allow credible calls for violence against Russian civilians.”

 

Why the supply chain is in crisis

By Grace Kay for Business Insider US

America seems to be running out of everything.

Supply-chain bottlenecks caused record shortages of everyday products from household goods and electronics to cars, food, and raw materials.

For shoppers, empty shelves can be jarring, spurring panic-buying sprees. It’s often the first sign people see that something may be wrong with the global supply chain. But, shortages are typically indicators of issues that have plagued the industry for months.

“At this point, shortages are guaranteed,” Jonathan Gold, vice president of supply chain policy at the National Retail Federation, told Insider. “… We’ve been warning consumers to manage their expectations for the holiday shopping season for months now. The fact of the matter is the supply chain is stretched to its limit from end-to-end.”

The supply chain didn’t recover from Covid-19
In 2020, coronavirus shutdowns wreaked havoc on the global supply chain. Since, lingering virus-mitigation measures continue to limit efforts to return the supply chain to pre-pandemic levels.

Several industry players limited worker levels due to fears of the further spread of Covid-19 within the workplaces. In China, port terminals temporarily shuttered as a result of the country’s Covid-19 zero-tolerance policy, spawning backlogs at some of the world’s largest ports.

“From an economic perspective, it’s sort of like a game of musical chairs,” former US trade negotiator Harry Broadman told Insider, pointing to efforts in the US to compete with 24/7 operations at Asian ports. “The world economy is out of sync because parts of it were forced to go offline when the pandemic started and getting all the industry players back in line at the same time is near impossible.”

Demand is soaring
Demand grew so rapidly in the past two years that it’s equivalent to about 50 million new Americans joining the economy, Gold told Insider.

“All parts of the supply chain, most of which are built on ‘lean’ principles (no slack, little redundancy, from truck drivers to inventory in warehouses), were not prepared for this increase,” Pelli told Insider. “While consumer demand can increase in a matter of months, it takes more time to increase port capacity, build warehouses, hire employees, etc., to meet that demand.”

Shortages make it difficult to keep up
Ports, warehouses, and trucking companies are processing more goods than ever while combatting a series of crushing shortages, including workers, equipment, and space.

A lack of chassis and shipping containers has made it even more difficult to transport goods.

Most notably, the national labor shortage has left warehouse companies scrambling for employees and key US ports working with limited manpower.

Two of the largest US ports saw a 30% increase in the amount of goods going through them while processing the cargo with 28% fewer workers. In July, the US Labor Department reported that the warehouse industry had a record 490,000 job openings. Meanwhile, the trucking industry has a shortage of over 80,000 drivers.

With fewer workers to process the goods, shipping yards and warehouses are running out of space, making it increasingly difficult to organize the output of goods to their final destinations.

No end in sight
While the record backlog at Southern California ports represents the most eye-grabbing aspect of the supply-chain crisis, every leg of the industry is in chaos, RBC analyst Mike Tran told Insider. Last week, Moody Analytics warned there will be “dark clouds ahead” for the supply chain.

The only realistic near-term solution would be a cut back on consumer spending, though the prospect seems unlikely.

Experts predict the disruptions will continue well into 2023, despite efforts from the government to mitigate the issue.

By Sheila Dang for Reuters / IOL

Forbes’ annual world’s billionaires list includes a record-breaking 2,755 billionaires, with Amazon.com founder Jeff Bezos topping it for the fourth consecutive year, the media company said on Tuesday.

The ranks of the ultra-wealthy are expanding after a year in which the coronavirus pandemic upended world economies and threatened the livelihoods of people across the globe.

This year’s billionaires are worth a combined $13.1 trillion (R190.08 trillion), up from $8 trillion last year, Forbes said.

“The very, very rich got very, very richer,” said Forbes’ chief content officer Randall Lane, in an interview with Reuters Video News.

Tesla Chief Executive Elon Musk jumped into second spot on the list, up from 31st last year.

Bernard Arnault, chief executive of luxury goods firm LVMH, Microsoft founder Bill Gates and Facebook Chief Executive Mark Zuckerberg round out the top five of the world’s richest billionaires.

Investor and business tycoon Warren Buffett fell out of the top five for the first time in over two decades, as tech executives dominate the Forbes rankings.

This year’s list has 493 newcomers, including Whitney Wolfe Herd, chief executive of dating app Bumble, which went public this year.

The 10 most wealthy people in the world are:

  1. Jeff Bezos
  2. Elon Musk
  3. Bernard Arnault
  4. Bill Gates
  5. Mark Zuckerberg
  6. Warren Buffet
  7. Larry Ellison
  8. Larry Page
  9. Sergey Brin
  10. Mukesh Ambani

By Patrik Schowitz for South China Morning Post

Buoyant stock markets are ignoring near-term warning signals on the pandemic resurgence and instead focusing on upbeat Covid-19 vaccine expectations. While financial markets’ resilience has been remarkable in the short run, what about the long-run, real-world economic legacy of the pandemic?

Most important, perhaps, is how much the pandemic has carved into long-term economic growth. The main worry concerns so-called economic scarring or constraining future growth potential.

For instance, this could mean households and firms emerging from the pandemic are more cautious in their spending and consumption behaviour as well as possibly loaded down with debt. As a result, they will be prone to saving more and investing less. Further, some sectors of the economy hit hard by the pandemic may never fully recover with, for example, a good chunk of business travel likely forever replaced by video meetings.

Workers who lost their jobs in those hard-hit areas may take a long time to find new careers, and their livelihoods might be permanently damaged. Even workers in other economic areas might become less employable over time if they remain unemployed for too long.

Set against these negatives, there is the potentially positive impact of more rapid adoption of technological advances. The same video-calling technology hurting the travel business is making many peoples’ working lives more efficient, allowing them to collaborate remotely and do more work in a given day.

Further, a huge amount of stimulus was thrown at economies by central banks through rate cuts and asset purchases as well as by governments through monetary support to affected businesses and workers.

Together, these are speeding up economic recoveries compared to past recessions. This should help keep scarring to a minimum, although it’s too early to tell what the net impact of these factors will be.

Another area of concern is inflation. In the near to medium term, the risk of higher inflation seems contained. The many factors that have pushed inflation down during the last few decades will still be in play in the next three to five years.

These include rapidly advancing technology adoption in e-commerce and working from home pushing down prices, the retirement of ageing populations weighing on consumer demand and a large amount of spare economic capacity around the globe pushing down on wages.

However, look slightly further out and the balance of risks could shift. Rapid technological progress might be here to stay, but globalisation – another factor pushing down on prices – could well have peaked already.

The worst of the demographic trends will at some point be behind us, and economic slack might increasingly disappear in the face of continued economic stimulus to keep economies going in the post-pandemic world. This continued stimulus carries at least the risk of a rise in inflation if governments and central banks increasingly act in a coordinated fashion to try and deal with an elevated debt load.

There is another lasting legacy of Covid-19: a drastically increased debt load across both public and private sectors around the world. As a result of governments’ spending to support their economies, net government debt is set to rise to nearly 100 per cent of GDP in 2021 for the Group of 20 economies, from less than 80 per cent before the pandemic.

Similarly, private companies, which had already been running up debt loads during the last cycle, in many cases have had to take on more debt to survive.

The good news is that this has so far not led to further problems in funding markets, once central banks brought the initial panic during February and March under control. Still, the new high-debt reality will increase economies’ sensitivity to rising interest rates going forward, which is exactly why policymakers will be reluctant to let them rise too quickly or too soon.

Until fairly recently, economic orthodoxy held that high debt levels in and of themselves were a serious headwind for economic growth, related to the scarring argument above. This view is increasingly being challenged by economists, but it is hard not to be apprehensive about the impact on growth and inflation from here.

Even as the near-term path out of the Covid-19 crisis is materialising with the arrival of vaccines, the jury is still out on the longer-term consequences of the pandemic.

3M to cut 3 000 jobs

By Martin Baccardax for The Street

3M has said that it will eliminate around 2 900 jobs next year, while pulling back on investments in slower-growth markets, as part of an overall cost-cutting plant that will cost around $300-million.

3M said the updated restructuring plans, which were first launched in January, will affect all of its business divisions and geographies include a pre-tax charge of between $250 to $300 million, around $150 million of which will be taken in the current quarter. The moves will likely result in annual pre-tax savings of between $200 million to $250 million each year, 3M said, as it re-positions its global operations in the wake of the global coronavirus pandemic.

3M will detail the restructuring plans at an industry conference hosted by Credit Suisse later today, with CEO Mike Roman scheduled to speak at 8:10 Eastern time.

“The COVID-19 pandemic has advanced the pace of change and disrupted end markets around the world, increasing the need for companies to adapt faster,” Roman said.

“At the same time, we are seeing significant opportunities from our new operating model which we launched at the start of the year. As a result, we are taking further actions to streamline our operations, positioning us to deliver greater growth and productivity as global markets emerge from the pandemic.”

3M shares were marked 0.23% lower in early trading Thursday to change hands at $171.50 each to clip their six-month gain to around 6.5%, well shy of the 13.6% gain for the Dow Jones Industrial Average benchmark.

Last month, 3M posted modestly slower-than-expected October sale growth figures Friday, suggesting a potentially sluggish start to the fourth quarter for the industrial group.

3M said October sales rose 3% from last year to $2.9 billion as healthcare revenues rose 12%, offsetting a 4% decline in transportation and electronics. Safety and industrial sales rose 4% while consumer sales were 7% higher, 3M said, compared to respective gains of 6% and 3% in August.

3M had forecast “flat to low single digit” October sales growth during its third quarter earnings conference call with investors last month, but declined to provide profit or revenue guidance for the final three months of the year owning to broader economic and demand uncertainty linked to the coronavirus pandemic.

 

By Jon Porter for The Verge

Amazon says it has just had its “biggest holiday season to date” as customers turned to the site to shop rather than venturing out to physical stores.

Although CNBC notes that the company did not share actual sales figures for either Black Friday or Cyber Monday, in a blog post the company revealed figures for independent sellers on its platform.

Amazon says these sellers saw over $4.8 billion in sales through the two shopping days worldwide, an increase of 60 percent over last year.

“Through Cyber Monday, 2020 has been the largest holiday shopping season so far in our company’s history thanks to customers around the world,” Amazon wrote.

While Amazon’s sales reached record highs, traffic at physical stores has reportedly plummeted. Preliminary data from Sensormatic Solutions reported by CNBC said that in-store traffic fell by 52.1 percent this Black Friday compared with 2019, as customers stayed home to avoid the crowds. If current trends continue, 42 cents of every dollar spent this holiday season could go to Amazon, according to one analysis, up from 36 cents last year.

Amazon says 71,000 small- and medium-sized businesses worldwide surpassed $100,000 in sales so far this holiday season. But Amazon’s own brands also appear to have sold gangbusters.

The company says customers bought “more Ring, Blink, and eero devices on Amazon than during any previous holiday shopping weekend.” The company adds that other top-selling devices on Black Friday and Cyber Monday include its new Echo Dot and Fire TV Stick 4K.

Other top-sellers in the US over the holiday season include Barack Obama’s book, A Promised Land; a Revlon hair dryer and volumiser hot air brush; and a genetic DNA test ancestry kit from 23andMe.

Over the course of this year, Amazon has been one of the biggest beneficiaries of changing shopping habits due to the pandemic. In its last earnings release, the company reported that its net income nearly tripled in the quarter compared to the previous year, and that’s not including its Prime Day sale that had to be delayed this year.

This growth has fuelled a massive hiring spree at the company, The New York Times reports, with Amazon adding 427,300 employees to its global workforce over the course of ten months.

 

UK retail giants collapse

By David Meyer for Fortune

Just as the coronavirus pandemic forced big U.S. retail names such as J.C. Penney and Neiman Marcus into bankruptcy, it is now wreaking similar havoc in the U.K.

On Tuesday, the Debenhams department store chain collapsed, possibly spelling the end of a business that has been running for nearly two and a half centuries. The implosion was the indirect result of the collapse, one day previously, of Topshop owner Arcadia Group.

In total, around 25 000 jobs are now at risk.

Cascading collapse
Arcadia Group, whose other properties include high-street staples such as Dorothy Perkins and Miss Selfridge, went into a form of bankruptcy protection on Monday following the reported failure of emergency financing talks.

The fashion empire, run for the last 18 years by the flamboyant and controversial magnate Philip Green, is not laying people off immediately, but 13 000 jobs hang in the balance, particularly if no buyers can be found for its businesses.

“The impact of the Covid-19 pandemic, including the forced closure of our stores for prolonged periods, has severely impacted on trading across all of our brands,” said CEO Ian Grabiner in a statement.

That first domino then pushed over Debenhams, which was also on the brink.

The sportswear retailer JD Sports had been in talks to rescue the venerable chain, which had been looking for a buyer since going into administration in April. But, as Arcadia’s businesses were the biggest concession operators in Debenhams’ department stores, JD Sports took Monday’s news as its exit cue.

“The sale process has not resulted in a deliverable proposal,” Debenhams said in a Tuesday statement.

“Given the current trading environment and the likely prolonged effects of the COVID-19 pandemic, the outlook for a restructured operation is highly uncertain. The administrators have therefore regretfully concluded that they should commence a wind-down of Debenhams UK, whilst continuing to seek offers for all or parts of the business.”

The U.K. is due to leave its second national lockdown period Wednesday, moving instead to a tiered system of regional restrictions that will allow non-essential shops to reopen. Debenhams will reportedly use the “Wild Wednesday” opportunity for a fire-sale of its stock.

Arcadia post-mortem
The difficulties of the department-store model in the age of e-commerce are by now well-known, with COVID-19 in many cases being the straw that broke the camel’s back. Arcadia is also seen as a victim of existing weaknesses, such as its positioning in a time of widening income inequality, as well as the pandemic.

“Most of the brands under Arcadia Group, especially Topshop, sit in the mid-range for price points,” said Melissa Minkow, retail industry lead at digital consultancy CI&T, in an emailed statement.

“We’ve seen mid-priced retailers struggle across the board because of the massive rift between low- and high-income groups. As the middle-income demographic shrinks, so does the success of mid-range retail. On a similar note, Arcadia Group’s brands’ failure to identify with either fast fashion or more quality, high-end messaging means a failure to connect with consumers at a values-based level.”

The news of the collapses prompted words of sympathy from leading politicians.

Alok Sharma, the business secretary, tweeted Monday evening that the Arcadia collapse was “incredibly sad news” and the government “stands ready to support those affected during this difficult period.” The next morning, shadow business secretary Ed Miliband—a former leader of the Labour Party—responded to the combined Arcadia and Debenhams news by decrying “a devastating day for the high street.”

Miliband went on to urge the government to “press Philip Green to do the right thing for his employees’ pensions.” Arcadia’s pension scheme is reportedly £350million ($466 million) in the red.

Green and his wife Tina Green (the actual owner of Arcadia, via her Taveta Investments vehicle) are controversial figures for many reasons.

High on the list is their lavish, Monaco-based lifestyle—they have a £100 million ($134 million) super-yacht moored in the tax haven—but Philip Green has also been accused of of sexual and racial harassment, and a parliamentary report in 2016 described him as the “unacceptable face of capitalism” over his role in the collapse of the BHS retail chain, which he sold the year before for just £1.

 

Pfizer leads vaccine race

Source: eNCA

A vaccine jointly developed by Pfizer and BioNTech was 90 percent effective in preventing COVID-19 infections in ongoing Phase 3 trials, the companies announced Monday.

Protection in patients was achieved seven days after the second of two doses, and 28 days after the first, according to preliminary findings.

“The first set of results from our Phase 3 COVID-19 vaccine trial provides the initial evidence of our vaccine’s ability to prevent COVID-19,” Pfizer Chairman and CEO Albert Bourla said in a statement.

“We are a significant step closer to providing people around the world with a much-needed breakthrough to help bring an end to this global health crisis.

“We are reaching this critical milestone in our vaccine development program at a time when the world needs it most,” Bourla added.

Across much of the globe, COVID-19 infections rates are soaring to record highs, with hospital intensive care units filling up and death tolls mounting as well.

Based on supply projections, the companies said they expect to supply up to 50-million vaccine doses globally in 2020, and up to 1.3-billion doses in 2021.

 

Kids’ stationery booms during pandemic

By Jennifer Alsever for Marker

Christy Warner, a communications manager in Minneapolis, searched for months for a desk that fit her teenage daughter’s room and was priced less than $200. “I looked on Ikea, Wayfair, Overstocked, Target, TJ Maxx, everywhere, and everything is sold out,” she says.

Last spring, her daughter, a high school senior, converted the dining room table into a working desk during lockdown. Today, she’s upgraded to a folding table in her bedroom. “I just couldn’t find something,” says Warner. “It’s just like the toilet paper shortage.”

Covid-19 has created a whiplash cycle of unexpected product surges and shortages, from bicycles and pools, to flour and outdoor heaters. The latest unexpected pandemic rush: children’s office supplies. Call it the most expensive back-to-school year yet. As schools continue toggling between remote and hybrid learning, parents have been throttled into spending hundreds and sometimes thousands of dollars to set up makeshift home classrooms for their children — from first-graders to marooned college students.

Some companies are cashing in on the boom by launching new products to cater to what’s essentially a new breed of kid’s home office.

Forget backpacks and lunchboxes — according to Wayfair, sales of student desks are up 129%; meanwhile sales of Chromebooks, a popular no-frills laptop for students, have surged in the past few months.

“It’s a totally different set of things that are needed for back to school,” says Ben Arnold, a consumer technology analyst at research firm NPD. For instance, sales of notebook computers jumped 46% between July and August, compared to the same time during 2019, according to NPD. There was a similar lift in sales of USB webcams (174%), PC headsets (109%), monitors (78%), computer mice, (70%) routers (60%), and keyboards (40%). Parents are also snapping up more specialised gadgets to modify their setups, including green screens and ring lights — which improve lighting for Zooming into school, says Arnold.

Headphones have also been selling out. In Carlsbad, California, back-to-school sales at JLab Audio, an online audio retailer, have doubled, driven by parents snapping up $29 kids’ Bluetooth headphones that offer a smaller fit for either distance learning or “keeping kids occupied during lockdown,” says JLab CEO Win Cramer.

Another unexpected back-to-school hit: children’s blue light glasses, designed to protect little eyes from prolonged exposure to the harsh glow of computer screens and electronics.

Some companies are cashing in on the boom by launching new products to cater to what’s essentially a new breed of kid’s home office. Annex, an on-demand service that outfits home offices for employees, has been bombarded with inquiries from parents who want to set up workspaces for their children — so many that Annex has a kid’s cubicle in product development, says Rob Wu, a spokesman for the company.

Meanwhile, McSquares, a Colorado-based office supply startup that recently raised funding on Shark Tank, has begun offering $50 “distance learning packages” which include erasable markers, a desktop whiteboard that can replace scratch paper, and a six-pack of erasable sticky notes, which let students jot down their thoughts and rearrange them on the wall.

“There are great things we shouldn’t be doing in front of a screen, and one of them is thinking visually,” says McSquares’s founder and CEO Anthony Franco, who has seen quarterly sales top $1 million, up 500% over the last year, thanks in part to demand for Covid home offices.

Even companies that typically sell to school districts are suddenly finding themselves in the mass consumer game. Cincinnati-based School Outfitters, which sells school furniture and supplies to districts, has been selling parents bouncy and wobble chairs that let kids move around while sitting, along with kid-size standing desks. The pandemic hurt the company’s sales in March and April, says CEO Tom Brennan, but it has since bounced back with a new revenue stream — “regular parents.” Adds Brennan: “It’s not really our market, but we’re happy to help them.”

Follow us on social media: 

               

View our magazine archives: 

                       


My Office News Ⓒ 2017 - Designed by A Collective


SUBSCRIBE TO OUR NEWSLETTER
Top