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Africa’s Chicken Meat Market to Reach 11M Tonnes by 2030

chicken meat

Africa’s Chicken Meat Market to Reach 11M Tonnes by 2030

IndexBox has just published a new report: ‘Africa – Chicken Meat – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The revenue of the chicken meat market in Africa amounted to $11.4B in 2018, jumping by 6.1% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price).

The market value increased at an average annual rate of +1.8% over the period from 2013 to 2018; the trend pattern remained relatively stable, with only minor fluctuations being recorded in certain years. The pace of growth appeared the most rapid in 2017 when the market value increased by 8% y-o-y. Over the period under review, the chicken meat market reached its peak figure level in 2018 and is likely to see steady growth in the near future.

Consumption by Country

The countries with the highest volumes of chicken meat consumption in 2018 were South Africa (2.1M tonnes), Egypt (1.1M tonnes) and Morocco (720K tonnes), with a combined 52% share of total consumption. Angola, Algeria, Ghana, Libya, Nigeria, Malawi, Tunisia, Congo and Democratic Republic of the Congo lagged somewhat behind, together comprising a further 27%.

From 2013 to 2018, the most notable rate of growth in terms of chicken meat consumption, amongst the main consuming countries, was attained by Malawi, while chicken meat consumption for the other leaders experienced more modest paces of growth.

In value terms, the largest chicken meat markets in Africa were South Africa ($3.3B), Egypt ($1.8B) and Morocco ($1.1B), together accounting for 54% of the total market. Nigeria, Angola, Malawi, Libya, Ghana, Tunisia, Algeria, Democratic Republic of the Congo and Congo lagged somewhat behind, together accounting for a further 24%.

The countries with the highest levels of chicken meat per capita consumption in 2018 were Libya (39 kg per person), South Africa (36 kg per person) and Congo (23 kg per person).

Market Forecast to 2030

Driven by increasing demand for chicken meat in Africa, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to retain its current trend pattern, expanding with an anticipated CAGR of +3.1% for the period from 2018 to 2030, which is projected to bring the market volume to 11M tonnes by the end of 2030.

Production in Africa

In 2018, the amount of chicken meat produced in Africa totaled 5.7M tonnes, surging by 4.2% against the previous year. The total output volume increased at an average annual rate of +2.4% over the period from 2013 to 2018. The general positive trend in terms of chicken meat output was largely conditioned by a moderate expansion of the number of producing animals and a relatively flat trend pattern in yield figures.

Production By Country in Africa

The countries with the highest volumes of chicken meat production in 2018 were South Africa (1.8M tonnes), Egypt (1.1M tonnes) and Morocco (720K tonnes), with a combined 62% share of total production. Algeria, Nigeria, Malawi, Tunisia, Libya, Tanzania, Sudan and Mozambique lagged somewhat behind, together accounting for a further 21%.

From 2013 to 2018, the most notable rate of growth in terms of chicken meat production, amongst the main producing countries, was attained by Malawi, while chicken meat production for the other leaders experienced more modest paces of growth.

Imports in Africa

In 2018, approx. 1.9M tonnes of chicken meat were imported in Africa; picking up by 23% against the previous year. In value terms, chicken meat imports amounted to $1.9B (IndexBox estimates) in 2018. In general, chicken meat imports continue to indicate a relatively flat trend pattern. The pace of growth appeared the most rapid in 2018 when imports increased by 21% against the previous year. The level of imports peaked at $2B in 2013; however, from 2014 to 2018, imports remained at a lower figure.

Imports by Country

Angola (432K tonnes) and South Africa (370K tonnes) represented the major importers of chicken meat in 2018, accounting for near 23% and 20% of total imports, respectively. Ghana (213K tonnes) ranks next in terms of the total imports with a 12% share, followed by Libya (6.6%), Congo (6.2%) and Democratic Republic of the Congo (5.8%). Benin (77K tonnes), Gabon (67K tonnes), Egypt (45K tonnes) and Guinea (37K tonnes) followed a long way behind the leaders.

From 2013 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by Guinea, while imports for the other leaders experienced more modest paces of growth.

In value terms, Angola ($465M), South Africa ($372M) and Ghana ($188M) appeared to be the countries with the highest levels of imports in 2018, together accounting for 53% of total imports. Libya, Democratic Republic of the Congo, Congo, Egypt, Benin, Gabon and Guinea lagged somewhat behind, together comprising a further 31%.

Import Prices by Country

The chicken meat import price in Africa stood at $1,038 per tonne in 2018, approximately reflecting the previous year. Overall, the chicken meat import price continues to indicate a pronounced decline. The pace of growth was the most pronounced in 2017 an increase of 9.1% against the previous year. The level of import price peaked at $1,266 per tonne in 2013; however, from 2014 to 2018, import prices stood at a somewhat lower figure.

Prices varied noticeably by the country of destination; the country with the highest price was Egypt ($1,705 per tonne), while Congo ($835 per tonne) was amongst the lowest.

From 2013 to 2018, the most notable rate of growth in terms of prices was attained by South Africa, while the other leaders experienced a decline in the import price figures.

Source: IndexBox AI Platform

cargo

GLOBAL CARGO IS LEAVING ON A JET PLANE

With the ongoing threat of COVID-19, airlines have seen a precipitous drop in passenger travel and are focused on the possibility of a voluntary or mandated halt to U.S. passenger flights. In response, major carriers are finding ways to keep flying during the global health crisis.

American Airlines and United Airlines, for example, have offered their passenger aircraft for charter cargo flights. Even in normal times, the lower deck of passenger aircraft carries cargo to maximize the utilization of space. With the sharp scale-back in passenger travel, however, the companies are offering dedicated cargo runs to deploy their assets and replace revenue while helping to keep supply chains moving and facilitate the shipment of essential goods.

Attention All Passengers:

Many air travelers don’t realize that it’s not just their own and fellow travelers’ luggage that checked in for their flights. The big passenger airlines generally have a lot of available space in their bellies. With operating costs covered by passenger tickets, the airlines often generate supplemental revenue by carrying packages, freight or mail for the U.S. postal service on board passenger flights.

In turn, cargo shippers secure relatively cheap space and can get goods close to their ultimate destination given the dense network of airports serving passenger flights around the world. Even logistics players like UPS and FedEx partner with passenger airlines, particularly in emerging markets where trade volumes may not justify the deployment of their own regularly-scheduled aircraft. Technology tools enable precise coordination to ensure goods off-loaded from a freighter aircraft make their departure on a passenger aircraft and vice versa.

Cargo split

The trend is taking off. The International Air Transport Association (IATA) has been cited as estimating the split between cargo carried by passenger airlines and freighter aircraft at 60/40 and forecasts that will grow to 70/30 in the coming years.

In 2018, American Airlines moved 2 billion pounds of cargo and raised $1 billion of cargo revenue despite not operating cargo aircraft. Airlines based in Asia such as Korean Air and Cathay Pacific do have freight fleets, but still carry more than half of their cargo in the bellies of passenger aircraft. McKinsey has noted that with the expansion of the major Middle Eastern passenger carriers and new aircraft designs with large belly-cargo configurations, the belly capacity of Middle Eastern carriers flying into Europe in 2016 equaled the capacity of more than 100 weekly Boeing 777 freighter flights.

Open Skies

“Open Skies” agreements governing the transport of people, pallets and packages are designed to enable market forces to guide decision-making about routes, capacity, and pricing. Critically, Open Skies agreements also provide both passenger and cargo flights unlimited market access to partner markets and the right to fly to all intermediate and beyond points. The United States now has Open Skies agreements with over 100 partners around the world, including both bilateral agreements and two multilateral accords. So-called fifth freedom rights – also called beyond rights – are a core element of Open Skies agreements, permitting a carrier to fly to a second country, offload passengers and cargo, pick up new passengers and cargo, and continue on to a third country.

Over 100 Open Skies

While Open Skies agreements provide benefits to both passenger and cargo carriers, cargo carriers to a large extent fly international packages and freight themselves, while passenger carriers utilize codeshare agreements and worldwide alliances. The different business models and complex tie-ups can produce a divergence in interests. A prominent example was the dispute between the “Big Three” U.S. passenger carriers – American, Delta, and United – and the governments of the United Arab Emirates (UAE) and Qatar, who the carriers alleged were providing billions of dollars in subsidies and other benefits to their state-owned carriers: Emirates, Etihad, and Qatar Airways. Among other serious concerns, this raised red flags about subsidized fifth freedom operations (e.g., Newark-Athens-Dubai) and the potential for their expansion, negatively impacting U.S. passenger airline service to the Middle East and India.

U.S. Airlines for Open Skies, a coalition that included FedEx, Atlas Air, the Cargo Airline Association and JetBlue (which has a code-sharing agreement with Emirates), opposed the call of the Big Three for restricted Gulf fifth freedom rights (a violation of the U.S.-UAE and U.S.-Qatar Open Skies agreements if restricted involuntarily). The cargo carriers expressed concern that challenges to the Open Skies accords with Qatar and the UAE put at risk the fifth freedom rights that cargo carriers depend on for their complex global networks. They discounted the view that the U.S. could breach passenger fifth freedom rights without setting a dangerous precedent for the equivalent all-cargo rights.

The dispute was ultimately resolved in 2018 through U.S. government agreements with the Qatar and UAE governments under which the parties acknowledged that government subsidies adversely affect competition and committed to financial transparency and business on commercial terms.

Air Cargo Players

In the Upright Position for Takeoff

As passenger carriers step up to support cargo at this extraordinary time, you may not know that from 1997-2001, UPS also ran passenger operations. For a period of years, the company had contracts with tour companies and cruise lines to offer vacation flights as well as charters for college and pro sports teams, politicians, the press corps and others. In under four hours, a 727-100QC could be ready to carry 113 passengers. See here for the UPS Quick Change process.

Air cargo capacity is critical at this time of crisis and the airlines’ role is deemed a critical infrastructure industry by the Centers for Disease Control and Prevention (CDC). American Airlines reports that its recent cargo-only charter carried medical supplies, mail for active U.S. military, and telecommunications equipment and electronics to support people working from home. United’s wide-body charter cargo flights are likewise getting critical goods into the hands of businesses and people in need. Stakeholders across the cargo and passenger industries look forward to a post-pandemic era where all can return to their respective roles in transporting people and cargo globally, described well by United’s slogan “Connecting People. Uniting the World.”

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Leslie Griffin is Principal of Boston-based Allinea LLC. She was previously Senior Vice President for International Public Policy for UPS and is a past president of the Association of Women in International Trade in Washington, D.C.

This article originally appeared on TradeVistas.org. Republished with permission.

AR

How to Create an Enduring Workflow for AR

Please note: Vocabulary in the payment automation world varies. While customers (i.e., clients, buyers) and their suppliers (i.e., vendors, beneficiaries, sellers) are both considered customers to payment automation companies like Nvoicepay, this article will use the terms “customer” and “supplier” to distinguish between them.

Imagine having to switch out old railroad tracks while a rusted steam engine thunders across. Adopting modern electronic payments runs about as smoothly for banks.

When you think about how old banks are in the U.S., it’s an understandable plight. They’ve been running on the same tracks since the first bank’s founding. Additional features, like wire payments and credit cards, were added over time as a complement to the old system. But the rise of nimbler financial technology (fintech) companies has lit a fire under them. Now they face the challenge of converting their processes to electronic means without disturbing their clients’ day-to-day business.

In a way, fintechs have it easy. Their very nature makes competing against banks a breeze, primarily because banks were built to last, and fintechs were built to adapt. They can easily shift gears to meet demand and immediate needs. Meanwhile, banks are frequently caught up in bureaucratic processes that make it virtually impossible to react quickly to problems.

Financial and fintech industries feel the contrast most often when tackling payment security—specifically when it comes to cards. Even though check payments incur 25% more fraud instances than card payments, according to the 2019 AFP Payment Fraud and Control Survey, many companies hesitate to make the switch to more electronic means.

Kim Lockett—the Director of Supplier Services at Nvoicepay, a FLEETCOR company—offers a glimpse into why companies are hesitating to shift gears: “Fraud is not a new issue to companies,” she states. “But what we’ve learned is that fear of change overrides the fear of potential fraud loss, even among companies who have already incurred those losses.”

With almost 30 years of experience in payments and financial services, Lockett possesses a holistic perspective on supplier expectations for seamlessly receiving payments, with payment fraud protection listed as one of the highest priorities. She’s heard all the horror stories, from a small business whose checks were stolen out of their mailbox and cashed, to a company whose employee tried to use business deposit information to clear her personal checks.

That’s not to say that errors and fraud don’t occur for card payments as well. But they occur significantly less and are much easier and faster to resolve than check, ACH, and wire payment issues.

What’s the Holdup?

In the last decade, fintech companies have improved the tracks on which many accounts receivable (AR) teams function. From providing lower processing costs for card payments to offering user-friendly portals for reliable payment retrieval, fintechs transform painful AR workflows into a functional process.

Meanwhile, banks have just begun to offer pseudo-solutions that appear to be tech-friendly but still run on old tracks. An excellent example of this is lockbox technology, where banks mitigate the processing of check payments and their data for their larger customers by taking on the work themselves. This sort of offering likely extended the life of check payments. Still, it didn’t eradicate the underlying problem: that even though work has been lifted directly from their customer’s shoulders, someone at the bank still has to process checks and submit data for manual reconciliation. The process is hardly automated, and the advent of payment processing technology has all but made the entire process impractical.

Embracing the Future

Of course, the best way to avoid check issues is to avoid checks. These days, electronic payment methods offer higher levels of security. But if electronic options like virtual card numbers are such a fantastic option, why are so many companies avoiding them?

Lockett states: “In general, I think companies are afraid of handling credit card numbers because they feel there is risk involved.”

It’s not the dangers of check payments, but misconceptions about electronic payments that cause companies to refrain from accepting them. Many AR teams rationalize that they’d rather respond to the inevitable check fraud cases they understand than walk unprepared into the relatively unknown territory of card fraud.

When checks are stolen and cashed, there’s very little that can be done. At the end of the day, someone will be out that money. Other electronic payment types like ACH and wire are significantly safer, but can still experience fraud, especially internal instances, such as when a company’s employee submits their personal bank account information to receive company payments. Whether these issues are reversible is dependent on each unique scenario.

Card payments, particularly the virtual card numbers provided by fintech companies, are typically protected by two-factor authentication. Whether this means that AR is supplied with a login to access secure details or a portion of a card number, the information is much more difficult for bad actors to access, securing the payment process and reducing the risk of fraud.

In the end, not every company will have the capacity to accept card payments, so leaving alternate options open like check and ACH truly boils down to how much individual payment providers value customer service.

Taking Suppliers Along for the Automation Journey

In many cases, banks have rushed to cater to customer’s needs, leaving suppliers in the dust when it comes to follow-through on electronic payments. Despite these efforts to change, most larger banks still follow their old tracks, and their customers and suppliers experience the same lack of customer service they always did.

With over 10 years of support development behind them, fintechs have expanded their offerings to suppliers, catering to their specific needs, whether they require something as simple as customizable file formats or a more significant request like payment aggregation. Fintechs that follow through with supplier support are truly delivering on their promise of offering an end-to-end solution. They are building tracks that support the advanced bullet trains that companies have become.

“Ten years ago, companies were reluctant to add virtual card payments to their list of accepted payment types,” says Lockett. “Education, experience, and word-of-mouth have established virtual card payments as a mainstream and relevant way to conduct business.”

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Alyssa Callahan is the Content Strategist at Nvoicepay, a FLEETCOR company. She has five years of experience in the B2B payment industry, specializing in cross-border B2B payment processes.

papaya

Papaya Market in Latin America and the Caribbean – Guatemala Emerges as the Fastest Growing Exporter

IndexBox has just published a new report: ‘Latin America and the Caribbean – Papayas – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The revenue of the papaya market in Latin America and the Caribbean amounted to $4.1B in 2018, going up by 5.3% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price).

Overall, papaya consumption continues to indicate a relatively flat trend pattern. The pace of growth appeared the most rapid in 2013 when the market value increased by 10% y-o-y. The level of papaya consumption peaked at $4.3B in 2014; however, from 2015 to 2018, consumption failed to regain its momentum.

Consumption By Country

The countries with the highest volumes of papaya consumption in 2018 were the Dominican Republic (1M tonnes), Brazil (1M tonnes) and Mexico (885K tonnes), together comprising 74% of total consumption.

From 2009 to 2018, the most notable rate of growth in terms of papaya consumption, amongst the main consuming countries, was attained by the Dominican Republic, while papaya consumption for the other leaders experienced more modest paces of growth.

In value terms, the largest papaya markets in Latin America and the Caribbean were Brazil ($1.2B), the Dominican Republic ($898M) and Mexico ($511M), together accounting for 64% of the total market. Cuba, Peru, Colombia and Venezuela lagged somewhat behind, together comprising a further 28%.

Production in Latin America and the Caribbean

The papaya production totaled 4.2M tonnes in 2018, growing by 7.2% against the previous year. In general, papaya production continues to indicate a relatively flat trend pattern. The most prominent rate of growth was recorded in 2018 with an increase of 7.2% year-to-year. The volume of papaya production peaked at 4.2M tonnes in 2016; afterwards, it flattened through to 2018. The general positive trend in terms of papaya output was largely conditioned by a relatively flat trend pattern of the harvested area and a relatively flat trend pattern in yield figures.

In 2018, approx. 97K ha of papayas were harvested in Latin America and the Caribbean; surging by 2.3% against the previous year. The average papaya yield totaled 43 tonne per ha in 2018, an increase of 4.8% y-oy.

Production By Country

The countries with the highest volumes of papaya production in 2018 were Brazil (1.1M tonnes), Mexico (1M tonnes) and the Dominican Republic (1M tonnes), with a combined 75% share of total production.

Exports in Latin America and the Caribbean

The exports amounted to 265K tonnes in 2018, shrinking by -2.9% against the previous year.  In value terms, papaya exports totaled $187M (IndexBox estimates) in 2018. The total export value increased at an average annual rate of +3.3% over the period from 2009 to 2018; however, the trend pattern indicated some noticeable fluctuations being recorded in certain years. The growth pace was the most rapid in 2014 when exports increased by 13% year-to-year. The level of exports peaked in 2018 and are likely to see steady growth in the immediate term.

Exports by Country

Mexico was the key exporter of papayas exported in Latin America and the Caribbean, with the volume of exports recording 155K tonnes, which was near 59% of total exports in 2018. It was distantly followed by Guatemala (59K tonnes) and Brazil (43K tonnes), together constituting a 38% share of total exports.

From 2009 to 2018, average annual rates of growth with regard to papaya exports from Mexico stood at +1.6%. At the same time, Guatemala (+53.8%) and Brazil (+5.0%) displayed positive paces of growth. Moreover, Guatemala emerged as the fastest-growing exporter in Latin America and the Caribbean, with a CAGR of +53.8% from 2009-2018.

Guatemala (+22 p.p.), Mexico (+7.6 p.p.) and Brazil (+5.7 p.p.) significantly strengthened its position in terms of the total exports, while the shares of the other countries remained relatively stable throughout the analyzed period.

In value terms, Mexico ($90M), Brazil ($50M) and Guatemala ($37M) were the countries with the highest levels of exports in 2018, with a combined 95% share of total exports.

Guatemala experienced the highest rates of growth with regard to the value of exports, among the main exporting countries over the period under review, while exports for the other leaders experienced more modest paces of growth.

Export Prices by Country

The papaya export price in Latin America and the Caribbean stood at $706 per tonne in 2018, picking up by 14% against the previous year.

There were significant differences in the average prices amongst the major exporting countries. In 2018, the country with the highest price was Brazil ($1,175 per tonne), while Mexico ($579 per tonne) was amongst the lowest.

From 2009 to 2018, the most notable rate of growth in terms of prices was attained by Mexico, while the other leaders experienced a decline in the export price figures.

Source: IndexBox AI Platform

language

The Most In-Demand Business Language Skills in 2020

The year 2020 is here. If you’re soon to join the workforce, or if you’re a seasoned professional planning to take their career to the next level, learning a second language can be one of your best moves.

 

According to the World Economic Forum, the 10 skills that one needs to succeed professionally in 2020 are:

1. Complex Problem Solving

2. Critical Thinking

3. Creativity

4. People Management

5. Coordinating with Others

6. Emotional Intelligence

7. Judgment and Decision Making

8. Service Orientation

9. Negotiation

10. Cognitive Flexibility

 

Being a bilingual speaker has clear cognitive benefits. All these skills can be acquired and refined by learning a new language. A second language is a highly regarded skill as well. In our increasingly interconnected world, companies that operate (or aim to operate) internationally with customers, partners and talent distributed across the world, are looking for multilingual people.

In this post, we’ll take a look at the language skills that will be the most in-demand this year. These skills are a second language and the cultural awareness that comes with it. Let’s take a closer look.

Why You Should Learn a Second Language

What specific language you should learn will probably have to do with your industry and your location. For instance, if you’re based in the United States, learning Spanish might be your best option. Estimates suggest that approximately 99.8 people of Hispanic descent will live in the United States by 2050. And, with a collective buying power of over 1.72 trillion dollars, the Hispanic population is one of the most promising consumer sectors in the country.

We can see an increase of culturally-sensitive advertisement targeting Spanish-speaking customers, as well as an increase in the request for professional translation services.

On the other hand, you might want to learn a language you could tie concrete professional opportunities. For instance, if your industry is booming in Italy, you should learn Italian. If your sector’s great innovators are in Denmark, perhaps you should learn Danish.

Throughout the last twenty years, the British Council has produced a series of reports titled “Languages for the Future”. It was concluded that post-Brexit, UK-based professionals should take their time to learn Spanish, Mandarin Chinese, French, Arabic or German. Think about what’s best for you, considering your location, industry, discipline and goals.

Of course, if you find a language and/or culture you’re particularly interested in — whether because you enjoy their media, or because of your own ethnic roots, even better.

It’s worth taking a moment to further explain how a second language might benefit you professionally.

For starters, bilingual workers tend to get paid more. And, with the digitalization of the workplace, remote work on the rise, and an increasing number of companies of all sizes sourcing talent internationally, bilingual workers have a clear competitive edge. They can communicate better through international organizations, and they tend to have higher cultural awareness than their counterparts. Cultural awareness makes for a healthy, strong and diverse company culture, and it’s also the key to high performance. Cultural awareness is the vehicle to above-average creativity, critical thinking, and negotiation skills. Let’s see why.

Cultural Awareness & Why We Need It

Cultural awareness has been defined as:

“ [S]sensitivity to the similarities and differences that exist between two different cultures and the use of this sensitivity in effective communication with members of another cultural group.”

Those who have cultural awareness can see their own culture from the perspective of an outsider, and see the differences between cultures in an analytical, intelligent and sensible way.

Cultural awareness has been linked to increased creativity because it’s about raising above our assumptions and experience and empathizing with others. Those who have spent a season abroad, taking part in academic or professional programs, have developed this creativity by constantly dealing with mundane situations that they couldn’t navigate through on “pilot mode,” as they would in their own culture.

Understanding differing preferences, interests and codes of conduct also boosts your emotional intelligence and makes you a people-oriented, flexible professional with leadership potential.

The Next Step

Now that we understand how learning a second language can boost our career and help us bring greater value to organizations, we could:

-Learn about the in-demand languages in your industry

-Find a learning method or strategy that fits your needs and the way you like to learn

-Consider using apps, films and other unconventional learning assets

-Set clear and realistic goals

-Explore relevant institutions, schools or academic programs

Remember that learning a second language isn’t just about adding a line to your resume. It’s about growing as a person and as a professional. And, like all learning processes, it’s basically neverending. You should always be looking to learn something new. As Henry Ford said, “Anyone who stops learning is old, whether at twenty or eighty.”

risk

How to Get a Handle on Risk in Uncertain Times: 10 Important Considerations

Risk: It’s the operative word on everyone’s mind right now. Whether it’s COVID-19 or oil prices, supply chain impacts or financial market concerns, understanding the impact of macro and micro-events, assessing their impact and putting in place the right action plans to mitigate that risk as best as possible is the priority task at hand.

Here we’ll examine ten steps to consider to ensure you’re being as thoughtful and rigorous as possible in your response to risk.

1. Take Care of Your PeopleHopefully, this has already been priority number one for your business after the past few weeks. How do we safeguard our people? How do we handle work from home – voluntary versus mandatory? What other flexible resourcing options do we provide – from sick leave to absenteeism considerations? What are the IT implications and subsequent human resource and capacity management concerns we need to consider and fully factor in? Err on the side of caution. Better to be safe than sorry.

2. Analyze Internal Risks – Before you can do that, you need to galvanize the right teams to be able to understand, assess and action against those risks. It’s critical to build the right cross-functional teams to be able to look at, and understand, the relevant issues to consider. This will involve finance, R&D (depending on your business) and marketing and sales. It will also involve teams like quality and sustainability leaders, as there will be implications and follow on ramifications despite your very best efforts.

3. Conduct Scenario Analyses – For critical categories, it’s important to get a handle on what alternative demand/supply options are. What are the pessimistic versus expected versus optimistic cases depending on what happens with the current situation, both in terms of the pandemic but also in terms of current and expected economic conditions? As part of any such assessment, you’ll need to score, assign probabilities and weights and adjust your thinking and actions accordingly.

4. Talk to Customers –This doesn’t tend to be the first thing people think about when it comes to procurement, but understanding the demand side implications for your business will be essential. How will demand be disrupted? Will there be specific products in your portfolio that will be more directly or severely impacted? Will this result in demand cutbacks or surges? Where will you source supply from? Can you cut back supply needs for others? How will buying patterns change – will there be channel shifts from offline to online? How does that play out in terms of critical suppliers and critical buys and requirements in the near to medium terms? Maintaining a dialogue with customers to understand their needs and issues and where all of this plays through for your team is essential.

5. Develop Plans for Strategic Categories –You’ll need to revisit your plans and the related risks around your most critical categories during a time of crisis. Make sure that these plans have been reviewed, the pressure points tested, the risk points analyzed and alternative plans considered. This could mean enhancing inventory levels (and rethinking inventory buffers based on the scenario planning we talked about earlier), assessing implications for delivery performance, gaining a view of multi-tiered supplier performance, increased inbound category visibility and more.

6. Examine Logistics Implications – By the same token, businesses must assess the logistics implications both inbound and outbound, either to make products or to ensure delivery. This has cost and timeline implications. All modes of transportation can be seen to be impacted, not least of which is shipping impacts – especially to and from China, but elsewhere, as well – whether these impacts are halts on movements, ramp downs, or the subsequently phased ramp back up. Or bypassing some of these options and going to airfreight which presents another level of cost to timeline tradeoffs.

7. Assess Liquidity – This will be critical and will call for a stronger partnership and alliance with finance. Looking at cash positions, assessing payables, and of course extending that into receivables, etc. will be essential. Add to this, talk of tightening credit markets and this makes it all the more important. Cash as always will be king if we need to endure near term instabilities, revenue disruptions, supply chain impacts, sourcing problems, and more

8. Assess Supplier Health – Part and parcel to all of this is assessing supplier health and evaluating who will be the most impacted. A clear view of your supplier segments – strategic versus mid-tier versus everyone else – is essential so you can focus your time and analysis accordingly.

For the most strategic suppliers, it’s critical to have a multi-tiered view of their supply base and related dependencies so you can adequately assess their performance and supply chain bottlenecks. This will involve structured risk analyses – looking across multiple variables beyond financials, to operational performance, to industry performance factors, to geographic and locational concerns and more. You’ll also need to identify alternate supply sources to shift production as and where needed, and as quickly as possible. Not all of this can be done at a moment’s notice. Some of it should have been done as part of a prior risk assessment exercise.

9. Think Ahead – Businesses can’t afford to simply think about today. Consider what the next three to six months look like. This is where scenario planning comes into play. It is critical to assess not only how you can react now but also how to prepare for eventualities later, when things are either fully back to normal or in some altered state based on longer-lasting ramifications from the events of today.

10. Work With Facts and Manage Emotion – Fundamentally, the most important thing you can do is to continuously monitor changes in a structured fashion. Have a programmed information collection and analysis mechanism. If we accept that the crisis is still unfolding and that the true impacts from a supply chain disruption perspective may not reveal themselves for months, we need to take tangible steps.  This can be done by establishing a process to monitor other regions outside the infected areas that could be impacted. Are ports outside the infected areas being impacted through disruption or through new regulations to protect against transmission of the virus?  Are suppliers struggling financially without access to the Chinese markets, jeopardizing their viability? Data will be important but data converted to relevant insight for your specific supply chain situation will be essential.

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About the author

Omer Abdullah is Co-founder and Managing Director of The Smart Cube and is responsible for managing the company’s Americas business.Omer has more than 25 years of management consulting, global corporate and industry experience across North America, Europe and Asia.

 Prior roles include A.T. Kearney (North America), Warner Lambert (USA) and The Perrier Group (Asia-Pacific). Omer has an MBA from the University of Michigan at Ann Arbor, USA and a BBA from the University of East Asia.

industry

Coronavirus: Five Severe Hits to the Automotive Industry

As the coronavirus pandemic is engulfing the world, it is adversely affecting the very structure of our society across the globe in a hitherto unprecedented way. The countries and international organizations around the world are trying hard to halt the progress of this pandemic. The people with infection need urgent medical care, and the people who do not have infection yet are isolating in their own homes.

The risk of infection is making it mandatory to stop all the activities of every industry and economic activity in our society to minimize the transmission of the virus. However, with no vaccine or cure in sight, it can be a long battle before normalcy is restorable.

 According to experts, more people are likely to stay at home in light of the COVID-19 pandemic, which will reduce the demand for cars. Automakers have yet to see the impact of the pandemic and the real impact may only come out in the coming months. Here are the five most severe impacts of the coronavirus on the car industry.

1. Lockdowns and Curfews

Several governments across the world are imposing lockdowns and curfews in the respective countries to try and limit the spread of the virus among the population. The mode of transmission of the coronavirus is from one person to another. Since the coronavirus is highly infectious, there is a need for people to keep their distance from each other.

The places that people tend to crowd are extremely susceptible to be hotspots of transmission of the disease to many other people. Hence the doctors around the world are advising the population to follow the norms of social distancing. Cleaning your hands regularly with sanitizers or soaps to prevent the transmission of the virus is a crucial prevention method.

People do not want to go out shopping and in the U.S., the places with the maximum reports of coronavirus are already witnessing a drop in demand. Since the lockdowns are affecting the general way of life of people and there is no need for people to purchase a car in these times, it is leading to a natural decline in demand for cars and bikes such as the Yamaha wr250r.

2. Economic Slowdown

The countries across the world are facing a crisis, and the panic is causing an economic slowdown across the world. The slowdown is also causing the stock markets around the world to take a hit. Economic slowdowns always adversely affect the car industry as people tend to find a decrease in wealth for making such purchases. Even if the world recovers from the coronavirus pandemic, the economic impact is bound to cause ripples for months to come.

Although the long term effects of the pandemic are still unclear, car manufacturers are expecting only a delay in the purchases against people refraining from making the purchase. The reason for this expectation is that the people buy cars only due to their need for a car and not on a whim and hence can not postpone their purchase indefinitely.

3. Closing Down of Factories

In order to stop the spread of the virus and curb the transmission, the various countries are shutting down the factories operating in their state. Since there is a need for workers to be present and working in factories for ensuring smooth and continuous production of cars, manufacturing is not going on. China is a major hub of car manufacturing, and as the disease originates from the country, many plants are shut down.

Many workers come in close contact in manufacturing plants, and hence they can act as hubs of disease transmission. Only the essential services are operational for limiting close human interaction and slowing down transmission. This is slowing down the manufacturing of cars around the world.

4. Need for Medical Equipment

Due to the sudden onslaught of the coronavirus pandemic, there is a sudden surge in demand for emergency medical equipment and protective gear. Many factories are also now producing face masks and ventilators as they are in acute shortage and are currently in high demand. Since the repurposing of factories is taking place, car manufacturing is coming to a standstill.

The manufacturers are not able to use their production line for the manufacture of cars. Hence, they can easily repurpose their plants to make the medical necessities by making slight modifications to the production line. They will need an expert to monitor and guide the production as the ventilators are complex machines. Manufacturers are working closely with government officials and health authorities for the production of ventilators.

5. Slow Down of International Trade

Due to the effect of globalization, every industry sources their raw materials and individual parts in different countries throughout the world for keeping the manufacturing cost low. Since some countries are stopping the production of materials due to the coronavirus, manufacturing plants all over the world are facing acute shortages.

The manufacturing plants of cars in other countries are also facing a shortage of parts and raw materials due to international trade restrictions in light of the current situation. This leads to the slow down or temporary stopping of the manufacturing process of cars around the world.

Conclusion

The virus is already present in every inhabitable continent throughout the world and almost every country is seeing a rapid spread of the disease amongst its population. As so, every country is imposing restrictions on the people venturing outside their homes for work and other needs to limit the spread of the pandemic.

The automobile industry is responding to the calls from the government to aid in manufacturing the face masks and ventilators in these trying times. The global economy is suffering and approaching a standstill due to the coronavirus pandemic and the automobile industry is also undergoing a crisis. As a responsible citizen, you must adhere to the regulations for curbing the spread of the disease and get back to normalcy in the fastest possible time.

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Reference Links –

https://www.benzinga.com/news/20/03/15525971/coronavirus-another-severe-hit-to-the-automotive-industry

https://finance.yahoo.com/news/coronavirus-another-severe-hit-automotive-135056364.html

https://economictimes.indiatimes.com/industry/auto/auto-news/auto-industry-stares-at-2-bn-loss-as-factories-and-dealers-shut-shop-to-stem-covid-19-contagion/articleshow/74782274.cms?from=mdr

https://www.sme.org/technologies/articles/2020/march/coronavirus-impact-on-auto-industry-may-accelerate/

https://www.acea.be/press-releases/article/coronavirus-eu-auto-industry-faces-unprecedented-crisis

https://www.bbc.com/news/business-51956880

https://www.autocarindia.com/industry/how-coronavirus-has-hit-the-global-auto-industry-a-timeline-416615

https://www.just-auto.com/news/updated-daily-automotive-coronavirus-briefing-free-to-read_id194210.aspx

https://www.wsj.com/articles/coronavirus-threatens-auto-industrys-record-run-of-robust-sales-11584532801

High Authority Links –

https://www.theglobeandmail.com/drive/mobility/article-how-will-coronavirus-affect-the-auto-industry-in-the-coming-months/

https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/auto-industry-still-awaits-full-force-of-coronavirus-outbreak-57494206
breakbulk europe

Breakbulk Europe Moves to September

Breakbulk Europe, the world’s largest event for the project cargo and breakbulk industry, has been postponed until September in light of the global novel coronavirus pandemic. The event will now take place at Messe Bremen in Bremen, Germany, from 29 September to 1 October 2020.

“We have been closely monitoring the impact of COVID-19 not only in Germany, but across the world, and have decided to move the event to September to ensure the safety of our customers,” stated Nick Davison, Portfolio Director for Breakbulk and CWEIME events, Hyve Group. “We know that this is the most important gathering for the breakbulk and project cargo industry and we want to be sure our customers can meet in a safe environment. The pandemic has had a significant impact on the global supply chain and bringing the industry to Breakbulk Europe will provide an opportunity for leaders to discuss the best way forward.”

To accommodate the new dates for Breakbulk Europe, Breakbulk Americas has been postponed to later in 2020. A new date will be announced shortly.

Meanwhile, Breakbulk Events & Media has launched BreakbulkONE, a weekly newsletter and web portal for industry updates around the effects and responses to the crisis. “Breakbulk events have built a reputation for hosting leaders across the industrial supply chain at the event conferences where they share insights and business strategies,” Leslie Meredith, Breakbulk’s Marketing and Media Director said. “We wanted to extend this support to provide a platform for industry members to share their own news by tapping into the resources of our media team who runs Breakbulk Newswire and Breakbulk magazine. We hope this also reinforces the feeling that our industry is a unified one and that we can find better solutions together.”

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About Breakbulk Europe

Breakbulk Europe has become the global hub for the industrial project supply chain, including the world’s foremost manufacturers, oil & gas companies, EPCs, carriers, ports, logistics firms, specialized transporters and related service providers. This year’s event is expected to bring together around 10,000 professionals from more than 120 countries. To request exhibiting and sponsorship information and to register for the event, visit europe.breakbulk.com.

Breakbulk Europe is one of four Breakbulk global events, along with Breakbulk Asia in Shanghai, 3-4 Aug. 2020, Breakbulk Americas in Houston, 29 Sept.-1 Oct. 2020 and Breakbulk Middle East in Dubai, 9-10 Feb. 2021.

About Hyve Group plc
Hyve Group plc is a next-generation FTSE 250 global events business whose purpose is to create unmissable events, where customers from all corners of the globe share extraordinary moments and shape industry innovation. Hyve Group plc was announced as the new brand name of ITE Group plc in September 2019, following its significant transformation under the Transformation and Growth (TAG) programme. Our vision is to create the world’s leading portfolio of content-driven, must-attend events delivering an outstanding experience and ROI for our customers.

Press contact: Leslie Meredith, Marketing & Media Director Breakbulk Events & Media

E: Leslie.Meredith@breakbulk.com

T: +1 801 201 5971

pineapple

Asia’s Pineapple Market – Japan and China Account for 55% of Total Imports in the Region

IndexBox has just published a new report: ‘Asia – Pineapples – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The revenue of the pineapple market in Asia amounted to $12.1B in 2018, approximately equating the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price).

The market value increased at an average annual rate of +2.7% from 2013 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations being recorded over the period under review. The pace of growth appeared the most rapid in 2014 with an increase of 5.5% against the previous year. Over the period under review, the pineapple market attained its maximum level in 2018 and is expected to retain its growth in the near future.

Consumption By Country

The countries with the highest volumes of pineapple consumption in 2018 were the Philippines (2.3M tonnes), Thailand (2.1M tonnes) and Indonesia (1.8M tonnes), with a combined 53% share of total consumption. These countries were followed by India, China, Viet Nam and Taiwan, which together accounted for a further 38%.

From 2013 to 2018, the most notable rate of growth in terms of pineapple consumption, amongst the main consuming countries, was attained by China, while pineapple consumption for the other leaders experienced more modest paces of growth.

In value terms, the largest pineapple markets in Asia were Thailand ($3B), China ($2.2B) and the Philippines ($1.9B), with a combined 59% share of the total market. These countries were followed by India, Indonesia, Viet Nam and Taiwan, Chinese, which together accounted for a further 34%.

The countries with the highest levels of pineapple per capita consumption in 2018 were Thailand (30 kg per person), the Philippines (21 kg per person) and Taiwan (17 kg per person).

From 2013 to 2018, the most notable rate of growth in terms of pineapple per capita consumption, amongst the main consuming countries, was attained by China, while pineapple per capita consumption for the other leaders experienced more modest paces of growth.

Production in Asia

In 2018, approx. 12M tonnes of pineapples were produced in Asia; leveling off at the previous year. The total output volume increased at an average annual rate of +1.5% from 2013 to 2018; the trend pattern remained relatively stable, with only minor fluctuations being observed throughout the analyzed period. The general positive trend in terms of pineapple output was largely conditioned by mild growth of the harvested area and a relatively flat trend pattern in yield figures.

Production By Country

The countries with the highest volumes of pineapple production in 2018 were the Philippines (2.7M tonnes), Thailand (2.1M tonnes) and Indonesia (1.8M tonnes), together accounting for 57% of total production. India, China, Viet Nam and Taiwan, Chinese lagged somewhat behind, together accounting for a further 37%.

From 2013 to 2018, the most notable rate of growth in terms of pineapple production, amongst the main producing countries, was attained by China, while pineapple production for the other leaders experienced more modest paces of growth.

Harvested Area in Asia

The pineapple harvested area stood at 425K ha in 2018, shrinking by -1.8% against the previous year. Overall, the pineapple harvested area, however, continues to indicate a relatively flat trend pattern. The growth pace was the most rapid in 2017 when harvested area increased by 6.3% y-o-y. In that year, the pineapple harvested area reached its peak level of 433K ha, and then declined slightly in the following year.

Yield in Asia

In 2018, the average yield of pineapples in Asia amounted to 27 tonne per ha, remaining relatively unchanged against the previous year. Over the period under review, the pineapple yield continues to indicate a relatively flat trend pattern. The most prominent rate of growth was recorded in 2015 when yield increased by 4.9% against the previous year. In that year, the pineapple yield attained its peak level of 28 tonne per ha. From 2016 to 2018, the growth of the pineapple yield remained at a somewhat lower figure.

Imports in Asia

In 2018, the imports of pineapples in Asia amounted to 521K tonnes, surging by 1.7% against the previous year.

In value terms, pineapple imports amounted to $370M (IndexBox estimates) in 2018. The total import value increased at an average annual rate of +4.6% from 2013 to 2018. The most prominent rate of growth was recorded in 2016 with an increase of 25% against the previous year. In that year, pineapple imports attained their peak of $372M. From 2017 to 2018, the growth of pineapple imports remained at a somewhat lower figure.

Imports by Country

Japan (159K tonnes) and China (126K tonnes) represented roughly 55% of total imports of pineapples in 2018. South Korea (78K tonnes) held the next position in the ranking, distantly followed by the United Arab Emirates (37K tonnes) and Singapore (24K tonnes). All these countries together held approx. 27% share of total imports. The following importers – Turkey (19K tonnes) and Saudi Arabia (16K tonnes) – together made up 6.8% of total imports.

From 2013 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by China, while imports for the other leaders experienced more modest paces of growth.

In value terms, Japan ($130M), China ($79M) and South Korea ($64M) constituted the countries with the highest levels of imports in 2018, with a combined 74% share of total imports.

Import Prices by Country

In 2018, the pineapple import price in Asia amounted to $709 per tonne, going up by 4.5% against the previous year.

There were significant differences in the average prices amongst the major importing countries. In 2018, the country with the highest price was South Korea ($826 per tonne), while Singapore ($362 per tonne) was amongst the lowest.

From 2013 to 2018, the most notable rate of growth in terms of prices was attained by the United Arab Emirates, while the other leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

disruptions

How Companies can Rethink Supply Chains to Deal with Disruptions

The coronavirus has disrupted U.S. companies in many ways, and nearly three-fourths of them have seen their supply chain significantly affected.

While China has begun slowly reopening as the number of coronavirus cases there decreased in recent weeks, reports of the illness shot up in other countries, and the epicenter of the pandemic shifted to Europe and then the U.S. Thus, multiple supply chains have been compromised as the outbreak spreads, and there’s no telling when those links in the various chains will operate at normal capacity.

“There are waves of effects coming even if Chinese manufacturing gets back to full-go,” says Hitendra Chaturvedi, a professor at the Supply Chain Department of W.P. Carey School of Business at Arizona State University and an expert on global supply chain sustainability and strategy.“As the coronavirus has spread globally, drops in different trading partners’ ability to supply is felt everywhere.

“What this is showing, especially in the U.S., is we need to reassess supply chain strategy and make it stronger to withstand unforeseen, major disruptions.” Chaturvedi outlines some possible outcomes in U.S. supply chain strategy as a result of the coronavirus:

Learning that cost is not the only consideration. Chaturvedi says that when companies in the future plan their overall global supply chain strategy, they may decide that paying more to establish a more resilient and flexible process would be worth it by reducing risk. “Companies typically find the lowest-cost supplier, but if you have a single source, you’re vulnerable, and that’s what’s happening now,” Chaturvedi says. “This will move companies more toward mitigating risk. That requires making investments. They could stabilize their supply chains by enlisting alternative suppliers, boosting inventories or investing in more diverse ways of distribution.”

Localizing more manufacturing and transporting. “Dependence on China for their manufacturing has put small and midsize businesses in jeopardy,” Chaturvedi says. “The pandemic exposes the vulnerability of companies that rely heavily on a limited number of trading partners. What will result is businesses will look to restructure their global supply chains, and some companies will look at localizing more than they would have in the past. A shift in that direction had already started during the U.S.-China tariff fight.”

Planning for future disruptions. Another result of the pandemic’s impact on supply chains is it will compel companies to anticipate disruptions in the future and build in quick responses to their supply chain. This involves a process called mapping, in which companies engage suppliers in order to better understand their sites and processes. “It’s imperative for businesses running a global supply chain to be in the know about news that could cause disruptions,” Chaturvedi says. “You have to be proactive and not reactive. Knowing where the disruption will come from and how that will impact their products allows companies to lead time and the ability to create a mitigation strategy.”

Utilizing technology. Chaturvedi expects to see a rise in the use of AI, chatbots, the internet of things, and robotic process automation to facilitate supply chains. “This will be done not only as a pretext to bring manufacturing jobs back from China,” Chaturvedi says, “but also for purely selfish reasons because bots do not get sick.”

“The impact of the coronavirus pandemic on supply chains has given new meaning to the word ‘disruption,” Chaturvedi says. “We’ve never seen anything quite like this, and businesses can learn a lot from it that will help their supply chain process in the future.”

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Hitendra Chaturvedi  (www.wpcarey.asu.edu/people/profile/3541031) spent over 30 years in progressive technology leadership positions with Microsoft, Newgistics, E&Y e-Business and A.T. Kearney. Chaturvedi also built a $100 million software company in India, GreenDust, where he implemented proprietary reverse logistics software at Amazon, Flipkart (Walmart), Samsung, Panasonic and Whirlpool. A computer engineer with a master’s degree from Louisiana State University and an MBA from Southern Methodist University, Chaturvedi has been widely covered in the media and is a subject matter expert on global supply chain strategy, sustainability in supply chain, reverse logistics, ecommerce, artificial intelligence and machine learning. Now a professor at Arizona State University, Chaturvedi has been a visiting professor at Southern Methodist University, University of Texas-Dallas, Penn State and Purdue.