Wooden Pallets Foil the Russia’s PLANS IN UKRAINE
We reported last year that there was a wooden pallet shortage. Well, we in the toy industry were not the only ones affected. It appears that the Russian army was as well.
Here is how Bloomberg News describes it:
Most people don’t think much about wooden pallets—and that might be true even of people waging large-scale military invasions. Recent reports claim that Vladimir Putin’s attack on Ukraine has been hampered by a lack of pallets, making it more difficult to move the vast amounts of supplies needed to support soldiers and tanks.
“What Wooden Pallets Have to Do With Russia’s War on Ukraine,”
Joe Weisenthal and Tracy Alloway, Bloomberg News
Let’s not get too cocky. Ukraine is one of the world’s major exporters of wood used in pallets (for such a small country, they certainly seem to export a lot of the world’s needs – like wheat). The coming shortage may well drive pallet prices up even more.
Mattel doubles down on Mexico
Mattel has taken a big step towards muscling up its manufacturing in Mexico. The company has spent $50 million expanding its existing facility, making it Mattel’s largest manufacturing plant in the world.
The Monterey site has in the past produced large plastic items like the Barbie Dreams House and Fisher-Price Power Wheels. It will be interesting to see if the expanded facility will also make smaller toys. It could signal a shift by Mattel away from China if it does.
Could Ocean Freight Prices Be Headed Down?
I have spoken with a number of analysts and read an even greater number of articles on the freight situation. Most of them tend to be gloomy with concerns about China’s Covid factory shutdowns, and the continuing backup at the ports. They generally see prices coming down slightly over the coming months, but not by much.
That is why I found this quote of interest:
Transportation shares, especially trucking and railroad stocks, make up the worst-performing group in the U.S. in the past week amid growing concern that aggressive interest rate hikes by the Federal Reserve and surging inflation will curb consumer spending. As a result, companies responsible for moving and delivering goods may see demand drop at a time when soaring oil prices squeeze margins.
“Gloom in Transports Sends Smoke Signal for U.S. Stocks,” Esha dey, bloomberg news
Compounding the issue is an increase in experiential rather than product consumption and American warehouses loaded with inventory.
A drop in demand could signal that the party may be coming to an end for ocean freight carriers as the supply of containers begins to outstrip demand.
