The Price Forecast Category

US Cotton Prices Shoot Up, Following a Rise in Demand

Spend Matters welcomes this guest post from Verity Michie, market analyst at Mintec.

US cotton prices have been on a rollercoaster ride in 2017, ending the year on a high. Last April, we looked at whether this could be the end of high cotton prices. We concluded that yes, cotton prices should fall as latest figures showed rising US cotton planted area for the 2017/18 season. Our expectations became reality, as prices fell throughout the year until recently, when cotton prices rose 22% since the beginning of November, reaching high levels last seen in 2014.

US Coal Struggles to Leave its Mark

Spend Matters welcomes this guest post from Jonathan Stokes, market analyst at Mintec.

When Donald Trump ran his presidential campaign in 2016, he did so with the pledge that he would transform the US energy market, cementing America’s place as an energy-providing superpower. The foundation of this new energy empire would be built similar to the industrial revolution, based on coal. While the rest of the world moved towards a cleaner future, would America be taking a step back?

What Boeing, SAP Ariba and Cannabis Have in Common: Spend Matters Best of Direct Materials in 2017

As always, the direct materials supply chain was a hotbed of activity over the past year, and Spend Matters held the front lines on much of it for what matters to procurement practitioners and their technology options. In this year-end wrap up, we present the best of our direct materials coverage from 2017, including news about direct materials-centric technology providers, commodity-specific updates and a budding new supply category.

Californian Raisin Prices Soar on Strong Demand and a Decline in Production

raisins

Spend Matters welcomes this guest post from Jara Zicha, market analyst at Mintec.

Turkish prices have also risen since April, buoyed by soaring prices in the US, but at a much slower rate, by only 25%. Californian raisins usually trade at a premium to Turkish produce, but this year, following the harvest, the price difference between the two origins increased rapidly.

Market Speculation Puts Soybean Oil Prices on Roller Coaster Ride

GMO

Spend Matters welcomes this guest post from Jonathan Stokes, market analyst at Mintec.

We, as analysts, steer the market more than we like to think. A prediction or forecast one way or another can be a significant factor in driving commodity pricing. During the summer, the USDA did exactly this, surprising markets when they forecast higher US soybean production, despite adverse weather conditions throughout the crop development period. So when market prices of soybean and soybean oil shot up at the beginning of October due to the downward revisions of USDA production estimates, what went wrong?

The Damage to Oranges, Lumber and Cotton Caused by the Hurricanes

Spend Matters welcomes this guest post from Jara Zicha and Verity Michie, market analysts at Mintec.

At the end of August, the Atlantic regions suffered devastating effects from Hurricane Irma that lasted for two weeks. It hit islands in the Caribbean and parts of the southern U.S. states, including Florida. But how did this affect commodity prices?

Oh Sugar, the EU is coming!

sugar

Spend Matters welcomes this guest post from Nick Peksa, opportunities director at Mintec.

One dark night in 1775, Paul Revere road his horse through the streets of Massachusetts shouting, “The British are coming!” While this may not be factually correct, I would like to be the first to shout, “Oh Sugar, the E.U. is coming!”

Supply Dynamics: Vendor Snapshot (Part 1) — Background & Solution Overview [PRO]

manufacturing

Direct materials procurement is similar in some respects to indirect procurement: you want to see your spend, aggregate demand and find opportunities to reshape your value chain to unlock value. But that’s where the similarities end. Analyzing direct spend (especially across multiple tiers of supply) is sometimes like seeing a cloud of smoke coming out of your tailpipe — you know there’s something wrong but don’t know the cause. For indirect spend, you basically change the oil, replace the air filter and hope for the best. But for direct spend, you need specific engine diagnostics to figure out what’s driving performance and how much you could potentially improve. And unfortunately, in many cases, the manufacturers of those engines parts don’t want you poking around under the hood.

Whether it’s for plastics, resins, hydrocarbon feedstocks, agricultural commodities, standard catalogue parts, electronic components or metals, you must translate your demand for parts into the raw materials that go into them. And you must understand the demand volumes, supply chain capacities and processing capabilities that drive that pricing — especially if you want to tap into aggregated buying channels beyond the stuff you buy to support your own internal factory requirements.

This intersection of supply chain modeling, demand forecasting, demand-supply reconciliation, demand aggregation and commodity price forecasting is where Supply Dynamics plays. The idea originated with one of North America’s largest privately owned metals distributors where the opportunity to roll up demand information across OEM customers and their outside contract manufacturers gave it a unique opportunity to build out specific analytics that would help it size up opportunities for its customers and itself. But last year that technology was liberated from its previous owners and is now a commercial offering for any manufacturer or distributor that wants to optimize its own extended supply chain.

This Spend Matters PRO Vendor Snapshot provides facts and expert analysis to help buying organizations make informed decisions about whether they need a solution like Supply Dynamics to expand their analytics initiatives into previously unchartered materials and supply chain components. Part 1 of our analysis provides a company background and detailed solution overview, as well as a summary recommended fit suggestion for when organizations should consider Supply Dynamics. The rest of this multipart research brief covers product strengths and weaknesses, competitor and SWOT analyses, user selection guides and insider evaluation and selection considerations.

How to Decide on Organizational Sourcing Structures, Supply Market Intelligence Sources (ICYMI)

category management

Last week, we ran two stories that have come out of our new feature, Ask Spend Matters. The feature asks readers to tell us what they’ve always wondered about procurement and supply chain, and our editors then select questions to pursue and investigate. While our first replies covered the intricacies of tail spend management and the use of big data in public procurement, last week we tackled two questions related to the sourcing side of procurement. Check out what your peers are wondering and be sure to leave us your own question!

Could an Answer to the Multiyear US-Canadian Lumber Trade War Soon be Here?

Spend Matters welcomes this guest post from Verity Michie, market analyst at Mintec.

Following the expiration of the nine-year-long softwood lumber agreement (SLA) in October 2015, the U.S. and Canada have yet to finalize a new trade agreement. But why do they need one?

The Butter Market has Gone Crazy

Spend Matters welcomes this guest post from Nick Peksa, opportunities director at Mintec.

Yes, the butter market has gone crazy. Normally these kind of rapid price movements are reserved for markets like vanilla, crude oil and currency, but not for shopping staples. At the end of May 2016, European butter futures had established a new monthly record for futures traded, with 1,382 butter contracts having been established. This phenomenon is not just confined to Europe; there has been an increased demand globally for all types of fats (people trending toward anti-sugar and organics).

Cashew Nut Prices Soar on Tight Supply

Spend Matters welcomes this guest post from Jara Zicha and Jonathan Stokes, of Mintec. 

A few years back, cashews were very competitively priced, being one of the cheapest tree nuts available on the market. However, prices have soared since the beginning of 2016, currently up 30% year-over-year, at over $11 per kilogram in Vietnam.