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Home>Today's Top Supply Chain and Logistics News From WSJ

Today's Top Supply Chain and Logistics News From WSJ

Today's Top Supply Chain and Logistics News From WSJ


 By Paul Page 

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America's top investor is placing a long-haul bet on trucking. Warren Buffett's Berkshire Hathaway Inc. is taking a nearly 40% stake in the operator of Pilot and Flying J travel centers, the WSJ's Nicole Friedman writes, and plans eventually to take control of a business Mr. Buffett says is tied to the intractable need to move more goods "to more people." It's the latest investment in traditional transportation at Berkshire, which also owns BNSF Railway, and marks an indirect move into the trucking business that the Knoxville, Tenn.-based family-owned Pilot Travel Centers LLC serves. Still, the deal seems to run counter to big changes percolating in the business: Some analysts project massive growth in electric and autonomous vehicles, which would cut into the fuel sales that provide Pilot Flying J more than $20 billion in annual revenue. Pilot Chief Executive Jimmy Haslam expects "diesel fuel will power trucks for a long time to come," however, giving the operator a steady business tapping into shipping growth.

Europe is getting more expensive for Amazon.com Inc. and the e-commerce giant has barely expanded its business there. European Union antitrust regulators are moving aggressively to retrieve several hundreds of millions of euros in allegedly unpaid taxes from Amazon, the WSJ's Natalia Drozdiak and Sam Schechner report, as Brussels cracks down on sweetheart tax deals that governments have granted to multinationals. The move against Amazon is over taxation in Luxembourg that was set in a 2003 tax deal with Amazon, one that regulators believe amounts to illegal state aid. The case highlights the complicated efforts multinationals are undertaking to rein in costs even as they expand internationally. That's a big concern for Amazon as it looks to bulk up its presence in the U.K. and spread out across Europe. The French newspaper Le Monde reported this week the company is looking for acquisitions and partnerships in France, including physical locations and deals with distributors.

American eating habits aren't keeping up with pork production. U.S. meatpacking plants are sending record numbers of hogs to slaughterhouses this year, the WSJ's Benjamin Parkin and Jacob Bunge report, pushing pork futures down nearly 40% since the middle of the summer. Wholesale prices for pork bellies are off over 50% since July and retail prices are sliding as American consumption falls behind supply. It's the latest example of agriculture production spinning beyond market demand, and the big supply imbalance carries heavy stakes because farmers and meatpackers are depending on selling abroad. Pork exports rose 11% in the first seven months of 2017 and a fifth of the pork produced in the U.S. this year will be exported as companies sell to countries like Mexico and South Korea where demand is growing. Those shipments depend on politically vulnerable trade agreements, however, and U.S. agriculture can figure prominently when tough trade talk gets more contentious.


Retailers are projecting a robust holiday shopping season but the wealth won't be spread around equally. The National Retail Federation forecasts sales will grow between 3.6% and 4% in November and December from a year ago, the WSJ's Sarah Nassauer reports, a rosy outlook in line with outlooks from Deloitte, AlixPartners and RetailNext Inc. Retailers certainly have been bringing in goods with confidence: The NRF says imports at major gateways in its Global Port Tracker report reached the highest volume ever in July, and loaded inbound volume at the Port of Los Angeles grew by more than 15,000 containers from July to August. The broad retail figures belie an industry in turmoil amid big changes in shopping and distribution, however. The NRF predicts "nonstore sales" -- online business -- will grow up to 15% this season. Several big chains have filed for bankruptcy protection this year, while others have closed hundreds of weaker stores, a trend likely to push even more sales online.



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