(Supply Chain and Logistics Trucking companies and manufacturers are in a rush to get new rigs on the road.Operators that were already ordering trucks in higher numbers pushed orders into a higher gear last month, the WSJ’s Jennifer Smith and Bob Tita write, adding 48,700 trucks to order books in the biggest single-month buying spree in nearly 12 years. ACT Research says that’s more than double the January 2017 total, and it signals trucking companies buoyed by the strong demand and big gains from the new tax law are stepping up plans to replace or expand their fleets. That’s bolstering operations at truck makers like Freightliner manufacturer Daimler Trucks North America, which is increasing production at several plants based on what it says is “very high order intake.” The business is growing more confident as the strong momentum that closed last year persists into 2018. Less-than-truckload carrier . Sala 0.72% says its freight tonnage rose 11% in January, and freight rates on trucking spot markets remain well above year-ago prices. Supply Chain and Logistics
The forces of supply and demand aren’t providing much fertile ground for profitable growth among U.S. farmers. The agriculture sector is caught in a tight spot in the fast-growing U.S. economy, the WSJ’s Sharon Nunn writes, with farmers prodcing too much wheat and corn even though global prices for the commodities have tumbled since 2014. They’re facing what one economist calls an “irreversible supply curve,” where investments in land or equipment create big fixed costs that have to keep producing to pay back their costs. It’s an enigma that hits industries with large and costly assets, including shipping operations, and leaves businesses hamstrung as they try to respond to changes in market conditions. The squeeze has dented farmers’ profits and pushed some out of business, but most have few options except to keep planting. Experts say the market among producers is so fragmented that there’s little hope of any widespread pullback in supply. Supply Chain and Logistics
British companies trading with Europe won’t get to keep a preferred path through customs checkpoints under Brexit. The U.K. government plans to leave the European Union’s customs union as part of the withdrawal from the EU, the WSJ’s Jenny Gross and Jason Douglas report, likely adding significant costs to business and ending hopes by some operations that they could retain ties through customs. Countries in a customs union trade tariff-free among themselves but impose common external tariffs on goods coming from outside. Its drawback is that it prevents member countries from implementing free-trade agreements for goods with nonmembers. British operators, including ports and logistics companies, have raised alarms about problems at the border after Brexit. But the new statement seems to rule out any arrangement with the bloc similar to that of Turkey, which is not in the EU but has an arrangement that make it subject to most of the bloc’s trade policies.