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Supply chains critical to educate fleet masses about electric vehicles

By Tomas Edwards, CMO, Daloop

Sustainability is a heavily discussed topic right now, with individuals and businesses seeking to have less impact on the environment as they become more aware of the increasing threats to our planet.

One of the clearest moves toward a more sustainable environment is the purchase of an Electric Vehicle (EV).  EV sales are continuing to rise alongside correlating proposals over infrastructure and manufacturing developments. With sales of new combustion-engine vehicles set to end in 2030 and the UK government’s latest proposal to legislate that 50% of automakers’ sales must be electric by 2028, the trend is clear.

However, anxieties over the transition remain ever-present in conversations that I have with fleet managers, drivers and in some of the more negative articles I’ve read.

The switch to EV is happening

The transition away from combustion engines is set to become mainstream. Recent surveys show that investment in EVs continues to rise with more EVs purchased in March 2022 alone than in the whole of 2019.

Alongside this impressive statistic, the trends indicate that increasing numbers of businesses and people are planning on making the switch. According to research from BP, 43% of managers and 41% of drivers expect to make the switch to EVs within two years. Survey results in May from major tyre manufacturer, Bridgestone, revealed that 67% of motorists intend to switch. Of that figure, 47% want to change to an EV to save on fuel bills, while 56% are sold by the environmental benefits. This is interesting and highlights the conscious effort being made to reduce carbon emissions and improve sustainability.

This is happening not only on an individual level but also across the vehicle industry. Over the past year, we have seen Ford, Nissan, Renault, and Mitsubishi all making commitments to massively invest in EV production. It is the same for luxury carmakers, with Mercedes-Benz, Bentley, and Jaguar-Land Rover all announcing pledges to reduce their greenhouse gas emissions.

Anxieties persist

Despite these positive statistics, anxieties remain around the EV transition process but some of these problems are simply out of most businesses’ and governmental control. Take for example, the issues surrounding global supply chains. Volkswagen announced earlier this month that they will deliver no new EVs to customers in Europe and the US for the rest of 2022 due to sell-out of battery-powered models, citing issues within supply chains as primary cause.

Away from supply chain issues, unfortunately, and broadly reflecting the same issues facing individuals, general anxieties around fleet electrification amongst businesses persist. The main concerns regularly discussed relate to the driving range of EVs and whether necessary infrastructure will be in place to support transport decarbonization. This is where education needs to occur, because such worries can only exist if you believe that the roadside on-demand fuel supplymodel will be replicated come 2030 and beyond.   It won’t.  Charging facilities will be found at home, at work, at leisure and retail sites – anywhere where vehicles are parked for the necessary length of time. That being the case, charge will be obtained before it’s necessary and road-side facilities will be used en-route for seldom taken longer journeys.

Regardless, the UK government’s promise to increase the number of electric charge points by more than ten times to 300,000 by 2030 was broadly welcomed across the industry.

This announcement included new standards and legislation which means EV operators will have to provide real-time data for customers to check the status of charge points, and apps for customers to find the nearest available charger. Enterprises clearly have a role to play in supporting this proposal. To reduce EV charging anxiety, it is imperative that the infrastructure to support the EV transition is in place.

This is where companies like Daloop, with our data-driven mobility management software, can deliver clear benefits to fleets and businesses and alleviate concerns that some may have about EV charging and range anxiety. The software that fleet managers and businesses use to manage their EV operations is just as essential in keeping their vehicles on the road as the charge points themselves. With the correct, data-driven approach, the EV transition can be a seamless and valuable choice for any individual or business without compromising on either efficiency or costs.

Invest in our planet

Sustainability and ‘saving our planet’ is clearly one of the top drivers for switching to EVs and, in April, we had the annual World Earth awareness day.  This provided an opportunity for us all to reflect on our impact on climate change and assess what we can do to reduce our carbon footprint. The theme this year was “invest in our planet”. Evidently a key investment individuals and businesses are making to reduce their carbon footprint is with the purchasing of an EV. This remains an important step, especially as the transport sector has continuously been a leading source of greenhouse gas emissions across the globe.

Aside from the environmental factor, it also makes economic sense. Research from Compare the Market found that driving an electric car for a year cost almost £600 less than a petrol equivalent after recent fuel price increases. Moreover, for businesses’ by using the right software fleet managers can safeguard journey routes and ensure that EV fleets are maintained and operated efficiently.

With the government setting clear commitments for all new HGVs to be zero-emission by 2040 and all car and van sales similarly needing to hit 100% zero-emission by 2035. EVs are now one of the most important investments that can be made to achieve global net-zero by the mid-century.

Your potential to reduce carbon emissions

This year, to support Earth Day 2022, Daloop launched a new online platform: Daloop.Earth. This platform provides business owners with an accurate, visual reflection of their potential to reduce global carbon emissions. The platform uses a simple calculation to illustrate the potential impact of a business’s fleet transition and quantifies emissions for focus and action as we all begin to make efforts toward a more sustainable transport industry.

World Supply Chain Day: Creativity in the electronics industry will counter chip shortages

Thanks to Brexit, the pandemic and now the Russia/Ukraine war, the risks and shortfalls in our global supply chains have become front and centre for most companies over the last two years, especially for the electronics industry.

Supply chains are increasingly recognised as a key component to business survival, success and growth, as ByteSnap found in its survey, Thriving in the Face of Change, which revealed that the electronics industry was one of the worst hit by supplychain disruptions. 82% of the companies surveyed had been adversely affected by supply chain challenges.

To recognise World Supply Chain Day on 21 April, ByteSnap’s team of embedded electronics engineers has put together some tips to help keep design projects on track and minimise the effects of supply chain disruptions:

1) Order quantities as soon as the project schematic is completed – despite the pandemic, 60% of ByteSnap’s survey respondents saw an increase in demand for their products or services, 9% experienced no change and 31% witnessed a decrease.

To accommodate the increasing demand for products and services, smart designers and manufacturers need to stay ahead with supply already in stock or en route, to match demand.

Materials requirements planning (MRP) is a system for calculating the materials and components needed to manufacture a product. It is made up of three steps:

  • taking inventory of the materials and components on hand
  • identifying which additional ones are needed
  • and then scheduling their production or purchase

This is important, particularly with specialised software, to ensure you have exactly what is needed, when you need it and at the lowest possible cost. MRP is key to improving the efficiency, flexibility and profitability of manufacturing operations.

2) Minimise risk exposure – sustainable supply chains are important so reducing the number of different components and reusing parts, when possible, can make your manufacturing process more efficient if there are any parts that become unavailable for some reason.

During the first lockdown, 18% of the electronics sector was concerned about supply chain disruption, according to ByteSnap’s survey. This has translated into 45% of companies holding more stock in-house rather than just in time (JIT) and 26% now auditing their supply chains more closely. While 10% of respondents in 2020 were considering using more domestic suppliers, the survey revealed that less than 11% actually moved part of their supply chain to the UK.

3) Improve scalability and defend against obsolescence – think about system design techniques like microservices or distributed compute across the whole product ecosystem to improve scalability and defend against obsolescence.

Microservices are a way of breaking large software projects into loosely coupled modules, which communicate with each other. This enables changes and redeploying of technology and gives you a more innovative, nimble approach to design, build and manage the project; which, in turn, brings the potential to speed development life cycles.

4) Replace single chips with discrete components – before integrated circuits, all capacitors, inductors, diodes and other input systems were individual and discrete circuits. So, if you can’t use a chip, consider using a few standard discrete components instead, which can be integrated into the same chip to reduce power consumption.

5) Choose devices which have footprint-compatible alternatives – footprint or pin compatible devices allow for the use of the same PCB without any electrical issues or risks. You can reduce risk during the early design stage by considering dual-footprint devices and pin-to-pin alternates that meet your system requirements. Manufacturers often have handy cross-reference tools which makes finding pin compatible alternatives, for parts like ADCs and DACs, much easier.

6) Design firmware to be as hardware abstracted as possible – hardware abstractions are sets of routines in software that provide programs with access to hardware resources through programming interfaces. By designing the firmware with a Hardware Abstraction Layer, you can improve portability and adaptability to different chips as your design allows for a computer operating system to interact with the device at a general, abstract level rather than a specific, detailed hardware level, if needed.

7) Reserve data within communications protocols and storage space in the firmware upgrade processes – this will enable you to account for wider support changes in the future and reduce the risk of requiring a complete new update system design for new generations of your products.

8) Port the application as early as possible – to make your design as painless as possible, port the application using reference hardware with the same chips as you are intending to use in production. By porting early, problems may come to the surface before the target design is finalised and can be easily rectified.

9) Connect with your contract manufacturers early – they may have access to search the semiconductor global supplychain and evaluate parts availability or potential shortages before you design in key components.

10) Engage hardware and software expertise under one roof – this may seem obvious, but having everything you need in one place makes it far easier than going to separate providers. Having to manage different companies can lead to delays whilst determining who is responsible for the resolution and getting this implemented. Delays affect business downtime and/or time to market.

By engaging a company that has both hardware and software design experience, you can ensure the best possible result, in the quickest time.

More people are now realising the consequences of disruptions in supply chains, and how imperative it is that they become more sustainable and have a process in place to avoid downtime.

On this year’s World Supply Chain Day, consider how essential supply chains are to our lives.

Think about how the supply chain industry has evolved and what it now means to businesses globally.

Ask yourself the question, “Is my supply chain is one that could withstand another pandemic, or not…?”

Supply chain disruption is going nowhere – what can retailers learn and take forward

By Suzette Meadows, Lead Consultant, Contact Centre/Unified Communications, Exponential-e

While many retailers are beginning to bounce back from the worst effects of the pandemic, others continue to see their bottom lines negatively impacted by its fallout, whether in the form of supply chain delays, staff shortages or rising living costs. All these obstacles pose a potentially disastrous threat if not handled correctly and are challenging retailers to adapt if they’re to survive and thrive in a post-pandemic context.

Technology will be a crucial part of that equation, helping boost operational efficiency and deliver those seamless customer experiences that are crucial for maintaining customer loyalty. Striking a balance between online and in store experiences is central to this process, and there are several learnings that retailers should be taking forward to drive omnichannel success.

  1. Understanding technology as a core foundation to a seamless retail experience

The draw of having hundreds and thousands of retailers at our fingertips shows no sign of diminishing, with the pandemic further accelerating the trend towards online shopping. Consumers today prize convenience and near-unlimited choice, so retailers simply have to adapt both the in-store experience – which while less popular than several years ago, is still a key source of revenue for many traditional retailers – and online shopping to their ever-changing needs and demands.

Technology will undoubtedly play a pivotal role in this process, helping both online and bricks and mortar stores underpin their product offerings with efficient operations. The last few years have shown that no retailer can predict what will happen in the future, and with supply chain challenges continuing, investing in technology that helps cope with erratic rises and falls in supply is essential preparation for whatever lies ahead.

The potential of software, for instance, is remarkable. Solutions that can help stabilise operations and prepare for unknown terrains, such as Enterprise Resource Planning (ERP) systems, are remarkably mature already and promise transparency across entire business processes. ERP itself makes it possible to track all aspects of production or distribution, financials and back office, while Workforce management solutions can help analyse and predict customer demand and match them with available resources, to ensure your shift patterns and staffing levels are as efficient as possible

These kinds of tools are critical in supporting an omnichannel approach, streamlining processes and gaining greater insight into the business, allowing retailers to make real-time decisions based on what’s best for their customers and employees.

  1. Efficiency is key

The world is as fast paced as it has ever been, and every day customers expect their experiences and products to be delivered at greater speed. Inevitably, this means an increased use of digital channels and a further elevation of the pivotal role contact centres play in the retail sector. Although often overlooked, contact centres are critical to an omnichannel model of customer service, as their customer service agents – who interact with customers over digital channels such as webchat, video and social media – are at the heart of the digital service delivery. The intelligence and insights they glean from interactions with customers are critical to retailers seeking to assign, manage and more effectively track actions and improve customer outcomes, and a big part of why the contact centre has to sit at the heart of planning and managing customer lifecycles.

  1. Putting empathy at the heart of customer service

If there’s one learning we’ve all seen from the pandemic, it’s importance of empathy. Its role in any retailer’s customer experience is crucial and simply has to be factored into a customer’s entire journey.

Video is a great place to start. One thing many of us lost and missed during the pandemic was face-to-face contact, which has in turn led to a newfound appreciation for being able to see each other when we communicate. Where in person is not an option, video can provide customer service agents with the critical information they need to better understand a customer’s emotions – body language.

Technology has other roles to play in helping customer service agents build an accurate picture of a customer’s situation and show empathy, too. Big Data and analytics solutions for example can help them focus on what their customers are actually telling them. The point being that while human empathy is critical to a good customer experience, the best agents will not only be able to use their own skills, but will also be able to use insights generated by technology to improve their customer service delivery.

  1. Brick and mortar stores can still thrive where innovation is involved

Retail organisations have been engaged in a battle between online and in-store shopping for some time. While this battle was certainly heightened by the pandemic, plenty of ‘e-tailers’ and traditional retailers have weathered the challenges and come out the other side stronger. Typically, it’s been those that have demonstrated ingenuity, persistence and a willingness to innovate.

One leader in sustainable energy has been leading by example, embracing digital tools to transform its customer experience and create a seamless journey. To do so, the company is intelligently leveraging the data it has access to, to improve its quality of service, streamline operations and offer a superior experience against competitors. For example, it has adopted a remote payment system and adapted to offer digital menus on its pioneering forecourts, all of which deliver better customer experience and in turn generate huge amounts of data to further personalise and tailor the customer journey. Now, when a visitor connects to charge their car, their regular coffee could be automatically ordered for them, or even a booking made at the gym, or one of the featured restaurants.

Retailers that follow suit will be able to maintain that all-important human touch, while simultaneously introducing a level of efficiency that would previously have been inconceivable.

Innovate to thrive

If retailers want to thrive and succeed in recovering their losses from the pandemic, embracing technology has to be a non-negotiable part of the journey. Digital tools are pivotal to helping retailers deliver the customer experience and service that today’s consumer demands, and a vital enabler of future growth.

Businesses that succeed in carefully assessing their needs and deploying the most appropriate tools to help improve efficiency, demonstrate innovation and enable stronger relationships, will undoubtedly be the market leaders. Others that wish to build the right foundations for seamless operations should look to no further than their example, if they’re to have their own success to celebrate in future.

UK has second-highest number of B Corps in the world

Research by green energy experts Uswitch has revealed Moodle, an online educational platform designed for distance learning, is the world’s most popular B Corp business, followed by Coursera and TOMS.

B Corp certification is awarded to businesses that meet the highest standards of accountability when it comes to their social and environmental impact, and there are now almost 5,000 B Corp businesses officially achieving B Corp Certification in the world.

The Most Searched For Sustainable Brands

The social and environmental impact of the products we buy, and the companies we buy them from, is now more important than ever to consumers. So, to discover which sustainable businesses are the most well-known around the world, researchers analysed Google search data, to reveal which ones consumers are Googling the most.

Moodle tops the list with over 53.5 million global searches each year. The Australian-based company is hailed as the world’s most popular learning management system and was crucial throughout the pandemic when classrooms were closed.

Coursera, the open online course provider that works with universities to offer qualifications, is second on the list with 35.9 million global annual searches, followed by the sustainable shoewear brand TOMS in third place, receiving over 14.9 million searches every year.

Popular brands such as premium ice-cream manufacturers Ben & Jerry’s and the world’s first carbon-neutral brewery BrewDog also appear in the top 15 most popular B Corp businesses list, ranking in seventh and 15th place respectively.

Top 15 Most Popular B Corps

Rank Company Name Annual search volume
1 Moodle Pty Ltd 53,550,000
2 Coursera 35,930,000
3 TOMS 14,920,000
4 Redbox 14,480,000
5 Athleta, Inc. 13,643,000
6 Warby Parker 11,335,000
7 Ben and Jerry’s 10,281,000
8 Kickstarter PBC 10,257,000
9 Envato 9,384,000
10 Boomera 8,403,000
11 Nature et Decouvertes 6,555,000
12 Vestiaire collective 5,736,000
13 Rentcars LTDA 4,812,000
14 Allbirds, Inc. 4,781,000
15 BrewDog 4,688,000

The Most Searched For Sustainable Food and Drink Brands

The research also looked at food and drinks organisations that have been recognised by B Corp – it reveals the American ice-cream manufacturer, Ben & Jerry’s, is the most popular sustainable food and drink brand in the world with over 10.2 million searches every year.

Scottish-founded BrewDog is the second most popular food and drinks B Corp business, with 4,688,000 searches every year, followed by Thrive Market, the membership-based retailer selling purely organic and natural food products, in third place.

The top five is made up of two subscription services; the UK-based meat delivery company ButcherBox is fourth, and Gousto is fifth with over 2.4 million searches.

Top 10 Most Popular Food & Drink B Corps

Rank Company Name Annual search volume
1 Ben & Jerry’s 10,281,000
2 BrewDog 4,688,000
3 Thrive Market 3,669,000
4 ButcherBox 2,737,000
5 Gousto 2,447,000
6 NATURALIA 2,104,000
7 Jeni’s Splendid Ice Creams 1,719,700
8 Alpro (Alpro SCA) 1,286,500
9 Mindful Chef 1,240,500
10 Tony’s Chocolonely 1,149,000

The Countries With the Most B Corp Certified Businesses

From Australia to Zambia, there are B Corp certified businesses all over the world, and the research also reveals the countries with the most certified B Corps. The United States takes the top spot, with 1,418 in total, followed by the United Kingdom with 590, and then Canada with 323.

Although it might not be a surprise that the USA is on top given the size of the country, it is worth noting that the process to become recognised by B Corp and receive the certification is very tough and incredibly thorough, so it’s only handed out to organisations who really are making a difference.

Top 10 countries with the most certified B Corps 

Rank Countries Total number of certified B Corps
1 United States 1418
2 United Kingdom 590
3 Canada 323
4 Australia 296
5 Brazil 181
6 Chile 136
7 France 151
8 Italy 134
9 The Netherlands 126
10 Argentina 119

To read the full research, please visit: https://www.uswitch.com/gas-electricity/most-popular-bcorps/

INSIGHT: Russia export disruptions to shift global trade flows, future capacities threatened

By Joseph Chang, Global Editor, ICIS

Disruptions to Russia’s chemicals and polymers exports will change trade flows, particularly to Europe and Asia, as international sanctions, lack of logistics and even “self-sanctions” limit volumes. 

While Russia’s capacities are relatively small on a global scale, they can still have a significant impact on regional markets if these exports are disrupted. 

Key Russia exports include methanol, polyethylene (PE), polypropylene (PP), styrene and paraxylene (PX). 

Russia has increased exports of high density polyethylene (HDPE) and polypropylene (PP) in particular in 2020 and 2021 as new capacity started up from SIBUR’s ZapSibNeftekhim complex in Tobolsk in 2020. 

Russia has ramped up HDPE exports from 160,000 tonnes/year in 2019 to over 850,000 tonnes in 2021, according to its own statistics in the ICIS Supply and Demand Database. 

Russia’s HDPE exports may be more insulated as China accounted for more than half of such exports in 2021. China has not levelled any sanctions against Russia. 

Other major destinations for Russia HDPE in 2021 included Turkey, Belgium, Poland, Kazakhstan and Belarus but none close to the scale of China.

Russia’s key chemical exports by destination in 2021 

Top five country destinations for Russian exports, compared with rest of world

*NL = Netherlands, KZ = Kazakhstan, LT = Lithuania, UZ = Uzbekistan, CH = Switzerland

SOURCE: ICIS Supply & Demand Database (2021 statistics)

MORE PE CARGOES TO CHINA?

“We expect more Russian PE cargoes will go to China. But Russia PE to the rest of Asia may not increase, as buyers there may have problems paying under sanctions,” said Amy Yu, senior analyst at ICIS based in Shanghai.

Russian PE accounted about 3% of China total PE imports in 2021 and mainly HDPE grades she noted.

While major new PE capacity is coming on in China, PE import dependence is still close to 40%, with large volumes coming in from the Middle East and the US, said Yu.

Russia’s ability to move cargoes will also depend on whether companies can open letters of credit (LCs) with banks, which appears unlikely, or whether Chinese banks are willing to step in, said ICIS senior Asia consultant John Richardson.

“But this then depends on the strength of the relationship between Russia and China,” he added, pointing to China’s decision to halt all business relating to Russia and Belarus via the Asian Infrastructure Investment Bank (AIIB) as a potential sign that China is recalibrating its relationship.

PP MORE PROBLEMATIC

However, PP could be more of an issue as Europe and Turkey took the lion’s share of Russia’s exports by far with China receiving minimal volumes. China has become much more self-sufficient in PP versus PE over the past several years.

Russia has ramped up PP exports from over 300,000 tonnes in 2019 to more than 800,000 tonnes in 2021, according to the ICIS Supply and Demand Database.

Major destinations for Russia PP exports in 2021 included Turkey, Poland, Belarus, Belgium, Italy and Ukraine.

ICIS senior analyst Lorenzo Meazza expects considerable changes in Russia export trade flows in the short term, and perhaps more significantly in the long term.

“In the short term, Europe should easily find alternatives to Russian volumes. Availability of PE is forecast to overall improve with abundant material available from the US and Middle East while Asia is increasing its PE supply,” said Meazza.

“On the other hand, Russia may try to sell more material to China, which is still very far from self- sufficient for PE. However, China is also considerably increasing its PE capacity and Chinese PE importers may also decide to avoid Russian volumes as long as the conflict and related sanctions continue,” he added.

ICIS SLASHES RUSSIA PE CAPACITY FORECAST

Bigger changes are expected for Russia’s future capacities as projects dependent on US and European technology will likely be delayed or cancelled, dashing the country’s ambitions of becoming a major exporter, the analyst noted.

The US on 2 March joined the EU in restricting exports of technology that support Russia’s refining industry.

Pre-war, ICIS expected Russia PE capacity to surge from around 3.4m tonnes/year in 2022 to more than 5m tonnes in 2025 and over 8.5m tonnes by 2027 with exports from the country expected to roughly triple in five years.

However, ICIS has now revised its forecast for Russia PE capacity from 3.4m tonnes/year in 2022 to less than 4m tonnes by 2027 – a massive difference of 4.5m tonnes that could tighten global markets if this is not replaced by other capacities.

BALTIC CHEMICAL COMPLEX IN DOUBT

Specifically in doubt is Russia’s €10bn Baltic Chemical Complex project, one of the world’s largest planned PE expansions at 3m tonnes/year in two phases, scheduled to start commercial production from mid-2024.

The first 1.5m tonnes/year had been planned to be onstream from mid-2024 and the second, with the same capacity, from 2025. There would be six PE reactors with US company Univation supplying the polymerisation technology.

Owned by RusGazDobycha which itself is owned by National Gas Group, the project would target Russia’s domestic market as well as export destinations including Europe, Asia, Latin America and Africa.

“If new PE projects in Russia are affected, they may not provide the large exports that had been expected. There may be more new investments in Asia, especially China, as demand grows,” said ICIS senior analyst Yu.

METHANOL ‘SELF-SANCTIONS’

Russia’s top chemicals export is methanol to the tune of 1.9m tonnes in 2021 with the bulk going to Europe.

ICIS is reporting buyers in Europe avoiding Russia-origin product even as there are no sanctions in place on Russian methanol exports to Europe.

“Energy markets are already starting to not want to take Russian product, whether it’s crude oil or gas. I think methanol is following that,” said a seller.

“Thankfully these energy products aren’t sanctioned yet, but it’s a self-sanction thing,” said the seller who also noted there were no bid-offers for Russian methanol.

While some companies have declared their stance on business with Russia, it is currently unclear how much of the European methanol market will self-sanction.

“Overall there’s a lot of players thinking about… not because it’s forbidden by any sanctions or government laws but for ethical reasons, not to purchase any longer Russian material. There are some players who seem to avoid this,” said a producer.

The sidestepping of Russian spot volumes has added to the rapid increase in spot prices which have surged 22% in the week through Thursday 3 March.

Players expect the supply gap from Russia to be filled by imports from elsewhere – the typical other sources being from the US, Trinidad, Venezuela, Equatorial Guinea and the Middle East.

PARAXYLENE HALTED

Market sources indicate that paraxylene (PX) and orthoxylene (OX) exports from Russia will be close to zero in the near future as a consequence of the invasion, as buyers fear the impact of new sanctions or simply choose to boycott Russia-origin material.

Several traders and producers in Europe said they received new requests from buyers who used to import from Russia.

RUSSIA STYRENE STILL AVAILABLE

Meanwhile, Russia styrene is reportedly available in Europe and there is no rush to secure volumes with the spot market very quiet.

Of Russia’s over 90,000 tonnes of styrene exports in 2021, over 80% went to Finland, according to the ICIS Supply and Demand Database. Most is used internally for expandable polystyrene (EPS), styrene butadiene (SB) latex and polyester resins (UPE).

The energy-intensive European styrene market faces growing challenges from higher heating costs stemming from natural gas prices, which have also surged in the wake of the Ukraine invasion.

“If the gas remains at this level it will be a big problem as we will lose money on the total envelope of whatever derivative we sell,” a Europe-based styrene producer said.

“We are talking double the cost of energy to make styrene monomer, so now 10x the normal energy cost versus 5x until just over a week ago,” the producer added.

CRUDE OIL RISKS RISE

Meanwhile, crude oil prices continue to rise, putting pressure on chemicals margins across the board, especially in Europe and Asia where oil-based naphtha is the primary feedstock for petrochemicals production.

“The risk of a reduction in Russian oil exports is the primary reason behind the oil price spike in recent weeks. Russia exports around 4.5m-5m bbl/day of crude, and around 2.5m bbl/day to non-European countries – much of this heads east to Asian buyers such as India, South Korea, Japan and China,” said Ajay Parmar, ICIS senior crude oil analyst.

On 3 March, a group of US lawmakers introduced legislation that would ban Russia energy imports.

“The manner in which the sanctions are designed will be critical to their success. If western sanctions on Russian oil exports only apply to western crude buyers, Russia will feel short-term pain, but will likely be able to still find willing buyers in Asia, as the oil market is especially tight at present,” he added.

However, if sanctions are broadened, the impact on Russia’s energy exports would be significant with the number of willing buyers of Russian crude very small.

“One such buyer will of course be China, which will gladly take Russian crude at an $18.65/bbl discount to Dated BFOE, as recently reported by ICIS. But even then, the logistics of re-routing such significant volumes of oil trade will cause temporary pain for Russia,” said Parmar.

The only major reprieve from high oil prices would come from a nuclear deal with Iran, which could allow an additional 1.3m bbl/day of crude onto the market.

“It should be noted that it would take 3-6 months for Iran to fully reach this production level, but just the news of a completed nuclear deal itself will help quell the current price rise,” said Parmar.

“If this deal does not come to fruition, expect oil prices to remain elevated for the foreseeable future,” he added.

Additional reporting by Eashani Chavda, Miguel Rodriguez-Fernandez, Fergus Jensen and Will Beacham For more analysis of the Russia/Ukraine war’s impact on chemicals, fertilizers and energy markets, visit our Topic Page.

Infographic by Yashas Mudumbai

Additional reporting by Stephanie Wix

Critical infrastructure security Q&A with McAfee’s Mo Cashman

Critical infrastructure and supply chains consist of networks and assets that form the backbone of society. Therefore, the fallout of an attack could be catastrophic. Across the globe, individuals have already experienced shortages of food, energy and other resources, and the inability to access critical healthcare services – despite this, it’s likely that the worst is yet to come.

Dynamic solutions are needed to reflect the fact that emerging threats, and the technology needed to deter them, often change faster than the regulatory process can keep up.

In the latest instalment of our supply chain industry executive interview series, we spoke to Mo Cashman, Enterprise Architect and Principal Engineer at McAfee Enterprise, about the biggest risk factors and 

  1. What are the most dangerous cyber security risks to the UK supply chains and other critical infrastructure?

Over the past year, cyber-attacks on critical industries have certainly seen an increase, with sectors such as healthcare, energy/utilities, and government under constant threat from cybercriminals looking to target critical infrastructures such as telecommunication networks and transport infrastructure. The report also saw a 64% increase in publicly reported cyber incidents targeting the public sector.

Some of the most dangerous cyber security risks to critical infrastructure include ransomware-as-a-service.  Our latest threat research found that the government was the most targeted sector by ransomware in Q2 of 2021. This is a cybercrime economic model that allows ransomware platform owners to earn money for their creations through affiliates. This model allows non-technical criminals to buy both the ransomware and potentially access to targets to launch attacks more easily while paying the developers a percentage of their take. As a result, the developers run relatively few risks, and their customers do most of the work. Some instances of ransomware-as-a-service use subscriptions, while others require registration to gain access to the ransomware. The attacks will typically enter the workplace via a malicious email or through a vulnerable remote access application.

But another entry point not to be overlooked is supply-chain compromises. This is another critical attack vector facing the national infrastructure. In this case, attackers will often enter the network through a trusted connection, system, or user. Unfortunately, this can make them very difficult to detect.

  1. Where do the biggest cybersecurity risks to the UK’s national infrastructure come from?

Interestingly, the most significant cybersecurity risks come from both criminal gangs and national state actors. Nation-state actors specifically target critical infrastructure to steal state secrets and cause national disruption. For example, cyber-attacks such as the Sunburst and SolarWinds have been widely attributed to nation-state actors.

Cybercriminal gangs also pose a significant threat to critical infrastructure. At the recent G7 summit, world leaders recognised ransomware as a global threat, calling upon member states to do more to combat it. The criminal gangs running ransomware-as-a-service networks were identified as a particular issue.

Currently, McAfee ATR and MVISION Insights platform is tracking 31 different Ransomware, APT, criminal groups, such as Darkside and Nation-State Actors like APT32. These groups operate globally and across many sectors, including the UK’s national infrastructure. We’ve noticed that criminal organisations and Nation-State actors often share the same malware or tools, such as Cobalt Strike, Mimikatz and Powershell, and leverage similar techniques, such as Supply Chain Compromise and Spearphishing to gain network access. The only real distinction then becomes the intent of the organisation behind an attack.

  1. What should the government do to improve its national infrastructure’s cyber defences?

Over the last few years, the UK Government has put several different programmes and initiatives in place to combat cyber threats. This includes the establishment of the National Cybersecurity Centre in 2016, which aims to increase cybersecurity awareness and improve skills across organisations associated with the national infrastructure.

Given the rapid move to a culture of remote working, which now looks set to become a permanent fixture, implementing more robust cybersecurity measures has never been more critical. Some additional practices which may help to improve cyber resilience include:

  • Adopting a zero-trust architecture framework that performs threat and data protection at every control point in a single pass to help improve user experience and productivity, reduce the cost of security, and simplify management.
  • Implementing Continuous Monitoring and Response across all enterprise systems
  • Gaining as much information as possible about the enterprise assets and services
  • Eliminating trusted zones and micro-segment resources
  • Operationalise and share threat intelligence
  • Improving security for operational technology networks
  1. What is the ideal interplay between public and private initiatives when it comes to best protecting the UK’s cyber infrastructure?

Private and public organisations must work together to protect critical infrastructures from cyber threats. A great example of threat intelligence sharing and cross-industry collaboration is the Cyber Threat Alliance (CTA). The CTA is a non-profit organisation working to improve the cybersecurity of our global digital ecosystem. In order to best defend against cybercriminals and threat actors, threat intelligence sharing is vital, and the CTA shares approximately 6 million threat indicators with its members each month.

Another example of great collaboration between the public and private sectors is the nomoreransom.org initiative. Set up five years ago by four founding partners, including law enforcement and private security cybersecurity companies. Since then, it’s expanded to include over 150+ public and private entities and credited with saving organisations an estimated $900 million (or £654 million).

These organisations are both fantastic examples of the public and private sector working in tandem to combat cybercriminals and reduce the cyber threats faced across the globe.

Plotting a path out of disruption that leaves businesses stronger

Constant phone calls and emails looking for space. Trying, or failing, to secure rates that preserve a level of margin. Last minute changes and blanked sailings. These were the daily challenges facing supply chain professionals shared at a forum hosted by Zencargo and B2G Consulting in July.

In response, the two organisations have produced a new roadmap for supply chain transformation Beyond Firefighting: How to start the journey out of supply chain chaos.

This new guide gives supply chain teams the questions, structures and techniques they need to to make a case for fundamental supply chain change within their organisations. And the need for change could not be more urgent.

With current volatility set to last until at least after Chinese New Year in 2022, it’s essential to think of a new way of working. However, leadership at some businesses still seem unwilling to make improving their supply chain a priority.

Moving past the way things are right now requires a whole-business approach, from sales prioritisation to financial planning. For companies that hadn’t already embarked on a supply chain transformation, this is the ideal moment to start making the supply chain more efficient, more resilient, and more fit for purpose. And for those who had already started, it’s time to redouble those efforts, rather than putting them to one side in order to tackle daily fires. 

Bringing about organisational change has to start with, and be led by, supply chain teams. As the experts within the business, it’s down to logistics and commercial professionals to build a case for change and lead the business forward. 

This guide walks you through:

  • Finding a ‘burning issue’ to engage senior management
  • Building a data-led case for change 
  • Packing your arguments to take root internally and drive change 

To find out more about the guide and to start making a difference, click here to download the roadmap.

How Smart Technology is Helping the Manufacturing Industry

In the world of manufacturing, the way things are produced has changed dramatically over the years. From the first moving assembly line created, through to the modern-day invention of Artificial Intelligence (AI), it’s safe to say that manufacturing methods have evolved quickly.

The secret to this progression is advances in technology. Not only has it allowed businesses to speed up production and increase efficiency it has brought greater profit margins too. In today’s market, it’s all about ‘smart technology’ or more accurately ‘enablers’.

Businesses now use technology to optimise their operations — from automated sales and distribution processes to energy management software. Here’s a list of the benefits smart technology can bring.

Artificial Intelligence 

Artificial intelligence (AI) is a computer science that can help the capabilities of humans. Voice recognition for example, allows processes to be carried out without being manually entered into a computer. AI also uses algorithms that can record and react to changes in data to help businesses achieve more and increase efficiency. 

Blockchain

Block chain is essentially a programme that helps keep track of goods, logs transactions and manages supply chains, following a ‘chain-like’ process. For businesses, this information is essential – allowing them to record data and deliver real-time analytics on their stock and supply chain without manual input. 

The Industrial Internet of Things 

The collection of data has now become a significant priority for businesses looking to gain a deeper insight into their production processes. With the Industrial Internet of Things (IIoT), companies can ensure that every device, machine and process is connected through data communication systems. This gives them a greater understanding of their business and can look at ways of enhancing efficiencies and increasing profits. 

Industrial Robotics

An extension of AI, industrial robotics have now become a focal element of the manufacturing process. Modern robotics can now carry out a range of tasks, whilst reducing the risk of injury to workers. Although robotics is a modern invention, they’re intelligent enough to learn human tasks.

More recently ‘collaborative robots’ or ‘cobots’ have been designed to work together with humans. Cobots have become prominent in the automotive industries to help build vehicles. 

Digital Twin

Manufacturers can create a ‘digital twin’ when creating a new product — this allows them to virtually forecast its cost and production. Using this technology, they can evaluate production, visualise products in different environments, track and monitor systems and troubleshoot equipment. This results in a more streamlined development process. 

Condition monitoring

Broken or machinery that needs repair can have significant impact on production. With condition monitoring, businesses can monitor a range of performance conditions, including vibration, temperature, pressure and oil condition. This can help manufacturers prevent breakdowns in equipment by noticing changes and faults at an early stage.

Cyber security

The rise in technology means businesses are open to digital malfunction, including the risk of cyber-attacks — which have been common in several industries. Cyber security is important as it protects computer systems from theft or damage to their software and electronic data. As the manufacturing sector is the third most hit sector in the UK for cyber-attacks, companies to ensure they are adequately protected.

A ‘smart’ way of working

As ‘smart technology’ continues to improve the way manufacturers can do business, evidence suggests that introducing new methods can have a positive impact on a company’s output and profit margins. With energy at the heart of manufacturing processes, it’s important that energy supply is efficient and automated. If you’re switching from oil to gas, such as Liquid Petroleum Gas (LPG) or Liquefied Natural Gas (LNG), speak to an expert for help with the process of becoming greener. 

The value of global trade insights in navigating COVID-19 supply chain disruptions

By Mark Segner, VP Global Sales, Descartes

The Coronavirus pandemic has exposed the fragility of the modern supply chain, as companies struggle to acquire the products and raw materials needed to keep revenue flowing. With many businesses relying heavily on a limited number of trading partners, many located in hard-hit areas like China, the scale of the supply chain disruption has been a wake-up call. 

Pummeling the Bottom Line

COVID-19 shockwaves are being felt around the globe, with one in six companies adjusting revenue targets downward. Figures from the Office of National Statistics revealed that 72% of businesses in the UK reported that they are exporting less than normal, and 59% of reported that they are importing less than normal due to the impact of Coronavirus. 

According to a survey by the Institute for Supply Management (ISM), nearly 75% of companies reported supply chain disruptions due to the COVID-19 outbreak, with lead times doubling and delays compounded by a shortage of air and ocean freight options. A recent survey of Descartes customers also found that 31% are looking for alternative suppliers, and their usage of tools to find alternative supply sources has increased by 21%. Given the sheer scale of the disruption, many different types of businesses are unlikely to have a plan in place to address supply disruption from China and other countries.

Re-thinking Sourcing

With the global supply chain often more complex than many comprehend, very few organisations can trace their supply chain beyond their Tier 1 suppliers, and many are uncertain of the location of their second and third-tier suppliers. To fully understand supply-side risk, Deloitte notes that advanced digital solutions are “generally required to trace supply networks reliably across the multiple tiers of suppliers.” Indeed, manufacturers, retailers, and distributors are in uncharted waters as they race to identify new supply sources.

Global Trade Insights Guide the Way

With the daunting task of navigating the rapidly changing global trade landscape, where should your organisation begin? Actionable global trade data is your lifeline for supply chain resilience. In the face of COVID-19 disruptions, global trade intelligence solutions can help businesses swiftly find alternative suppliers in a concise three-step process:

  1. Identify potential sources; Know the market to make better sourcing decisions

A sophisticated global trade intelligence solution can assess market dynamics, revealing the impact of both the Coronavirus and recent tariff changes on specific commodity imports and exports by mapping the global flow of shipments and identifying recent volume shifts. Previous shipment volumes reveal which suppliers have capacity for your sourcing demands, while bill of lading (BOL) data helps you easily identify names, addresses, and contact details for each supplier.

2. Analyse costs; How much will it cost to do business?

Given the slowdown many companies are facing during the pandemic, curtailing costs is top of mind. Global trade data technology can analyse potential suppliers to calculate the total landed cost of doing business with them, including duty spend, variable and fixed taxes, shipping costs, and insurance costs. With international trade insight, businesses can also identify favourable Free Trade Agreements (FTA) or other preferential mechanisms to help maximise margins.

3. Vet potential trading partners; Limit liability and brand damage

The vetting process is vital for avoiding exposure to sanctioned parties but, given the fluidity and sheer size of restricted party lists and the rabbit hole of shell companies, obtaining an accurate view can be extremely challenging.

With a global trade intelligence solution, businesses can quickly screen potential suppliers to determine if the country or vendor are subject to any restrictions or sanctions from the government. Compliance vetting is crucial for avoiding fines and penalties but also ensures your company brand remains untarnished. 

Beyond COVID-19

Access to actionable trade insight is critical to developing a proactive supply chain response to the coronavirus and emerging from this pandemic as intact and profitable as possible. Sophisticated global trade intelligence solutions use shipment data from across the world to model trade flows globally, helping companies rapidly identify, analyse, and vet new sourcing locations. With the right approach, businesses can mitigate the impact of COVID-19 on supply chains and also strengthen and add resiliency to their logistics operations going forward.

Five advantages of handing over your IT procurement needs to specialists

By Alex Wilkinson (pictured), Chief Operating Officer, Solutionize Global

Every day, modern-day leaders are being challenged to operate within tighter parameters when it comes to productivity, cost and efficiency. These three elements are vital when considering the current strain on the economy following the global crisis – and helping organisations to survive.

What this has led to is a greater requirement for technology to become more sophisticated. In turn, practitioners are being tasked to adapt swiftly – so that they can provide attractive, streamlined services and an unrivalled competitive edge.

This is especially the case within the procurement and finance arenas. These industries are continuously shifting their focus in how they can strategically enhance efficiency via advanced digital methods. And for those that get it right, they’re typically in a much stronger position to ensure business continuity – even during the most turbulent of climates.

Today, there’s even more reason to stay ahead of the curve, especially as a 2016 Chief Nation and SAP Ariba report revealed how 77% of industry managers anticipated that new procurement technologies would be one of their sector’s biggest trends of recent times.

For modern-day leaders, adapting to economic flux comes with the territory, but that doesn’t mean they have to do everything themselves. So, how can successful C-suite chiefs handle the current pressures they face, and still meet greater supplier demands for IT products and services when time and resources are constantly against them? 

Now might be the time to hand over the reins to tech procurement specialists. Selecting an expert who understands the industry and ever-evolving marketplace can encourage a more flexible and agile approach, amongst other advantages. Here are five reasons why organisations should consider the options…

  1. Ensuring optimum speed when sourcing goods and services

There will be few firms that have not been negatively impacted by the current climate – resulting in their supply chain being hit the hardest. Leaders are often left to ‘pick up the slack’ as they attempt to continue ‘business as normal’. But the clock isn’t slowing down, and time is of the essence.

Bringing in a savvy tech procurement specialist should provide managers with both the opportunity to focus on their company continuity priorities, and also feel secure that services will still be efficiently sourced and quality goods delivered on time – regardless of the climate. 

Speed is of paramount importance in today’s saturated marketplace and having someone knowledgeable on hand to quickly select the best vendors to meet the brief, negotiate the right price, and organise swift distribution can help to keep projects on track and meet end user demands.

2. Establishing a centralised approach for orders

Very much in the same vein as speed, efficiency relies on operations being streamlined and secure throughout. Having one point of contact is often better than a number of individuals or departments getting involved – which could over-complicate an order and slow things down.

Not only that, for managers this means there will only be one Service Level Agreement – and terms and conditions guidelines – to  adhere to, resulting in no lengthy sign-off processes and fewer security concerns, because everything runs through a single source.

3. Exploring a wider portfolio of vital contacts

Leaders who know that they have a professional IT procurement service on hand to always turn to is vital for both peace of mind and maintaining a professional, transparent, and consistent service.

Specialists will typically have a wider network themselves too, so if further products or services are required – that aren’t in their current portfolio – there will likely be a trusted contact they know that can help.

Companies that have strong, meaningful relationships with their suppliers may often treat them like an extension of the existing team – providing motivation, a reliable service and greater competitive edge. Additionally, clients know they’re getting a dependable, streamlined offering.

4. Reducing costs and controlling outgoings

Managing budgets in today’s business climate is all about having agile supply chains that enable enterprises to adapt to ever-changing market conditions. Therefore, variable cost structures – such as flexible purchasing models – should typically be in place to encourage an elastic approach that helps organisations to both control outgoings and scale effectively.

In addition, leaders will want to be safe in the knowledge that their tech procurement needs are being met in the most cost-effective way – perhaps through real-time tracking solutions – so they can release capital for investment across other areas of the business, when needed.

And, if there’s ever a need to re-evaluate budgets, specialists should be able to introduce new suppliers – and renegotiate with existing ones – to alleviate any stresses and save money on transactions and overall operations.

5. Ensuring the best solution to build credibility

Managers must feel that they can speak to their procurement consultant whenever their organisation’s needs evolve. And, in turn, the professional must be one step ahead – understanding how global developments are causing business flux and impacting on efficiency.

By offering in-depth knowledge of the marketplace in real-time – and across a broad range of sectors – this expertise should not only deliver direct benefits but also help leaders to ‘learn from the best’ and improve on their own capabilities. Additionally, specialists often know when the time is right to bring in numerous vendors to provide a commercially savvy solution.

When selecting procurement experts to manage the IT supply chain, it’s important for businesses to firstly align their buying strategy with the overall objectives. This way they can clearly identify where the need is for a specialist, and when they’re required to step in.

Creating a streamlined service that delivers in a timely and efficient fashion will not only create greater loyalty with the end user but develop credibility and a trusted service that positively impacts reputation and bottom line – and delivers true competitive advantage.