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Shanghai: world’s biggest port is returning to normal, but supply chains will get worse before they get better

China lockdowns and Ukraine war have made global supply chains far worse in 2022 than many expected.

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Shanghai is slowly emerging from a gruelling COVID lockdown that has all but immobilised the city since March. Although Shanghai’s port, which handles one-fifth of China’s shipping volumes, has been operating throughout, it has been running at severely reduced capacity. Many shipments have either been cancelled, postponed or rerouted to other Chinese mega-ports such as Ningbo-Zhousan.

With the city due to fully reopen on June 1, the port is going to be in overdrive as manufacturers try to fulfil backlogs, with serious knock-on effects around the world. It is an example of how global supply chains in 2022 have been destabilised in ways that were not apparent at the beginning of the year. In January, we predicted ongoing disruption as the world economy continued to recover from the pandemic. In fact, things have got worse.

Besides Shanghai, other major Chinese ports such as Shenzhen have also been affected by lockdowns. And then there is Ukraine. The war has pushed up prices for goods and services even higher than predicted rises for 2022, as well as adding to logistical difficulties.

According to the New York Federal Reserve’s global supply chain pressure index, which takes account of issues such as freight rates, delivery times and backlogs, supply chains are under unprecedented pressure – and have been getting worse recently.

The global supply chain pressure index

Y-axis shows standard deviations from average value. NY Federal Reserve, based on data from various sources

Ukraine and food

Ukraine might not have been on many people’s radar as a key economic partner, but it was already seen as a major bottleneck for food supply chains long before the war got underway. This was due to poor port infrastructure and the large concentration of world maize and wheat supplies moving through. The war was therefore always going to have a devastating impact on international supplies.

You can get a good sense of the ripple effect on prices by considering a bag of fish and chips. Sunflower oil for frying used to be imported from Russia and Ukraine. Flour for the batter came from Ukraine. Much of the fish used to be caught by Russian trawlers but is about to be affected by sanctions. In all cases, this translates into shortages and/or raised prices.

Then there is electricity and gas, whose prices have skyrocketed thanks to sanctions, affecting everything from deliveries to food production. And since Russia is a key player in the fertiliser market, even domestically grown potatoes will become more expensive soon enough.

With Ukraine’s ports blockaded now for months, Russia is also being accused of holding food hostage for millions around the world. Developing countries are being hit hardest, while in richer nations, the poorest are bearing the brunt. Even when the conflict ends, restarting food exports from Ukraine will not be easy. Capacity on land transport is limited and the sea, in addition to the Russian blockade, is heavily mined.

The double whammy

Beyond food, the war’s impact on energy and fuel prices has made both production and transport more expensive across the board, exacerbating the effects from China’s COVID problems. This has hit major western players, including Apple, Tesla, Adidas, Amazon and General Electric. Easing restrictions in China are now allowing some, such as Volkswagen and Tesla, to restart production, but logistics delays linger, with everything from healthcare to entertainment gadgets affected.

Around the world, many major ports experienced congestion in 2021, with the US west coast ports of Los Angeles and Long Beach enduring long periods with dozens of ships waiting to dock. This eased noticeably in early 2022, but Shanghai port’s return to normal operations is likely to lead to a torrent of products heading west as manufacturers do their best to clear order backlogs.

This will probably mean bottlenecks and delays at the western end in the coming weeks. Meanwhile, the heightened demand for ships will potentially affect freight prices: these went up at least five-fold in 2021 as suppliers struggled to deal with pent-up COVID demand, and even after reducing in 2022 they are still about four times the pre-COVID rate. Any further increases will put more pressure on consumer prices.

There is hope

Even if there are no more China lockdowns and the Ukraine crisis does not spread, the global supply chain is clearly going to be under heavy pressure for the rest of the year. According to one recent UK survey, three-quarters of companies think 2023 will be tough too.

For smaller businesses in particular, a failure to adapt to the changing environment could threaten their survival. At a time when fears of a recession are already in the wind, this could make longer-term economic recovery all the more difficult.

But for the medium term at least, there are reasons to be cautiously optimistic. For decades, most supply chains were focused on cutting costs. Manufacturing was outsourced to specialist suppliers, ideally in countries with lower labour costs. Firms kept minimal inventories and used short-term contracts to be as flexible as possible.

The weaknesses in this “just-in-time” system were exposed by COVID and the US/China trade war, and now many companies are putting more emphasis on being resilient and also having a clearer view of all the suppliers in the chain. In this “just-in-case” model, some inefficiencies are considered an advantage rather than a waste of money.

Cost is still of course a key consideration, but product quality and availability are now seen as more important. Companies are also diversifying their supplier base so that they are not as dependent on China (with the additional benefit of reducing their carbon footprints). US players such as Walmart, Boeing and Ford are among those turning to locations nearer their home markets, while numerous UK and mainland European companies are following suit.

Shifts like these should at least make supply chains a bit more robust in future, even if this probably also leads to higher prices. At the same time, we see efforts to anticipate future crises. The EU and US plan to develop an early warning system to identify future global disruptions to semiconductor supply chains, which have affected everything from production to cars to video game consoles. More broadly, a recent UK report called on the government to establish a resilience task force and work with industry to increase visibility within supply chains.

That sort of approach would be well worth implementing. Supply chains are going through their most turbulent period in many years, but learning lessons and adapting will hopefully mean that the worst can be avoided in future.

The authors do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.

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Aging-US | Time makes histone H3 modifications drift in mouse liver

BUFFALO, NY- June 30, 2022 – A new research paper was published in Aging (Aging-US) on the cover of Volume 14, Issue 12, entitled, “Time makes histone…

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BUFFALO, NY- June 30, 2022 – A new research paper was published in Aging (Aging-US) on the cover of Volume 14, Issue 12, entitled, “Time makes histone H3 modifications drift in mouse liver.”

Credit: Hillje et al.

BUFFALO, NY- June 30, 2022 – A new research paper was published in Aging (Aging-US) on the cover of Volume 14, Issue 12, entitled, “Time makes histone H3 modifications drift in mouse liver.”

Aging is known to involve epigenetic histone modifications, which are associated with transcriptional changes, occurring throughout the entire lifespan of an individual.

“So far, no study discloses any drift of histone marks in mammals which is time-dependent or influenced by pro-longevity caloric restriction treatment.”

To detect the epigenetic drift of time passing, researchers—from Istituto di Ricovero e Cura a Carattere Scientifico, University of Urbino ‘Carlo Bo’, University of Milan, and University of Padua—determined the genome-wide distributions of mono- and tri-methylated lysine 4 and acetylated and tri-methylated lysine 27 of histone H3 in the livers of healthy 3, 6 and 12 months old C57BL/6 mice. 

“In this study, we used chromatin immunoprecipitation sequencing technology to acquire 108 high-resolution profiles of H3K4me3, H3K4me1, H3K27me3 and H3K27ac from the livers of mice aged between 3 months and 12 months and fed 30% caloric restriction diet (CR) or standard diet (SD).”

The comparison of different age profiles of histone H3 marks revealed global redistribution of histone H3 modifications with time, in particular in intergenic regions and near transcription start sites, as well as altered correlation between the profiles of different histone modifications. Moreover, feeding mice with caloric restriction diet, a treatment known to retard aging, reduced the extent of changes occurring during the first year of life in these genomic regions.

“In conclusion, while our data do not establish that the observed changes in H3 modification are causally involved in aging, they indicate age, buffered by caloric restriction, releases the histone H3 marking process of transcriptional suppression in gene desert regions of mouse liver genome most of which remain to be functionally understood.”

DOI: https://doi.org/10.18632/aging.204107 

Corresponding Author: Marco Giorgio – marco.giorgio@unipd.it 

Keywords: epigenetics, aging, histones, ChIP-seq, diet

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About Aging-US:

Launched in 2009, Aging (Aging-US) publishes papers of general interest and biological significance in all fields of aging research and age-related diseases, including cancer—and now, with a special focus on COVID-19 vulnerability as an age-dependent syndrome. Topics in Aging go beyond traditional gerontology, including, but not limited to, cellular and molecular biology, human age-related diseases, pathology in model organisms, signal transduction pathways (e.g., p53, sirtuins, and PI-3K/AKT/mTOR, among others), and approaches to modulating these signaling pathways.

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FDA asks for COVID boosters to fight Omicron’s BA.4, BA.5 subvariants

The U.S. Food and Drug Administration on Thursday recommended booster doses of COVID-19 vaccines be modified beginning this fall to include components…

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FDA asks for COVID boosters to fight Omicron’s BA.4, BA.5 subvariants

By Michael Erman

June 30 (Reuters) – The U.S. Food and Drug Administration on Thursday recommended booster doses of COVID-19 vaccines be modified beginning this fall to include components tailored to combat the currently dominant Omicron BA.4 and BA.5 subvariants of the coronavirus.

The FDA said manufacturers would not need to change the vaccine for the primary vaccination series, saying the coming year will be “a transitional period when this modified booster vaccine may be introduced.”

FILE PHOTO: Signage is seen outside of the Food and Drug Administration (FDA) headquarters in White Oak, Maryland, U.S., August 29, 2020. REUTERS/Andrew Kelly/File Photo

The new booster shots would be bivalent vaccines, meaning doses would target both the original virus as well as the Omicron subvariants.

The decision follows a recommendation by the agency’s outside advisers to change the design of the shots this fall in order to combat more prevalent versions of the coronavirus. read more

BA.4 and BA.5 are now estimated to account for more than 50% of U.S. infections, according the U.S. Centers for Disease Control and Prevention, and have also become dominant elsewhere.

The FDA said in a statement on Thursday that it hoped the modified vaccines could be used in early to mid-fall.

Pfizer Inc (PFE.N) with partner BioNTech SE (22UAy.DE) and Moderna Inc (MRNA.O) have been testing versions of their vaccines modified to combat the BA.1 Omicron variant that caused the massive surge in cases last winter.

Although they have said those vaccines worked against BA.1 and the more recently circulating variants, they did see a lower immune response against BA.4 and BA.5.

The companies had already been manufacturing their BA.1 vaccines, and said on Tuesday that swapping to a BA.4/BA.5 version could slow the rollout.

Pfizer/BioNTech, which on Wednesday announced a $3.2 billion contract to supply more COVID vaccine doses to the United States, said they would have a substantial amount of BA.4/BA.5 vaccine ready for distribution by the first week of October. read more

Moderna said it would be late October or early November before it would have the newly modified vaccine ready.

Reporting by Michael Erman in New Jersey and Leroy Leo in Bengaluru; Editing by Jonathan Oatis and Bill Berkrot

Our Standards: The Thomson Reuters Trust Principles.

Source: Reuters

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Marketing automation startup Retail Rocket nabs $24M for expansion

Retail Rocket, a retention management platform for brands, today announced that it raised $24 million in a Series A round led by Cyprus-based private equity…

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Retail Rocket, a retention management platform for brands, today announced that it raised $24 million in a Series A round led by Cyprus-based private equity fund Flintera. In addition to the fundraising, Retail Rocket revealed that it acquired SailPlay, a startup developing software to help retailers build loyalty programs and send mass message campaigns.

New York-based SailPlay had raised $3.3 million prior to the acquisition. Founded in 2013 by Leonid Shangin and Yakov Filippenko, the company offered services to collect customer data and leverage it to create games, texts, and tasks designed to encourage repeat business.

As for Retail Rocket, it launched in 2012 headed by Moscow Business School of Management classmates, Nick Khlebinsky and Andrey Chizh, who’d attempted but failed to gain traction with several startups. The learnings from their previous efforts were the springboard for Retail Rocket, which after multiple pivots eventually grew its customer base to over 1,000 companies including Nintendo, Puma, and Decathlon.

“The digital marketing world is growing very fast and the demand for highly-skilled professionals is constantly increasing,” CEO Khlebinsky said. “The complexity of digital marketing tools is booming too — just several years ago we couldn’t imagine the technologies we use today.”

According to Khlebinsky, Retail Rocket uses a mathematical model to segment first-time buyers of a company’s product. By analyzing their actions — for example, the links they click on — the platform attempts to figure out their wants and preferences.

Image Credits: Retail Rocket

Retail Rocket also offers tools for campaign management like email marketing and web-based push notifications, as well as an engine that attempts to identify the best timing and communication channel (e.g., SMS) to make personalized offers. The goal is to create a “system of loyalty and retention management” for both online and offline customers, Khlebinsky said, that ultimately boosts business.

“We work with ecommerce on a performance-based pricing model,” Khlebinsky explained. “In most countries, the pandemic lockdowns spiked online sales, thus we experienced a temporary revenue increase. After the lockdown ended, there was a decrease, but to levels exceeding the pre-lockdown months, because a lot of people were forced to change their buying habits towards online shoppings.”

Absent independent reviews of Retail Rocket’s platform, it’s unclear whether its approach might beat out rivals like SalesForce, SAP, Bloomreach, and Dynamic Yield. But the promise of software that predictably drives repeat business is alluring. According to HubSpot, a mere 5% increase in customer retention can boost profits by 25% to 95%.

Retail Rocket has around 150 employees spread across offices in the Netherlands, Germany, Spain, Italy, and Chile, and it plans to double down on mergers and purchases in the coming months. Sources close to the company tell TechCrunch that Retail Rocket has $50 million set aside for acquisitions alone.

“Retail Rocket popped on our radars thanks to their international expansion and ability to set up sales teams in Europe and Latin America,” Flintera partner Sergey Vasin said in a statement. “We were impressed with the company’s results given the limited amount of investment they raised. The company was bootstrapping its growth after the seed round. Despite that, the efficiency of Retail Rocket products surpasses those of international competitors. We expect that the global e-commerce market will continue its growth at more than 10% per annum, with Latin America leading the race.”

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