coronavirus impacts on global supply chain logistics

Over the past four months, we have provided multiple updates focused on known and potential supply chain impacts due to the coronavirus (COVID-19). We expect that this information will continue to develop in the coming days and weeks, and we will continue to work diligently to provide our customers, vendors and employee-owners with the most current and accurate information available. While the situation is fluid and continues to evolve more and more quickly, below is an update based on the latest information we have today. 

coronavirus impacts on global supply chain logistics

As of this update, all 50 states continue to reopen in some capacity, but some states are seeing a spike in new cases as a result. Border States continues to closely monitor and adhere to federal and state guidelines and use extreme caution regarding our operations, with health and safety as the number one priority. All Border States branch locations across the country continue to remain operational and ready to serve our customers. 

Market Indicator Updates 

  • Oil prices have come a long way since we saw historic negative futures earlier this year with the West Texas Intermediate (WTI) trading over $37 per barrel this week. The road to recovery for oil is projected to be a long one, with caution to return global supply and demand expected to fall short of pre-pandemic levels through 2021.  
  • Copper pricing continues to recover, trading near $2.60 per pound this week. This is up from a low in March of $2.01 per pound. Continued economic recovery globally, specifically in China, and reduced mining capacity due to the pandemic, are the primary drivers of this positive trend. 

Freight Updates 

We continue to stay in close contact with major third-party freight carriers. Ports of entry from Mexico and Canada to the United States continue to operate normally without delays. Airfreight rates from China and Europe into the United States have started to normalize from peaks in April and May. Many medical and PPE supplies that were being shipped previous via air are now arriving via ocean freight and the supply chain has somewhat stabilized. Increasing passenger air travel in several countries is also increasing global air freight capacity.  

For truckload and less-than-truckload (LTL) carriers, overall domestic freight rates remain competitive and capacity is readily available. Freight congestion and social distancing measures at terminals and distribution centers continue to impact lead times of some shipments. 

Supplier Updates 

We remain close to our key suppliers and manufacturers through daily communication. Mexico remains the area with the most significant manufacturing challenges, but there is growing concern in South America — particularly Brazil — where several of our key suppliers have operations. In Mexico, many suppliers continue to work through challenges with reducing employee density due to community spread in their facilities and high employee absenteeism.  

Most supplier production facilities impacted by closures have since reopened, and most manufacturers are working to create redundancy in their supply chains to increase capacity above pre-pandemic levels.  

Product Updates 

Circuit breakers, most specifically 2 and 3 pole, arc fault, ground fault and dual function breakers have seen significant disruption out of Mexico and Puerto Rico, and we expect this to continue through the summer.  

For the utility market, pole line construction materials, ground sleeves and box pads are seeing extended lead times due to strong demand and temporary facilities closures. We are working diligently with impacted suppliers in these categories to mitigate risk to our customers where possible. 

Border States continues to have a team dedicated to sourcing PPE and safety products to support the health and safety for our employeeowners and our customers. We are focusing on the following products: 

  • Disposable respirators 
  • Reusable masks 
  • Protective gloves  
  • Hand sanitizer 
  • Disinfecting sprays  

We continue to see some shipments of U.S. made N-95 rated disposable respirators to our critical infrastructure customers, and we are not seeing some allocation to our shipments into our stock inventory. Please continue to work with your Border States account manager for any PPE and safety needs. 

 

Border States continues to monitor the Centers for Disease Control and Prevention (CDC) for additional information and around safety, social distancing guidance and travel restrictions that will continue to create some impacts on the supply-chain.  

Our number one priority remains the health and safety of our customers, vendors and employee-owners. As we start to reopen many of our counter operations, we have put in place additional safety measures to ensure for our customers and employee-owners. Our curbside pickup method remains in place. We continue to maintain a no contact delivery (NCD) policy for all drivers. You can get updates for your Border States branch by visiting location pages on our website. 

Additional information is available on our website regarding these measures and plans focused on health and safety in our operations. If you have any questions, please reach out to your Border States Account Manager for additional information. 

 

Related Articles: 

New OSHA guidelines on COVID-19 safety for construction sites | 5 key takeaways 

Border States’ response to the COVID-19 outbreak 

Cleaning and disinfecting tools | 4 tips for keeping your jobsite safe during the COVID-19 outbreak 

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