$26 Billion Deal to Create Largest Copper Firm November 21, 2006
Posted by Tim Raines in: wholesale, business, finance, mining , add a commentFreeport-McMoRan Copper & Gold announced it will pay $126.46 per share in cash and stock to purchase Phelps Dodge, creating the world’s largest publicly-traded copper company.
From Reuters:
“This kind of big merger could raise the company’s ability to take advantage in price negotiations, therefore this should be positive for copper prices,” said Naohiro Niimura, director at Barclays Capital Japan.
“In the current bearish trend, the market is not too sensitive about buying copper actively, but in the medium- and long-term it should be positive.”
Phelps Dodge has mines in North America, South America and Africa, while Freeport-McMoRan operates the Grasberg mine in Indonesia, said in terms of reserves to be the world’s largest copper and gold mine.
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Retailers Struggle With Limited PS3 Supplies November 16, 2006
Posted by Tim Raines in: wholesale, business, manufacturing, retail , add a commentRetailers frustrated with Sony’s tiny allotments of PlayStation 3 consoles are beginning to fight back.
Abt Electronics has chosen to completely ignore Friday’s launch instead of disappointing customers, staying open late and dealing with near-riots.
From TWICE magazine:
“We looked into buying truckloads through a distributor,” said president Mike Abt, who ultimately decided to pre-sell his limited allotment in July and pull any mention of PlayStation from ads. “We’re very disappointed in the allocations,” he said. “We’re not taking orders and we’re not talking about it”– an ironic twist, given that Sony’s largest-ever in-store shop will open within Abt’s showroom on the day PS3 debuts.
Circuit City is holding midnight launch events at six stores in some of the major markets, including giveaways and radio coverage. Best Buy, who appears to have the largest inventory of the consoles, will also keep select stores open until 1:00 am for the launch.
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Wal-Mart Expects a Merry Christmas November 14, 2006
Posted by Tim Raines in: wholesale, business, retail, finance, marketing , add a commentWal-Mart showed a better-than-expected quarterly profit of 11.5 percent and gave a fourth quarter profit forecast that was close to Wall Street expectations.
The world’s largest retailer said price cuts on toys and electronics are already drawing customers and expects them to drive better holiday (or should we say “Christmas”) sales.
From Reuters:
Chief Executive Officer Lee Scott said third-quarter U.S. sales were softer than planned, but holiday season price cuts should boost fourth-quarter demand.
“This season, no one will doubt Wal-Mart’s leadership on price and value,” he said.
On a recorded message detailing third-quarter results and fourth-quarter plans, Scott said specials such as a $398 laptop computer sold out quickly, and he vowed the “most aggressive pricing strategy ever” for the holiday season.
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Acetaminophen Recall Causes a Headache for Tylenol November 13, 2006
Posted by Tim Raines in: wholesale, business, manufacturing, retail, marketing , add a commentTylenol has the makings of a huge problem on its hands.
Perrigo makes acetaminophen for a large number of retailers and has recently decided on a recall due to problems that allowed bits of metal to be mixed in with some of its product.
The recall itself was obviously a huge problem for McNeil Consumer Healthcare, makers of Tylenol, as people generally associate acetaminophen with the Tylenol brand name. Radio spots and website alerts from the company are already pointing out that Perrigo was the company affected and bottles of Tylenol are safe.
Add to that the tampering that took place with Tylenol in 1982, and the company’s got a real PR problem on its hands.
And then Seth Godin went and pointed out what would be the straw that broke the camel’s back if I worked for the company:
A quick search on Google News for “acetaminophen” turns up the result shown above, complete with a picture of Tylenol. The search engine, of course, isn’t trying to make things worse for Tylenol; it’s just doing what many consumers do—associating acetaminophen with Tylenol.
How will McNeil’s marketing and PR departments recover from these unfair associations? Stay tuned.
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“Merry Christmas” is Back in Retail November 10, 2006
Posted by Tim Raines in: wholesale, business, retail, marketing , 2 commentsTaking a step back from the trend in recent years Wal-Mart and other big retailers, including Kohl’s and Macy’s, are bringing “Christmas” back into their marketing.
Mounting criticism that resulted from eliminating or de-emphasizing Christmas in the stores’ advertising has resulted in a change in plans.
From the Associated Press:
“We learned a lesson from that. Merry Christmas is now part of the vocabulary here at Wal-Mart,” said Linda Blakley, a Wal-Mart spokeswoman. Wal-Mart said Thursday that it will launch its first Christmas-specific TV ad in several years, feature Christmas shops, previously called Holiday Shops, and increase the number of seasonal merchandise labeled “Christmas” instead of “holiday” by 60 percent.
Macy’s is adding Christmas signage in all of its department stores and Kohl’s is playing up Christmas this year in its TV, print and radio advertising, according to Vicki Shamion, a Kohl’s spokeswoman.
Not everyone, of course, is following suit. Best Buy’s advertising, for example, continues to omit any reference to Christmas. Dawn Bryant, a company spokeswoman says, “We are going to continue to use the term holiday because there are several holidays throughout that time period, and we certainly need to be respectful of all of them.”
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Crude Oil May Rise with Winter Demand
Posted by Tim Raines in: wholesale, business, government, manufacturing, transportation, finance, mining , add a commentThe price of crude may rise next week, as higher U.S. consumption as winter approaches reduces stockpiles.
From Bloomberg:
Twenty-one of 43 analysts, traders and brokers, or 49 percent, said prices will increase, according to a Bloomberg News survey. Five expect a decline and 17 forecast little change.
World oil demand peaks in the fourth quarter as refineries increase production of heating fuel. Implied demand for distillate fuel, or diesel and heating oil, averaged 4.4 million barrels a day over the four weeks to Nov. 3, up 8.9 percent from a year earlier, the Energy Department said this week.
The reductions agreed on by OPEC started November 1st, reducing oil output by 1.2 million barrels a day. The group is scheduled to meet again on December 14th.
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Orange Juice Prices on the Rise November 9, 2006
Posted by Tim Raines in: wholesale, business, agriculture, retail , add a commentOn the heels of the grim orange harvest we told you about last month, Pepsico announced it will raise prices on its Tropicana and Dole brands of orange juice four to eight percent beginning in 2007.
The company also plans to trim discounts and other incentives offered to consumers. The changes will amount to a total 20 percent increase on prices for orange juice that were already up an average of 11 percent over last year.
From the Associated Press:
“Given the world citrus supply is severely challenged and cost pressures have dramatically increased, we are once again forced to raise our prices to customers,” Eric Miller, Tropicana’s vice president of sales, said in a written statement. “However, we believe these pricing strategy changes are in the best long-term interest of the category, our customers and consumers.”
Coca-Cola already announced a price increase of 9 to 11 percent for its Minute Maid and Simply Orange brands, the company’s fourth price increase on orange juice this year, after no increases over the previous five years.
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A World Without Seafood? November 3, 2006
Posted by Tim Raines in: wholesale, business, agriculture, fishing, government, retail , add a commentAccording to a report in today’s issue of the journal Science, if trends of overfishing and pollution continue, just about all the world’s seafood populations will be gone by 2048.
From the Associated Press:
While the study focused on the oceans, concerns have been expressed by ecologists about threats to fish in the Great Lakes and other lakes, rivers and freshwaters, too.
[Lead author Boris Worm of Dalhousie University in Halifax, Nova Scotia]…and an international team spent four years analyzing 32 controlled experiments, other studies from 48 marine protected areas and global catch data from the U.N. Food and Agriculture Organization’s database of all fish and invertebrates worldwide from 1950 to 2003.
The scientists also looked at a 1,000-year time series for 12 coastal regions, drawing on data from archives, fishery records, sediment cores and archaeological data.
The solutions suggested by the researches include better management to prevent overfishing, tighter controls on pollution and new marine reserves.
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ADM Doubles Profit on Ethanol & Soybean Processing November 1, 2006
Posted by Tim Raines in: wholesale, business, agriculture, manufacturing, finance , add a commentArchter Daniels Midland reported first quarter (the three months ending September 30th) profit more than doubled due to higher prices for corn-based ethanol and better earnings from soybean processing. The company said a recent decline in the price of ethanol, however, would likely lower earnings.
From this Bloomberg article:
Archer Daniels “benefited from the April to September value of our ethanol contracts,'’ Schmalz said on a conference call with investors. The recent decline in ethanol pricing will be reflected in the current quarter, he said, with some of the impact being staggered throughout the year as customers renegotiate contracts.
Ethanol prices have plunged 51 percent from a record high of $4.23 a gallon in June as U.S. gasoline inventories increased. Ethanol is blended with gasoline to stretch supplies and make the fuel burn more cleanly.
Profit on soybean processing (crushing soybeans into animal feed, cooking oil and meal) rose 27 percent during ADM’s first quarter as prices for the oilseed fell.
Archer Daniels Midland employs 26,800 people and operates nearly 240 processing plants worldwide.
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South Korea Accepts U.S. Beef Shipment October 30, 2006
Posted by Tim Raines in: wholesale, business, agriculture, government , add a commentSeoul, South Korea accepted its first shipment of U.S. beef in nearly three years today, after fears of mad cow disease began a nearly three-year ban.
Some nine tons were shipped from a Kansas slaughterhouse and arrived on a flight this morning. It will undergo quarantine inspections and will be available for sale in a little over two weeks.
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