Preliminary thinking, speculation, and hypotheses. Earnestly intended and honestly attempted, but almost always needing further consideration, clarification, correction, or not-yet-found confirmation. These are research notes and homework still underway. Conversation is derived from the Latin meaning to turn together.

  • Coal for the cold
    Speaking on September 10, the President of Ukraine said: This will be the most difficult winter in the whole world… Russia is doing everything to break the resistance of Ukraine, the resistance of Europe and the world in 90 days of this winter. Because this is what Russia hopes for. This is its last argument. […]
  • European Energy Flows
    Nordstream 1 is closed (Nordstream 2 never started). Natural gas continues (rather amazingly) to flow west from Russia through Ukraine to Velke Kapusany then farther along (more and more and more). Current Natural Gas inventories in Europe range from a low of about half-full in Latvia to two-thirds full in Bulgaria to more than 90 […]
  • Inflation’s role in demand destruction
    Since March 2020 American consumers have wanted more of many food products than there has been capacity to supply these food products (more). The first chart below displays real personal consumption expenditures for food. The second chart shows an index for US food manufacturing. Even after several months of consecutive declines, food demand remains well […]
  • US Railway Squeeze
    [Updates Below} Yesterday, Friday, September 9, US railroads began to prepare for a possible strike. Here is what BNSF told its customers, “Due to the possibility of an interruption of service when the cooling off period expires September 16, we will begin to take steps to manage and secure the shipments of hazardous and security-sensitive […]
  • California grid: demand management
    [Update Below] Yesterday, September 6, at 17:48 Pacific Time the California Office of Emergency Services sent the following mass text message: “Conserve energy now to protect public health and safety. Extreme heat is straining the state energy grid. Power interruptions may occur unless you take action. Turn off or reduce nonessential power if health allows, […]
  • California’s Constrained Grid Capacity
    [Updates Below] According to the National Weather Service in Sacramento that region and most of California will experience, “a prolonged period of dangerously hot conditions with record and near record temperatures up to 105 to 115 degrees. Limited overnight relief, especially in the foothills… The most significant heat is forecast to occur Monday and Tuesday […]
  • Black Sea: fragile flows grow
    [Update Below] Grain and other agricultural flows from three Black Sea port are persisting (see first map below). Reuters reports, “A total of 61 cargo ships carrying around 1.5 million tonnes of food have left Ukraine under a deal brokered by the United Nations and Turkey to unblock Ukrainian sea ports…” (more) This Black Sea […]
  • Jackson Mississippi water system
    The Mississippi Emergency Management Agency is providing ongoing updates on the response to the Jackson water crisis. See below for related summaries and updates. +++ Upstream Sourcing: Water is sourced from the Pearl River, Ross Barnett Reservoir (just northwest of the city, see map below), and six wells drawing on the Sparta Aquifer. The Pearl […]
  • Today’s discount, tomorrow’s tragedy
    In the near-term — such as the next eight weeks — there are risks to supplies of refined fuels serving US demand, especially in the Northeast. Current diesel inventories in New England and Central Atlantic are anemic. And every hurricane season, there is some risk that a major hit in the wrong place could disrupt […]
  • July Personal Consumption Expenditures
    This morning’s July report suggests a largely unchanged consumption glidepath. Nominal consumption increased 0.1 percent from June. Inflation adjusted consumption was up 0.2 percent. (See first chart below.) While many discretionary expenditures (e.g., non-durable goods) have flattened or fallen, other factors — such as shelter costs — are keeping consumption historically high. The Bureau of […]
  • Freeport: Sturgis redux?
    Yesterday Freeport LNG announced another delay in restarting their Texas facility. Shut-down since a June 8 explosion, flows had originally been expected to resume in September, but based on regulatory action had then been delayed until October. (See text of action by Pipeline and Hazardous Materials Safety Administration.) According to a news release, “Although typical […]
  • Black Sea berths
    The trickle of agricultural exports leaving three Ukrainian ports has continued. Sailings include not just those ships trapped since February, but new ships arriving to receive new loads. That new ships have arrived so soon surprises me. It is further evidence of the power of effectual demand — even in the midst of very high […]
  • Big picture: Resilience diagnosis and prescription
    [Update Below] Resilience implies problems. We spring back from adversity. The more rapid and complete a recovery from hard hits, the more resilient a system’s character. In recent years there have been plenty of serious supply chain problems. In most cases and places, supply chains have demonstrated significant resilience. The Coronavirus Pandemic continues to stress […]
  • US retail sales and savings
    July retail sales — both nominal and real — continued to be strong. The Wall Street Journal summarized: Overall retail sales—a measure of spending at stores, online and in restaurants—were flat in July compared with the prior month’s revised 0.8% increase, the Commerce Department said Wednesday. But a measure of spending that strips out gasoline […]
  • US domestic freight flows
    I just completed a 2000 mile road-trip. Truck traffic seemed strong, especially at Indianapolis (major road construction undoubtedly amplified that observation). I can confirm that Lexington KY loads and flows circling Cincinnati are impressive (lots of activity at the nearly one-year-old Amazon hub). Demand for stuff has moderated (I agree), but it remains plenty strong. […]
  • Flows: better but not balanced
    Disruptions, disconnections, delays, surprising demand, congestion, and confusion are supply chain constants. Minimizing and mitigating mismatched pull with push is what supply chain managers do. So do production line workers, DC selectors, truckers, and retailers… day after day, even minute-by-minute. War (and rumors of war), natural disasters, and pandemics can create especially dramatic complications. Recent […]
  • July food inflation persists
    While the headline and core numbers moderated (see chart below), food inflation continues to hurt. Here is the complete CPI blurb for food from this morning’s Bureau of Labor Statistics report: The food index increased 1.1 percent in July; this was the seventh consecutive monthly increase of 0.9 percent or more. The food at home […]
  • Ants busily build winter storage
    [Updates below] Natural gas storage facilities in the European Union are now over seventy percent full. Inflows have been well above normal for Spring/Summer since the end of May (see chart below). France is at over 80 percent, Italy about three-quarters, Germany at the EU average. Austria, Hungary, and Latvia are closer to 55 percent […]
  • California soil moisture
    The Golden State grows (and typically processes and packages) about 13 percent of total US agricultural sales. Almost twenty percent of US dairy production occurs in California. The state is the leading source of fresh fruits and vegetables consumed in the United States, including over 99 percent of almonds, clingstone peaches, dried plums, raisins, and […]
  • Global food flows
    [Update Below] Upstream food capacity is variable by place, precipitation, and season. Midstream flows are vulnerable to a wide range of disruptions. Downstream demand is profound — and sometimes desperate, especially in the face of price increases. Grain exports from the Northern Black Sea through the Dardanelles were fundamental to food flows (and prices) for […]
  • Grain ship departs Odesa
    [Updates below] Today at 0948 local time the bulk carrier Razoni departed Odesa, Ukraine for Tripoli, Lebanon carrying 26,000 tons of Ukrainian corn. This is the first shipment to leave a Ukrainian Black Sea port since the war began on February 24. The Razoni is one of seventeen cargo vessels trapped when the war began. […]
  • Food consumption: summer diets?
    According to this morning’s report from the Bureau of Economic Analysis, during the month of June US real personal consumption expenditures continued flat, almost unchanged from January and basically the same as October 2021. The “feels-like” rate of expenditure is much hotter because of inflation (economic humidity?), but in terms of steady 2012 dollars US […]
  • Decadent Demand?
    President Putin is depending on decadent demand. He is depending on European consumers and bourgeois politicians to succumb to high prices and chilly room temperatures. Putin has restored General Winter to a prominent place in Kremlin councils. He hopes this month’s temperature extremes will return to Europe in dramatic winter garb. January is Berlin’s coldest […]
  • Mid-summer US grocery flows
    The US grocery supply chain continues to close the gap between demand and supply. Despite (and because of) high food inflation and plenty of competition for spending (e.g. eating out and travel), in June US consumers spent almost one-fifth more on groceries than in June 2019 (see first chart below). Inflation-adjusted spending is flat or […]

Join the conversation