Best state for manufacturing and logistics – Missouri

…At least according to a report from Ball State University’s Bureau of Business Research.

Via Springfield Business Journal:

In addition to landing the top ranking, the Show-Me State was one of six states to earn an “A,” according to the 2008 National Manufacturing and Logistics Report Card issued by the Muncie, Ind.-based university. Missouri earned high marks for research and development efforts as well as relatively low long-term health care costs and health insurance premiums. Corporate and property taxes also are lower in Missouri than most states, according to the report card.

Rounding out the top 5 were Utah, Florida, Alabama and North Dakota. The reports ranks each state in 20 different categories including:

Property taxes, sales taxes, unemployment insurance, corporate taxes, crime, R&D and percentage of the population with college degrees.

By the way…last place, West Virginia.

World’s Busiest Airports

The Airports Council International has just released their annual 2007 World Airport Traffic Report which ranks the world’s busiest airports. According to the report worldwide airports in 2007 welcomed a record of 4.8 billion passengers.

The world’s busiest airport for passengers remained the Atlanta airport handling 89 million passengers. Second was Chicago’s O’Hare (76m), and third, London Heathrow (68m). The report also mentioned that the fastest area of growth in passengers occurred in the Middle East with an 11.3 percent increase.

World’s busiest airport for cargo was Memphis followed by Hong Kong and Anchorage. Los Angeles ranked number 12 globally.

The growth in cargo traffic slowed slightly to 3.2 percent over the previous year, with 88.5 million metric tonnes handled in 2007, possibly due to the increase in fuel price pushing cargo traffic to other transport means. Once again, the hub of FedEx airlines, Memphis, was the largest cargo airport in the world, followed by Hong Kong and Anchorage. However, Memphis traffic is predominantly domestic cargo which is why it doesn’t appear on the list of top ten airports handling international freight, where Asian airports dominate.

Read here for the Airports Council International’s complete report and findings.

China’s logistics industry: a mixture of challenges and promise

Via China Daily comes a rather long but interesting article that breaks down the good and the bad facing China’s logistics industry.

The challenges:

With energy costs persistently on the rise and mounting inflationary pressures, China’s logistics sector is suffering a steady fall in profit margins that may herald a possible reversal of the past decade’s growth momentum.

Gone are the days when a transportation company with only 20 people and half a dozen trucks could make 2 to 3 million yuan a year. The average profit margin of the transportation sector, according to statistics of China Federation of Logistics and Purchasing (CFLP), has been squeezed to no more than 2 to 3 percent, plunging as quickly as oil prices surge.
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Deteriorating US demand and the slowdown in the world economy has further dented the industry’s outlook, as China’s export sector is noticeably down with a slackened growth rate and disturbing implications for the logistics sector.

China’s trade surplus in the first half of this year fell 11.8 percent to $99 billion from a year ago amid declines in international trade growth triggered by the global economic slowdown as well as the government’s efforts to curb exports of resource-intensive and heavily polluting products. For related logistics service providers, the impact has been acute.

Some of the positives:

By stepping into the planning and designing spheres of a company’s supply chain management, covering purchasing and manufacturing to information and other distribution processing services, PGLogistics is geared toward meeting the new market demand for highly integrated and efficient supply chain solutions, Xie says.

“Although the current market share of one-stop, third-party logistics outsourcing in China is only 2 percent, the trend is quite obvious as about 42.6 percent of enterprises chose to outsource at least a part of their logistics services in 2006, compared with 37 percent in 2005.”

One obvious advantage with such integrated logistics service providers is that they have a greater chance of shielding against the impact of volatile oil prices, says Bao Wenqing, director of the marketing department of the Shenzhen-based Eternal Asia Supply Chain Management Ltd (EA). It’s a professional supply chain solution provider offering one-stop supply chain services for some of the world’s top 500 companies like GE, IBM and Philips.

Sales revenue from energy-sensitive logistics services takes up less than 10 percent of the company’s revenues, Bao says. But Chinese manufacturing companies still have a long way to go before they can fully realize the significance of efficient supply chain management, he adds. Bao says there is noticeable lack of cooperation between Chinese manufacturing and logistics companies, which has severely hindered the development of the logistics outsourcing industry.

But not all are bent on becoming bigger. Specialized logistics services that cater to the needs of individual sectors are also seeing a boom in China, driven by the demand for professional services.

Read the whole thing.

WTO trade talks in Geneva fall apart

The U.S. is blaming China and India for refusing to cut farm and industrial tariffs. As usual, ShopFloor.org is all over the story. They have links to numerous news articles here. They have excerpted a statement from the President and CEO of their parent organization, NAM, here:

The “Special Safeguard Mechanism” demanded by China and India for their agricultural sectors was the final straw. That mechanism would have violated one of the most basic tenets of the world trading system: nations do not violate their tariff bindings by raising tariffs above the legally-bound levels. Once an exception is made, no matter how small, the entire world trading system could begin to unravel. The Doha Round was supposed to move world trade forward, not backwards.

It is regrettable that China and India in the end refused to stick with the rules and wishes of the majority of countries. However, we must face the reality of what they did. It is important to note, however, that other developing countries, especially Brazil, made it plain during the Geneva talks that they were prepared to enter into give and take negotiations, and that is a positive development.

Statement from U.S. Trade Representative Susan Schwab here, and they have a link to an interesting article from a German daily here:

China and India have taken the stage, powerfully. They represent their own interests, hard as stone, and will support free trade only as far as it benefits them. The former industrial powers will come to rue the day, bitterly. Geneva was just a taste of what’s to come.

All in all, a bad day for free trade. I imagine this will facilitate the growth of bilateral trade deals between the U.S. and individual trade partners.

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