[#247] Supply Chain in Numbers - Aug 26, 2024
Dali's unloading of 4.8k containers, Cost of $30 per DroneUp delivery, Kellogg plans $500M SC investment, Utz Brands shrinks by 6 plants, China accounts for 41.3% of containers in top 100 ports
Welcome to “Supply Chain in Numbers.” This newsletter tracks significant numbers from the supply chain world. Five prominent numbers are published every Monday. If you have any feedback, please send it to me.
Unloading of 4,800 containers
Nearly five months after the fatal allision of the containership Dali with Baltimore’s Francis Scott Key Bridge, offloading of the vessel has been completed in Norfolk, Virginia. The ship arrived in the Norfolk area on June 25 after a complex overnight move from Baltimore’s Seagirt Terminal, largely still loaded with a reported 4,800 containers. The vessel has a total capacity of approximately 10,000 TEUs (standard-sized boxes), although vessels generally carry larger double-size boxes. There was also speculation that the 4,800 number was only laden boxes with additional empties likely aboard. [Maritime Executive]
$30 per drone delivery
Walmart is ending drone deliveries made with partner DroneUp in Phoenix, Arizona, Salt Lake City, Utah, and Tampa, Florida, because the services in those cities weren’t sustainable. Right now, it costs about $30 to use a drone to deliver a package, but DroneUp wants to bring the cost down so that it’s less than $7. DroneUp will close 18 Walmart delivery hubs in the cities, and 17 percent of DroneUp’s workforce (70 staffers) will lose their jobs. Following the cuts, there will only be 15 Walmart locations — “11 in Dallas, three near Walmart’s Bentonville, Ark., headquarters and one in Virginia Beach. In addition to DroneUp, Walmart partners with Alphabet’s Wing and Zipline on drone deliveries in the Dallas-Fort Worth metro area and with Flytrex on deliveries in Fayetteville, North Carolina. Amazon has also recently adjusted its drone plans, announcing in April that it would shut down its drone delivery service in California. [The Verge]
$500 million supply chain modernization
WK Kellogg Co. has unveiled a half-billion-dollar supply chain modernization plan to hoist margin growth into double digits by the end of 2026. Under the plan, expected to cost $450 million to $500 million, WK Kellogg said it would invest in new infrastructure, equipment, technology, and capabilities at its manufacturing plants in Battle Creek, Mich.; Lancaster, Pa.; and Belleville, Ont., to boost production at those sites as well. The supply chain strategy also consolidates WK Kellogg’s manufacturing footprint. The company said it plans to close its plant in Omaha, Neb., in a phased production shutdown starting in late 2025, targeting full closure near the end of 2026. Production at WK Kellogg’s plant in Memphis, Tenn., also is slated to be reduced beginning in late 2025. [Baking Business]
6 plants removed from the network
Utz Brands planned to shrink its manufacturing network in Q2 to cut costs while focusing on distribution and market gains. The company sold two plants — in Michigan and Pennsylvania — to chip brand Our Home in April. Utz has shed at least six plants over the past several months through closures and divestments, leaving it with eight current facilities. The supply chain overhaul aims to save $135 million over three years. The strategy includes plans to reduce production costs by $90 million through lean manufacturing, improved sourcing and automation, and saving $45 million through network optimization. [Supply Chain Dive]
41.3% of container volumes
Judging by the cargo flowing through China’s maritime ports, the world’s export king still reigns despite US and European efforts to diversify their trading relationships. The report showed that China’s share of container volumes at the biggest 100 seaports globally rose to 41.3% last year from 40.2% a year earlier. Ten years ago, the figure stood at 36.6%. In a distant second place was the rest of Asia, which had a 26.6% share, according to the just-released figures for 2023. North America came in at 7.6%, and Europe at 7.3%. In the list of top 100 ports, of the world’s top 10 ports, measured by annual container throughput, seven are in China. [Bloomberg]