The Friday Report: June 18, 2021

Quick wrap up of a few hot topic newsworthy stories in the supply chain logistics industry

New Bipartisan Bill Offers Incentive for U.S. Chip Production

New legislation originating from the Senate Finance Committee provides a 25 percent tax credit to semiconductor producers that manufacture their silicon in the United States.  This incentive would apply to companies that invest in domestic semiconductor manufacturing facilities and equipment.  The tax credit would be in addition to the $52 billion that the Senate earmarked earlier this month as part of the U.S. Innovation and Competition Act.

The committee previously identified that as much as 70 percent of the cost advantage offshore chip foundries abroad enjoy is due to foreign subsidies.  Reuters recently reported that this new U.S. tax credit would primarily benefit Taiwan’s TSMC as it is constructing a $ 12 billion plant in Arizona as well as U.S. chipmakers Intel and Micron Technology.

For more information, please continue reading here.


Chinese Ports Backlog May Spell Delays for Holiday Season

With an outbreak of COVID-19 in southern China, ports are facing increased congestion, blocking global trade.  Home to one of the world’s busiest ports, authorities in Guangdong cancelled flights, suspended trade, and locked down communities along the southern coastline to gain control over a significant spike in COVID-19 cases.  Although the tactics proved effective and many operations have since restarted, damage has been done.

The port 50 miles north of Hong Kong, Yantian, handles the flow of goods capable of filling 36,000 20-foot containers on a daily basis. Yantian was shut down for approximately one week last month.  Although it reopened and has continued to remain open, the port is operating at reduced capacity.  Because of this, there is a substantial backlog of containers waiting to leave as well as ships waiting to dock.

Chiwan, Shekou, and Nansha, other container ports in Guangdong are likewise experiencing major congestion.  This is creating a domino effect that is impacting the entire global shipping industry.  Industry experts have voiced concern that this may impact the supply of goods for this year’s holiday season as well as higher shipping costs due to delays, change in vessel routes and increased fees.

For more information, please continue reading here.


Pandemic Hatches Numerous New Chicken Restaurants

Part of the reason why chicken is in such short supply across the United States is the popularity of fast-food chicken sandwiches.  From Popeye’s to Chick-fil-A, McDonalds, Wendy’s and other fast-food venues, chicken sandwiches have taken center stage during the pandemic.  For consumers, having access to fast food proved too delicious an option to disregard.

Recently, popular dine-in restaurant chain O’ Charley’s, a favorite across Southern states announced changes.  The chain has launched two brand new virtual fast-food brands, offering new menu items in addition to menu favorites.  Prior to the pandemic, O’ Charley’s had introduced an online ordering platform and curbside pickup and recouped its investment when diners were no longer permitted to dine in restaurants.

The virtual new brands, Coop & Run and Dockside Charlie’s are helping the restaurant to experience an uplift in sales without opening more restaurants.  Coop & Run, launched in late 2020 features a menu filled with chicken tender options and a wide array of sauces such as Sweet Teriyaki, Honey Boom Boom, Carolina Gold BBQ and Mango Habanero.  The second virtual brand, Dockside Charlie’s is a new seafood brand that spotlights salmon, sandwiches, platters and new dessert options.

For more information, please continue reading here.

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