Panjiva Blog: Blogging Global Trade

Today we’re excited to announce the launch of Panjiva Trends, which will give you insight into the trajectory of U.S. imports of various products.  Type in any product, and you will see how U.S. imports of that product have been trending over the last few years — up through the end of the most recent month.  You will also see which countries are shipping more of the product compared to last year and which countries are shipping less.  Panjiva Trends will be free for the next month; all that we ask if that you tell us how we can make it more useful to you.

In anticipation of the launch of Trends, our research team took a look at which products are trending positive this holiday season, and which products are trending negative.

The winners:  Snuggie, Zhu Zhu Pet, Toy Story, Chocolate Truffles, Hand Magnifier, Hand Sanitizer, Booklight, and Coal.

The losers:  Batman, Digital Picture Frame, Hannah Montana, Bratz, and High School Musical.

Notes for the data junkies… 

• Panjiva Trends is based on waterborne shipments to the United States, so items coming in by air are not captured.
• Our algorithms have structured the data drawn from the unstructured descriptions of the shipments, so you can use Boolean operators in your searches.

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The word from Panjiva’s research team: there was a slight uptick in global trade activity during October. Specifically, from September to October, there was a 3% increase in the number of global manufacturers shipping to the U.S. market. Similarly, there was a 2% increase in the number of U.S. companies receiving waterborne shipments from global manufacturers.

Those hoping for a major holiday bounce are likely to be disappointed by this new data; on the other hand, it’s good to see that last month’s slide did not continue.  A few notes:

• Last year, we also saw a slight uptick from September to October.
• The percentage of significant manufacturers on the Panjiva Watch List declined slightly from 27% to 26%.
• Similarly, the percentage of significant buyers having done business with a Panjiva Watch List supplier in the preceding three months declined slightly from 37% to 36%.

Methodological notes for the data junkies:

• Manufacturers that have suffered a 50% or greater decline in volume shipped to American customers in the most recent three month period, versus the same period a year ago, are on the Panjiva Watch List.
• “Significant manufacturers” are companies that have sent 10 or more shipments to American customers within the last year.  As of the end of October, there were 86,254 significant manufacturers.
• “Significant buyers” are U.S. companies that have received 10 or more shipments from overseas manufacturers within the last year.  As of the end of August, there were 73,987 significant buyers.

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Over the weekend, CIT filed for bankruptcy. This is the latest chapter in a saga that has significantly reduced the availability of capital for a wide variety of businesses.  The general consensus seems to be that the bankruptcy isn’t going to make things much worse than they already are, and insiders point out that strong businesses should be able to get capital from sources other than CIT.

A couple of months ago, Panjiva’s clients began asking if we could help them identify which companies are exposed to CIT risk.  Sure enough, we were able to use our data to spot companies that have a relationship with CIT.  Below, you can see how we’ve built this into Panjiva’s intelligence platform.  Note the “CIT Relationship” refinement on the left.

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If the September decline in global trade is any indication, U.S. companies aren’t expecting many items to fly off the shelves this holiday season.  However, it certainly seems that U.S. companies are betting that Swine Flu will turn hand sanitizer into a holiday hit.

On Monday, over lunch, I told apparel industry veterans of a random warning I received about the dangers of ingesting hand sanitizer.  One of my lunchmates commented that he expected hand sanitizer to do quite well this year, thanks to the Swine Flu.  So, of course, I asked our research team to take a look.

Sure enough, there’s been a massive spike in shipments of hand sanitizer to U.S. companies, suggesting that American companies think they may have a holiday hit on their, um, hands.

Specifically:

• In the third quarter of 2009, there were 128 waterborne “hand sanitizer” shipments to the United States — compared to 56 shipments in the third quarter of 2008.
• When analyzed on a weight basis, there was a threefold increase in the amount of hand sanitizer shipped in the third quarter of 2009 — compared to the third quarter of 2008.

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We have wrapped up the first round of the onPanjiva program, and we are thrilled to announce that six new data sources will be available on the Panjiva intelligence platform by the end of 2009.

Over the course of six weeks, over 100 data sources were nominated for inclusion onPanjiva, and over 20 of these organizations applied to publish their data via the onPanjiva program.  In consultation with clients and advisers, our team selected the following applicants for 4th quarter 2009 integration into the Panjiva intelligence platform:

• Customs Info, which compiles “denied parties” information from government sources
• D&B, which provides information on the financial health of companies
• Good Factories, which maintains profiles of furniture and home furnishings suppliers
• Made-By, which maintains profiles of suppliers that have a track record of social and environmental responsibility
• The American Apparel Producers’ Network, which maintains profiles of apparel suppliers in the Americas
• TriVista Sourcing, which provides on-demand audits of Chinese suppliers

These new data sources will appear on the Panjiva intelligence platform alongside data from existing Panjiva affiliates, including:

• deKieffer & Horgan, which tracks companies that have engaged in illicit global trade
• DP Information Group, which provides information on the financial health of companies in Singapore
• Hong Kong Trade Development Council, which maintains profiles on companies in Hong Kong and around the world
• SINOSURE, which provides information on the financial health of Chinese companies
• Social Accountability International (SAI), which sets the SA8000 standard for socially responsible manufacturing
• Worldwide Responsible Accredited Production (WRAP), which sets the WRAP standard for socially responsible manufacturing

The onPanjiva program will continue on a regular cycle, with applications to be reviewed in quarterly rounds.  Know of data sources that you’d like to see us integrate into the Panjiva intelligence platform during the first quarter of 2010?  You can nominate these data sources between now and November 30th.

In the meantime, we’re getting to work on integrating the six new data sources named above.

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The word from Panjiva’s research team: global trade activity declined in September.  Specifically, from August to September, there was a 5% decline in the number of global manufacturers shipping to the U.S. market. Similarly, there was a 4% decline in the number of U.S. companies receiving waterborne shipments from global manufacturers.

These declines are the steepest we’ve seen since February, when global trade hit bottom, and would seem to confirm that American businesses have modest expectations for the coming holiday shopping season.

Pessimists will take note that it was last year’s August-September decline that marked the beginning of global trade’s six-month decline.  However, we probably won’t see a repeat of last year’s global trade free-fall unless we get another macro shock to the financial system.  (For an interesting perspective on where we may be headed, check out the SpendMatters blog.)  A couple of positive items from our team’s latest analysis:

• The percentage of significant manufacturers on the Panjiva Watch List declined slightly from 28% to 27%.
• Similarly, the percentage of significant buyers having done business with a Panjiva Watch List supplier in the preceding three months declined slightly from 38% to 37%.

Methodological notes for the data junkies:

• Manufacturers that have suffered a 50% or greater decline in volume shipped to American customers in the most recent three month period, versus the same period a year ago, are on the Panjiva Watch List.
• “Significant manufacturers” are companies that have sent 10 or more shipments to American customers within the last year.  As of the end of August, there were 86,663 significant manufacturers.
• “Significant buyers” are U.S. companies that have received 10 or more shipments from overseas manufacturers within the last year.  As of the end of August, there were 73,904 significant buyers.

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VentureBeat featured our thoughts on the importance of leveraging your team’s knowledge for risk management purposes.  Excerpt below — full version available at VentureBeat

Senior executives across a wide variety of companies found themselves confronted with the threat of supplier bankruptcies – and the frustration of not knowing which specific suppliers were most at risk. As companies scrambled to enhance their risk management capabilities, there was a ravenous hunger for data.  Specifically, we saw a sharp increase in demand for financial and operational data about suppliers.  However, in my many conversations with senior executives, I repeatedly heard: “I have an army of people on the ground; surely they know where the risks are.”

Read the rest….

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The word from Panjiva’s research team: global trade activity held steady in August.  Specifically, from July to August, there was a 1% increase in the number of global manufacturers shipping to the U.S. market.

Reasons for optimism:

• This year’s July-to-August increase compares favorably to numbers from 2008 (1% decrease) and 2007 (1% decrease)
• The percentage of significant manufacturers on the Panjiva Watch List declined to 28% — down from 29% in July.
• The percentage of significant buyers having done business with a Panjiva Watch List supplier in the preceding three months declined to 38% — down from 40% in July.
• From July to August, there was a 1% increase in the number of U.S. companies receiving waterborne shipments from overseas.

As we look ahead, it’s worth remembering that September is when global trade fell off a cliff last year.  For the remainder of 2009, there are three possible trajectories for global trade:

• Cliff-diving — If we have a new shock to the financial system, look for global trade to go off a cliff for a second year in a row.  Low probability (we hope).
• Holiday surge — If retailers bet on strong consumer spending in the holiday season, look for global trade to surge in the months ahead.  Anecdotal evidence suggests that corporate buyers are being cautious (better to be burned by having too little inventory than by having too much), so a holiday surge is unlikely.
• Holding steady — Probably the best bet.  Over the last several months, we’ve seen a slow but steady recovery of global trade activity.  No reason to think we won’t see more of the same.

Of course, we’ll see soon enough.  In the meantime, methodological notes for the data junkies:

• Manufacturers that have suffered a 50% or greater decline in volume shipped to American customers in the most recent three month period, versus the same period a year ago, are on the Panjiva Watch List.
• “Significant manufacturers” are companies that have sent 10 or more shipments to American customers within the last year.  As of the end of August, there were 86,686 significant manufacturers.
• “Significant buyers” are U.S. companies that have received 10 or more shipments from overseas manufacturers within the last year.  As of the end of August, there were 73,683 significant buyers.

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The window for Round 1 onPanjiva nominations has closed, and we are now reviewing applications.  In early October, we’ll announce the data sources that will be integrated into the Panjiva intelligence platform during the fourth quarter of 2009.  In the meantime, I thought I’d share some stats.  In the first six weeks of the onPanjiva program:

• 111 data providers were nominated
• 23 data providers submitted applications

onPanjiva Round 1 nominations came from several sources: Panjiva clients, industry experts, and data providers themselves.  And, through this process, we’ve been introduced to an incredibly wide variety of data providers – organizations across different industries, of different sizes, and with different types of information.

So we’re happy to announce that the onPanjiva program will continue on a regular cycle, with applications to be reviewed in quarterly rounds.  Between now and November 15th, you can nominate information providers you would like to see onPanjiva during the first quarter of 2010 – as part of onPanjiva Round 2.  The first company to nominate an information provider that ultimately publishes its information onPanjiva will receive one-year’s worth of free access to information from this provider.  And, of course, information providers can also nominate themselves for inclusion onPanjiva.

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Thanks to Paul Kedrosky for highlighting Ambrose Evans-Pritchard’s article about China’s plans to limit exports of rare earth minerals.

Specifically, there’s discussion of limiting exports of terbium, dysprosium, yttrium, thulium, lutetium, neodymium, europium, cerium, and lanthanum.  We took a look at who’s sending shipments to the United States that include these rare earth minerals.  Results below:

• 3 suppliers of products including terbium
• 5 suppliers of products including dysprosium
• 54 suppliers of products including yttrium
• 1 supplier of products including thulium
• 8 suppliers of products including lutetium
• 41 suppliers of products including neodymium
• 12 suppliers of products including europium
• 85 suppliers of products including cerium
• 121 suppliers of products including lanthanum

If you dig into the searches, you can see the geographic distribution of these suppliers.  Some are the original suppliers; others are middlemen.

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