Export bans 🙅🏽‍♂️ + Fastest growing logistics companies 📈

Author

Ben Thompson
August 16, 2023

Good Morning! So you're familiar with the mainstays of international trade transportation: Sea, Air, Truck, and Rail. But are you aware there are also lesser-known players moving billions in trade value. Pipeline transportation quietly moves oil and gas through pipes, while Inland Water transportation efficiently shifts goods within regions using barges and water vessels. Both are often overlooked.

In today’s email:

  • Growth on Growth: More then 200 logistics & transport companies make 2023 Inc 5000 list

  • Holding On: How the US dollar controls international trade

  • Rice Bans: Which countries are effected most by India’s export bans

GROWING FAST

Logistics Winners

The 2023 Inc. 5000 list, which highlights the fastest-growing companies in America, this year includes over 200 companies from the logistics and transportation sector. These companies were ranked based on their percentage revenue growth from 2019 to 2022. To qualify, businesses had to meet certain criteria:

  • Founded and generating revenue by March 31, 2019.

  • U.S based, privately held for-profit, and independent, not subsidiaries or divisions of other companies as of December 31, 2022.

  • The minimum revenue required for 2019 was $100,000; the minimum for 2022 was $2 million.

To give perspective of the growth of these businesses the top 10 within the “logistics & transport” section reported median growth of 3387%.

Transportation Top 10

Overall the industry participants grew revenue at a median 227% and added a reported 30,000+ jobs to the US economy. To dive into the full list click here. Under the “industry” column select, “logistics & transport.

VIDEO OF THE WEEK

How Global Trade Runs on U.S. Dollars

Roughly 90% of global transactions in 2019 utilized the U.S. dollar as the currency, thereby granting the United States significant influence over virtually all entities engaged in importing or exporting worldwide. This video delves into the mechanics of how the global economy relies on the U.S. dollar and explores the motives of certain nations aiming to diminish its prevailing authority.

TRADE NEWS

Rice Ban Implications

India, the world's largest rice exporter who accounts for 40% of global rice trade, implemented a ban on the exports of non-basmati white rice on July 20, aiming to control surging domestic food prices and ensure sufficient availability at reasonable rates within the country. This move is expected to have a significant impact on global rice markets, affecting millions of consumers, particularly in Asia and Africa.

Among the countries vulnerable to the ban, Malaysia appears to be the most exposed due to its substantial reliance on Indian rice imports. Singapore, though dependent on food imports in general, also heavily relies on India for approximately 30% of its rice supply.

The ban comes amid the ongoing El Nino phenomenon, posing additional risks to rice production in major Asian exporters like Thailand, Pakistan, and Vietnam. The Philippines, despite sourcing most of its rice from Vietnam, could still be highly impacted as rice holds the highest weighting in the country's consumer price index basket.

Beyond Asia, several African and Middle Eastern nations are also at risk. Djibouti, Liberia, Qatar, the Gambia, and Kuwait are identified as the most exposed regions.

In the past, India had imposed a ban on non-basmati rice exports in 2007, resulting in a substantial price increase. This time, the impact could be more far-reaching, given India's larger role in the global rice trade.

It is expected that the ban will remain in effect until India's general elections, which may exacerbate domestic food price concerns. If other rice-exporting countries follow suit with export restrictions and major importers stockpile rice, the rice market could face disruptions and price volatility.

GLOBAL TRADE SNIPPETS

China becomes the largest shipowning nation: In a significant development, China has surpassed Greece as the world's largest shipowning nation in a crucial metric, solidifying its position as a key player in global trade and transportation. 📈 

BRICS’ growing influence: BRICS, representing over 25% of global GDP, is poised to challenge the G7's economic dominance. Over 40 countries are keen to join BRICS, reflecting its growing influence before its annual conference in the coming weeks.

Delays at Panama Canal: Long delays at Panama Canal after drought hits global shipping route. The number of vessels able to pass through each day is limited due to the lower availability of water.

Shifting trade patterns: Mexico and Canada have replaced China as the top providers of goods to the US as a nearshoring push encourages more diversified supply chains. China is now the third-largest provider of merchandise to the US.

Recommended Reads 📖

The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger. Read about the fascinating history of the shipping container and its profound impact on global trade, transforming logistics and revolutionizing the world economy. View Details.

Alibaba's World: How a Remarkable Chinese Company is Changing the Face of Global Business. A captivating insight into the rise of Alibaba, China's e-commerce giant, and its disruptive influence on the global business landscape. View Details.

A Splendid Exchange: How Trade Shaped the World. A captivating insight into the rise of Alibaba, China's e-commerce giant, and its disruptive influence on the global business landscape. View Details.

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