Stocks, bonds rise with inflation concern fleeting #SootinClaimon.Com

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https://www.nationthailand.com/business/30404864

Stocks, bonds rise with inflation concern fleeting

EconApr 14. 2021

By Syndication Washington Post, Bloomberg · Vildana Hajric, Claire Ballentine

U.S. stocks climbed to record highs and bond yields fell as investors bet that a higher-than-forecast rise in inflation won’t be enough to slow economic stimulus measures.

The S&P 500 closed at an all-time high even after the U.S. recommended pausing Johnson & Johnson vaccines amid health concerns. The tech-heavy Nasdaq 100 also set a record while the Dow Jones Industrial Average finished in the red. Consumer prices rose more than expected last month but investors speculated the acceleration was not fast enough to warrant any Federal Reserve policy change. The drop in yields weighed on bank shares.

“The market has been skittish about rates for some time,” said Mike Loewengart, managing director of investment strategy at E*Trade Financial. “While this may cause some short-term volatility, investors have been pretty steadfast in their faith in a full economic recovery.”

J&J shares fell as officials agreed to the pause and started an investigation into a link from its shot to rare and severe blood clots, while rivals Moderna and Pfizer advanced. The U.S. anticipates having enough other vaccines during the period.

Fund managers across the world now see inflation, a taper tantrum and higher taxes as bigger risks than covid-19, according to the latest Bank of America survey.

“A lot of growth and inflation have already been priced into the market,” said Emily Roland, co-chief investment strategist at John Hancock Investment Management. “It’s almost as if you need to exceed those expectations in order to see a more pronounced reaction from markets.”

Although policymakers at the Federal Reserve expect a bump in consumer prices to be short-lived, many traders disagree, with fears of faster CPI playing out across duration-heavy assets from bonds to tech stocks.

Treasuries extended gains after the government’s auction of 30-year bonds was greeted with strong demand.

Meanwhile, Bitcoin jumped to an all-time high as the mood in cryptocurrencies turned bullish before Coinbase Global Inc. goes public. Oil traded near $60 a barrel.

These are some of the main moves in financial markets:

Stocks

– The S&P 500 Index increased 0.5% to 4,141.67 as of 4:02 p.m. New York time, the highest on record.

– The Dow Jones Industrial Average was little changed at 33,678.78.

– The Nasdaq 100 Index advanced 1.2% to 13,986.50, the highest on record with the largest gain in a week.

– The Nasdaq Composite Index advanced 1.1% to 13,996.10, the highest in almost eight weeks on the biggest gain in a week.

– The Stoxx Europe 600 Index climbed 0.1% to 435.75.

Currencies

– The Bloomberg Dollar Spot Index dipped 0.2% to 1,139.10, the lowest in three weeks.

– The euro gained 0.3% to $1.1952, the strongest in almost four weeks.

– The British pound advanced 0.1% to $1.3753.

– The Japanese yen appreciated 0.3% to 109.06 per dollar, the strongest in almost three weeks.

Bonds

– The yield on two-year Treasuries decreased one basis point to 0.16%.

– The yield on 10-year Treasuries sank four basis points to 1.62%.

– The yield on 30-year Treasuries declined three basis points to 2.30%.

– Germany’s 10-year yield advanced less than one basis point to -0.29%, the highest in almost two weeks.

– Britain’s 10-year yield dipped one basis point to 0.779%.

Commodities

– West Texas Intermediate crude climbed 1.1% to $60.40 a barrel, the highest in more than a week.

– Gold strengthened 0.8% to $1,744.98 an ounce.

Bitcoin rallies to all-time high as traders eye Coinbase listing #SootinClaimon.Com

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https://www.nationthailand.com/business/30404863

Bitcoin rallies to all-time high as traders eye Coinbase listing

EconApr 14. 2021

By Syndication Washington Post, Bloomberg · Eric Lam, Yakob Peterseil

Bitcoin jumped to an all-time high as the mood in cryptocurrencies turned bullish ahead of Coinbase Global’s listing this week.

The token rose as much as 5.3% to $63,179, exceeding the previous peak in March. Cryptocurrency-exposed stocks such as Riot Blockchain and Marathon Digital Holdings also advanced in U.S. premarket trading.

Crypto bulls are out in force as growing list of companies embrace Bitcoin, even as skeptics doubt the durability of the boom. In one of the most potent signs of Wall Street’s growing acceptance of cryptocurrencies, Coinbase will list on the Nasdaq on April 14 at a valuation of about $100 billion.

Coinbase’s debut “will mark the first official juncture between the traditional financial avenue and the alternative crypto path,” Ipek Ozkardeskaya, a senior analyst at Swissquote, wrote in a note. “As such, a successful addition to Nasdaq should act as endorsement of cryptocurrencies by traditional investors.”

Goldman Sachs Group and Morgan Stanley have announced plans to offer their clients access to crypto investments. Tesla earlier this year disclosed a $1.5 billion investment in Bitcoin and more recently started accepting it as payment for electric cars.

Still, skeptics argue that digital coins have been inflated by stimulus that’s also sent stocks to records. Regulators around the world are stepping up oversight and casting doubt on its usefulness as a currency.

Isabel Schnabel, member of the executive board of the European Central Bank, called Bitcoin “a speculative asset without any recognizable fundamental value” in an interview with Der Spiegel this month.

Coinbase’s public debut this week is also boosting the digital coins of other cryptocurrency exchanges, such as Binance Coin, which has jumped to become the third-most valuable cryptocurrency behind Bitcoin and Ether.

Fed is taking on a racist legacy in the field of economics #SootinClaimon.Com

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https://www.nationthailand.com/business/30404862

Fed is taking on a racist legacy in the field of economics

EconApr 14. 2021A vehicle passes the Marriner S. Eccles Federal Reserve building in Washington, D.C. MUST CREDIT: Bloomberg photo by Stefani ReynoldsA vehicle passes the Marriner S. Eccles Federal Reserve building in Washington, D.C. MUST CREDIT: Bloomberg photo by Stefani Reynolds

By Syndication Washington Post, Bloomberg · Catarina Saraiva

As the pandemic slammed the Black community and amplified the conversation around racism in America, the economics profession grappled with an uncomfortable truth: that its historical roots and practices today are mired in systemic racial bias.

Last summer, the shock of George Floyd’s death and other instances of police brutality ignited a national debate about inequality. Topics like the racial wealth gap became part of everyday discourse.

But at the heart of the problem is not just the prosperity separating White Americans from minorities — often the Black Americans whose ancestors helped build the economy through enslaved labor — but also that the very discipline that is a key conduit for improvement remains rife with racial bias.

“My view of how economics has to inherently address structural racism starts with economics recognizing the role of institutions and power and politics in shaping economic outcomes,” said Joelle Gamble, special assistant to President Joe Biden for economic policy. “We are trying to practice this differently and say ‘how are we actually driving towards economic growth in a way that is helping more and more people who have been permanently left out?'”

Part of the challenge is that few Black Americans have joined the profession: Just 13 received a doctorate in economics in 2019 among the 464 awarded to U.S. citizens, according to a report published in December by the American Economic Association. Of those, four were Black women.

In a sign of the heightened focus on the issue at the highest ranks in the field, the Federal Reserve — the nation’s foremost economic institution and the largest employer of doctorate-level economists — is hosting a conference on racism in economics on Tuesday.

Two weeks after Floyd’s death, economist William Spriggs published an open letter to his peers, explaining how many economists perpetuate inequality by ignoring race, and the impact of racism, in their research. Spriggs, a professor of economics at the historically Black Howard University and the chief economist of the AFL-CIO labor federation, will participate in the Fed’s Tuesday conference.

The U.S. economy’s problems today are monumental. Some 22 million jobs were lost at the onset of the pandemic, and while a good amount of them have been recovered, the Black unemployment rate remains at 9.6%, almost double the White rate.

Undoing a crisis whose burden has fallen heaviest on minorities while striving for a more equal economy — as Biden has said he wants to do — will be challenging and will likely require new ideas.

Modern-day economics in America was founded in the Progressive Era — a period at the turn of the 20th century that overhauled the role of government in public life, according to Thomas Leonard, an economist and historian at Princeton University. Progressive lawmakers created the administrative state we know today, including the Fed, the Department of Labor, and other institutions that shape the economy through policy and regulation.

This was a time in U.S. history, some 30 years after the end of the Civil War, when racism and eugenics were commonplace.

Many of the earliest economists, including Irving Fisher, one of the most celebrated of the profession, were staunchly racist and backers of eugenics, the theory that some races are superior to others.

“They not only founded economics as a professional, scientific discipline, they founded it as an academic discipline and they made it a politically influential discipline,” Leonard said. “They kind of invented this idea of the economist as a scientific expert who advises governments, politicians, regulators, on what to do.”

But Leonard says the economics profession has made a lot of progress in the past century. While outright racism might no longer be acceptable, and eugenics has been completely discredited, some say economics retains subtler, yet acute biases.

At the root of many economists’ issues with the failures of modern-day economics is the profession’s sometimes fervent reliance on neoclassical theory. Neoclassical economics was established by Progressive-Era economists and asserts that supply and demand are the driving forces behind things like the pricing of goods.

So when looking at something like the racial income gap — in America, Black workers make 60% of their White counterparts’ wages — a strict adherent to neoclassical theory might blame the gap on things like disparate education or skills levels, ignoring the impact of race-based discrimination, according to Nina Banks, an associate professor of economics at Bucknell University.

– – –

“The empirical research that demonstrates that racial and ethnic discrimination explains economic outcomes is often overlooked or dismissed within the profession,” Banks said. “Even when we have a profession that is more inclusive of historically excluded groups, it’s not going to resolve the problem of racial biases in economics because the problems of racial bias, those problems are really embedded within our economic theory.”

Banks calls stratification economics, which explores inequality by how different groups experience things, one of the most important developments in economics in the past few decades.

Jala Abner, a research assistant at the Chicago Fed, is one of the newer entrants to the field.

“As a Black woman I always wondered why there were these differences, and can we necessarily pinpoint the intersections of someone’s identity for the reason why they have lower wealth, lower income, things like that,” Abner said. “Just to see that there’s proof within these data sets that there’s something clearly wrong. It just reaffirms that we have a lot more work to do in general, whether it’s the Fed or society as a whole.”

Abner graduated from Spelman University last year with a Bachelor’s degree in economics. She is considering pursuing a graduate degree in the discipline and may focus her research in stratification economics.

Abner is among the few Black economists within the Federal Reserve system. The Board of Governors in Washington, which employs about 400 doctorate-level economists (the 12 reserve banks together employ another 400 or so) had just two Black PhD holders at the end of last year.

While the Biden administration has put Black women in some of the most prominent economic positions — Cecilia Rouse heads the Council of Economic Advisers and Janelle Jones is the chief economist at the Labor Department — the profession overall is still starkly male and White.

Other science professions do slightly better. About 4% of doctorate degrees given in science, technology, engineering and math subjects went to Black Americans, who make up about 13% of the U.S. population. About 11.7% went to minorities overall.

The Fed has been trying to alter this for the past few years. The Board has changed hiring practices so that interviewers ask job candidates a standard set of questions and evaluate them based on specific criteria. It is working with historically Black colleges and universities to recruit more of their graduates, and created a program at Howard University in 2016 where Fed economists teach students.

To try and improve the pipeline of diverse students into economics, the Fed also sends economists to high schools to give presentations about the discipline and brings students to the Board in Washington to meet with the governors.

Beyond its work to improve diversity within its own ranks, the Fed last year changed the strategy behind how it carries out monetary policy. It will now seek to limit shortfalls from maximum employment, defined as a “broad-based and inclusive goal.” That means it won’t raise rates preemptively to head off inflation as unemployment falls, bringing more people from marginalized communities into the workforce.

SET dives 1.6% as fresh outbreak hits Thai stocks #SootinClaimon.Com

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https://www.nationthailand.com/business/30404816

SET dives 1.6% as fresh outbreak hits Thai stocks

EconApr 12. 2021

By The Nation

The Stock Exchange of Thailand (SET) Index closed at 1,541.12 on Monday, down 25.22 points or 1.61 per cent. Total transactions amounted to Bt78 billion with an index high of 1,562.07 and a low of 1,539.24.

In the morning session, Krungsri Securities forecast the day’s index would fall to between 1,555 and 1,560 points after Thailand’s daily Covid-19 count rose by almost 1,000 cases on Sunday, triggering uncertainty over the economic recovery, especially in tourism.

“Also, finance-related stocks will be under pressure due to negative news on the interest rate adjustment and calculation method, while investors will sell stocks to reduce risk over the Songkran holiday,” said a Krungsri Securities analyst.

The 10 stocks with the highest trade value today were KBANK, CPALL, BDMS, STGT, DELTA, SAWAD, BBL, BCH, PTT and AOT.

Other Asian indices were mixed:

Japan’s Nikkei Index closed at 29,538.73, down 229.33 points or 0.77 per cent.

China’s Shang Hai SE Composite Index closed at 3,412.95, down 37.73 points or 1.09 per cent, while Shenzhen SE Component Index closed at 13,495.72, down 317.59 points or 2.30 per cent.

Hong Kong’s Hang Seng Index closed at 28,453.28, down 245.52 points or 0.86 per cent.

South Korea’s KOSPI closed at 3,135.59, up 3.71 points or 0.12 per cent.

Taiwan’s TAIEX Index closed at 16,859.70, up 5.60 points or 0.033 per cent.

The forgotten shipping pallet is staging a pandemic-era rally #SootinClaimon.Com

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https://www.nationthailand.com/business/30404788

The forgotten shipping pallet is staging a pandemic-era rally

Biz insightsApr 12. 2021An employee uses a forklift truck to move a stack of heat treated wooden pallets at Shaw Pallet in Huddersfield, England, on Aug. 25, 2020. MUST CREDIT: Bloomberg photo by Chris Ratcliffe.An employee uses a forklift truck to move a stack of heat treated wooden pallets at Shaw Pallet in Huddersfield, England, on Aug. 25, 2020. MUST CREDIT: Bloomberg photo by Chris Ratcliffe.

By Syndication Washington Post, Bloomberg · Brendan Murray

After carrying the weight of the global economy since World War II with little fanfare, the lowly shipping pallet is finally commanding some respect.

Demand for the platforms used to haul nearly every consumer good or industrial ingredient is soaring amid a surge in e-commerce, forcing retailers and manufacturers to expand warehouses or pile inventories higher. At the same time, two keys to production — cheap lumber and labor — are scarce, and even nail costs are rising.

The result: Pallet prices have hit record highs, according to a U.S. Labor Department index, and European gauges show big jumps from the U.K. to Germany. The market may stay hot through the peak construction season in the springtime and as Covid-19 vaccines help revive restaurants and event venues — adding to inflationary pressures rippling across supply chains.

“Supply is just barely keeping up with demand,” said Howe Wallace, chairman and CEO of PalletOne Inc., a Bartow, Florida-based producer with facilities across the Southeast. “It’s a pretty dicey situation.”

At Virginia Tech’s Center for Packaging and Unit Load Design, the nation’s foremost pallet laboratory, “the companies we work with, every single one of them, said they’ve had their best year,” said Associate Professor Laszlo Horvath, the center’s director.

Pallets serve as the base of a so-called unit load, a standard way to ship products so they’re easy to move with forklifts and jacks. They are generally bought or leased by product makers and get baked into transport packaging costs. When a retailer or other end user is finished with pallets, recycling companies collect, repair and resell them. Some industries like bottling companies manage their own pallet pools.

There are roughly 5 billion pallets in use worldwide, and an estimated 2 billion in the U.S. alone — enough to go two-thirds of the way to the Moon if stacked on top of each other. About 90% are wooden and the rest are made of plastic, metal or cardboard. Each year, some 513 million new wood ones are built in the U.S. and another 326 million are repaired and put back in circulation, according to Horvath.

Depending on the region, the usual price tag of $9 to $12 per wooden pallet may approach $15 this year.

“New pallets, used pallets, rental pallets — they’re all raising their prices,” said Chaille Brindley, editor and publisher of Pallet Enterprise magazine and Pallet Profile, a market report.

Pallets are made with a lower grade of hardwood and softwood than the timber used for construction and furniture. In the mid-Atlantic region, the price of pallet-grade hardwood rose to $635 per 1,000 board feet in March from $530 a year earlier, and a Southern California softwood more than doubled, to $520. Meanwhile, nail prices gained between November and March along with a 36% jump in the cost of wire rod, Brindley said.

Adding to the squeeze is a dearth of workers willing to do the tough job of constructing pallets. “The market’s right for a second shift, but there are no people to add a second shift,” Wallace said.

Such strains would seem to provide an opening for plastic pallets, which are lighter, built to last longer, easier to sanitize, and pose fewer hazards like splinters and protruding nails. The downside to plastic pallets: They’re about three times more expensive, meaning a shift from wood to plastic turns what most companies view as throw-away packaging into pricey assets that need to be managed.

Before the pandemic, the overall pallet market was growing at about 5% to 7% annually.

“After the pandemic we believe that’s even higher,” said Jeff Pepperworth, CEO of Orlando, Florida-based iGPS Logistics, the U.S.’s largest plastic-pallet pooler. “We are seeing, especially in the plastic-pallet space, there’s more demand than there is supply.”

Pepperworth said the shift to robotics and artificial intelligence in warehouses and distribution centers favors pallets with more consistent dimensions and tracking technology — top selling points of plastic.

“In the past, automation looked at the pallet as the dumbest asset in the process,” he said. “In the future, the pallet is going to be the smartest asset in the process.”

The wood-pallet lobby has heard such arguments before about their venerable product. “Companies will always look to build a better mousetrap,” said Brent McClendon, president and CEO of the Alexandria, Virginia-based National Wooden Pallet & Container Association. “They keep coming back to wood.”

With lumber prices so high, the logistics world is intrigued by a pilot program this year using plastic pallets by Costco Wholesale Corp., the Issaquah, Washington-based chain of warehouse stores where pallets are fixtures on the sales floor. In an email reply to questions about the trial run, Costco Chief Financial Officer Richard Galanti said “we wouldn’t have any comments.”

The leasing company working with Costco is CHEP, a unit of Sydney-based Brambles Ltd. that traces its history back to Australia’s role in the Second World War.

Brambles CEO Graham Chipchase indicated on a conference call in February that CHEP — known for its pool of bright-blue wooden pallets — is proceeding cautiously into the plastic variety so it doesn’t weaken the wood business.

“Because plastic pallets are so much more expensive than wooden ones, we feel that if this is a solution for Costco, we don’t think it’s likely to spread across the whole system quickly because of the price premium,” Chipchase said.

Marshall White, a Virginia Tech professor emeritus and a developer of pallet-design software, said it’s reasonable to expect plastic could reach 10% of the market over the long term, from about 5% to 6% now.

“Wood pallets will continue to dominate, until the time that we find the physics to dematerialize toilet paper at Procter & Gamble and rematerialize it in my house with some magic device,” he said.

SET hit by negative sentiment as new Covid-19 cases soar #SootinClaimon.Com

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https://www.nationthailand.com/business/30404805

SET hit by negative sentiment as new Covid-19 cases soar

EconApr 12. 2021

By The Nation

The Stock Exchange of Thailand (SET) Index fell by 7.83 points, or 0.50 per cent, to 1,558.51 in the morning session on Monday.

A Krungsri Securities analyst forecast that the SET would fall to between 1,555 and 1,560 points after Covid-19 cases in Thailand rose by almost 1,000 cases on Sunday, resulting in uncertainty over the country’s economic recovery, especially that of the tourism sector.

“Besides, stocks related to finance would be under pressure due to the negative news of interest rate adjustment and calculation method, while investors would sell their stocks to prevent risks during the Songkran holidays,” he said.

He suggested that investors buy:

▪︎ TQM, STGT, COM7, SYNEX, BDMS, BCH, CHG and BH, which benefit from the Covid-19 outbreak.

▪︎ HANA, KCE, TU, and CPF, which benefit from the weakening baht.

The SET Index closed at 1,566.34 on Friday, up 7.51 points or 0.48 per cent. The volume of total transactions was Bt82 billion with an index high of 1,572.13 and a low of 1,561.76.

Gold stays steady despite decline in spot price #SootinClaimon.Com

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https://www.nationthailand.com/business/30404801

Gold stays steady despite decline in spot price

EconApr 12. 2021

By The Nation

The price of gold was unchanged in morning trade on Monday from Saturday’s close, the Gold Traders Association reported.

As of 9.26am, the buying price of a gold bar was Bt25,850 per baht weight and selling price Bt25,950, while gold ornaments were priced at Bt25,337.84 and Bt26,450, respectively. The price had risen by Bt400 per baht weight last week.

Spot gold price on Friday dropped by $13.4 to $1,744.8 (Bt55,035) per ounce due to the strengthening dollar, rising US bond yield and strong economic data.

Hong Kong gold price dropped by HK$30 to $16,160 (Bt65,528) per tael, the Chinese Gold and Silver Exchange Society reported.

Reopening economy too quickly could cause new coronavirus spike, Powell says #SootinClaimon.Com

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https://www.nationthailand.com/business/30404786

Reopening economy too quickly could cause new coronavirus spike, Powell says

EconApr 12. 2021

By The Washington Post · Rachel Siegel

Federal Reserve Chair Jerome Powell warned in an interview broadcast Sunday that reopening the economy too quickly could lead to another worrisome jump in coronavirus cases, saying that the United States has not completely turned the corner and that the pandemic continues to pose major risks to any recovery.

Powell, speaking in a “60 Minutes” interview, also said that the coronavirus pandemic had exacerbated economic disparities in the United States and that this could take time to address during an uneven recovery.

In the interview, Powell described an economy that was at “an inflection point,” showing signs of acceleration but still facing numerous risks. By many measures, the economy is rebounding strongly, with the hopes that increased vaccinations and recent stimulus packages charting a year of strong growth. The Dow Jones industrial average is at record levels, and more than 900,000 jobs were added last month.

Yet at the same time, coronavirus cases are rising. And with at least 8.5 million Americans still out of the workforce, the scars of long-term unemployment, especially for workers of color and women, compound by the day.

“There really are risks out there,” Powell told CBS News’ Scott Pelley. “And the principal one just is that we will reopen too quickly, people will too quickly return to their old practices, and we’ll see another spike in cases.”

Powell said previous waves of coronavirus cases hampered the recovery, and he urged caution as people get vaccinated and attempt to return to their normal routines.

He said the central bank was watching all these economic forces closely as it maps its path forward.

When it comes to monetary policy, the Fed has signaled that it will not raise interest rates from near zero until it sees substantial progress in the labor market. It could come under pressure from Wall Street and lawmakers to reconsider its stance if inflation picks up and the expected economic rebound gains steam.

But Powell said the Fed should not pare back its support for the economy based on inflation expectations. The unemployment rate for the bottom 25% of wage earners is about 20%. Many low-wage service-sector jobs disproportionately employed women and people of color. Those jobs could be some of the last to return because they depend heavily on person-to-person contact.

Then there is the challenge of whether many jobs that vanished in 2020 will return at all. Powell said the “economy that we’re going back to is going to be different from the one that we had,” making it harder for people to regain a foothold in the labor force.

“I think we need to keep in mind, we’re not going to forget those people who were left on the beach really without jobs as this expansion continues,” Powell said. “We’re going to continue to support the economy until recovery is really complete.”

The economy is a long way from healed. But Powell said the depths of the recession could have been much worse. He credited Congress’s swift action through the Cares Act as being “a big feature of the landscape when people look back.”

Powell declined to answer whether he’d push for another round of stimulus. Last month, President Joe Biden signed a massive $1.9 trillion coronavirus spending plan. The administration now has its eyes on a major jobs and infrastructure package.

Powell also would not say whether corporate and personal tax increases would slow growth. The White House is proposing tax increases could pay for much of its next legislative push.

The Fed chair, whose term expires next year, also declined to say whether he’d want to be reappointed. The central bank has one open seat on its board of governors, and the Biden White House could have major influence on the makeup of the central bank over the next four years.

For now, Powell’s message was one of growing optimism, without losing sight of how far there is still to go.

“We’ve got to remember there’s in the range of 10 million people who were working in February of 2020 and lost their jobs because of covid-19,” Powell said. “And they’re still not working. So, for them, it’s not over. And we’re going to keep those people in mind.”

Coping with corporate challenges amid uncertainties #SootinClaimon.Com

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https://www.nationthailand.com/biz-moves/30404780

Coping with corporate challenges amid uncertainties

Apr 11. 2021

By THE NATION

Krungsri has launched “The Change Master”, a television programme, to cope with disruption and uncertainty.

The initiative under Krungsri Business Empowerment aims to provide knowledge, perspectives, and inspiration to entrepreneurs, and airs on Business Watch, TNN 16 Channel, this month.

Krungsri collaborated with four CEOs from four leading Thai organisations to share their experiences in leadership during a crisis in order to empower customers and entrepreneurs to make a change, welcome disruption and uncertainty.

Each of the four leaders gave important lessons on how to “manage business durinv uncertainty”.

Prasit Boondoungprasert, chief executive officer of Charoen Pokphand Foods Pcl, suggested that “in crisis, we must shift to high-speed mode; otherwise problems will not be fixed in time”. What is a high-speed way of operation?

“The end game must be set, we have to ask, if we want to achieve this kind of success, which direction we should take and how to solve problems. Moreover, frontline workers must be given more authority to make decisions, and the steps in approval process must be reduced to enable prompt response to customers,” he said.

“We are also trying to look for opportunities, for example, during the Covid-19 situation, we visited our export partner countries to see how they were affected.

What happened was we had the opportunity to export thousands of tons of chicken meat to Singapore, which led to a bigger project that would help the supply chain in Singapore by providing food safety.

“CP’s plant in Wuhan was chosen by the government to be the sole food supplier for the province, leading to learning and acquisition of logistics knowledge.

“The situation also caused employees of all generations to adapt to IT, resulting in faster operations, decrease in expenditure, use of AI in connection with production process, eg, voice technology in pork quality checking and camera-based chicken weighing system.

“The idea was that everyone should select technologies and approaches suitable for each of their business.

Adopting ‘circular economy’ will make Thai energy firms more sustainable: PwC #SootinClaimon.Com

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https://www.nationthailand.com/business/30404714

Adopting ‘circular economy’ will make Thai energy firms more sustainable: PwC

Biz insightsApr 10. 2021Amornrat PearmpoonvatanasukAmornrat Pearmpoonvatanasuk

By The Nation (sponsored news)

Thai energy firms should transition to a “circular economy” to address the adverse impact of non-renewable resources and join the global race to end emissions, audit company PwC Thailand said recently.

Companies should also start trading in carbon credits, which would generate millions of baht in income yearly, especially since the Covid-19 pandemic is cutting down carbon emissions and diminishing demand for fossil fuels.

Amornrat Pearmpoonvatanasuk, energy leader and assurance partner for PwC Thailand, said energy firms across the world, including those in Thailand, are facing mounting challenges when it comes to addressing climate change in the wake of Covid-19.

The pandemic has brought attention to the need to reduce greenhouse gas (GHG) emissions, resulting in a change in product demand, market characteristics and business models. A growing list of governments and corporations have committed to tackling climate change through achieving net-zero carbon dioxide (CO2) emissions by 2050.

“A global movement to achieve a net-zero future by replacing fossil fuels – the major contributors to global warming such as oil, natural gas and coal – with renewable energy sources will lead to shrinking demand of these markets. Business leaders will increasingly transition out of traditional business models to a circular economy prioritising renewables and low-carbon energy sources that have less impact on the environment.

“Against this backdrop, we expect more oil giants and other energy businesses to profoundly shift the way they do business to boost competitiveness and efficiency, including offsetting the risk from a fall of non-renewables demand globally,” Amornrat said.

Recently major economies such as China, the US, Japan and South Korea set targets to achieve net-zero emissions by 2050. The European Commission also unveiled the European Green Deal, a roadmap for Europe to become a climate-neutral continent by mid-century.

More than 400 leading organisations, including PwC, have signed the United Nations Global Impact’s “Business Ambition for 1.5°C” commitment to limit the rise in average global temperature to 1.5°C and reduce net-zero global emissions by 2050.

Circular economy in energy, utilities and resources industry

Growing concerns over climate change will likely accelerate a transition to a circular-economy model aimed at recycling renewables to ensure maximum benefits and release zero or the least-possible waste across all industries, Amonrat said.

This shift will transform business models by using integrated technology to add value to an organisation’s supply chain, from production systems and raw material management to applying renewable energy and resources principles to expand new markets such as producing green hydrogen from waste.

Companies in the energy sector have a crucial role in the development of a circular economy, according to PwC’s “Taking on Tomorrow: The Rise of Circularity in Energy, Utilities and Resources” report. There are six steps companies can take to build a more sustainable future, namely:

• Mapping out circular opportunities

• Being clear about strategy and vision

• Planning your circular transformation route

• Developing circular collaborations and frameworks

• Measuring, reviewing and communicating progress

• Making moves before competitors, customers and regulators do.

Thailand’s commitment to the Paris Agreement to reduce GHG emissions by 20 to 25 per cent by 2030 in the area of energy, transport, industrial processes and waste management has prompted Thai energy, utilities and resources companies to shift their business models towards clean energy to ensure their financial performance is sustainable, Amornrat said.

Such efforts also help win trust from clients, communities, investors and stakeholders who increasingly pay more attention to environmental, social and governance (ESG) reporting, she continued.

Another option for the sector to reduce GHG emissions is through trading carbon credits. This tool is increasingly becoming popular overseas, where regulatory allowances for emissions can be bought or sold, she said. A few Thai energy companies generated up to Bt10 million per year from selling carbon credits to other companies, Amornrat added.

Combining this approach with the transition toward renewable energy would add value to business operations and create new revenue streams.

“Energy businesses should revisit their business and cost structures in the aftermath of Covid-19.

“This includes rethinking how to make the most of available natural resources and using this crisis as an opportunity to do more socially responsible business in order to build long-term sustainability and competitiveness,” she said.