Transportation Costs Amplify Market Conditions

While many people are getting ready to hit the road for the holiday weekend, it seems fitting to end my month of pricing blogs with an early post containing a word or two on transportation costs. For the past couple of weeks I have blogged about how commodity pricing and supply shortages have led Personal Protective Equipment (PPE) manufacturers to announce price increases. It seems that every year for the past few years around the unofficial start of the summer season Americans have grappled with rising prices at the pump. This year is no different, as skyrocketing fuel costs have affected everything from air freight to ground delivery to the point where some manufacturers have begun to levy fuel surcharges. At this time, these added fees have not directly affected the cost of Arbill's safety products. We will monitor the situation closely, as always, in an effort to continue to provide our customers with the highest quality and value across the whole spectrum of Arbill's safety solutions. Have a great holiday weekend and drive safely!

Leather & Nitrile Also Rising

Last week I blogged about cotton and latex, two key commodities used in Personal Protective Equipment (PPE) manufacturing. Leather and nitrile are two more commodities on which the safety industry relies, and the pricing of each is also on the rise. The short explanation for rising leather prices is a shortage of raw materials (hides). More specifically:

• Cattle populations in South America are down due to a drop in demand for the past two years during which farmers found it more profitable to raise crops versus cattle
• Although cattle herd production picked up when demand did late last year, current populations cannot support today's demand, and it will likely be two to three years until the market catches up

As far as nitrile is concerned, I addressed this raw material back in my April 12 blog and what I foretold is coming to pass. Nitrile is in short supply, and therefore many of our thin-walled safety glove manufacturers have announced price increases. As always, the Arbill Operations team is monitoring the commodities markets and is committed to sourcing high-quality products at the best value, as well as ensuring that our customers do not experience any supply interruptions.

Cotton and Latex Prices Rise, Manufacturers Follow

Almost daily, we can read news headlines and price indices that show increasing commodity prices. These levels are well beyond the initial 2011 expectations. Raw materials, such as cotton and latex have been particularly hard hit. The U.S. cotton projections for 2011/2012 include lower supplies relative to last season therefore the forecast range for the average price received by producers is a record 95.0 to 115.0 cents per pound. World cotton projections show a sharp increase in production, mainly reflecting higher import demand by China. Latex prices have risen more than 8% since the beginning of 2011, and continue to fluctuate with predictions that they still have not peaked. These market dynamics have resulted in all major PPE manufacturers announcing price increases for the second time this year with most not guaranteeing pricing beyond a three-month horizon. Arbill understands the impact that cost increases can place on your business and we will continue to drive initiatives that focus on cost reduction reduction opportunities while keeping your employees safe. I will continue to update you on the commodities markets and how is is affecting the safety supply chain for the remainder of the month of May.

Now Available: Easy Reference Guide to Chemical Hazards

I recently became aware that the National Institute for Occupational Safety and Health (NIOSH) has made its popular Pocket Guide to Chemical Hazards available for download with the ability to create a disc with CD-ROM software. The Pocket Guide is intended as a source of general industrial hygiene information for workers, employers, and occupational health professionals, to assist them in recognizing and controlling occupational chemical hazards.

The 677 chemicals or substance groupings that are contained in the guide include all substances for which NIOSH has Recommended Exposure Limits (RELs) as well as those with Permissible Exposure Limits (PELs) as defined in the OSHA General Industry Air Contaminants Standard (29 CFR 1910.1000). Information covered in the guide includes chemical name and structure, Chemical Abstracts Service (CAS) registry number, Registry of Toxic Effects of Chemical Substances (RTECS) number, U.S. Department of Transportation (DOT) identification and guide numbers, and synonyms and trade names for each chemical compound. All of this information is listed in an abbreviated tabular form, making the guide very user friendly.

You can access the guide at http://www.cdc.gov/niosh/npg, or download the NIOSH Guide to Chemical Hazards zip file, which contains a condensed version of the pocket guide at http://www.cdc.gov/niosh/docs/2010-168c/. This is a great, free tool for every worker to have.

Create A Visual Workplace

Consider your garage or storage area. I am sure that you've noticed that when your tools, equipment, and miscellaneous boxes are visually organized that there is a) a much greater chance that you will be able to complete tasks and find stored materials in an expedient manner, and b) much less of a chance that you are going to trip over something in the process. The same idea can be applied to the workplace to help keep people safe. We call this "creating a visual workplace" by employing the following 5Ss:

• Sort (organization)
• Set in order (orderliness)
  
• Shine (cleanliness)
• Standardize (standardized cleanup)
• Sustain (sustaining the discipline)

Organize the workplace for success and safety, visually identify processes and expectations, and develop an intuitive workplace that is clean, well-organized, and efficient, all of which leads to improved workplace safety. Your workers are worth it!