NPR’s popular Planet Money podcast recently blasted off into orbit with a multi-episode series about the ongoing revolution in data derived from satellites. In Episode 2 of the series titled, “Wait, Why Are We Going To Space?” NPR’s Robert Smith visited Genscape at our headquarters in Louisville, Kentucky, to discover what kinds of market intelligence and economic signals we are distilling from satellite images. Since radio podcasts are inherently audio-only experiences, we here at Genscape are sharing this handy visual companion to all the topics that were referenced in the NPR story.
Satellite imagery enables Genscape to see remote and inaccessible regions of the globe, make quantitative measurements over vast distances, and track changes in commodity supply chains over time. Here are a few examples of the exciting ways we are combining satellite imagery with proprietary data from our privately-owned network of more than 8,000 terrestrial sensors to derive unique insights about the current state and forecasted future of global commodity supply chains.
Satellites & Global Commodity Markets
Satellite imagery enables observation and measurement in locations that are too distant, expensive, or dangerous to install terrestrial sensors or send people. For example, Genscape’s customers are interested in tracking changes in crude oil production rates in countries where production has been impacted by internal conflict and civil war, such as Libya, Nigeria, and South Sudan. Oil production in these African countries is particularly volatile because hundreds of thousands of barrels per day can be instantly impacted by pipeline blockades or oil fields being shut-in or brought back online as the result of geopolitical events. Due to the amount of oil production and the speed at which volatility can impact the supply chain, these events can have significant impacts on the global price of oil. With satellite imagery, we can monitor the African crude oil supply chain remotely for destruction, construction, and even new well drilling and completions for individual oil wells. Genscape is using satellite imagery to collect near-real-time signals about changes in global oil infrastructure and drilling activity, and using that information to forecast Global oil supplies.
Satellite imagery not only allows us to peer into commodity supply chains in remote and inaccessible regions, but it also allows analysts to make quantitative measurements covering large geographic areas. Genscape measures crude oil volumes held in major storage facilities across the globe and provides that information to oil commodity markets. Do not let the images deceive you; the floating roof oil storage tanks truly are massive, and the largest “little marshmallow” in the satellite image of the Cushing, Oklahoma storage hub below is roughly the size of an NFL football field, over 295 feet (90 meters) in diameter.
Satellites & Equities Markets
The newest generation of satellite image providers, such as Planet, capture photos of the entire globe every day and take consistent photos of the same locations every day. Frequent revisit rates for satellite imagery allows analysts to track changes in energy infrastructure and construction activity that can be tied directly to individual publicly tradable companies in equities markets. For example, with the help of satellite imagery and strategically installed terrestrial sensors, Genscape has kept its customers informed of activity at the Tesla Gigafactory in Sparks, Nevada, and the Tesla automobile factory in Fremont, California, and counted production volumes of both lithium ion batteries and electric vehicles during the production ramp-up of the Tesla Model 3.
Satellites & Avocados
Genscape extensively uses satellite imagery to research and understand the supply chain links in new markets to help our customers find the answers they seek. The initial spark for new market intelligence ideas often comes directly from customer suggestions. During his visit to Louisville, NPR’s Robert Smith brainstormed a new idea with us to track the global avocado market to better understand production areas and bottlenecks along the supply chain before the “guacamole pipeline” ultimately arrives in time for the Super Bowl. With the help of the new era in real-time satellite imagery, Genscape could even map out and survey all the major avocado production areas and transportation links across the globe, start forming a plan to monitor critical constraint points and methods to derive quantitative measurements, and build a product that delivers actionable market-relevant insights. No puzzle is too crazy for Genscape to solve.