NOW the general public starts to learn and understand what is going on with the supply chain

Jean-Pierre Degembe - NOW the general public starts to learn and understand what is going on with the supply chain.

For all of you that deal with supply chain/procurement/logistics, this is NOT news as for over 1 year now we have to manage a very disturbed global supply chain.
And yes, this is GLOBAL. This has been a perfect storm development and still developing. Last week “NBC Today Morning Show” has done a live report from POLA which is a good summary of the situation in the USA.

Back during the summer, I posted on LinkedIn a note “do your Christmas shopping in July”. 

The number of container ships waiting to enter the biggest U.S. gateway for trade with Asia reached an all-time high of nearly 70 vessels, carrying potential payloads of cargo boxes that would stretch halfway across the country if lined up end to end.

The flotilla, either anchored outside the ports or drifting further offshore until an anchorage spot is available, has a combined capacity to carry nearly 400,000 20-foot equivalent units of containers, according to data from the Marine Exchange of Southern California & Vessel Traffic Service Los Angeles and Long Beach. Both ports have handled a monthly average of about 862,000 inbound containers this year.

According to Hong Kong-based Freightos, an online shipping marketplace, China-to-U.S. transit times for ocean freight reached 71 days door-to-door this month, up from 40 days two years ago.

Bottlenecks are exacerbating capacity constraints in shipping and pushing transpacific freight rates to all-time highs. Shipping a 40-foot container of goods from Shanghai to Los Angeles costs around $20K these days, more than triple the spot price at the start of the year, according to the Drewry World Container Index. 

Freightos, which measures container rates plus premiums and surcharges, shows a 40-foot box soaring past $20,000, compared with less than $4,000 in early 2021. The beneficiaries include A.P. Moller-Maersk A/S, the world’s largest container carrier. Recently the Danish company raised its full-year profit forecast, signaling that consumer demand in Europe and the U.S. will remain at current levels at least through the rest of the year.

And this is only a small part of the puzzle as now we have energy restrictions in China so factories can only operate 3 or 4 days/week. Covid is still very active and numerous lockouts are in place across Southeast Asia. 

So yes, we are going to have to keep managing this mess for quite a while. So do not be surprised if you do not find the products you want in the near future.

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