Supply chain disruptions can be expected for the next two years at least, DP World Chairman and CEO Sultan Ahmed Bin Sulayem said in media interviews during the opening of the Dubai Expo 2020.
“The global supply chain was in crisis in the beginning of the pandemic.
“Maybe in 2023 we’ll see an easing.”
His is the latest in a series of warnings about continued disruptions.
In an open letter to governments around the world, the International Chamber of Shipping warns that “we are witnessing unprecedented disruptions and global delays and shortages of essential goods including electronics, food, fuel and medical supplies.
“Consumer demand is rising and the delays look set to worsen ahead of Christmas and continue into 2022.
“It is of great concern that we are also seeing shortages of workers and expect more to leave our industries as a result of the poor treatment they have faced during the pandemic, putting the supply chain under greater threat,” the letter warns.
It says that traffic-jams at major United States ports, which serve as the main entry point for cargo coming from China, “have reached their longest since the start of the pandemic and have steadily worsened over the past two months”.
A.P. Moller-Maersk, the world’s largest shipping line, has also warned of ongoing disruptions.
In its Interim Report for the second quarter of 2021, the company states “the outlook beyond the next couple of quarters is unusually uncertain given the dislocation in demand and supply sides of logistics industries.
“On the demand side, high household savings in the USA and Europe should support consumer demand, but the composition of spending is likely to rebalance towards services, and sharply rising prices for some goods may lead consumers to adjust their spending plans. “At the same time, inventory replenishment will support goods trade through end-2021 at least, and the channel shift to e-commerce is likely to keep pressure on outbound logistics capacity.
“On the supply side, supplier delivery times remain lengthy, and there is little visibility into when equipment shortages and capacity constraints will abate, which has been the key driver for the increase in short-term freight rates.”
In August, Denys Hobson of Investec warned that the global supply chain disruptions would persist into 2022 and could impact on Christmas freight and sales volumes.
“It appears to be a never-ending story when it comes to importing cargo with multiple disruptions. The only constant is the anticipation of what will be the next major setback to an already severely constrained sea freight market.
“Every trade route has its challenges and the uncertainty in terms of when shipments will depart and arrive keeps growing. Port congestion continues to hamper carriers’ efforts to reposition equipment and adhere to routings and sailing schedules.
“Capacity is negatively comprised and as we enter the peak shipping period the overall impact is compounded, creating a snowball effect across global supply chains. Longer lead times and increasing rates will remain a common theme and importers need to factor this into their business planning,” he wrote.
