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Disruption in the seas-Chaos Strikes Global Shipping

March 11, 2021
The pandemic has toppled global shipping and is shaking all freight transport modes, from trucking to air cargo. Off the coast of Los Angeles, containers pile up with exercise equipment and electronics while containers carrying masks to Africa and South America are uncollected because shipping carriers are concentrating on their vessels most popular routes linking North American and Europe to Asia.

Western importers fail to pick up containers when they arrive at the ports causing congestion and inland supply shortages. The apparel and automotive importers are delaying production lines and receiving goods for the brick-n-mortar stores that are closed while protective equipment and household goods are being wanted faster by importers. Goods from factories in China meeting consumer orders from home during the pandemic have now these goods stacking up in vessels and are immovable. There is a big shortage in containers now and so container arrivals just pile up at the ports. Import volumes from Asia remain strong and the tight capacity have forced perishable food importers and exporters to compete with dry goods shippers for space and equipment.

U.S. soybean exporters are facing their most logistically challenging summer due to an unprecedented backlog of soybeans purchased by China that still needs to be shipped. Higher costs for transporting American grain and soybeans across the Pacific threaten to increase food prices in Asia.

In China, factories are dealing with mass market home furnishing orders that are piled up with schedules to ship at the end of March to October 2021. They do not lack orders now but instead have problems with shipment delays, lack of labor, and rising cost on materials. Containers are still stuck in floating traffic jams and there is no other place to unload them.

In Australia and New Zealand empty containers pile up at their ports and India’s Kolkata port is out of containers and is finding container supply miles away at another port in the West.

Thailand, Vietnam, and Cambodia rice exporters are forgoing shipments to the USA because they could not get a hold of containers. China factories make the containers and all of them are still trying to catch up with demand.

Head of Global Ocean Network, Mikael Jensen, said “I’ve never seen anything like this. All the links in the supply chain are stretched. The ships, the trucks, the warehouses.”

There is disruption in the seas happening around the globe and each delay is an extra cost for someone in every part of the journey. The worst is not over, and deliveries cannot be made on time. International Trade now faces big challenges and economies around the world are taking the consequences with uncertainty ahead. These challenges put inflationary cost pressure on goods, businesses, and transportation rates.

The surge in demand overwhelmed the system. It is a global problem and could get worse before it gets better. Everything and everyone needs time.

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