Supplies of many types of items continue to be uncertain or lacking in many areas of the economy as difficulties with supply chains continue. Seed shortages are reported nationwide. Vehicles can’t be built because of computer chip shortages. Appliances and computer shipments are delayed for months or years. Even teachers and substitutes, and many other kinds of employees, are in short supply in some places.
Reuters reports that it could be next year before chains start to mend, in World’s damaged supply chains brace for painful recovery.
Signs are growing that a global supply chain crisis which has confounded central bank inflation forecasts, stunted economic recoveries and compressed corporate margins could finally start to unwind towards the end of this year.
But trade channels have become so clogged up it could be well into next year before the worst-hit industries see business remotely as usual – even assuming that a new turn in the pandemic doesn’t create fresh havoc.
“We’re hoping in the back half of this year, we start to see a gradual recession of the shortages, of the bottlenecks, of just the overall dislocation that is in the supply chain right now,” food group Kellogg CEO Steve Cahillane told Reuters.
But he added: “I wouldn’t think that until 2024, there’ll be any kind of return to a normal environment because it has been so dramatically dislocated.”
The global trade system had never contended with anything quite like the coronavirus…
Baker Creek Heirloom Seeds said in a letter to customers:
1) Unbelievable demand for seeds is causing national shortages. Our growers and our in-house production team are redoubling their efforts to produce more rare seeds, but global demand is causing many items to be temporarily unavailable. We apologize that many popular items are again selling out.
2) The volume of orders have been a challenge for our packing and fulfillment teams, who now work 24 hours a day in three shifts. We are working harder than ever to ship a record amount of orders, and we apologize for any delays you may have experienced in the last month.
3) Global paper shortages will greatly affect catalogs this year. We expect the paper costs for our 2023 catalogs to increase by 110%; we also face the possibility of having a supply shortage. The cost of seed packets, paper mailers, etc. is also quickly rising, and supplies are very short. We are currently out of both of our seed catalogs and copies for 2023 will again be limited…
“I’ve been doing this 30 years and I’ve never seen markets like this,” Currie said in a Bloomberg TV interview. “This is a molecule crisis. We’re out of everything, I don’t care if it’s oil, gas, coal, copper, aluminum, you name it we’re out of it.”
There are a number of variables at play in the grocery shortages we’re seeing this year. “It is a combination of factors: supply chain issues and driver shortages, scarcity of packaging, labor shortages at manufacturing and production plants as the workforce has not returned as facilities restarted from COVID closures,” Keith Daniels of Carl Marks Advisors told us. And, yes, COVID-19 plays a huge role, especially the latest variants.
“Omicron infections impacting employees reporting to work at manufacturing and grocery stores, higher demand from consumers—particularly impacting the last few weeks as consumers revert to eating at home from restaurants out of fears of Omicron,” Daniels said. “The recent, abrupt winter weather is also slowing down distribution.”