Prevailing trials testing the resilience of many resulted in speculations of another endemic for this industry
Port congestion, soaring rates from equipment shortage and inflation are battering the world supply chain good and proper. While it is true this will take time to resolve, it is too soon to label this as a trade endemic
Not everything is gloom
Analysts from ING Group expressed pessimism on the subject of the norm’s return. The pandemic has been around for close to 2 years and world economies are compelled to roll with the punches. The intense pressure on ocean freight resulted in many businesses being brought to their knees and needing governments’ support. Some were severely wounded from having to incur more costs adopting other modes of transportation.
However, not all are gloom. The disruptions turned out to be opportunities for countries to re-evaluate their trade routes. Russia is one example – having declared to explore the possibility of using the Caspian Sea to reduce costs and delivery times. If Russia gets this one right, it is still a point scored for its economy. Suez Canal on the other hand have a lesson to learn from the Ever Given’s circus. The authority could have handled the crisis better. Adopting a blanket leverage on its short route between Europe and Asia against the shipowners and related parties lead to a blow on the canal’s value.
Lately, with the FMC’s attention, carriers are in progress of being sorted out for their absurd practices for the benefit of US’ economy. The ultimate winners would appear to be the manufacturers – provided they skillfully negotiate the curve balls hurled by carriers.
Not a trade endemic (yet)
Certainly, accidents can happen anywhere – with some causes totally out of man’s control. It is not in the best interests of the industry to assume the worst and conclude things are broken with blanket solidarity. With a combination smart business decisions, and feasible deterrents imposed by authorities, there is still a glimmer of hope for robust trade to return. It takes time, but it will happen.