Supply Chain Shortages: Here We Go Again
I recently noticed that there weren’t many ships at the Tacoma Port. I was wondering where they all were. Eureka. They are in Shanghai. I initially learned this from a tweet.
With Shanghai in a near total lockdown, this is a map of the commercial ships currently waiting offshore to be loaded and offloaded of goods; exacerbating global supply chain woes pic.twitter.com/Md6PtpF3VE
— Scott Gottlieb, MD (@ScottGottliebMD) April 18, 2022
Look at the image below. Each square dot and each little ship-like graphic is a commercial cargo ship. For now, just look at how many there are, how tight they are. Get an idea of the magnitude of the number of these ships…
These ships are parked just outside of Shanghai. They are all waiting to offload and pick up their next cargo.
COVID has closed Shanghai (again). The port has been closed for weeks.
This is a level of gridlock that the shipping industry has never seen before.
How do you begin to untangle a mess like this? How do you get each ship offloaded, get the containers sorted and onto multi-modal trains and trucks, and how do you then stage the right containers so that you can load up the ship?
I understand that there is an equally large gridlock of trucks and trains. Cargo trying to get to the port to get on ships. Trucks without drivers (Shanghai is closed) parked alongside every road.
How do you begin to untangle this? Where do you begin? What are the impacts?
This could take a year to straighten out. You can’t just unload a ship and then immediately load it because the cargo for that ship has no room to be pre-staged at the port. The containers you are unloading have no place to be stored, there are no trucking orders (everything is canceled). How do you get it out of the port?
The impact of this will be severe, and felt here by consumers and businesses. A large amount of supplies from China, aren’t going to be here for a long time. The implications are significant.