The supply chain issues are going to get worse before they get better. The California ports aren’t only short-staffed because of the COVID-19 virus and the COVID-19 vaccine mandate. Still, President Joe Biden’s Administration and California Governor Gavin Newsom seem to be working in unison to do nothing to fix the issue.
Unions can help and hurt jobs. Unions require dues to operate, which take away income from workers even though they say that they fight for workers’ rights and fair pay, but they aren’t good for the United States.
The California ports aren’t efficient, either. The supply chain issues at California ports have happened throughout 2021, making this a manufactured crisis. The federal government, California government, and the citizens of the US have known about the port issues for a long time, but the government or the ports haven’t done anything to fix it.
DHL isn’t happy about the US ports. They released an Ocean Freight Market Update Outlook that says that the US ports are bottlenecked with 50-75 ships, and the wait is around 8-10 days. DHL also said, “North America currently faces a 40% imbalance, meaning that for every 100 containers that arrive, only 40 are exported. The remaining 60 containers continue to accumulate at the depots, pushing carriers to send the containers back to Asia empty.”
DHL explains that their projects show the problem progressing through 2023 with new vessel capacity easing rate pressures, but the wait will be years.
The other problem is that more than 10% of the global fleet is anchored with port backups, waiting to be offloaded.
Then there’s the ship-building process that’s hindered. With low raw materials, DHL says that new vessels are delayed until 2024, with global port congestion reaching manageable levels in 2023 to the level they were at pre-COVID-19.
It’s not looking good. Grocery stores are being hit the worst right now, with #BareShelvesBiden is trending on Twitter due to the stores lacking items to sell. It isn’t an issue that will go away anytime soon because there are plans to pay farmers not to farm. It’s not a plan that’s working, but the fact that this is even a consideration to combat climate change, and it’s been going on for years. It’s hard to assume that less food was consumed during the COVID-19 pandemic. It’s a fact that food distribution changed from restaurants to dinner tables.
Luckily, DHL wins in the end. Their suggestion is to get long-term contracts even if the price is higher because they said: “capacity wins over price.” That’s a proper step to try and fix the things that governments across the world have created.