New disruptions to supply chains in 2022

In December, Drewry published on their blog this article describing four significant disruptions likely to happen to shipping in 2022.

I feel these are right on target for the business, and will affect international shippers of all sizes, and intermediaries, such as brokers and freight forwarders.

I’m especially concerned with disruption in the resale of blocks of container space. Drewry’s discussion of MQCs (Minimum Quantity Commitments) indicates that contracts being tried out will require the MQC to be evenly spread across the year. This will be very hard for most forwarders to meet. While some of the business is of the level-quantity, just-in-time sort, lots of other shippers have seasonal blips in their demand. Those seasonal demands cannot be supported by regular fixed-quantity shipments; inventory costs would balloon, jeopardizing the business.

I’m using the word ‘seasonal’ in a time-series sense, not a climate sense; there is a lot of business that experiences ups and downs in demand, not related to weather, but to the needs of their customers. Clothing retail offers an example; summer wardrobes need to be brought in in early spring; winter clothes in late summer. Christmas tree lights and trees themselves are only needed in September-October to be ready for the Thanksgiving to Christmas buying period.

Smaller brokers and forwarders usually exist because they can provide special services to smaller shippers. They need to get access to space in order to help these shippers. Having to purchase on the spot market exclusively will mean that many small shippers will be handicapped.

But we cannot expect the brokers and forwarders to provide inventory consolidation services for the shippers who have these seasonal needs.

I recommend reading the brief article provided.

Drewry – Browse Recent Opinion Articles – New disruptions to supply chains in 2022 and how international shippers can respond

Drewry – Browse Recent Opinion Articles – New disruptions to supply chains in 2022 and how international shippers can respond

One response to “New disruptions to supply chains in 2022

  1. Pingback: New disruptions to supply chains in 2022

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