Signs Growing that the Global Supply Chain Crisis is Over
From the docks of Southern California and Europe to the parcel hubs in the Midwest and the store shelves in New York, signs are growing that the global supply-chain crisis is over, according to the Wall Street Journal (WSJ).
The COVID-19 pandemic that spawned product shortages, shipping bottlenecks and soaring transport costs may not be gone, but the WSJ reports goods are moving around the world again, reaching companies and consumers.
Despite widespread government and industry attempts to unwind the bottlenecks, the real break may have come in the demand slowdown that has eased the pressure on strained operations.
"As some of commodity prices and transportation costs begin to come down, we're revisiting these costs with our suppliers," says Bill Bolts of Lowe's, on easing supply chain pressures.
On the Water
According to Drewry Shipping Consultants' index for spot prices, to ship a 40-ft. container from Shanghai to Los Angeles the week of Dec. 22 was $1,992, down from $2,000 the week before and 82.2% below the 2022 high set in Jan.
U.S. container imports reached their lowest level in November since early 2020, and shipping heavyweight Maersk Line projects demand will decline next year from 2% to 4%. Freight rates that busted shipper budgets last year are sliding and broader costs for suppliers heading into 2023 are also retreating.
