DATA from supply chain visibility provider FourKites show that the effect of last month's typhoon In-fa has had a cumulative impact on global supply chains in China, which are continuing to mount, even contributing to transportation disruption and delays in the United States.
As a result shippers are faced with mounting pressure to find alternative means of transportation and to build up safety stocks, reports IHS Media.
FourKites has identified a 14 per cent average increase in weekly late shipment notifications from container shipping lines and Chinese ports since In-fa hit the Chinese coast and port cities July 25.
For shipments exported out of China from August 9 to August 15, delays increased an additional 32 per cent, rising 70.4 per cent above the average delay in the last four months, FourKites said.
Those delays are extending end-to-end delivery times by weeks, said FourKites vice president Glenn Koepke.
'Delays are growing from a week to a month cumulatively,' he said. Those delays further complicate US sales efforts and production schedules and put more stress on already fragile inland transportation networks.
In addition to increasing port congestion, delayed ocean shipments are also disrupting surface transportation networks, Mr Koepke said.
Trucks, trailers, and domestic containers that were meant to pick up freight at a certain time have been sent elsewhere and are no longer available thanks to that delay. That forces more importers and domestic shippers to turn to the truckload spot market.
Brent Hutto, chief relationship officer at Truckstop.com, said freight demand 'is going to stay strong' through the end of 2021.
'By all accounts, the holiday season is going to start earlier, and it is going to be bigger than last year,' he said. 'We're seeing a prolonged plateau which will continue until we have some normalisation, sometime in first quarter or second quarter of 2022.'
Shipment delays are putting more pressure on already stressed US inventory levels, said Jason Miller, associate professor of logistics at Michigan State University.
'One of the assumptions made when planning inventory is that lead times are uncorrelated,' he said. That assumption breaks down during extended periods of high demand and panic buying, such as most of 2020 and 2021.
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As a result shippers are faced with mounting pressure to find alternative means of transportation and to build up safety stocks, reports IHS Media.
FourKites has identified a 14 per cent average increase in weekly late shipment notifications from container shipping lines and Chinese ports since In-fa hit the Chinese coast and port cities July 25.
For shipments exported out of China from August 9 to August 15, delays increased an additional 32 per cent, rising 70.4 per cent above the average delay in the last four months, FourKites said.
Those delays are extending end-to-end delivery times by weeks, said FourKites vice president Glenn Koepke.
'Delays are growing from a week to a month cumulatively,' he said. Those delays further complicate US sales efforts and production schedules and put more stress on already fragile inland transportation networks.
In addition to increasing port congestion, delayed ocean shipments are also disrupting surface transportation networks, Mr Koepke said.
Trucks, trailers, and domestic containers that were meant to pick up freight at a certain time have been sent elsewhere and are no longer available thanks to that delay. That forces more importers and domestic shippers to turn to the truckload spot market.
Brent Hutto, chief relationship officer at Truckstop.com, said freight demand 'is going to stay strong' through the end of 2021.
'By all accounts, the holiday season is going to start earlier, and it is going to be bigger than last year,' he said. 'We're seeing a prolonged plateau which will continue until we have some normalisation, sometime in first quarter or second quarter of 2022.'
Shipment delays are putting more pressure on already stressed US inventory levels, said Jason Miller, associate professor of logistics at Michigan State University.
'One of the assumptions made when planning inventory is that lead times are uncorrelated,' he said. That assumption breaks down during extended periods of high demand and panic buying, such as most of 2020 and 2021.
SeaNews Turkey