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Ship Congestion Gradually Improves Supply Chain

Specialty Food Association

Many factors associated with the COVID pandemic contributed to supply chain bottlenecks, and experts agree that they seem to be improving, reports Bloomberg.

One such example began in California on October 15, 2020 with five ships that were backed up. The situation worsened into Feb. 2021 with over 40 ships backed up. By Jan. 9, 2022, the problem peaked with 109 backed-up ships before gradually dipping back towards more manageable levels, according to data from the Marine Exchange of Southern California and Vessel Traffic Service Los Angeles/Long Beach.

“Our workforce is now managing reasonable levels, and the stress level is down,” said Captain J. Kipling Louttit, a former Coast Guard officer who’s the executive director of the Marine Exchange of Southern California & Vessel Traffic Service Los Angeles and Long Beach. “We're back to being in a good place.”

Analysts at Sea-Intelligence, a research company, projected in a report that a “reversal to normality should come in March 2023” because of the pace of improvement.

Oxford Economics’ U.S. indicator of supply strains also shows a similar improvement trend. Oren Klachkin, Oxford’s lead US economist, said, “Supply chain conditions should stay on a more encouraging trajectory in the final stretch of 2022 and in 2023.”

Despite the good news, Jason Miller, associate professor of supply chain management at Michigan State University, warns that the situation has not improved substantially. The relief of cargo ship demand has affected the profitability of the trade, and another holiday season is on the horizon as dockworker strikes, lockdowns in China, and the war in Ukraine continue to threaten the world stage. Full Story (Subscription Required)

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