The global supply chain is being blocked from Asia to Europe via the United States, starting the review of the macroeconomic trend in reference to globalization itself and microeconomic, with reference to the efficiency of trucking on American ports.

Within the larger general picture, the intertwined world economy continues its evolution. Economists are analyzing the data to study the changes that the pandemic and the Russian war in Ukraine are imposing, in the short term, on consumption, investment, production and trade.
Some observers say that now is the time to focus on different parameters than traditional measures of employment, prices and gross domestic product. We need to look at the global economy differently and more precisely, we should no longer look at growth, inflation and monetary policy from the demand side but from the supply side.
In fact, before the pandemic, the supply of goods and services was defined by economists as “elastic”, because it flexed easily to meet demand. Today supply has become inelastic, as the response to changes in demand is much less.
To represent the above, many economists have developed new indices to show the degree of stress on supply lines. Examining traditional indicators such as delivery times and the relationships between the order and inventory, the rates of air cargo and the number of ships anchored outside the Port of Los Angeles, it is clear that the disruptions are again very evident.
Moody’s Analytics shows that supply stress in the world’s two largest economies, the United States and China, is well above what was analyzed in the pre-pandemic period. The conflict in Ukraine has exacerbated the trend in February, but now the disruptions are caused by Covid in China, which has blocked 15% more ships in the waters off the ports of Shanghai and has increased the wait compared to the same. time of last year. This is reversing the improvement started in the last quarter of 2021.
The large flows of containers, of commercial traffic between China and the United States, arrive in the ports of Los Angeles and Long Beach, which handle about 42% of all trade between the two countries.
According to data from the Pacific Merchant Shipping Association, the share of containers staying in ports for more than five days increased last month to 38.7% from 34.3% in February. The figures also showed that rail container parking rose to 7.7 days from 5.2 days in February.
Congestion is also worsening in European ports, which suffer more than their American counterparts from war-related disruptions in Ukraine.
Banned Russian cargo must be separated from other cargo and diverted or stored, adding labor and consuming resources that ultimately act as a brake on shipping capacity. According to Chicago-based FourKites, a platform that monitors the supply chain, the average residence time for export containers in European ports was 10.8 days as of April 24, up from 9.2 in mid-February. For imports, the wait has risen to 6.5 days from 6.2.
Many companies are running into delays in container delivery due to the Shanghai lockdown. Apple Microsoft and Texas Instruments are among the big techs on the list of companies whose sales are hampered by Chinese restrictions linked to Covid-19. A senior 3M executive said tensions will continue to pose challenges for the future. Amazon has indicated a slowdown in ecommerce sales growth.
But according to some maritime research and consulting firms in London, not everyone will be at a loss in the third year of the Covid drama, within the global supply chain. For the container shipping industry, unexpected profits could reach $ 300 billion this year, up from $ 214 billion in 2021. The analysis predicts that global freight rates will rise 39% this year as the blocks will last until the first half of 2023.

TitleCovid-19 and Russia-Ukraine Crisis. Disruptions to the global supply chain

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