WA’s mining and agriculture sectors are starting to feel the squeeze from continued global shipping delays, with concerns vital maintenance supplies are becoming caught up in the backlog.
As we predicted months ago, the pandemic-related delays of 2020 have continued to snowball this year, made worse by the Suez canal blockage and the more recent COVID outbreak in China, which saw Yantian port closed for weeks.
It’s basically been a downhill slide since the EverGiven blockage in March, and the echoes of those issues are still happening worldwide.
The supply chain has become so overloaded, there’s so much more cargo than there are vessels to move it. The situation’s not getting any better, in fact it’s actually getting worse.
Western Australia’s key industries of mining and agriculture are now facing long wait times for essential items, including maintenance-related parts.
Unfortunately, there’s only so much priority space onboard vessels. And if mining companies can’t get maintenance supplies to heavy machinery, it’s going to become a real issue.
The agriculture industry is also facing the same problem. Basically, anything that can wear out needs replacing, and if they have to wait for those parts, that will have flow-on effects.
I don’t think people understand just how bad the problem is, with delays already far worse than last year.
With peak-season approaching, delays could blow out even further, with several factors to blame for the ongoing congestions.
- New weight restrictions: Temporary weight restrictions are being imposed on some lines, virtually halving maximum container tonnage, placing extra demand on available containers and adding to overall shipping costs.
- COVID outbreaks: Ongoing COVID outbreaks and subsequent lockdowns are continuing to impact countries around the world, causing fresh bottlenecks in the supply chain.
- Freight rates: There’s been no reprieve from sky-rocketing shipping rates, up more than 25% year-on-year for some clients.
- Industrial action: Recent strike action at Australian ports, including here in Fremantle, is also adding to the delay in getting products off ships.
Adding to the problems for the shipping industry was the recent fire onboard the X-Press Pearl off the coast of Sri Lanka, which has seen tighter restrictions around the movement of hazardous goods.
It’s hard to think of an industry that’s not being affected by the delays. Non-essential health care items such as hospital sanitary wipes, vital car-parts, and even man-hole covers for council and community sewage systems are just some of the items facing longer than usual wait times.
We’re encouraging clients to plan well in advance to avoid being impacted by the backlog. And while it’s still some months away, getting in early with Christmas product orders is definitely key.
Read more here.