How Long Will The Supply Chain Crisis Last?
U.S. Transportation Secretary Pete Buttigieg said some of the supply chain crises we are currently facing could last “for years.
This is not the first time that the supply chain crisis has been raised for several years. In a recent interview, Pete Buttigieg said “it’s an incredibly complex situation” and that the government is holding online “roundtables” with port operators, unions and private companies. Nevertheless, he also previously told MSNBC that the “challenges” will continue, not only “for a year or two, but for a long time.
Inflation Caused By Supply Chain Crisis
Isn’t it notable that the economic outlook has changed so dramatically in just a few months?
The Daily Mail declared that “U.S. stores are now just empty shells. A series of supply chain crises has led to inflation that will continue into the new year. Store shelves across the U.S. are empty, and retailers such as Costco and Walmart are limiting the amount of toilet paper available in some stores.
More than 60 cargo ships carrying hundreds of thousands of containers were waiting to dock in California, arriving from Asia, not expecting to be stranded for months due to traffic jams.
In addition to backlogs at major ports, the cost of shipping products across the Pacific is increasing. The Washington Journal reported that the average cost of shipping a standard container from China to the U.S. West Coast reached a record $20,586. That’s almost twice the cost in July, which was twice the cost in January.
As we approach the holiday shopping season, consumers are facing rising prices and shortages of cars, children’s shoes and sports equipment. Now, the emerging global energy crisis will make it more expensive to ship goods. In October, U.S. gasoline prices hit a seven-year high.
The average value of gasoline across the U.S. touched a seven-year high of $3.27 per gallon, up 7 cents in the past week alone, according to the data. Gasoline prices have nearly doubled since bottoming out at $1.77 in April 2020. High running gas prices will only increase inflation and squeeze the budgets of American households.
U.S. heating oil inventories may fall to the lowest level in more than 20 years to meet soaring demand. According to the data, stocks of diesel distillate used for transportation and heating are only enough to meet 31.2 days of demand. This is the tightest since 2000.
In the coming months, global energy supplies will become even tighter and prices will rise further.
The Supply Chain Crisis Has Affected Global Energy.
Large companies are being forced to pass on the rising costs to consumers. Miguel Patricio, CEO of an international food giant that makes ketchup and baked beans, said the company has raised prices in several countries. He said that unlike previous years, inflation is “across the board.
The United Nations Food and Agriculture Organization (UN food and Agriculture Organisation) said the cost of raw materials such as grains and cooking oil has pushed global food prices to the highest level in 10 years. Global food prices have risen by more than 32 percent in the past year.
The UN FAO Food Price Index (a measure of monthly changes in global food prices) reached 130 points in September, the highest level since 2011 and 32.8% higher than in September 2020.
As the situation worsens, the American people are becoming increasingly restless. Polls show that only 37% of Americans think the economy is in very good or fairly good shape, the lowest percentage since March, and more than half of Americans are quite dissatisfied with the status quo for the second month in a row.
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