Julian Evans-Pritchard is a senior China economist at the research company. He said that power rationing could affect ports' ability ship orders.
Capital Economics observed that ships waiting in Chinese ports have increased again in recent weeks. They called it "concerning." The 7-day average number of ships in China as of Sept. 30, was 206. This is compared to an average of 82 ships in 2019, prior to the pandemic.
Recent oil shipping problems in Europe and China are the result of energy crises.
All supply chains have been affected by major disruptions this year. These range from container shortages to flooding and Covid infections that caused port closures.
Let's take a look at recent developments that have once more hampered shipping and which goods are being affected during the holiday shopping season.
Many goods have been affected by factory shutdowns in Vietnam after many companies moved production to there amid the U.S. China trade dispute.
China's power crisis has led to widespread disruptions. Many factories were shut down by local authorities. Europe is also facing a huge gas shortage.
Analysts and industry watchers agree that what's going on in these two regions is disrupting global supply chains.
The energy crisis has caused factories in Europe and China to temporarily close down or reduced their output. Jena Santoro, Everstream Analytics, said that more than 60 Chinese companies have been affected by power disruptions and that the number is expected to rise.
Consumers will feel the biggest impact in the form higher prices, as the inflated energy prices will lead to increased manufacturing costs. Dawn Tiura, president, Sourcing Industry Group, stated that this will have the greatest impact on consumers.
Which goods are being targeted?
1. 1.
Tiura says that rising energy prices in Europe could have a "serious and cascading impact" on regional food supply chains.
She explained that major fertilizer plants had to reduce their output due to rising costs. Farmers are now unable produce enough food because of this.
2. 2.
Per Hong, senior partner at Kearney, said that the shortage of fertilizer will also result in a shortage of a "very interesting byproduct" carbon dioxide. This is used in a wide variety of consumer products.
We will almost certainly face a global shortage in CO2 due to reduced fertilizer production. He said that CO2 is widely used in the food value chain, from inside packaged foods to keep them fresher for longer, to dry ice to keep frozen food cool during delivery, and to give carbonated beverages (like soda or beer) their bubbles."
Hong stated that this demonstrates the vulnerability of global food supply chain chains.
3. Apple iPhones, electronics, toys
Hong reports that several major Apple suppliers have stopped operations in their Chinese factories. Hong said that the whole electronics industry, already suffering from the shortage of big chips, is likely to continue to be affected.
Hong stated that while things will likely improve over the long-term, power restrictions and production cuts in China are likely to cause export price increases and worsen inflation in the holiday season. He also said that products such as toys, textiles and clothing are also likely be affected.
4. Christmas decorations
Businesses warn that Christmas decorations will be in high demand.
According to Chris Butler, CEO at the National Tree Company, this is due to disruptions in China's supply chain.
The crisis would also have a significant impact on other sectors, such as metals, chemicals, and cement. These sectors are all energy-intensive, according to Pawan Joshi (executive vice president at E2open supply chain software company).
