Bottleneck at U.S. Ports snarls supply chain across the country
WICHITA, Kan. (KWCH) - Prepare to look harder and earlier for those Christmas presents this year, as supply chain delays threaten to thin out the number of gifts under the tree.
It’s a lingering impact of the COVID-19 pandemic and is expected to last into next year.
For businesses in the business of imports and exports, it’s a complicated time.
F. H. Kaysing Company is dealing with this directly. As a U.S. Customs Broker, they work with clients to get international goods cleared through U.S. Ports, becoming more challenging for them and their clients.
“When he gets to receive a contain, it feels like Christmas to him. You know, they’re that excited to get a hold of their goods,” said F. H. Kaysing Company Vice President Abbie Booth.
Booth said it’s not uncommon for some of their clients to experience delays of between two and four months.
“For us to predict and try to guide our clients, they’re asking me how long it’s going to take, and I never have a good answer for them,” she said.
Booth said they used to have reliable ETAs when ships with their clients’ containers would be docking in the ports.
“Take those and time our Customs entree accordingly, but now ETA, they’ve just gone by the wayside. They don’t mean much anymore.” Booth said, “We are constantly tracking shipments.”
The cause of this stems from the start of the COVID-19 pandemic.
Booth said, “COVID started it all. The manufactures had to shut down. Ports had to shut down. So everything just kind of stopped, and during the pandemic, we were all home, so we were all shopping.”
Once these factories restarted, it became hard to keep up with the consumer and business demand in the U.S.
“Those factories just couldn’t produce, and once they could, there was just a mass, mass flood of containers leaving Asia,” said Booth.
She said there were signs of improvement earlier in the year, but the Delta variant of COVID-19 changed that. Now, this is looking like a problem that will continue into and throughout 2022.
This week, President Joe Biden stepped in to open the U.S. largest port in Los Angeles to 24-7, but other issues remain in moving the good.
Booth said, “You’re still dealing with staffing shortages, trucking shortages.”
On a more local level, Jeremey Hill at Wichita State Center for Economic Development And Business Research said this is seen in two main ways.
“On the business side, some of these supply chain issues are particularly a problem for aerospace. We have all kinds of parts that come in through these ports that are impacting the supply chain and our abilities to deliver,” said Hill, Director of CEDBR.
He said the longer this goes on, the more impact it will have on the local economy.
“Going to further hinder a manufacturing town when you can’t get the input goods and that’s a very costly thing, it could put pressure on their ability to hire back or to maintain employment,” Hill said.
It’s as customers see struggles getting items.
Hill said, “The household side where you go to the store and everyone can visually see that at all kinds of stores, their shelves are not completely full.”
The supply chain issues could contribute to the inflation rate continuing to climb.
“Some of those goods are going to continue to go up, so you need to plan for that.” Hill said, “The good news is that wages are still going up faster than inflation.”
Even when these issues get remedied, Hill said the impact of the last year and a half will have long-term implications.
He said, “For the business said, it’s that “Just In Time’ model, especially in aerospace. We had some more capacity, not as lean, but that whole model is going to likely change. It already has changed because of COVID. In Kansas, we’re already seeing expansions of plants to try to hold inputs and try to hold finished goods for your customer because that’s the only way we’re going to be a more flexible environment to move forward.”
Copyright 2021 KWCH. All rights reserved.