There have been an enormous amount of stories relating to shortages since the early days of the first lockdown. But it is the unavailability of goods or chaos is more due to the unavailability of transportation of it.
For the basic commodities for now it is more of transport-related issues. Let us take an example of India, being the largest coal reserve country there should not be a shortage of it but there are patches of shortage that are impacting the output.
To elaborate, it is mainly due to limited rail wagon capacity availability to move around the coal throughout the country. And the priority is logical to power supply for these wagons. Thus, leaving non-power sectors with less coal even after high production.
The next-door neighbour, China is having a different problem that will impact the world. Due to covid restrictions, the major ports have seen an increase of 100% or 150% in the waiting period resulting in a delay of the current voyage that would impact the next voyage scheduled for the vessel. And being a hub supplying many critical components this delay impact factors throughout the world.
In Europe, many countries have seen strikes by truckers due to a rise in fuel prices and some under capacity due to a lack of drivers. This has put pressure on basic goods resulting in rationing at stores.
Within the USA, Texas has seen a higher trucker waiting period at borders due to new rules and this has resulted in an increase in journey time by 30-40%.
These all are transport issues that have hampered availability further and might result in higher premiums on products. Such issues will take a long time to resolve through some demand destruction which eases these pressures. This is due to the central bank's reversal of policy and lower disposable income.
There have been an enormous amount of stories relating to shortages since the early days of the first lockdown. But it is the unavailability of goods or chaos is more due to the unavailability of transportation of it.
For the basic commodities for now it is more of transport-related issues. Let us take an example of India, being the largest coal reserve country there should not be a shortage of it but there are patches of shortage that are impacting the output.
To elaborate, it is mainly due to limited rail wagon capacity availability to move around the coal throughout the country. And the priority is logical to power supply for these wagons. Thus, leaving non-power sectors with less coal even after high production.
The next-door neighbor, China is having a different problem that will impact the world. Due to covid restrictions, the major ports have seen an increase of 100% or 150% in the waiting period resulting in a delay of the current voyage that would impact the next voyage scheduled for the vessel. And being a hub supplying many critical components this delay impact factors throughout the world.
In Europe, many countries have seen strikes by truckers due to a rise in fuel prices and some under capacity due to a lack of drivers. This has put pressure on basic goods resulting in rationing at stores.
Within the USA, Texas has seen a higher trucker waiting period at borders due to new rules and this has resulted in an increase in journey time by 30-40%.
These all are transport issues that have hampered availability further and might result in higher premiums on products. Such issues will take a long time to resolve through some demand destruction which eases these pressures. This is due to the central bank's reversal of policy and lower disposable income.
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