Inflation and recession top concerns for supply chains in 2023
A survey of supply chain business leaders found that inflation and recession are the main fears for companies as they head into 2023.
Shipping containers (Photo: TheDCN)
The Container xChange platform has released its Container LogTech 2023 prediction report, which explores the hopes and concerns of leaders for the coming year through a survey, poll, and interview.
Inflation and recession topped the list of worries, with 88% of respondents seeing this as a supply chain problem in 2023, followed by the impact of war at 57%, the impact of COVID in China at 53% and workers' strike at 23%.
Forecast a year of lower freight rates and increased countermeasures, with the report highlighting 23 trends for 2023. Among the trends are container ship deliveries, persistent port congestion, increased fines and fees warehouses, the war on container freight rates, capacity cuts, production strategies in friend-shoring countries, and changing work culture after the pandemic.
“Due to inflation increasing, there’ll be more unrest in the labour market which will certainly lead to more strikes, specifically in Europe, the UK and North America. And as we have seen before, strikes result in slow operations within the port which can exacerbate supply issues,” said Aamir S. Mir, COO, Caspian Container Company SA know in interviews.
Labor problems are expected to be compounded by continued inflation, which will put pressure on the incomes and living standards of workers in Europe and North America.
“Two, almost three exceptional years for carriers are definitely coming to an end. They will have to adapt back to lower margins due to a different supply and demand balance. Many customers, forced into high-cost contracts during the up-cycle, will come for revenge in the down cycle. And regulatory pressures, following excessive profits might appear on top of that, be it through bodies like FMC, EU or China’s MOC, as they each review alliance exemptions, new taxation regulations, or precedence cases from several complaints raised by shippers at different institutions," said Ruben Huber, Founder and Director, OceanX.
“The overall outlook for the year 2023 remains gloomy. Europe is hit hard with an all-time high inflation; China struggles to cope with the virus and the US continues to witness hinterland transportation challenges and labour unrest. Most of these challenges will stay in 2023. Consumer confidence will pick up, but it really depends on whether we witness more disruptions in the coming times." Christian Roeloffs, Co-Founder and CEO, Container xChange.
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Source: Phaata.com (According to SeatradeMaritimes)