Two crises at sea
Products are having difficulty getting to their destinations around the world because of twin crises on the high seas that have simultaneously bogged down global commerce.
For six days, Egypt's Suez Canal was blocked by a giant cargo vessel that got stuck and held up hundreds of other ships on a route that handles about 12% of world trade. The Ever Given — about as long as the Empire State Building is tall — was finally freed Monday, but analysts say it could take more than a week to clear the backup.
Meanwhile, a shortage of shipping containers also is causing problems in the cargo transport industry. Many of the factories that build the giant metal boxes are in China — and a number of them shut down in the early days of the COVID crisis, cutting supplies short.
The companies that produce the containers were caught off guard as international trade started to rebound from the pandemic during the second half of 2020. A wide range of things, including cars, clothing, toys and raw materials, ship in the containers, so manufacturers are having difficulty getting their goods to market.
The products that might be affected
Grocery prices were already rising faster than inflation. Now, shortages related to the shipping troubles could push up prices for an array of items — and force you to find creative ways to save.
Given the situation in the Suez Canal and the container crunch, several types of products could become harder to find before long.
1. Toilet paper
One of the companies impacted by the container crisis is Suzano SA. The Brazilian company is the world’s largest producer of wood pulp, used to make toilet paper, and it's warning that the lack of containers could slow shipments to its production partners.
Suzano CEO Walter Schalka told Bloomberg his company shipped less product in March than anticipated and has been forced to delay some shipments into April. A global shortage is possible.
With memories of last year's barren toilet paper aisles and inflated prices still fresh in many minds, the specter of another t.p. shortage is unsettling. Put some fun back into your shopping trips by using an app that rounds up your purchases to the nearest dollar and invests your "spare change." Then, just watch the money grow.
The Suez Canal blockage has stalled some shipments of coffee, specifically the type used to make instant coffee like Nescafe.
The Suez is a major shipping route from Vietnam — the world’s largest producer of robusta coffee, used in instant coffee — so a scarcity of beans could soon be felt at coffee shops and in supermarkets.
If you plan to stock up on java, be sure to use an app that rewards you with cash back on your grocery shopping — just for snapping photos of your store receipts.
Deliveries of furniture are being affected by the shipping industry issues. La-Z-Boy recently said on an earnings call that customers can expect to wait for their new sofas and chairs anywhere from five to nine months after placing their orders.
Congestion at ports in Southern California, where many containers from Asia arrive, has been an issue for months.
And the Suez shutdown held up shipments of furniture from Ikea, which is based in Sweden. "The blockage of the Suez Canal is an additional constraint to an already challenging and volatile situation for global supply chains brought on by the pandemic," Ikea said in a statement.
The wholesale club chain Costco recently blamed a shortage of imported cheese on the shipping container shortfall. The retailer cited issues at ports along the West Coast, from Seattle down through California.
"Overseas freight has continued to be an issue in regards to container shortage and port delays," Costco chief financial officer Richard Galanti told analysts on a call in March. "This has caused timing delays on certain categories."
Galanti said Costco also has had trouble keeping its giant stores stocked with furniture, sporting goods and lawn equipment, in addition to other imported food items like seafood and olive oils.
Stay ahead and shop smart
As we saw last year, retailers may put limits on high-demand items that are in short supply — to keep shoppers from filling their carts with every last package of toilet paper or bottle of olive oil on the shelves.
If you do decide to make a few big grocery hauls, be careful with not to overextend yourself on your credit cards. If you've been relying heavily on your plastic during the pandemic, consider rolling your balances into a lower-interest debt consolidation loan, to help pay off your credit card debt more affordably and quickly.
Watch for deals and rewards to get the most for your money, even if the ol' law of supply and demand puts pressure on some prices. For example, you might download a free browser extension that will automatically hunt for better prices and coupons whenever you shop online.
And this might be the most important tip of all: Don't panic. The Suez Canal should be back to normal soon, and the production of shipping containers will ramp up. In the meantime, there are plenty of stores and product suppliers — so if one retailer is out of toilet paper, just keep looking and asking around. Trust us, you will find some.