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Australia could experience another supply chain crisis

Cargo Port

Australia is facing a potential new supply chain crisis that could go on for months, according to an international supply chain expert.

Speaking to Clinton Maynard on 2GB’s Australia Overnight, Kelly Crossley, owner of Transitainer WA said the recent announcement of US tariffs on Chinese imports will affect Australia, as Chinese exporters rush to get their products to the US to beat the 1st August deadline.

A couple of weeks ago, President Joe Biden slapped major tariffs on a number of Chinese imports, including electric vehicles, advanced batteries, solar cells, steel, aluminium and medical equipment.

The new tariffs will affect US $18 billion in Chinese goods.

Crossley has predicted that the crisis will worsen before Christmas, leading to higher prices, delivery delays and empty shelves for Australian consumers.

“We’re already seeing some implications. The rush on cargo is already happening. In terms of loading at Chinese ports, there’s already a shortage of space and equipment, and rates are increasing. There’s also massive congestion in Singapore,” she said.

“Usually a vessel could birth on arrival or worst case, maybe half a day. We’re seeing vessels now wait for seven days.”

She confirmed that the rush from China to get containers to the US to beat tariffs will delay material exports entering Australia, when combined with the ongoing issues in the Red Sea and the recent delays experienced due to the drought in the Panama Canal.

“In particular for Fremantle, being over here in the west, we’re already seeing cargo that’s being delayed. We don’t have many direct links from many parts of the world. It’s all Singapore-based. With Singapore having a massive congestion issue, the impacts are going to be massive and it’s only going to get worse.

“We’re going to see a shortage of equipment, a shortage of space and rate increases.”

Crossley confirmed that when the 1st August deadline passes, she doesn’t believe that the pressure will suddenly ease as the peak shipping season looms. 

 “My advice is start shopping now (for Christmas),” she added.

 “Prices are going to go up, it’s going to be harder and harder to get goods in. The pressure on importers is how do they control their stock? They’ve got to change their buying models.

 “It’s a big issue that’s going to be bigger.”

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