Early in the pandemic there was an expectation of reduced demand while at the same time factories in the Pacific Rim region were shut down because of Covid-19 quarantines and infections. In response, shipping companies cut their schedules in anticipation of a drop in demand for moving goods around the world.
Meanwhile in western countries, especially the United States, the timing and quantity of consumer purchases swamped the supply chain system. Factories whose production tends to be fairly predictable ramped up to satisfy a surge of orders. But the problem is the ability to obtain needed materials and the timing as the delivery system tattered on the edge of disaster. Shortages beget more shortages. A paint manufacturer that needs 27 chemicals to make its products may be able to buy all but one, but that one — perhaps stuck on a container ship off Southern California — may be enough to halt production. Continue reading