Supply Chain Crisis: Christmas canceled due to no inventory

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Bar Ran Dun: Jan 22, 2006

Wrote this years ago. Pandemic did what I was worried the trade war would do.

Bar Ran Dun posted:

Systems, Business, Trade, Kanban, and Political Economy

This a bit rambling and it's not polished and it's probably not coherant yet. But here it goes.

There is a very useful concept from the Foundations of Cybernetics I�d like to start with. For every technology, be it a physical technology or a conceptual one there is a corresponding set of ideas and concepts, an (or almost) ideology, that allows one to use the technology in question most efficiently. Basically when one has a tool one also has to have a suite of concepts to use that tool most effectively. With that in mind I�m going go all the way back to the beginning. I think one needs to look at the technologies and historical events that gave rise to systems thinking to really understand it. This is a very, very simplified representation of a steam cycle.

Steam cycle

A boiler, boils and then superheats steam, it runs through the turbines which turn a generator, the steam is condensed and then as water it is pumped back into the boiler. Look at the diagram. Obviously the system and the drawing is informed heavily by thermodynamics. But I�m trying to communicate the following characteristics: The circular nature of the cycle, the flows of steam and water represented by lines, and the stocks of various liquids inside each of the parts. The lines showing flows between individual components. This diagram omits controls, but I�ll get to that in a sec. Anyways stocks are how much poo poo (water in a tank, steam in a boiler, etc) X things. Flows are how fast poo poo is moving X things per second. Flows can indicate what will happen in a system, but you need stocks to know when it will happen. Now one of the ways to control systems, is valves. Valves can do things like open and close. Or they can be throttled. Or a line can take pressure feed back from a pipe against a spring tension (or theses days a controller) and keep a flow at a particular rate (a analog solution). These are controls. Controls let one maintain the output one wants across variable inputs. One uses controls to keep a system from blowing up basically.

I�m going to play fast and loose with the history here but eventually WWII happens. During the war there is a lot of development in maths and we get tools like linear programming, that let's one maximize or minimize for desired values. There also is a problem after the war. How the hell does one get a rocket to fly where one want�s it to? Control theory solves this problem. They take concepts, particularly the math for how that pressure control valve works and they apply it to rocketry. Controls theory is how they solve the problem of getting rockets to fly straight. See those simple valves, can be expressed as terms in differential equations. That same math can describe rockets, electronics, etc. All of these things (and some other concepts from other disciplines like ships stability) eventually come together and form a discipline called Operations research. The controls / stock and flow modeling part sometimes gets called the �Differential Equations Paradigm� and eventually we can digitize the industrial controllers with it. Eventually we turn this poo poo on everything. In business operations research gets used as �management science�. In the sixties Kennedy�s eggheads, the whiz kids, this is the way they�re thinking , the tools they are using. Rand Corp pioneers a lot of this type of modeling. Eventually it becomes one of the standard ways we look at business. Managers use linear programming to maximize production and profits. Businesses are modeled using ideas from the circular stock and flow . That steam cycle, the suite of concepts used to describe that, can also be used to describe a business or business cycles. In fact when executives talk about creating value designing systems is what they mean. And I don�t mean I�m inferring this. I mean I�ve asked, and they give this answer. They are creating circular systems that take in inputs and spit out money. Some of these models get pretty sophisticated look at things like SCOR as good example. And I would remind you this type of supply chain modeling is what makes apple, one of the most valuable companies in the world. It�s what Tim Cook is good at.

Something vitally important to understand. A lot of these models are constructed and then spread. They then get applied and even taught by people who couldn�t have made them and don�t really understand them.
Anyway systems thinking gets used to model economics and trade, the economist Wille posted here: https://forums.somethingawful.com/showthread.php?threadid=3862896&userid=0&perpage=40&pagenumber=11#post488017309
Is a great example amd what prompted this post. And important because it shows how compatible systems thinking is with dialectic though, because of the circular nature of the model. A number of times he talks about using stocks and flows to model trade and currency flows after the switch to fiat currency. He talks at length about using stock and flow models (and I think he is applying them correctly and reaching correct conclusions with them). Think tanks, consultancies (McKinsey is a good current example) they all use models built on these ideas. I�ve done some simple modeling in this area for grad school.

Anyway eventually somebody (the Japanese, but I don�t know enough about the specific people to tell which ones, Toyota is a big player) takes this thinking and comes up with the idea of minimizing inventory (a stock) by balancing logistical flows. One can really supercharge a business� return on investment by bringing it�s inventory holding costs down as low as possible. This idea is called Kanban. Now the principle here is basically just that pressure control valve I told you about earlier. Flows are controlled to reduce the need for inventory. This idea becomes wide spread. Process management (which is more than Kanban and proceeds it) becomes widespread and largely in conjunction with growing globalization. Something to have in mind. You and I are if we are employees are stocks to be minimized to maximize cash flow and return to shareholders.

I wrote all that to say this. Now we have business systems that are very sophisticated, they use models like SCOR, to minimize their inventories (and again it�s worth noting inventory can be considered include employees) and make more money . But systems with very low stocks tend to be less stable. In physical systems, like the steam cycle, poo poo blows the gently caress up when things go wrong. Now in business where we have managers applying models they didn�t construct and are merely applying (hmmm now that�s familiar) and those models tend reduce stocks, they�re reducing stability in the system.

When it gets too hard to steer around the rocks, sometimes we hit the rocks. And this is the underlying thing that�s been worrying me about this escalating trade war.

# ¿ Oct 31, 2021 02:15

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# ¿ Apr 24, 2024 17:13

Bar Ran Dun: Jan 22, 2006

Bar Ran Dun posted:

https://www.nytimes.com/2021/08/20/opinion/us-globalization-tariffs.html?referringSource=articleShare

Lol I fired an email off at Krugman asserting he was underestimating the effect of the container flow issue on inflation and I�m pretty sure this is his the response:

Honey, Who Shrunk the World?

When I was in my 30s, my parents gave me a sweatshirt bearing the words �Global shmobal.� At the time, I was going to many economics conferences; when my parents would ask me what the latest conference was about, I apparently always replied, �Global shmobal.�

What I didn�t know at the time was that the global was about to get even shmobaler. In the mid-1980s, world trade had recovered from the disruptions and protectionism of the interwar period, but exports as a share of world G.D.P. were still back only to around their level in 1913. Starting around 1988, however, there was a huge surge in trade � sometimes referred to as

hyperglobalization � that leveled off around 2008 but left the world�s economies much more integrated than ever before:

Image
Exports as percentage of world G.D.P.
Exports as percentage of world G.D.P.Credit...World Bank
This tight integration has played an important background role in pandemic economics. Vaccine production is very much an international enterprise, with production of each major vaccine relying on inputs from multiple nations. On the downside, our reliance on global supply chains has introduced forms of economic risk: One factor in recent inflation has been a worldwide shortage of shipping containers.

But how did we get so globalized? There are, it seems to me, two main narratives out there.

One narrative stresses the role of technology, especially the rise of containerized shipping (which is why the box shortage is a big deal). As the work of David Hummels, maybe the leading expert on this subject, points out, there has also been a large decline in the cost of air transport, which is a surprisingly big factor: Only a tiny fraction of the tonnage that crosses borders goes by air, but air-shipped goods are, of course, much higher value per pound than those sent by water, so airplanes carry around 30 percent of the value of world trade.

By the way, pharmaceuticals, presumably including Covid-19 vaccine ingredients, are mainly shipped by air: An alternative narrative, however, places less weight on technology than on policy. That�s the narrative one often sees associated with Trumpists (although they�re not the only ones with something like this view): Globalists pushed to open our borders to imports, and that�s why foreign goods have flooded into our economy.

And the truth is that from the 1930s up to Donald Trump, the U.S. government did, in fact, pursue a strategy of negotiating reductions in tariffs and other barriers to trade, in the belief that more trade would both foster economic growth and, by creating productive interdependence among nations, promote world peace.

But the long-run push toward more open trade on the part of the United States and other advanced economies mostly took place before hyperglobalization; tariffs were already very low by the 1980s:

While there weren�t big changes in the policies of advanced economies, however, there was a trade policy revolution in emerging markets, which had high rates of protection in the early 1980s, then drastically liberalized. Here�s the World Bank estimate of average tariffs in low and middle-income countries:

You might ask why a reduction in emerging-market tariffs � taxes on imports � should lead to a surge in emerging-market exports. So let�s talk about the Lerner symmetry theorem � or, actually, let�s not and just say that tariffs eventually reduce exports as well as imports, typically by leading to an overvalued currency that makes exporters less competitive. And conversely, slashing tariffs leads to more exports. Basically, nations can choose to be inward-looking, trying to develop by producing for the domestic market, or outward-looking, trying to develop by selling to the rest of the world.

What happened in much of the developing world during the era of hyperglobalization was a drastic turn toward outward-looking policies. What caused that trade policy revolution and hence helped cause hyperglobalization itself?

The immediate answer, which may surprise you, is that it was basically driven by ideas.

For more than a generation after World War II, it was widely accepted, even among mainstream economists and at organizations like the World Bank, that nations in the early stages of development should pursue import-substituting industrialization: building up manufacturing behind tariff barriers until it was mature enough to compete on world markets.

By the 1970s, however, there was broad disillusionment with this strategy, as observers noted the disappointing results of I.S.I. (yes, it was so common that economists routinely used the abbreviation) and as people began to notice export-oriented success stories like South Korea and Taiwan.

So orthodoxy shifted to a much more free-trade set of ideas, the famous Washington Consensus. (Catherine Rampell suggests that should be the new name for D.C.�s football team. Nerds of the world, unite!) The new orthodoxy also delivered its share of disappointments, but that�s a story for another time. The important point, for now, is that the change in economic ideology led to a radical change in policy, which played an important role in surging world trade: We wouldn�t be importing all those goods from low-wage countries if those countries were still, like India and Mexico in the 1970s, inward-looking economies living behind high tariff walls.

There are, I think, two morals from this story.

First, ideas matter. Maybe not as much as John Maynard Keynes suggested when he asserted that �it is ideas, not vested interests, which are dangerous for good or evil,� but they can have huge effects.

Second, it�s a corrective against American hubris. We still tend, far too often, to imagine that we can shape the world as we like. But those days are long gone, if they ever existed. Hyperglobalization was made in Beijing, New Delhi and Mexico City, not in D.C.

# ¿ Oct 31, 2021 03:02

Bar Ran Dun: Jan 22, 2006

Been commenting on all this in CSPAM for a while gunna cross post the stuff that might be relevant. Will be a couple of posts:

Bar Ran Dun posted:

it�s also that international container shipping cartel�ed up and most of the big lines jointly reduced capacity to bring rates up in response to the Covid drop off. they had been caught up in nasty feedback loop that kept prices low for a long time.

absurdly cheap intl container freight was always going to end eventually. it would have been bad if there would have abrupt line failures, but eventually it would have been a similar state to what�s happened now.

Bar Ran Dun posted:

lol,

so the lines reduced capacity by laying up smaller ships. the smaller ships did the Asia-> west coast-> east coast -> Europe-> east coast -> west coast -> Asia. think a big ole horseshoe. the biggest ships just go Asia to LA.

so this fucks European supply chains more than us ones by raising the freight from Asia to Europe. long term that gap is real bad for Europe, especially Germany I think.

edit and that�s a huge gap.

Bar Ran Dun posted:

the marine underwriters were having a bad year already. I mean there have been multiple very large losses of on deck containers on several vessels in the last six months.

the claims industry is uh having a good year.

Bar Ran Dun posted:

Global supply chains are going to be less competitive going forward. The container lines are pulling it in hand over fist now. The cheap container freight party is over.

Bar Ran Dun posted:

it�s not just the db order book it�s all ship category order books.

it means the feed back loops that were driving down freight rates in several categories have stopped driving new builds. it means the ship owners think there will be less international trade in the future. that or they intend to go the route the container lines did and pulling back jointly to raise rates.

basically bulk freight rates are probably going to rise and operators are going to be more profitable.

Bar Ran Dun posted:

the end goal of supply chain management is for what we buy at the final point of sale to be able predict future needs all the way back to the base raw materials being dug out of the ground. then to maximize the whole chain for shareholder profit.

Bar Ran Dun posted:

lol of course. love finding out that people reached the correct conclusion (that controls were necessary to prevent collapse) over a decade before I was born and chose the status quo.

Delay terms are what�s happening. looking at the critiques of the model , the only really valid one I saw was substitution, that we would find new resources to substitute as old ones ran out. the critiques seem to suggest that would stop collapse. no it would just slow it down a bit. another thing slowing it down would be efficiency we have gotten way more efficient. we get way more out of infrastructure than we do in the seventies. the economies of scale are much much greater than in the seventies. but again that would only be a delay.

think about it this way. the SS Kauai is a steamship built in 1980. it�s 1626 TEU. The MV HMM Algeciras was built in April 2020 23,964 TEU. Kauai would have more crew. Fuel consumption is probably comparable, Kauai might even be worse because it�s a steam plant.

# ¿ Oct 31, 2021 03:06

Bar Ran Dun: Jan 22, 2006

Bar Ran Dun posted:

employees were just another inventory to reduce, whoops

Bar Ran Dun posted:

lol

I�m looking at estimates that are $100,000 dollars higher from two months ago for some industrial machinery. like a 20% increase in two months, with a that�s only good for a week warning.

Bar Ran Dun posted:

�SHIP ORDERS SURGE AS CARRIERS RUSH TO ADD CAPACITY
Global shipyards that were retrenching and consolidating in a faltering maritime market barely more than a year ago are now flush with new orders, boosted by efforts by shipping lines to add capacity to meet resurgent consumer demand in Western economies.
Orders for new container ships in the first five months of this year were nearly double the orders for all of both 2019 and 2020, according to London-based maritime data provider VesselsValue Ltd., with the biggest gains going to shipyards in South Korea and China.
The order tally has been so strong that some yards have stopped giving quotes for new vessels and are trying to renegotiate existing orders for more than 20 ships as the price of steel plates used to build vessels has doubled since the end of 2020, according to people involved in those deals.
The resurgence in ordering is being driven mainly by container ships as Western retailers such as Walmart Inc. and Amazon.com Inc. scramble to restock after a year of supply-chain disruptions from the coronavirus pandemic.
The rush to replenish depleted inventories, along with congestion at major ports in North America, Europe and Asia, has left cargo space hard to find and sent freight rates soaring. That has spurred big profit gains at operators like A.P. Moller-Maersk, CMA CGM and Hapag-Lloyd , as well as triggered moves to renew and expand their fleets.
The strong orders are in contrast with the past couple of years, when a long downturn in maritime trade left a dwindling backlog of orders at shipyards and forced some to consolidate.
�It�s been our busiest period in years and it�s very much about container ships,� said a senior executive of South Korea�s Hyundai Heavy Industries Co., the world�s biggest shipbuilding facility in terms of capacity. �The orders are mostly for bigger ships with all the extras to emit less, which is good for margins. We are almost out of slots to build new ships until late 2023.�
�I�ve never seen such demand in 20 years,� this executive said.
South Korea�s three big yards - Hyundai Heavy, Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co. - account for more than a third of all shipbuilding orders for all types of vessels. The other shipyards with big shares of global orders are China State Shipbuilding Corp., China Shipbuilding Industry Corp. and Japan�s Imabari Shipbuilding Co.
In the first five months of this year, 208 container ships worth $16.3 billion were added to the global order book, compared with 120 ships valued at $8.8 billion for all of last year and 114 vessels worth $6.9 billion in 2019, according to VesselsValue.
The South Korean shipyard executive said the boxship orders are mainly for vessels that can move around 14,500 containers and behemoths with a capacity of more than 20,000 boxes that are mainly deployed on Asia-Europe trade lanes. (The Wall Street Journal, 6/8/2021)�

lmao

Bar Ran Dun posted:

this will not happen quickly. ships take a long time to build. so that means years and years until capacity gets back to where it was.

it also means they broke ranks and eventually they�ll go back to what was happening before the pandemic. just that�ll be years from now...

Bar Ran Dun posted:

LINER CONGESTION SPREADS ACROSS THE PLANET, 304 SHIPS QUEUING FOR BERTH SPACE
The ebb and flow of record global liner congestion is neatly encapsulated in two maps provided below from Seaexplorer, a container shipping platform created by logistics giant Kuehne+Nagel.
As of 3.30 pm Singapore time today there were 304 ships idle in front of ports around the world waiting for berth space to open up. Seaexplorer data shows there are 101 ports reporting disruption such as congestion. Officials at the Kuehne+Nagel digital offshoot report the number of ships forming queues hit 350 in the middle of this week before falling back to 304, the same level as this time last week (see lower map). Red dots in the enlargeable maps represent clusters of ships while orange ones mark out ports that are congested or suffering from disrupted operations.
The clear change over the past week is how the congestion, so visible in recent weeks in south China, a key export area hit by a Covid-19 outbreak, is now spreading to other important hubs. Singapore, for instance, has seen the number of boxships waiting for berth space increase by 37.5% over the past week, while intra-Asia hubs such as Laem Chabang are now reporting tailbacks and in the US, east coast ports are suffering all manner of disruptions.
While last week, boxships queueing in Chinese waters made up more than 50% of the global total, this has dropped today to less than 40% indicating the growing global congestion contagion.
Terminals are becoming global bottlenecks, be it at berths, yards or gating out cargo.
Maersk, the world�s largest container line, in a post from earlier this week discussed the stretched nature of global supply chains, something it warned was now the new normal.
�The trend is worrying, and unceasing congestion is becoming a global problem. Due to Covid-19 and a significant volume push since the end of last year, terminals are becoming global bottlenecks, be it at berths, yards or gating out cargo, and it�s continuing throughout the logistics chain � in the warehouses, the distribution centers � with numbers on the rise,� Maersk stated.
Splash reported yesterday how the partial shutdown of Yantian Port following a Covid-19 outbreak late last month is now on track to affect twice as many containers as were impacted during March�s high-profile blockage of the Suez Canal. (Splash 24/7.com, 6/18/2021)

# ¿ Oct 31, 2021 03:07

Bar Ran Dun: Jan 22, 2006

Bar Ran Dun posted:

The skyrocketing price of shipping goods across the globe may hit your pocketbook sooner than you think - from that cup of coffee you get each morning to the toys you were thinking of buying your kids.
Transporting a 40-foot steel container of cargo by sea from Shanghai to Rotterdam now costs a record $10,522, a whopping 547% higher than the seasonal average over the last five years, according to Drewry Shipping. With upwards of 80% of all goods trade transported by sea, freight-cost surges are threatening to boost the price of everything from toys, furniture and car parts to coffee, sugar and anchovies, compounding concerns in global markets already bracing for accelerating inflation.
�In 40 years in toy retailing I have never known such challenging conditions from the point of view of pricing,� Gary Grant, the founder and executive chairman of the U.K. toy shop The Entertainer, said in a interview. He has had to stop importing giant teddy bears from China because their retail price would have had to double to add in higher freight costs. �Will this have an impact on retail prices? My answer has to be yes.�
A confluence of factors - soaring demand, a shortage of containers, saturated ports and too few ships and dock workers - have contributed to the squeeze on transportation capacity on every freight path. Recent Covid outbreaks in Asian export hubs like China have made matters worse. The pain is most acutely felt on longer-distance routes, making shipping from Shanghai to Rotterdam 67% more expensive than to the U.S. West Coast, for instance.
Often dismissed as having an insignificant impact on inflation because they were a tiny part of the overall expense, rising shipping costs are now forcing some economists to pay them a bit more attention. Although still seen as a relatively minor input, HSBC Holdings Plc estimates that a 205% increase in container shipping costs over the past year could raise euro-area producer prices by as much as 2%.
Central bankers have so far been sanguine about the phenomenon, arguing that the rise in consumer prices tied to supply hiccups won�t last. European Central Bank President Christine Lagarde said on June 10 that while supply-chain bottlenecks would push up production prices and the headline inflation rate is expected to rise further in the second half of this year, the effect will fade.
Several factors explain the relative lack of concern. Shipping costs only constitute a small fraction of the final price of a manufactured good, with economists at Goldman Sachs Group Inc. estimating in March - when China-Europe rates were about half of current levels - that internationally they made up less than 1%.

To top that, companies have annual contracts with the container lines, so the prices they�ve locked in are considerably lower than the headline-grabbing spot rates. Although the latest round of contract negotiations in May reflected the stronger spot market, HSBC trade economist Shanella Rajanayagam said that �the longer-term rates are much much lower than the spot rates, even if they are feeding through.�
With the end of lockdowns consumer demand is likely to shift to services from goods, but �the risk of course is that higher shipping costs persist - especially given ongoing shipping disruption - and that producers become more willing to pass these higher costs on to consumers,� Rajanayagam said.
While many economists note that even a full pass-through of higher shipping fares to consumers will have a marginal effect on headline inflation, Volker Wieland, a professor of economics at the Goethe University in Frankfurt and a member of the German government�s council of economic advisers, warns that they might not be sufficiently factored in.
�Even if the order of magnitude is smaller than estimated, the dynamic builds over a year and has significant effects,� he said. �That means there�s a danger we�re underestimating the impact.� (Bloomberg, 6/14/2021)

Bar Ran Dun posted:

RETAILER HOME DEPOT CHARTERS BOXSHIP TO MAINTAIN SUPPLY CHAIN
After months of reports of capacity and equipment shortages highlighting the challenges retailers are having getting merchandise to their stores, one of the largest big-box stores in North America, Home Depot, has taken the extraordinary step of chartering a containership to maintain its supply chain. It is the first time in the company�s 40-year history that it has gone to such extremes to fill its shelves.
The home improvement� retailer ranks as one of the largest importers. With nearly 2,300 stores in the U.S., Canada, and Mexico, Home Depot generated over $132 billion in revenues in 2020. The home improvement sector continues to be one of the hottest segments, with consumers deciding to make changes as they spent months at home during the pandemic.
With sales rising over 30 percent in the first quarter of 2021, Home Depot has a voracious appetite for merchandise to keep its stores and warehouses full. Each store stocks approximately 35,000 products, the company reports, with a total of more than one million items listed in its online store.
President and Chief Operating Officer Ted Decker told CNBC that the company has already taken usual steps to maintain its merchandise inventories and get products on the shelves during the disruptions to the global supply chain. He said Home Depot has purchased merchandise at higher costs in the open market beyond its contracted suppliers. The company has even resorted to flying smaller, higher value items, such as power tools and electrical components, by air freight to make up for shortfalls in supply.
Describing the company�s latest efforts to maintain its supply lines, Decker told CNBC, �We have a ship that�s solely going to be ours, and it�s just going to go back and forth with 100 percent dedicated to Home Depot.� He did not identify the size of the boxship or which carrier they are chartering the vessel from, nor the length of the charter. He said it would start running next month, but did not specify which routes or ports.
Last week, the National Retail Federation forecast that the U.S.�s major ports were on track for record volumes in 2021 driven in large part by retail merchandise imports. The NRF in its monthly Global Port Tracker projected that container volume would remain above 2020 levels at least until the fall but might see a slight decline in volumes versus 2020 before retailers begin stocking up for the holiday retailer season. (Maritime Executive, 6/15/2021)

Bar Ran Dun posted:

Hapag Lloyd just ordered 6 ultra large containerships.

Bar Ran Dun posted:

a business is a system designed to poo poo out whatever widget or service from its inputs to be turned into money (or a system designed to just Hoover up money). a business is a loop to repeat the same task over and over again.

and this is capitalism it is modernity tied up with the roots of the the industrial revolution.

Bar Ran Dun posted:

Home Depot is literally chartering their own containership because the container lines service is so bad now.

i don�t think another company is going to that extreme.

# ¿ Oct 31, 2021 03:08

Bar Ran Dun: Jan 22, 2006

Bar Ran Dun posted:

they had too many ships and freight rates v were artificially low for a long time. it was systematic problem that had been causing line failures and mergers. then pandemic. they cartelled up and reduced capacity to not die. but now ships take a long time to build and it�ll be years before it gets back to that state.

Bar Ran Dun posted:

lmao got an advanced degree for a dying system

Bar Ran Dun posted:

well yeah I think the trend going forward is less global. international supply chains are probably going to get less predominate and JIT now has a bloody nose and black eye in just about everybody�s minds.

by normal I mean you�ll actually be able to get a container. or you�ll actually get things rather than containers sitting at anchor in ships for months. or drayage companies will actually be able to move something for you without a three + week wait.

the system going back to prepandemic I don�t think that�s coming back.

Bar Ran Dun posted:

this it�s: container flow. the rate of flow is the ships, it�s the chassis, it�s the rail capacity, it�s the labor. basically all the parts have restricted capacity and the containers are going through the cycle very slowly.

and we spent decades reducing stocks and thus system stability, and the ability of companies to weather this.

Bar Ran Dun posted:

On the warehouses...

they have been slamming up warehouse all over the country about as fast as is possible. what to watch for is a giant rear end concrete slab. then they bring in prefabricated reinforced concrete panels and stand them up vertically to make the walls. then a steel framed roof.

it�s impressive how fast they go up. I�ve seen a couple in ports I work in the last six months to a year.

inventory in warehouses will be back as a thing after this.

Bar Ran Dun posted:

the big thing is nobody can get cans.

things like frozen meats are getting stuck waiting in rail cars for months. then the railroads don�t have enough people so when the reefer have a problem things just sit get warm and rot (and it�s actually kindof hard to let that happen in a rail car reefer).

basically poo poo is stuck or being ruined by delays.

Bar Ran Dun posted:

freezer cars and reefer containers are running out of fuel on the rail because they don�t have people to fill the tanks.

the fundamentals are strong folks. not great not terrible fundamentals.

# ¿ Oct 31, 2021 03:09

Bar Ran Dun: Jan 22, 2006

Bar Ran Dun posted:

I started to write a post a couple days ago to try to say what I thought, I�m just gonna post even though it�s not done:

So a couple major things are occurring...

There is a growing divide between folks that can and probably will continue to work from home and everybody who can�t. This isn�t strictly class aligned, see some of the call center jobs Business Gorilla is going hooking people up with in the covid thread. At the same time a whole segment of people have realized the managers don�t give a gently caress if they die. Retail restaurants, etc, before the pandemic they would put up with it, because of the pandemic they�ve gone: well gently caress this. Also seeing this in health care workers...

This is to say the relationships of production are changing.

At the same time global supply chains and all logistics are becoming more expensive and slower. Companies want more inventory as a consequence and this creates a feedback loop exacerbating the logistical issues. This isn�t going away and will push supply chains away from horizontal, truly global, just in time supply chains to more vertical, regional, inventory heavier, supply chains.

This is to say there is a change occurring in the means of protection.

That said we ain�t changing mode, poo poo�s still capitalism. But I think these are large changes. We are looking at everything getting worse for everyone or the cool zone.

probably everything going worse for everyone.

Bar Ran Dun posted:

no but as ships got larger US marine terminals didn�t really keep up. before the pandemic they were always just barely hanging on on the West Coast with regards to capacity and container flow rates.

it�s hard to ever get out of a hole if you were only able to tread water before the poo poo hit the fan.

Bar Ran Dun posted:

weirdly the only place that really gets it right is GA. GPA has inland rail yards one can in gate into the marine terminal from. So drop the container in Macon, GPA port rails it to Garden City Terminal. super simple .

we should have a national level port authority that did the same thing for intermodal. I mean gently caress it, set it up so you can in / out gate for LA/Longbeach from Chicago over the rail.

This is a doable thing demonstrated to work and we could just choose to do it. but we won�t

Bar Ran Dun posted:

To be fair the how was worked out here. the current scale would not have been apparent in the 70�s or 80�s. the construction of these cranes and terminals was a new thing, and sometimes it didn�t go well. I�ve heard stories about the first generation of cranes falling down during construction in several ports.

it�s not so much that there was no consideration, it�s that it was a new thing. I don�t think the realized ships would go from low thousands of TEUs to tens of thousands. I mean the Kauai for b example was 1626 TEUs in 1980. now some ships are 24,000 plus.

basically the system is hosed by it�s own successes that weren�t entirely apparent when it was being constructed here. foreign ports do benefit from several decades of watching the system develop.

Anyway to get to the point:

We need a National Port Authority patterned on Georgia Ports Authority. It could break the advantage the lines have over individual ports. It could have the resources to expand where smaller entities might not. It could do innovating things like inland rail/marine ports allowing in-gating / out gating far inland.

# ¿ Oct 31, 2021 03:13

Bar Ran Dun: Jan 22, 2006

KillHour posted:

Removing safety regulations "temporarily" has never in the history of man either backfired or resulted in them not going back in after. Nope, never.

Two high stacking isn�t a safety regulation.

It�s a I don�t wanna look at containers regulation .

Now the truckers hours getting relaxed that�s a safety regulation that shouldn�t be hosed with.

# ¿ Oct 31, 2021 03:17

Bar Ran Dun: Jan 22, 2006

Except there isn�t a labor shortage. There are workers that won�t take the lovely god awful jobs that don�t pay anything anymore.

# ¿ Oct 31, 2021 03:42

Bar Ran Dun: Jan 22, 2006

Most of the real problems are being hidden. While lotta poo poo is being transported by air. Other things you won�t even notice. Hell some effects might even look like �sales�. Product that normally wouldn�t have a buyer is getting bought and sold in stores.

# ¿ Oct 31, 2021 05:28

Bar Ran Dun: Jan 22, 2006

To who?

If you work in manufacturing or anything industrial lol. Between 10 to 6 months ago.

Consumers at grocery indefinitely with cracks and absences/ substitutions/ price increases. Edit: poorer folks and people intentionally testing grocery costs already have noticed the price increases.

Consumers for specific affected durable goods. Regionally for specific items 10 to 6 months ago.

Bar Ran Dun fucked around with this message at 17:31 on Oct 31, 2021

# ¿ Oct 31, 2021 05:41

Bar Ran Dun: Jan 22, 2006

GlassEye-Boy posted:

Found a faster way to get cargo shipped to Long Beach and out, Matson Fast Vessel seems to be unaffected by the delays since they have their own dedicated terminal. Then again it�s 75k for a full container plus a partial. So not for everyone.

Yeah they have three vessels on the China west Coast service.

At that price one could fly many things. Matson does have its own terminals (and they own SSA). lol they�re charging so much.

# ¿ Nov 6, 2021 17:16

Bar Ran Dun: Jan 22, 2006

Ghost Leviathan posted:

, because so much work has become just that bad.

I think a lot of people did something else and found oh this isn�t awful and now I�m making more money.

Now employers that had employees doing awful jobs can�t get those people back and everybody new doesn�t want to put up with the old horseshit.

In logistics the places that laid people off, they�re hosed. Honestly they deserve it too. CFS that kept people around are hanging on, barely, basically they still have what they had, just nobody new.

# ¿ Nov 10, 2021 18:11

Bar Ran Dun: Jan 22, 2006

Jaxyon posted:

It turns out that businesses will shoot themselves in the foot rather than pay a decent wage or improve conditions. I guess I shouldn't be surprised.

Paradoxish posts about small businesses being terrible in this way in CSPAM, but I think there are entire necessary critical segments particularly in logistics that just see excessive hours and low pay as �normal� and it�s going to take a long time before they move on from bitiching about �millennials who only want to work 40 hours� to offering positions that don�t suck and pay for how truly hard the work is.

I mean that could take years before they give on it.

# ¿ Nov 11, 2021 00:59

Bar Ran Dun: Jan 22, 2006

Jaxyon posted:

In other news, my friend posted about how her entire supply chain team has been hospitalized for work-related stress conditions in the last few months.

The suddenly more work staffing problem is a thing that got modeled by the big consultancies in tiffs between shipyards and the navy about major change orders and the workload effects.

Basically if there is suddenly more work it creates a series of feed back loops than burn people out faster than they can be replaced (if it lasts longer than a couple weeks) and especially if they take training to replace.

Like so many other things the loving problems hitting us now have solved solutions that just get ignored by managers.

# ¿ Nov 11, 2021 01:53

Bar Ran Dun: Jan 22, 2006

Owlofcreamcheese posted:

The most recent US unemployment rate was 4.6 percent. Lowest it's been in ages. Lower than pre-pandemic in a lot of places.

It seems like it's not just a matter of not paying enough (even though people are not paid enough). It seems like there may be actually more jobs than there are workers (because people died, but more overtly because a large rotating number of people at any one time are out sick), which would mean higher pay could only move the shortage around instead of ending it.

Yep work force shrank by a large amount. Like 5 million.

# ¿ Nov 11, 2021 17:16

Bar Ran Dun: Jan 22, 2006

Mr. Fall Down Terror posted:

its really not a crisis for a lot of people. its annoying to have higher prices but a general increase in grocery costs is not the same as a pending famine. high inflation sucks but not everything that sucks is a sign of the imminent collapse of civilization imo, if we made it through a generational-scale pandemic then i think we can bear a 10% increase in the cost of milk and bacon

If one is a well over professional it�s not that big of a deal. Specific things will be unavailable intermittently.

Where it will be a big deal:

If you have a necessary durable good or vehicle purchase and can�t eat the price spike.

If you work in manufacturing and the company you work for isn�t figuring it out as far as securing alternative inputs goes or just gets randomly hosed by bad luck and they stop production.

So...

Most people will be mildly irritated occasionally with higher expenses . Some people will have a crisis because a big item they need like a fridge or car is now out of reach entirely. Other people will lose jobs and work.

# ¿ Nov 12, 2021 21:37

Bar Ran Dun: Jan 22, 2006

Owlofcreamcheese posted:

. If specific things seem to start being totally inaccessible I think people will start worrying more.

Specific things are basically inaccessible. They just aren�t things you are interacting with.

You aren�t trying to repair a marina or get a boat part. You aren�t trying to get a roof contractor. You aren�t working at a factory that is laying you off. You probably aren�t in need of a car. You aren�t trying to arrange for the transportation of anything.

# ¿ Nov 13, 2021 03:03

Bar Ran Dun: Jan 22, 2006

Most of the discussion is going on in CSPAM but Vancouver, BC just had most of its rail and highway connections cut off.

# ¿ Nov 17, 2021 20:18

Bar Ran Dun: Jan 22, 2006

lol he�s so wrong. They aren�t artificially restricting supply.

It�s real duder.

# ¿ Nov 17, 2021 21:45

Bar Ran Dun: Jan 22, 2006

Cpt_Obvious posted:

Which is to say: this supply chain crisis is incredibly profitable.

To certain parties... carriers, container lines, etc making bank. Raw goods, steel, chemicals, etc making bank.

Complex manufacturing... a lot of them are eating it. Where the profit is, is getting pushed to different parts of the supply chain. Labor situation isn�t entirely dissimilar. The bottom and the very top are benefiting, professionals and mid level not so much losing purchasing power.

# ¿ Nov 17, 2021 23:44

Bar Ran Dun: Jan 22, 2006

Cpt_Obvious posted:

Let me put it this way:

There is a massive supply chain shortage, and it is very solvable: hire more truckers, hire more longshoreman, and pay them enough to show up. So why aren't the capitalists doing this?

Because it is more profitable not to. Hiring people costs money, but jacking up the price doesn't. With dwindling supply comes rises in price, and that is more profitable than solving the actual problem with wage hikes. This is the same reason that the Covid crisis was so particularly disasterous: it was more profitable to force people to work than paying them to stay home.

More labor alone doesn�t solve this. This would still be a problem if we had double the truckers and longshoremen tomorrow. The physical infrastructure is also a major a limiting factor particularly for the West Coast marine terminals.

If we started today it would take years to physically upgrade the marine terminals and rail. Years! And we aren�t starting.

It�s very solvable yes, but lol not in the way you think it is.

# ¿ Nov 17, 2021 23:48

Bar Ran Dun: Jan 22, 2006

The quits is a related but separate issue than the supply chain.

Terminals and container flow have been a problem waiting to bite us in the rear end for a couple decades now. Think of the quits as a comorbidity.

# ¿ Nov 17, 2021 23:55

Bar Ran Dun: Jan 22, 2006

Owlofcreamcheese posted:

I�ve asked before: are there tons of people to hire? Unemployment is no longer very high.

Buncha people dropped out of the workforce, not included in unemployment percentage.

# ¿ Nov 18, 2021 00:05

Bar Ran Dun: Jan 22, 2006

Hellblazer187 posted:

What part of "capitalists shifted production overseas to increase profits, and cut down on inventories to increase profits, and so any kind of disruption can cause a shortage. And now they're trying to blame others for it" is wrong?

Agree with this as what is happening

Hellblazer187 posted:

He is not saying the entire supply chain crisis is caused by a deliberate reduction in production.

But this is what Dick seemed to be saying in the video.

# ¿ Nov 18, 2021 00:07

Bar Ran Dun: Jan 22, 2006

He also strongly implies the crisis is an ideological construction to justify higher profits which it is not.

# ¿ Nov 18, 2021 00:34

Bar Ran Dun: Jan 22, 2006

Owlofcreamcheese posted:

Yeah, but not like, because it would be fun, people retired, or became stay at home parents, or just died or became sick (temporarily or permanently). I am sure that if you payed more you could draw some amount back, and 4% unemployment isn't zero percent, so it could go lower but it really might be that there really is somewhat of a shortage of humans to work right now.

Right but those people don�t get included the the reported unemployment figure, and I know you have read that before in D&D.

# ¿ Nov 18, 2021 00:54

Bar Ran Dun: Jan 22, 2006

Cpt_Obvious posted:

2. Capitalists could fix or at least alleviate the problem by motivating new hires up and above the replacement rate by improving wages/benefits etc.

3. The capitalists are not doing this because it costs money.

Longshoremen get paid pretty well on the West Coast. It�s literally the strongest US union job that exists.

# ¿ Nov 18, 2021 00:56

Bar Ran Dun: Jan 22, 2006

plogo posted:

I think this is a pretty good chart for explaining some (not all) of the supply chain issues:

https://twitter.com/DavidBeckworth/status/1460666724328611848

There has been a huge shift in demand from services to goods.

Krugman makes this point and it�s contributory. Basically is like this: Not going out to eat (pandemic) buying poo poo to do instead.

# ¿ Nov 18, 2021 00:59

Bar Ran Dun: Jan 22, 2006

Mr. Fall Down Terror posted:

any problem can be solved if you throw enough money at it. we could have a full faculty of teachers tomorrow if we paid them all $200k a year. thus, the capitalists who run the school system are simply failing to do this obvious fix because they are concerned about their profits

My man you can throw all the money you want at getting say new container cranes, it�s still gunna take years.

# ¿ Nov 18, 2021 01:00

Bar Ran Dun: Jan 22, 2006

Cpt_Obvious posted:

Truckers aren't tho, and that's a big bottleneck right now.

Trucks are waiting in line at the terminals. The terminals rate of container flow is less than the short haul drayage rate of container flow.

# ¿ Nov 18, 2021 01:20

Bar Ran Dun: Jan 22, 2006

Cpt_Obvious posted:

Labor force participation means a guy working 8 hours a week and a guy working 80 hours are counted the same way.

Now that be interesting to see. I bet women are way down in hours and men are down. But it be job specific, in the understaffed areas they�re probably way up.

# ¿ Nov 18, 2021 01:53

Bar Ran Dun: Jan 22, 2006

I saw prices at 7.99 a pound. Then 2.50. Then 1.79. Then back up to like 3.50 for the same brand over the last couple of weeks. Then notes about no custom cut birds.

# ¿ Nov 23, 2021 04:26

Bar Ran Dun: Jan 22, 2006

The turkey thing is going to be reefer can availability not product supply so it�ll be really regional and basically luck based as to if and when there are any issues.

# ¿ Nov 23, 2021 04:33

Bar Ran Dun: Jan 22, 2006

Market place did say supply on turkeys was down 24% from last year.

# ¿ Nov 23, 2021 21:53

Bar Ran Dun: Jan 22, 2006

GreyjoyBastard posted:

That's goddamn appalling for everybody except the big shipping companies. Snowglobe lady is the human interest centerpiece but honestly I'm more horrified about the truckers.

It�s been a couple decades since they really made any money at all (the big container lines) basically they had been staying afloat by merging.

They also haven�t become a cartel to a certain extent, they are a cartel.

And drayage truckers... life has sucked hard for them for decades too.

Also snow globe lady probably won�t get anything. No compensation from the lines (which is extremely limited under COGAS anyway ) and likely unless her cargo was physically damaged no insurance either.

We need a national port authority because small city based ones even for big terminals don�t have the size to deal with the lines, they can always just go somewhere else.

# ¿ Nov 30, 2021 04:58

Bar Ran Dun: Jan 22, 2006

Every single thing in that post is spot on.

# ¿ Nov 30, 2021 07:06

Bar Ran Dun: Jan 22, 2006

Well yeah. If transit slows down and becomes more expensive more inventory needs to be carried.

There will eventually be a point where firms are carrying adequate inventory for the delays and increased costs. Then those costs and delays will go away.

# ¿ Nov 30, 2021 07:50

Bar Ran Dun: Jan 22, 2006

CMYK BLYAT! posted:

CBP really does have a dedicated radiation scanner in case someone sneaks a ton of plutonium into a container, or did i mishear things?

Yes, and they definitely work. I used to do a lot of high consequence work, which I�ll not be going into.

They also check imported yachts occasionally for this.

# ¿ Nov 30, 2021 17:03

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# ¿ Apr 24, 2024 17:13

Bar Ran Dun: Jan 22, 2006

And every container is scanned.

CBP also has VACIS and mobile VACIS which basically let them look inside containers. Various agencies and not for profit also inspect a percentage of containers.

# ¿ Nov 30, 2021 17:20

The Something Awful Forums > Discussion > Debate & Discussion > Supply Chain Crisis: Christmas canceled due to no inventory

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