Supply Crisis Expected to Ease by 2022

The supply crisis that began with the pandemic and affected world trade continues to have negative impacts on the logistics sector. Rising transportation costs resulting from the supply crisis are affecting logistics traffic, particularly in maritime shipping. The supply crisis, which began showing signs of improvement in the final quarter of 2021, is expected to be resolved, with 2022 anticipated as a recovery year. Fatih Baş, Executive Board Committee Member (Commercial) at Globelink Ünimar, who shared his views on the supply crisis and global maritime trade, stated: "The supply crisis is being resolved day by day. However, we may not see its impact on the sector and costs until the end of 2022."

Fighting the "Supply Crisis"

The Covid-19 pandemic that began in 2020 deeply affected world trade as it impacted all aspects of our lives. Particularly, containers produced primarily in China and with annual production growth of 4 percent are considered one of the most important tools in the logistics sector. As a result of disrupted production due to the pandemic, the logistics sector has been battling a "Supply Crisis" for nearly two years. The disruption of world trade and the uncertainty caused by the pandemic brought container production to a standstill, leading to a global crisis in the logistics sector. Maritime shipping, which handles over 80 percent of global logistics network volume, has intensified this crisis. As a result of the "Container Shortage" and rising demand, logistics sector costs have at times increased tenfold depending on region, affecting global trade flow and creating a domino effect. With the final quarter of 2021, the supply crisis began showing signs of resolution, with forecasts indicating it will be fully resolved by the end of 2022. Fatih Baş, Executive Board Committee Member (Commercial) at Globelink Ünimar, commented on the impacts of this crisis in the logistics sector and shared his views on the supply crisis and its resolution.

"We closed 2021 above our targets"

Speaking about the supply crisis, Globelink Ünimar Executive Board Committee Member (Commercial) Fatih Baş said: "Without question, as a logistics and supply chain sector, we have been among the most affected sectors during the pandemic period. By the nature of our sector, we move in parallel with world trade and the commercial activities of our stakeholders. During a period when trade stalled, supply-demand imbalance emerged, and numerous sectors came to a halt at times, we as a sector experienced another major crisis. Containers produced primarily in China and Asia hold a very important place in logistics operations. The halt in production directly disrupted container manufacturing. For our sector, which by its nature never experiences disruptions and never rests for a moment, such uncertainties and crises cause enormous damage. We can view the supply crisis we experienced in this way. It led to the lockdown of a transportation mode that hosts more than 80 percent of logistics traffic such as maritime shipping. Although there were no clear solutions in 2020, 2021 was a productive year in terms of resolving the crisis. Particularly in the final quarter, we tracked important improvements and had the opportunity to see its impact on costs. Although disruptions occurred in maritime shipping with the crisis we experienced during the pandemic period, we once again observed the importance of alternative transportation modes such as road, air and rail, and the importance of flexibility in logistics operations. As Globelink Ünimar, we are a company that frequently uses maritime shipping in the logistics solutions we provide. Although we felt the effects of this crisis as much as our entire sector, we quickly adapted to the process and continued to safely deliver our customers' shipments to any point they desired through our fast, reliable and flexible logistics solutions. At this point, we can say we are satisfied with the developments, particularly in the final quarter of 2021. As of 2022, we can observe improvements regarding the resolution of the crisis, and our forecast is that this crisis will disappear by the end of 2022." he said. Sharing his views on developments that will follow the resolution of the supply crisis, Baş stated: "Unfortunately, we saw the effects of the supply crisis in costs that sometimes exceeded tenfold in shipments from Asia to Europe. As we have continuously emphasized, the logistics sector plays a key stakeholder role for all other sectors, and during this process we experienced that our sector holds a critical position in trade and production. In light of current developments, we forecast that the supply crisis will be resolved by the end of 2022. However, the complete reflection of the crisis's effects on costs will take time. Rather than very rapid improvement, it will be more prudent to expect costs to fall with quarterly improvements during this period. We can point to the final quarter of 2022 as the timeline when the crisis's effects end. Particularly in the specific case of the container crisis, broader-scale production will certainly accelerate this process. Currently, global trade and consequently logistics traffic are sending a very strong demand signal. Meeting the necessary production and resolving the supply crisis will affect the pace of the logistics sector and directly world trade. Despite the difficult period we have gone through, as Globelink Ünimar we closed 2021 above our targets. In 2022, we will continue to focus on warehousing, domestic transportation & partial distribution and value-added services, expand our customer base by reaching potential customers within this scope, and continue to incorporate end-to-end solutions into our service network. Both the resolution of the supply crisis and the increase in global trade volume point to 2022 being a positive year for us." he said.