UK’s largest chicken producer warns the industry is in danger
The meat industry in the United Kingdom is facing a severe shortage of carbon dioxide as rising gas prices has led to the suspension of production from large fertilizer plants. The factories, owned by CF Industries, make up around 60% of the UK’s commercial CO2 supply as a byproduct of fertilizer production.
Companies are urging the UK government to support the suspended fertilizer plants to try to tackle the nationwide gas crisis, with the owner of 2 Sisters Food Group, Ranjit Boparan, threatening that “Christmas will be canceled” without government intervention.
Before the crisis began, processors were already struggling with labor shortages which were hindering production levels. The lack of CO2 is straining the industry further, with “massive disruption” on the way, set to leave consumers with a lack of products on supermarket shelves. The government is rushing to respond to the disruption in an attempt to minimize the impact on the nation’s meat industry.
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Asian lockdowns strain commodity supply chains
As Covid-19 cases increase across the continent, so does the strain on supply chains. Producers of commodities such as palm oil and coffee are facing major disruptions due to labor shortages and issues with transportation.
Malaysia’s output of palm oil has decreased due to travel restrictions preventing workers from traveling to plantations, which is also causing prices to spike. Unilever’s Chief Financial Officer noted that the price of the oil is now around 70% higher than average. Vietnam, the world’s second- biggest coffee exporter by volume is experiencing trouble with transporting coffee beans, leading to higher prices for consumers.
Trinh Nguyen, a senior economist at Natixis, said that “these supply shocks reverberate globally because Vietnam and Malaysia hold a large market share of key commodities”, with leading companies such as J.M Smucker Co. and Unilever PLC facing cost pressures due to the scarcity of the raw materials.
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Backlog of cargo ships at California ports hits all-time high
This week, 70 ships were stuck outside two of the biggest ports in the United States, Los Angeles, and Long Beach, which process 40% of all cargo containers entering the country. The backlog is due to surging demand for imports, with retailers and manufacturers rushing to restock their inventories, but the global shipping system is struggling to keep up.
The delays have impacted the supply of many lines of goods, with shortages of children’s toys, pet food and clothes on the rise. The US Toy Association has warned that the backlog could affect many of its members going into the holiday season.
The Californian ports have agreed to expand their operating hours to try to clear the backlog, as well as working with the White House Supply Chain Disruptions Task Force to try to alleviate bottlenecks. Gene Seroka, head of the Port of LA indicated that the backlog will not ease any time soon, warning that extremely high volumes of cargo are expected to arrive into the port “throughout the year and into 2022”.
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