Barbadian consumers have been assured by importers that there will be enough food items on the shelves this Christmas, but a leading trade specialist is warning that the region is not immune to the crippling disruptions being witnessed in the developed world.
Dr Kai-Ann Skeete, a research fellow at the Shridath Ramphal Centre for Trade Law, Policy and Services, (SRC) Cave Hill Campus of The University of the West Indies has told consumers to brace for delays and possibly shortages of some items as the pandemic-induced supply chain disruptions continue.
Writing in a recent SRC Newsletter, she said part of the solution to some of the import issues was for the region to work as a consortium to ship products directly from the source markets in places like Asia to a central regional port, for on-shipping throughout the Caribbean.
“Christmas barrels, decorations, household items, food and toys will not arrive at their intended destinations in time for the start of the season. After all, popular US retailers Walmart, Target, Costco, Ikea, Bed Bath and Beyond (BBD) and Dollar Tree to name a few have reported the impending delays and battles with the delayed shipments stuck at Chokepoints across the country,” she stated in a recent blog.
Despite the assurances there was no need to panic shop after producers cut production of various products during the COVID-19 pandemic due to greatly reduced demand, Dr Skeete said price increases were evident as Christmas holiday demand surged.
“We do not produce the gadgets, tools, equipment, household items, toys and processed foods that we consume on a daily basis,” the research fellow noted, offering her suggestion to importers.
“In a world where crisis managers troubleshoot on a daily basis, the apparent solution is the investment into chartering cargo vessels to deliver containers from Asia to the US terminals. After all, the goods within container ships stuck outside major Ports is of little value to the retailers unless they are offloaded and processed in a timely fashion which would allow the retailers to recoup losses and earn a profit during the upcoming holiday season.”
Skeete cited the actions of major retailers in the United States who have sought to bypass the major obstructions that had the potential to cause significant distress to their businesses during the current high-demand holiday season.
“The solution of chartering the ships can speed up the delivery of critical goods in a timely fashion to the mainland United States. In the spirit of innovation and due to the unavailability of traditional 40-foot containers, Walmart started to utilise 53-foot containers that are mainly used inland in the US.
“These large containers require specialised cranes to assist with the off-loading and become more labour intense. But the chartering of these ships is not a cheap solution since a monthly cargo charter costs major US retailers between US$1 to 2 million and rising in cost dependent on the number of rented containers which could range between 500 and 1,500 containers monthly,” Skeete disclosed.
In this connection, the UWI research fellow commented: “Having read the state of play in the US, the reality hits home to us in the Caribbean because we purchase hundreds of items from the popular US retailers as well as online from Amazon. We must now confront the reality that their challenges will exacerbate the challenges confronting our local retail industries and inevitably, local consumers.
“Our solutions will not be as immediate, but the time has now come for us in the Caribbean to think about expanding our seaports to achieve greater efficiency and increased movement to ensure there is space for the storage of containers, consulting with the trade unions to ensure that port operations eventually become 24/7 similar to the Asian ports of origins.”
In addition, Skeete said it was time for the region to act as a collective in the sourcing of products from the region.
“As a region, we should explore chartered – joint cargo shipments directly from Asian to Kingston Wharves and then disseminated across the region.”
Recently Chairman of the Retail and Distribution Committee for the Barbados Chamber of Commerce and Industry (BCCI), Tomilson Bynoe alerted local consumers that they could expect across the board price increases. Those price hikes have already
hit consumers.
“We have situations where quite often orders are being placed or even increased, but what is being shipped is around 25 per cent less than what you ordered or sometimes you are not receiving it all. t varies based on the particular commodity.”
He added: “It is only going to get worse coming on to Christmas because if you look at the information coming out of the source markets – China, United States and the United Kingdom, the supply chain has issues.”
Even more important shipping costs have risen more than 200 per cent. (IMC1)
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