Major supply chain problems have continued well into 2022, and in some cases have got worse, according to a survey by the American Chemistry Council. In particular, transportation-related issues continued through the first half of the year, having a prolonged impact on manufacturing operations in the U.S.
Supply chain and freight transportation disruptions have been harming survey respondents’ activities for three consecutive quarters. As well as lost manufacturing and customer orders, they reported that higher shipping costs were being compounded by expensive workarounds. These include increased inventories, investing in additional rail cars, and having to commit extra resources to managing shipments.
Almost all – 97 percent – of respondents said they had had to modify their operations in some way because of supply chain issues and transportation disruptions. Inventories have increased by 92 percent of chemical producers, while 62 percent reported increased inventories of finished products. And 52 percent curtailed production because they were unable to ship products to customers. About a third had orders cancelled by customers over fears the order would not arrive in time.
ACC said that while policymakers have implemented some concrete measures to address the ongoing crisis, this has not matched the scope and depth of the problem.
“There are some positive signs most notably in ocean shipping and trucking where policymakers have taken action, but it’s clear that we still have a long way to go before we turn the corner,” said Chris Jahn, ACC president and CEO. “That fact is driven home by the continued deterioration of freight rail service and its negative impacts on manufacturing. We need more solutions from policymakers and urge Democrats and Republicans to act without further delay.”
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