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To put that into perspective, the Stansberry Digest calculated that a 40-foot shipping container holds 2,390 cubic feet of stuff – large enough to fit the contents of a standard four-bedroom American home. It can store around 160 barrels of oil or more than 12,000 shoeboxes. And four medium-sized cars can fit, end to end, in a 40-foot container.
The shipping vessels are each around 1,000 feet long (three football fields) and rise 150 feet above the water--and they are filled with containers, including many goods scheduled to arrive in stores in time for holiday gift shopping.
How did we get here?
During the pandemic quarantine many Americans, stuck at home and bored, began to shop to amuse themselves, work from home, refurnish, repair or redecorate homes, support a new hobby, occupy children and make their yards more comfortable. At the same time, workers were getting sick, which slowed down--or even shut down-- production. Companies anticipated less demand and pulled back on manufacturing-- or shifted to making products needed during a pandemic.
Demand for consumer goods is up 30 percent and services are down. “The Americans’ buying strength is so strong and epic that we can’t absorb all this cargo into the domestic supply chain,” Port of Los Angeles Director Gene Seroka told CBSLA.
According to the Guardian, with the peak shipping period getting under way as the holiday shopping season approaches, in recent weeks the ports have been setting new records for ships in port almost daily. Traffic has been rising since last summer amid a pandemic-induced buying boom that created a backlog at both ports and overwhelmed the workforce, some of whom were themselves recovering from Covid.
It’s Complicated
Supply chains have become increasingly complex. Today, as the Economist explains, supply chains are "some of the most sophisticated forms of human endeavor." The iPhone, for example, sources inputs from a network that spans 49 countries. Pharmaceutical giant and vaccine maker Pfizer (PFE) has more than 5,000 suppliers.
Interestingly, a survey conducted in April by EY, an accounting firm, found that as many as 83 percent of multinational executives were contemplating so-called “reshoring” or “nearshoring.”
On the other end of the supply chain, Amazon is working to get goods as close to consumers as possible. According to Supply Chain Dive, in 2020, Amazon's capital expenditures were more than three times greater than those of Walmart. The spending is part of Amazon's investment in the company's goal of providing one-day shipping to its customers. "They're trying to become a national retailer that can provide same-day or next-day service to the entire population in the country," said Marc Wulfraat, the president and founder of MWPVL, a supply chain consulting firm.
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