Pulp News

Global logistics crisis expected to continue in 2022

According to Suzano's director of forestry, logistics and supplies, Carlos Aníbal de Almeida, the bottlenecks in the global transport of products can be even greater

Over the last few months, global logistics chains have been under great pressure, and there is no indication of improvement for this situation in 2022. With the scenario of lockdowns in China, to contain new outbreaks of covid-19, the bottlenecks in the global transport of products can be even greater, in the assessment of Suzano’s director of forestry, logistics and supplies, Carlos Aníbal de Almeida.

“The lockdowns in China bring more uncertainty about the recovery and can even worsen the situation. We see no prospect of improvement in 2022”, said the executive.

Bottlenecks in shipping began with the resumption of demand, when large economies determined the end of some isolation measures against the coronavirus, and it turned out to be stronger than expected. This high demand occurred at a time when the supply of containers was reduced, also due to the pandemic.

For this reason, cargo had to be transported on loose cargo ships, without containers. Upon arriving at the port, due to carrying different types of cargo, the vessels started to stop at more port terminals than usual, reflecting on the time between the shipment and the arrival of the product.

There is still a lack of manpower, due to the contamination of covid-19 and suspension of activities in strategic ports, such as in Shanghai. “The contracts [with shipowners] provide for a window, but the ships are outside of it. This contributes to congestion at ports, which affects everyone,” explained Aníbal.

According to him, Suzano has also faced delays in boarding because of the longer cycle of ships, amid congestion in ports around the world. However, the company manages to neutralize part of the problems in world maritime transport due to the structure of its logistics operation, which comprises three ports in the country and a fleet of ten dedicated ships, contracted with the Korean Pan Ocean.

With a focus on the pulp industry, problems in global and regional supply chains led to a reduction in the supply of raw material. In North America and Europe, the problem has been the lack of availability of railcars and trucks, as well as truck drivers, which hamper plant operations and limit the supply of chemicals and wood used in the process and disposal of the commodity produced.

In Canada, after Canfor announced that its sawmills in western Canada would operate at reduced rates in April because of rail transport limitations, a late-March report by analysts at BMO Capital Markets said the country’s logistical problems appeared the most serious in years, exacerbated by the shortage of wagons. One of the Canadian company’s pulp mills already had production suspended and could extend the measure for another six weeks.

In China, the fear is the scarcity of raw material, because stocks are low and the displacement, from the producers, is much greater than normal.

Valor Econômico
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