Supply Chain Solutions

Apr 27, 2021

Suez Canal Container Blockage implications for MENA supply chain 

 

The giant 400m container ship which ran aground and blocked the Suez Canal caused significant disruption across Europe, the Middle East and Africa. It is reported that 12% of global trade flows through the Suez Canal on ships like the Ever Given, which can hold up to 20,000 containers. 

 

Although cleared, the knock-on effect of the Suez Canal blockage is expected to add to the strain on the global supply chain already disrupted by the pandemic and surge in demand for goods. It is anticipated that there will be further congestion in key ports, with vessels not being in the right place for their scheduled journey. Assembly lines have been disrupted in just-in-time systems because parts don’t arrive when they are expected. Supply chains already reeling from a container shortage amid COVID-19 buying may mean further container shortages. 

 

If you are experiencing challenges like these in your supply chain, PRISM consultants can help, here are a list of ways the PRISM Free Tools and Members Supply Chain Pack could be used to effectively manage this or other disruptions in the future: 

 

1)    Activate Disaster Recovery Plans – in the PRISM Freight Forwarding Services Contract, there is a clause dealing with these types of circumstances. It aims to ensure that your freight forwarding partners have contingencies in place for these challenges to ensure their reactions have one priority: your business. 

 

2)    Maintain Sufficient Safety Stock – the simple but effective Inventory Control Spreadsheet is a useful tool when setting safety stock requirements for a high demand SKU, to ensure that situations such as this, don’t result in disruption to just-in-time systems and production assembly lines. 

 

3)    Ensure Vendors are Reactive to all Disruptions – setting clear plans in a Supply of Goods and Services Contract with your key vendors shall ensure that, as the implications of a disruption of a blockage on this scale emerge, your vendors will already have business continuity plans in place providing alternative solutions to meet your requirements. This proactive approach can make the difference and guarantee that there is minimal adverse impact to your supply chain and business. 

 

If your company supply chain has been affected by the Suez Canal blockage or any other disruption to your supply chain, PRISM consultants are on hand to help you overcome the challenge or can conduct a future proofing exercise to minimise future unexpected disruptions, whether these be a short-term enquiry or a longer-term assignment.