Nuherbs VP: Shipping issues unlikely to work themselves out until April 2022

24-Jun-2021 - Last updated on 28-Sep-2021 at 14:32 GMT

With over 80% of global trade transported by sea, ongoing issues and bottlenecks in global shipping will continue to impact international raw material and ingredients supplies, which could drag into Spring of 2022, says Wilson Lau, VP of Nuherbs.

Speaking with NutraIngredients-USA via video, Lau explained that some dietary supplement companies are doing a better job of planning, but many companies are still reeling from trying to juggle all the things that have come from the increased demand for their products and the disruptions caused by the pandemic.

“I think a lot of companies are disappointed this year… because there have been issues really beyond the control of the ingredients supplier and the brand itself,” he said. “The issue that were really seeing is the logistics from when it’s ready to ship to when the person gets it to be used.

“I don’t see it working out until April of 2022,” said Lau, “and the reason is that we’re in July now, and we thought we were at peak issue end of May. Then all of a sudden, in Shenzhen, they had a couple of cases of COVID and they shut down the port for six days, and they want to test everyone in that area five times. That’s more sand in the system.

“Even if we can clear this issue in three months, that gets us to October, and then you get to Christmas, which is peak shipping season, and then right after that you have Chinese New Year.”

The issues with shipping are not exclusive to China, but everywhere. As things start opening back up, everything is jammed at the ports. COVID protocols are slowing things down, just as the volume of shipping is trying to resume.

Indeed, once a ship gets to its destination, they often have to drop anchor and just wait, sometime two to three weeks, for a berth to become available before they can unload, which is a process that can take five to seven days. These are basically floating traffic jams, said Lau.

So, what is Lau telling customers and contacts? “This issue won’t resolve itself any time soon, at least six to nine months. So, I tell them to place a blanket order, and you can even store your order at Nuherbs’ warehouse so that you can raw on it as soon as you need it.”

Through 2021 it is important to plan much further ahead, he said, and for those planning to go back to “just in time” ordering, Lau thinks the “absolute earliest possibility for materials to reach you reliably is the second quarter of 2022, but I think it’s more likely to be 2023 when you can reliably follow that practice”.

Watch the video above for more.