Bob Ballantyne broke a cord on his blinds in early July, and his repairman in Ottawa still hasn91Ƶt been able to replace the snapped part.
91ƵHe says, 91ƵYou know, supply chain issues. I can91Ƶt get the string that I need to fix it.91Ƶ91Ƶ
Ballantyne isn91Ƶt alone. The pandemic sent shockwaves through the global supply chain and the backlogs are mounting even as freight volumes fall in North America this year.
The delays stem from several choke points along the chain, including backed-up warehouses, staff shortages and rail capacity. Ultimately the longer wait times, and extra costs, are being passed along to consumers.
In the first half of 2022, container volumes at the Port of Vancouver dropped seven per cent from the same period a year earlier. But containers sat on its docks for nearly six days on average, almost twice as long as in 2019 and a 41 per cent increase from 2021.
That 91Ƶdwell time91Ƶ rose higher in July, to more than six and a half days. Meanwhile cargo vessels sat at anchor for 9.6 days on average before docking at the country91Ƶs largest port as a result of the buildups last month, more than twice as long as they waited last year.
91ƵIt91Ƶs like Lego bricks,91Ƶ said Robert Lewis-Manning, president of the B.C. Chamber of Shipping, of shipping containers. 91ƵThey91Ƶre piled up and there91Ƶs just no more place to put them.91Ƶ
In Montreal, Canada91Ƶs second-largest port, containers wait four times longer than the 2019 average, and vessel turnaround is similarly well above both 2019 levels and those from a year ago.
A lack of storage space in distribution hubs on the fringes of Toronto, Montreal and Vancouver is one reason.
91ƵWarehouses in Ontario and Quebec are largely full,91Ƶ said Lewis-Manning. 91ƵThe problem is, there91Ƶs something behind it that can91Ƶt get through to where it needs to go. And maybe it is a critical part for a manufacturing operation.
91ƵUltimately the consumer will pay the price for that,91Ƶ he said.
Storage fees, contract extension penalties and 91Ƶdemurrage91Ƶ fees 91Ƶ issued by a shipping line when freight exceeds the time allotted at a terminal 91Ƶ eventually show up in the retail price tag, on top of higher freight rates and overtime wages for those working on the backlogs.
Ironically, the delays brought on by full warehouses are partly the result of importers91Ƶ response to previous supply-chain disruptions.
91ƵWhen people anticipate a shortage or capacity constraint, they overcorrect. And that actually amplifies the challenge,91Ƶ Peter Xotta, head of operations at the Vancouver Fraser Port Authority, said, citing what he called a 91Ƶbull-whip effect.91Ƶ
91ƵIf the goods show up two months later than when they91Ƶre anticipated, you might be missing that window for these barbecues, for parasols, for garden furniture that you were looking for in June,91Ƶ said Daniel Dagenais, vice-president of operations at the Port of Montreal.
Once the sales window is over for these seasonal products, they either need to be physically stored until the following year or heavily discounted.
Canadian Tire Corp. Ltd. said earlier this month that its merchandise levels shot up 18 per from a year earlier, which means it has less flexibility for storing off-season items.
Shippers and marine carrier operators see rail as a critical bottleneck.
Grain volumes were down last year due to a drought, but rail companies 91Ƶstill had problems,91Ƶ said John Corey, president of the Freight Management Association of Canada.
The grain yield 91Ƶ often the biggest source of commodity revenues for Canadian National Railway Co. and Canadian Pacific Railway Ltd. 91Ƶ is expected to return to the historical average this year, raising questions about what other shipments might be sidelined to accommodate the larger harvest.
91ƵThe amount of rail capacity that there is with various rail lines, that really is what91Ƶs making a big impact,91Ƶ said Xotta.
Stakeholders from wheat and canola exporters to lumber producers are worried, as demand for Canadian grain, potash and coal surges due to shortages caused by the Russian invasion of Ukraine.
91ƵAll those Asian imports that are coming in by container and the largely bulk exports that are headed to Asia 91Ƶ are all competing for that same rail service,91Ƶ Lewis-Manning said.
91ƵI think we91Ƶre going to see a real mess on the West Coast.91Ƶ
A dire dearth of truck drivers marks another snarl in the chain. The sector saw record vacancies in the first quarter, with 25,560 unfilled driver positions between January and March, according to Trucking HR Canada.
And spillover from heavily backlogged American ports such as Los Angeles and nearby Long Beach further adds to port congestion, while labour shortages at warehouses also gum up the cargo flow.
91ƵYou get to a point where one more drop and you start to overflow. And we have started to overflow,91Ƶ said Chris Hall, CEO of the Shipping Federation of Canada.
Canada91Ƶs two main rail lines have been pouring money into network upgrades and new railcars while scrambling to hire workers after laying off thousands in the first year of the pandemic.
CN and CP hope to hire more than 3,800 workers this year, including some 1,850 already on board since Dec. 31. But the labour market 91Ƶ especially for train conductors and engineers 91Ƶ is tighter than it91Ƶs been in decades and it takes up to nine months to train some crews.
CN spokesman Jonathan Abecassis said the railway has set up temporary storage capacity in Montreal and Toronto, as the Vancouver port did in February. And CP Rail CEO Keith Creel assured analysts on a call last month the company is flexible: 91ƵWe have capacity. We91Ƶre not holding any freight at West Coast ports or East Coast ports to pace into our inland terminals.91Ƶ
That91Ƶs cold comfort for Ballantyne, still waiting for a repair to his blinds. The last he heard, the component might be replaced by next month. But there are no guarantees.
91ƵChristopher Reynolds, The Canadian Press