BDP Trendwatch: China’s omicron outbreak is bad news for the global supply chain; California Governor Newsom proposes $2.3 billion for California ports and congestion reduction; EU to stage large-scale cyberattack exercise on supply chains

China’s omicron outbreak is bad news for the global supply chain 

An omicron outbreak in China is sending jitters through supply chains as manufacturers and shippers brace for disruption inside the world’s-biggest trading nation if it can’t contain the fast-spreading variant. 

In 2020 and 2021, China’s ‘covid-zero’ strategy meant factories could stay open throughout the pandemic to produce everything from health equipment to laptops that global consumers hoovered up at a record pace. But there’s been confirmed cases of local infection everyday since mid-October and it’s likely even tougher restrictions will be needed to curb omicron’s spread, with knock-on consequences for ports and factories as more cities lock down. 


California Governor Newsom proposes $2.3 billion for California ports and congestion reduction 

California’s Governor Gavin Newsom is proposing $2.3 billion in state funding to help ease congestion and supply chain problems that continue to impact the California Ports of Los Angeles, Long Beach and Oakland. 

In a January 10th news release, the California Governor “proposed allocating $2.3 billion for supply chain investments in the new state budget. The funds will help address congestion and bottlenecks across the West Coast. “ 


EU to stage large-scale  cyberattack exercise on  supply chains 

European Union governments will launch later this week a large-scale simulation of cyberattacks against multiple member states. 

Participants will be confronted with attacks on their supply chains and some spillover socio-economic effects in other member states, before having to coordinate public communications and a diplomatic response, according to people familiar with the matter and documents seen by Bloomberg.  

The aim of the six-week exercise is to stress-test Europe’s resilience, strengthen preparedness and cooperation among member states, and improve the effectiveness of a joint response. 

Supply Chain Brain/Bloomberg 

New York port hustles to cut rare  logjam amid Covid labor woes  

The Port of New York and New Jersey is working to clear a small but rare bottleneck of container ships anchored off the coast of Long Island as COVID-19 cases among dockworkers collide with a pandemic-fueled surge in cargo volumes. 

“We have seen a spike in the number of labor going out into quarantine,” Port Authority Director Sam Ruda said in an interview last week. The average wait at anchorage for container carriers was 4.75 days in the final week of 2021, compared with an average of 1.6 days for all of last year. 

Supply Chain Brain/Bloomberg 

Supply-chain snags, quarantines  hurting global air-cargo growth 

 Global air-cargo growth slowed sharply in November as demand was hit by supply-chain disruptions, partly because Covid-19 restrictions left workers stuck in quarantine, causing labor shortages. 

Demand for air freight, measured in cargo ton kilometers, rose 3.7% from the same month in 2019, prior to the pandemic, according to the International Air Transport Association. That’s less than half the 8.2% increase seen in October and significantly lower than in previous months, IATA said. 


Christmas was saved from the supply-chain bottleneck. The next challenge: Lunar New Year 

The supply-chain nightmare didn’t cancel Christmas, but another holiday crisis is looming: the Lunar New Year. 

Local lawmakers and port officials accompanying U.S. Transportation Secretary Pete Buttigieg at the Port of Long Beach on Tuesday acknowledged enduring problems with the shipping, unloading and delivery of goods across the country, including the challenge of getting the local ports — a major choke point — to operate around-the-clock. 

And though one holiday crisis appears to have been averted, a fresh surge of cargo from Chinese manufacturers is expected to flood U.S. ports before Chinese businesses close up to celebrate the Year of the Tiger starting Feb 1. 

Los Angeles Times