Suez Canal blockage adds to pressure points in global trade

Delays in freeing a mammoth container ship stuck in Egypt’s Suez Canal have highlighted still more pressure points in global trade, a year after supply chains were disrupted by the pandemic.

Tugboats and salvage crews took advantage of high tides early Monday to partially refloat the Ever Given, which carries cargo between Asia and Europe. It was unclear how long it would take to fully reopen the canal after moving the ship, which has been lodged in a single-lane stretch of the canal for nearly a week, blocking traffic through the critical trade gateway.

Earlier, it was feared the Panama-flagged, Japanese-owned ship might be stuck for weeks.

Economists say the Ever Given’s disruption of shipping through the Suez Canal probably won’t have an impact on global trade for more than a few weeks, and is unlikely to derail global growth this year as more people get COVID-19 vaccines and economies reopen.

But it's another wake-up call for companies that have set up their business to rely on supply chains with little room for error, said William Lee, chief economist at the Milken Institute.

“This is a warning about how vulnerable our supply chains are and how the just-in-time inventory techniques that have been so popular have to be rethought,” he said.

“The shortages and the supply chain shortages that cause assembly lines to shut down — that will have a greater impact,” Lee added.

Many countries got a harsh lesson in those realities last year when commerce, was disrupted in myriad ways after new coronavirus outbreaks began in China, the world's factory floor.

Consumers everywhere soon found that ordering online was an adventure in the unknown, with many factories shut down and trade between Chinese provinces stalled. Obtaining supplies of medicines and vital...