Global economic woes to plague supply chains in 2023

Ongoing inflation and the potential for an economic recession are among the top concerns in shipping and supply chain in the year ahead, according to a 2023 predictions report from German container logistics platform Container xChange, released Monday.

The company surveyed more than 2,600 industry professionals from over 20 countries and conducted follow-up interviews with executives for the report, which predicts 23 trends and issues that will shape the industry this year. Of the survey respondents, 88% said the biggest factor impeding businesses in 2023 will be inflation and recessionary fears, followed by “implications of war” (57%), the “impact of Covid in China” (53%) and “worker strikes” (23%).

The report also identified outsourcing and reshoring trends, as well as predictions about the direction of container rates worldwide. Nearly 70% of respondents said that India and Vietnam are attractive alternatives for a “China plus one” supply chain strategy, and U.S. respondents said they will focus on “friendshoring” in 2023–meaning they will limit their supply chain networks to allies and friendly countries. As for container rates, the majority of respondents said that container rates and contract rates will fall further this year.

“The overall outlook for the year 2023 for the supply chain industry remains challenging,” Christian Roeloffs, co-founder and CEO of Container xChange, said in a press release announcing the report’s findings. “Europe is hit hard with all-time high inflation; China struggles to cope with the virus, and the U.S. continues to witness hinterland transportation challenges and labour unrest. Most of these challenges will stay in 2023. Consumer confidence will pick up, but it really depends on whether we witness more disruptions in the coming times.”

Labor may prove to be one of the biggest disruptors, as the survey predicts a rise in worker strikes this year.

"Due to inflation increasing, there’ll be more unrest in the labour market which will certainly lead to more strikes, specifically in Europe, the UK and North America,” according to Aamir S. Mir, chief operating Officer (COO) for Caspian Container Company SA, who was interviewed for the report. “And as we have seen before, strikes result in slow operations within the port, which can exacerbate supply issues.’’

Visit the Container xChange website to download a copy of the report.