Although Shanghai ’ s port , which handles one-fifth of China ’ s shipping volumes , has been operating throughout , it has been running at severely reduced capacity . Many shipments have either been cancelled , postponed , or rerouted to other Chinese mega-ports such as Ningbo-Zhousan .

The Port of Shanghai is the largest sea port in the world , which was put into service in 1842 . It is also said to be the world ’ s busiest container port . Over the years it has also grown to become one of the most important ports in the region and occupies an area of almost four square kilometres . The port is linked with the Yangtse River , reaching into multiple provinces of China .

With the city due to fully re-open by the beginning of June , the port is going to be in overdrive as manufacturers try to fulfil backlogs , with serious knock-on effects around the world . It is an example of how global supply chains in 2022 have been

destabilised in ways that were not apparent at the beginning of the year .

In January , it was predicted widespread that ongoing disruption would result as the world economy continued to recover from the pandemic . In fact , things have gotten worse .

Besides Shanghai , other major Chinese ports such as Shenzhen have also been affected by lockdowns . And then there is Ukraine . The war has pushed up prices for goods and services even higher than predicted rises for 2022 , as well as adding to logistical difficulties .

According to the New York Federal Reserve ’ s global supply chain pressure index , which takes account of issues such as freight rates , delivery times and backlogs , supply chains are under unprecedented pressure – and have been getting worse recently .

UKRAINE AND FOOD Ukraine might not have been on many people ’ s radar as a key economic partner , but it was already seen as a major bottleneck for food supply chains long before the war got underway . This was

due to poor port infrastructure and the large concentration of world maize and wheat supplies moving through . The war was therefore always going to have a devastating impact on international supplies .

There is electricity and gas , whose prices have skyrocketed thanks to sanctions , affecting everything from deliveries to food production . And since Russia is a key player in the fertiliser market , even domestically grown potatoes will become more expensive soon enough .

With Ukraine ’ s ports blockaded now for months , Russia is also being accused of holding food hostage for millions around the world . Developing countries are being hit hardest , while in richer nations , the poorest are bearing the brunt . Even when the conflict ends , restarting food exports from Ukraine will not be easy . Capacity on land transport is limited and the sea , in addition to the Russian blockade , is heavily mined .

HOPE Even if there are no more China lockdowns and the Ukraine crisis does not spread , the global supply chain is clearly going to be under heavy pressure for the rest of the

year . According to one recent UK survey , three-quarters of companies think 2023 will be tough too .

For smaller businesses in particular , a failure to adapt to the changing environment could threaten their survival . At a time when fears of a recession are already in the wind , this could make longer-term economic recovery all the more difficult .

But for the medium term , at least , there are reasons to be cautiously optimistic . For decades , most supply chains were focused on cutting costs . Manufacturing was outsourced to specialist suppliers , ideally in countries with lower labor costs . Firms kept minimal inventories and used short-term contracts to be as flexible as possible .

Supply chains are

under unprecedented

pressure – and have

been getting worse

recently .