Navigating Global Water Logistics Constraints
Supply chain disruptions caused by water logistics constraints have recently made headlines, from the Suez Canal blockage to the weight and draft restrictions in the Panama Canal. The decrease in water levels due to severe drought has forced vessels to reduce their loads and shippers to face higher rates, leading to increased costs and variability in lead times. As the drought worsens, approximately 6% of global maritime trade passing through the Panama Canal is at risk.
To mitigate the impact of these constraints, supply chain leaders must invest in network optimization technologies that continuously assess transportation lead times, costs, and plan feasibility. Close collaboration between finance, procurement, manufacturing, and planning is crucial, with monthly evaluations preceding the Sales and Operations (S&OP) meetings. Aligning these functions and improving reliability amidst variability requires modeling and shared review, moving beyond spreadsheet analysis to consider feasibility, lead times, and logistics constraints. Utilizing network design technologies becomes essential to effectively navigate these challenges.
Get ready for some serious heat!