Shortages due to disruption in global supply chain
Posted on Tuesday 29 December 2020, 08:12 - updated on 30/01/21 - Energy Crisis - Permalink
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Yes we’re here to talk about shortages; to talk about the impact of the oil shocks , the upheavals, on ordinary day to day life, and how there is going to be an increasing amount of disruption and difficulty gaining access to ordinary day to day items
So, take a step back, we remember when the Honda factory in the south of England shutdown production for a few days, because of shortages due to the disruption of trade by covid. This caught your attention
It’s a very good example really because it demonstrates the fragility of the supply lines for modern manufacturing. Many large manufacturers employ procedures such as ‘just in time’ which mean that they can minimise their inventory and reduce costs and so on. This has been a management technique for many decades now; it’s nothing new and probably came in during the 1980s
However it means that in order for a manufactured item, say an automobile, to be finished promptly and to leave the production line, every component coming to the factory has to be there at just the right time. For various reasons this wasn’t happening at the car factory in your country, and so they sent the workers home for a few days
This is going to be widespread. The situation globally today is such that although many manufacturers have attempted to source a good proportion of components and parts locally, there is still a significant number that come from overseas; obviously China is a major supplier to many manufacturers
This will mean that once the supply, the distribution, is affected by the impact of the upheavals on the availability and price of fuel; supply will then become erratic. This will have knock-on effects right across the board
You only have to think of the availability of parts for service and maintenance of all sorts of structures and manufactured goods, which will be seriously impacted. It will then become more and more difficult to guarantee secure supplies. So this is what we mean by shortage. And it will occur all across the globe and across all types of manufactured goods both large and small
We’re not going to even touch on the area for example of food and farming. This is for another document on another day. But we’ll leave you with the thought that the vast majority of intensive farming which goes on around the world, is highly dependent upon easy access to sensibly priced fossil fuel
Oil, Food and Ecosystems
As you are well aware, oil, food and ecosystems are all inextricably bound up
The drive was to create larger fields and obviously to increase the return from the land. This activity was just a tiny part of what became known as the ‘green revolution’, with the focus to maximise yields using all the latest scientific methods available to man; the success was really quite considerable
Returns have increased many fold, but when you look a bit more closely at this, it was predicated essentially upon the availability of an enormous amount of chemicals by way of fertilisers, pesticides and herbicides; the availability of mechanised methods and of course fossil fuels
Certainly in the early stages the concept of an ecosystem was very poorly understood; in fact at the outset the phrase itself had never been coined. Things have improved considerably from the point of view of the appreciation of the interconnectedness of all aspects of ecosystems, and subsequently farming practice has to some extent been moderated, to take into account the fact that it is not sensible or possible to remove nature from the equation
What you have across much of your arable land today, are basically vast tracts of what is essentially sterile land. Obviously this land is producing a good return, but it is coming at a high price, and now in the early 21st century you’re becoming much more aware of the loss of biodiversity; the price of essentially eradicating all plant and insect life from these areas of production
This is a path which mankind really has to move away from, because pursuing yield in this way is going to be highly counter-productive. What we’re really saying is that the monoculture approach to farming needs to be radically overhauled, and things need to be brought back into balance regarding nature
The obvious problem which is looming in the immediate future is going to be the price and availability of the energy required to drive this agricultural production. To date this has not really been an issue; once it becomes so then agricultural production on this scale and intensity is going to become unviable
So we would say that whilst most of the information in this piece has had a mention elsewhere in other documents, it is important we believe to re-iterate these points, and stress the fact that the shortages mentioned above are of course going to be extended to cover all sorts of foodstuffs
Bear in mind that there is no global shortage of food; the localised shortages are a product of mankind’s approach to food production, distribution, pricing and so on. So if it were the case that man had already learnt how to properly co-operate, then these localised shortages would have been removed