‍Learning from the trends of 2023, let's take a proactive stance for the challenges and opportunities awaiting us in the upcoming year.

APAC Supply Chain Disruptions 2023 Recap. 

Natural Disasters, shipping delays, worker shortages, geopolitical conflict - we've certainly navigated some choppy waters during 2023. To recap, here’s  some of the disruptions that added strain to supply chains in APAC in 2023.

February

• Quarantine clearance delays caused over 60,000 vehicles to be stranded offshore or in a backlog at ports around Australia.
• A freight train derailed north of Adelaide, with several carriages coming off the track.
• Flooding in remote NT cuts off rail lines and roads, limiting food supplies and sparking freight concerns.

June

• Port of Brisbane and Port Melbourne were blocked by activist network Blockade Australia causing minor disruptions.

September

• Unionized cargo workers staged work stoppage at Brisbane Airport late September.
• Melbourne also saw strikes from the Australian Rail, Tram and Bus Industry Union (RTBU) in September.

November

• Industrial actions at DP World terminals disrupted all import and export movements.
• Optus' mobile network went down for 14 hours in a nationwide outage.
• DP World was hacked and its port operations grind to a halt for days.
• More than 100 protesters were charged after blocking Newcastle coal port on kayaks.

December

• Westpac customers were left locked from online accounts for 9 hours after a botched software update.
• Pro-Palestinian trade unionists attempt to block the movement of ships owned by ZIM an Israeli shipping company at Port of Fremantle in Western Australia.
• After a series of drone and missile attacks on merchant vessels, CMA CGM, Hapag-Lloyd, Maersk and MSC interrupted or suspended their passage through the Strait of Mandeb/Red Sea and Suez Canal.

And this list is by no means exhaustive. With such a line-up of disruptions, it’s no surprise that McGrathNicol Advisory published an article warning Australian business leaders about the pitfalls of overconfidence in dealing with supply chain risks.

By nature, risks are unpredictable. So, it’s imperative that leaders mitigate, adapt to, and learn from both forthcoming risks and existing challenges. 

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2023 Global Trends.

Subdued Demand

74% of consumers have reduced their nonessential retail spending to better navigate financial constraints. A decrease in cargo volumes, brought about by rationalized consumption patterns and destocking practices, has set the stage for an anticipated oversupply in the market.

China Plus One

Due to ongoing US-China trade tensions, rising labor costs, and concerns about potential disruptions similar to those in the COVID-19 pandemic, brands are actively diversifying their global supply chains. This process typically requires over two years, suggesting an uptick in production in alternative regions in 2024, and more significant transitions are on the horizon for 2025.

Anticipated Oversupply

The capacity of new–build vessels, slated for delivery through 2025, increased to 2.95 million TEUs. This surplus, along with a decrease in demand, has the potential to spark intense competition and price decreases, posing a risk to carriers' profitability over the long term.

Geopolitical Friction

Escalating geopolitical tensions in 2023 exerted pressure on APAC supply chains, leading to shifts in trade patterns and delays. Global supply chains issues, including the war in Ukraine and geopolitical tension with China, are costing Australian companies $11 billion a year, according to new analysis by TMX Global.

In the PwC 25th Annual Global CEO Survey: 

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With these new emerging risks, it's evident that traditional approaches alone are insufficient. Now is the time to take proactive measures and embrace innovative solutions to protect your supply chain from these challenges. 

The Australian Industry Groups (Ai Group) 2023 survey of Australian CEO Expectations found that 88% of respondents are investing in measures to reduce their supply chain vulnerabilities over the coming 12 months.

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Don't be left all at sea in 2024. Arm yourself with the right advice and technology to better manage supply chain disruptions by contacting our team.

Stay in the loop by following our LinkedIn page. Next week, we're sharing our advice and predictions for 2024, alongside resources to aid in your supply chain planning for the new year.

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