Expert Warn It’s Worse Than Thought, Amazon Is About To Have Problems, 2nd Shipping Crisis To Hit USA

We’ve been talking about this one for a few months.

We reported in November the Panama Canal heavily relies on the rainfall to feed its lake reservoirs, which are essential for the operation of its locks. These locks are a critical component of the canal, enabling ships to transit between the Atlantic and Pacific oceans. However, the ongoing drought has led to a substantial drop in water levels, jeopardizing the canal’s ability to function effectively.

As water levels decrease, the canal authority has been forced to implement vessel draft restrictions. This means that ships must carry less cargo to reduce their draft, the vertical distance between the waterline and the bottom of the hull. This restriction is a direct consequence of lower water levels in the canal’s lakes, which are essential for its operation.

The water levels has been described as a primary threat to shipping the canal.

These draft restrictions have a cascading effect on global shipping. Vessels either have to reduce their cargo load, which leads to inefficiency and increased costs, or seek alternative routes, such as the longer and more expensive journey around the southern tip of South America.

Well, experts are speaking out and the drought in the Panama Canal coupled with the Suez Canal Crisis is “dramatically impacting supply chains.”


Diego Pantjoa-Navajas, vice president of Amazon Web Services Supply Chain told Fox Business that things are going to get real difficult in the summer if things don’t change.

He said the Panama Canal is experiencing “an unprecedented drought impacting water tables and the ability of ships to pass.”

Pantjoa-Navajas said that the Houthi attacks near the Red Sea and drought in the Panama Canal “both situations require a solution that currently doesn’t exist.”

The warning is that everything from electronics to furniture are going to cost a heck of a lot more until these situations resolve themselves.

Ann Marie Jonkman, the senior director of global industry strategies at supply chain management company Blue Yonder said, “Over the next month, we will likely see a greater impact to North America. Product delays will become more prevalent, leading U.S. retailers to begin announcing shipment delays for consumer goods in the coming weeks.”

She also added to expect more “shrinkflation” as companies try to recover profits.

“U.S. consumers have high expectations for in-store availability and delivery times,” Jonkman said. “To keep up with the standards consumers have come to expect, retailers will likely have to address inventory availability issues by reducing packaging size but keeping prices the same to offset losses to their bottom lines.”

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