Canadian seaport congestion and supply chain delays

Supply chain delays are caused by several factors that affect the supply of raw materials.

Delayed product supply chains affect Canada’s production and economy. The primary cause of these bottlenecks was the pandemic that slowed global trade. As a result, raw materials are stuck, delayed, or unable to reach their destination, affecting the entire production chain.

What is the leading cause of supply chain delays at the Vancouver and Prince Rupert seaports?

The primary problem was the quarantine established to contain the Covid-19 pandemic. As a result, the production chain was stopped, generating a backlog that still exists today. Alternative causes affecting the production chain include bottlenecked warehouses, personnel shortages, and rail capacity.

Container volumes at the Port of Vancouver were down 7% during the first half of this year, compared to last year. On average, containers were delayed at the docks for six days, almost twice as long as in 2019 and 41% longer in 2021. Ships were forced to remain at anchor for more than nine days on average, which increased the delay.

It is ironic that in 2021 when the world was more affected by the pandemic, the delays were less than in 2022. This is because the pandemic was more disruptive then, and the demand for products was also affected. Once disruptions in logistics stabilized, most processes returned to normal. However, production chains were still experiencing a lag and are still catching up.

The railroad is one of the main bottlenecks that prevent goods from leaving the ports on time, and this is because they can only meet some of the transport demands. The leading solution could be using trucks, but there is a record number of vacancies in the first quarter, with 25,560 unfilled driver positions.

What are the possible solutions to delays in the production chain?

The possible solutions are grouped into two methods. The first is short-term solutions, designed to solve the contingency situation and reduce the time and volume of delays. The second method would be long-term solutions to avoid future supply chain delays. Hiring new personnel to make up the shortfall is an excellent short-term option; it makes various salary improvements and incentives. Another short-term solution would be to use artificial intelligence to better plan the supply network. Creating temporary warehouses outside the ports would help empty them so they can receive new goods, thus branching out the supply chain.

While these are feasible solutions in the short run, a more radical change is needed in the long run. First, adopting a better supply chain planning system and improved labour conditions and incentives. This would help keep the number of workers needed stable.

Infrastructure improvements are also a great, long-lasting solution. Improvements like expanding the ports would help them receive more ships and goods. The creation of permanent warehouses outside the ports would help to relieve congestion. Lastly, improved rail networks would be a complete solution to speed up the supply chain by decongesting the main bottleneck.