Freight News, Logistics, Business, Forwarding

Logistics industry cautious over post-Covid prospects

[ February 9, 2021   //   ]

Supply chain industry executives do not foresee a global economic recovery until 2022 or beyond but do expect Asia, North America and Europe to rebound from Covid-19 this year, says the 2021 Agility Emerging Markets Logistics Index.

Of 1,200 industry professionals surveyed for the Index, 51.5% do not expect a full recovery until 2022-24. They see Latin America and Sub-Saharan Africa to be the last regions to bounce back.

The survey is part of the 2021 Agility Emerging Markets Logistics Index, the company’s 12th annual snapshot of industry sentiment and ranking of the world’s 50 leading emerging markets. 
In the survey, logistics executives saw the duration of the pandemic as the biggest factor in determining when global economic activity will return to 2019 levels, viewing U.S.-China trade relations, Brexit, protectionism and other factors as secondary.

Chief executive of Agility Global Integrated Logistics, Chris Price, said: “The economic disruption caused by the pandemic is not behind us. Lockdowns and shipping challenges will constrain consumer and business activity through much of 2021.”

He added: “The companies, markets and regions poised to recover most quickly are likely to be those using digital technology to collect data, share information, get supply chain visibility, and transact with customers and stakeholders.”

The survey found that industry executives are speeding up adoption of technology and online business capabilities with 21.9% choosing to move production through multi-shoring, near-shoring or reshoring; few companies plan to bring manufacturing jobs back home.

Logistics executives felt disruption across the entire supply chain in 2020, saying they struggled to cope with port congestion (19.6%), transportation capacity (18.4%), supplies of parts and inputs (16.9%), distribution and delivery (16.1%), maintaining international operations (15.1%), and storage (13.8%).

In their own operations, industry executives say the most acute pain points were planning and forecasting for both supply and demand. Managing orders and cash flow were the areas next most affected by pandemic.

Despite their caution, more than half (52.0%) of respondents say they plan to increase business activity in developing markets or say they have more confidence in emerging economies. Only 19.5% say they are less confident in emerging markets.