The material crisis still has a firm grasp on German industry. The electronics and automotive industries in particular are complaining about the scarcity of resources and supply bottlenecks. And there’s no end in sight.
The procurement of raw materials and preliminary products is still a big problem. While the ifo Institute is reporting that the situation is easing slightly in August, this is by no means an all-clear. The key sectors of the German economy such as mechanical engineering (85.7 percent) or the electronics industry (80 percent) in particular are reporting on the persistence of the material crisis. And not a single sector expects an end to the supply problems this year.
Electronic components in particular are in short supply, but so too are steel and aluminum in various forms.
According to a study by Katek SE, half of the companies surveyed primarily complained about bottlenecks in chips and semiconductors. Nearly a third of organizations is struggling with a shortage pf integrated circuits. And 22 percent indicated that there is a shortage of production materials such as soldering metal as well as capacitive and inductive components.
What exactly is missing varies from industry to industry. The automotive industry, for example, is affected by a lack of chips and semiconductors. One in four companies also has insufficient stocks of cable harnesses and plastic. Mechanical engineering and industrial engineering are primarily lacking in semiconductors, followed by chips and integrated circuits. And in the telecommunications industry, chips are right at the top of the list, followed closely by semiconductors and integrated circuits. In the area of renewable energy and the environment, semiconductors and integrated circuits top the list of shortages for 55 percent of the organizations surveyed.
The material crisis is leading to losses in revenue between 10 and 19 percent for a third of companies. A fifth predict a decrease between 20 and 29 percent. In the telecommunications industry, 38 percent state that they will either lose no revenue, or no more than 9 percent. Meanwhile a third of companies from the automotive industry surveyed fear that sales will decrease 10-19 percent or 20-29 percent due to a lack of parts.
The main reason for the procurement crisis in the electronics industry is the lack of supplies from East Asia. Two thirds of all chips come from there. Currently, however, lockdowns and the challenging situation in maritime traffic caused by the pandemic are leading to unstable supply chains to Europe.
The Kiel Trade Indicator shows that bottlenecks and traffic jams in container shipping are intensifying. At present, around 11 percent of all shipped goods are stuck. In the North Sea, for example, significantly more than two percent of the world’s freight capacity is at a standstill and can be neither loaded nor unloaded. In the German bay alone, 19 container ships are waiting for their goods to be unloaded.
Queues are also growing in front of the US states of South Carolina and Georgia with the important container port of Savannah. In contrast, there is a cyclical reduction in traffic jams in front of China’s ports. In the Red Sea, one of the most important maritime trade routes between Europe and Asia, however, 16 percent fewer goods are being shipped compared to normal conditions.
In maritime trade from Asia to Northern Europe and to the west coast of North America, cargo rates have fallen from over USD 14,000 per container to around USD 4,000 and USD 8,000 respectively since the beginning of the year. However, the traffic jams are preventing a return to the pre-pandemic level.