Houthi Attacks on Red Sea Shipping Routes Put China in a Pickle

vexikron , 6 months ago

Its wild that the angle here is that specifically China is in a pickle.

The reality is that every person and economy that depends on low shipping costs and reliable logistics is in ‘a pickle’.

Which is … basically everyone, every economy.

Just In Time Inventory

• plus +

Must Make Next Quarter’s Numbers Look Good

• plus +

Oh God Our Razor Thin Margins Just Got Obliterated By Shipping Costs

=

Layoffs

Pass the Cost to the Consumer

Shortages

MotoAsh , 6 months ago

Don’t forget the mass inflation even on products that never see a boat because of, “supply chain issues”.

Capitalism is a farce of a scam. A body that cannot store fat for rough times. It is a body that deserves to starve to death.

vexikron , 6 months ago

My GOD think of how many YouTubers selling merch will be driven into destitution rofl.

Please. Please buy my 25 cents of plastic molded into a cute action figure by sweatshop workers for $25 dollars PLEASE.

Viking_Hippie , 6 months ago

You’re right about the rest, but the margins aren’t really that thin. The official numbers are AFTER all sorts of tax avoidance tricks.

Not that sky high profits are gonna stop them from pretending that they HAVE TO pass every new expense onto consumers, of course.

vexikron , 6 months ago

You are correct.

A more in depth version of what I meant would be something like… margin squeeze + delays -> more delays -> more delays /of everything/ causing a kind of general, network style problem of firms that rely on inventory arriving on schedule paying premiums for more reliable delivery dates for their either assembled or premium products to hit their own delivery dates.

This kind of thing can spiral out of control easily as it did when the Suez got the ship wedged in it during covid. Its hard to summarize it neatly other than the logistics version of death by a thousand cuts.

gregorum , 6 months ago

Tomorrow: China Claims Red Sea as Ancestral Territory

Viking_Hippie , 6 months ago

I read that as “Chinese state-owned shipping firm COSTCO” at first and was like “wtf? I would NOT have guessed that!” 😄

autotldr Bot , 6 months ago

This is the best summary I could come up with:

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Chinese state-owned shipping firm COSCO has become the latest company to suspend its routes to Israel through the Red Sea due to the threat of Houthi attacks, it has been reported.

The Yemen-based Houthis have launched a series of anti-ship ballistic missiles towards Red Sea shipping lanes which they say is in response to Israel’s military offensive against Hamas.

Orient Overseas Container Line (OOCL), which is a part of COSCO Shipping Group, had already suspended sailing to the Red Sea since December, CNBC reported.

Attacks on ships in the Red Sea have pushed ocean freight rates higher as shippers reroute the long way around South Africa’s Cape of Good Hope instead.

However, it noted that rerouting vessels traveling to the Netherlands from Taiwan, the self-governed island off the coast of China, adds around nine days to a journey which could have a “considerable” cumulative effect on global shipping capacity.

The U.S. also joined 10 other countries last week in warning that if the Iranian-backed group continued to attack shipping, it would “bear the consequences”—suggesting the threat of military action against targets in Yemen.

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