Supply chain disruptions: the ripple effect, and what we can do about it

 

We've spoken several times about the current supply chain disruptions being experienced across the world's economies.  They're now so widespread that they're creating ripple effects, where shortages in one area are directly and immediately impacting seemingly unrelated areas.  A couple of examples:

• Some time ago, China's power generators cut back on ordering coal to fuel older-technology power stations, due to government edicts concerning air pollution.  However, this means less power has been generated;  so industries such as aluminum production, heavily reliant on electrical power, have been impacted.  More modern power stations are fueled by liquid natural gas;  but the world supply of this fuel is limited, and the suddenly increased demand from China, among other factors, has driven LNG prices up around the globe.  That's meant that the Chinese government has had to guarantee fuel prices at a level the power stations can afford (effectively subsidizing the fuel market) - but this comes at a time when the government is also trying to stabilize China's financial system, rocked by scandals and bankruptcies in the property market.  Does China have enough money to do everything that's needed?  That remains to be seen.  Meanwhile, some of the older power stations have been ordered to increase power generation - but the coal they need is in short supply, thanks to China boycotting Australian coal, so coal prices are also skyrocketing.  Wheels within wheels . . .
• Britain is also experiencing the consequences of soaring fuel prices.  Liquid natural gas is used as a feedstock to produce many other industrial raw materials, such as carbon dioxide.  LNG has become so expensive that a number of factories producing carbon dioxide and other materials simply shut down, because the increased cost of their raw materials and price controls on their production meant they could not charge an economically viable price for their output.  Now, the shortage of carbon dioxide threatens the production of all sorts of foodstuffs - meat, fizzy drinks, etc.  The British government is in urgent talks to solve the problem, which will likely involve some degree of subsidy of LNG prices.  Meanwhile, because British industry is buying carbon dioxide from across Europe in a bid to stay afloat, the shortage of that gas is now spreading across that continent, and affecting food production there too.

Those are just a couple of examples on the international level to illustrate how widespread and how severe supply chain problems are becoming.  That's just as true here in the USA.  I've already described enough of our local problems that I won't repeat it here.

I've accordingly decided to update our planning for emergencies to incorporate supply chain problems, and how they may affect our family.  We're "small fry", without much extra cash, or storage space, or opportunity to "plan big";  but there are very practical measures we can take to minimize the impact we're already feeling from supply chain shortages.

Amongst other measures, I'm doing the following:

• Increasing the quantity and variety of essential motor vehicle parts and spares we keep on hand.  I've always had enough lubricant and filters for an oil change on each of them.  Now, I'm doubling that, and adding essential spares that are likely to be needed (e.g. air filters, etc.)  I'm also getting a spare serpentine belt for each vehicle, because they're a critical component - no belt, engine no run, period!  To my surprise, serpentine belts are already in short supply for many vehicles, both locally manufactured and imported, because the belts are overwhelmingly made overseas and have been hit by the same supply chain problems as everything else.
• We've always aimed to have up to three months' essential food supplies, enough to eat reasonably well in an emergency, plus another three months' longer-term supplies such as rice, beans, etc. - not necessarily very appetizing, but enough to keep body and soul together until things improve.  I'm now extending our essential food supplies, and storing at least 30 days' food off-site in a conveniently accessible location.  That's for two reasons.  First, if shortages become crippling, I fully expect there to be propaganda pressure on "preppers", describing them as "hoarders".  In more statist or authoritarian jurisdictions, this may even extend to door-to-door visits from the authorities, demanding to inspect one's supplies, complete with pressure to "donate" one's "excess" to the community - if not outright confiscation.  (Think I'm joking?  I'm not.  I've seen it happen elsewhere.)  Second, we don't have enough storage space in our smallish house for large-scale supplies, but we can mitigate that by using a small climate-controlled storage unit.  They're not cheap to rent, but we can share the cost with trusted friends and all benefit from having a remote storage location.
• I'm noting the effect of supply chain shortages on power generation overseas, and wondering how that might play out in the USA if things get worse.  Therefore, I'm increasing our stock of foods that are simple and easy to prepare, and if necessary can be eaten cold out of a can, without any preparation at all.  I don't really think we'll go without power for months on end, but a few days - or even weeks - here and there?  We had that earlier this year, thanks to Mother Nature.  If that may become a more frequent pattern, for whatever reason, I'd like us to be able to eat as well as possible.  I've also provided two portable gas stoves and a couple of rocket stoves, so that easily-gathered twigs and wood offcuts can fuel our cooking if needed.  (Hint:  don't use your high-quality pots and pans on camping stoves.  Rather buy a few cheap spares from your local thrift store, and reserve them for emergency use.  That way, if they get blackened or scorched, you won't mind very much.)
• I've always stored enough gasoline in jerrycans (not inside our house!) to fill our vehicles' tanks in an emergency, plus a bit more to fuel our lawnmower.  I now want enough gas on hand, properly stored using a stabilizer, to fill each of our vehicles' tanks twice.  If worse comes to worst, we can fill up, then head out with enough gas to fill up again en route to wherever we're going;  and if we stay put, but local gasoline supplies are scarce, we'll have a bit of leeway in our transport needs.  (For those who think this is an unnecessary precaution, consider what happens when a hurricane shuts down refineries.  The fuel pipelines from them to other states shut down too, as we saw earlier this year.  Hackers can do the same thing by taking out the computers controlling the pipelines, as we also saw earlier in 2021.  If you're on the other end of those pipelines during extended outages, you may not enjoy the experience.)
• Finally, I'm thinking of alternate ways to heat our home.  Winter's on its way, and if we lose power, we lose heat.  I'd like to have alternatives.  We have a fireplace, but it's small, and would only heat our living-room by a few degrees, thanks to the design of our home.  I'll take a long, hard look at alternative fuels, bearing in mind the risks of fire, suffocation, etc.  (Yes, additional carbon dioxide and carbon monoxide alarms are included in my planning!)  I'll also consider getting additional warm clothing, blankets, etc.

Those are just a few of the ways in which the supply chain shortage is altering our preparations for emergencies.  What are you doing to prepare for it?  Please share your ideas with us in Comments, so we can all benefit from other people's experience and circumstances.

Peter