Busy shipping supply routes have experienced recent disruptions, resulting in delayed deliveries of critical medical supplies.
The medical supply chain relies on an intricate system of shipping routes to deliver products on time.
A recent threat assessment from Healthcare Ready explored why some medical products are currently taking longer to get to their destinations. Healthcare Ready is a nonprofit organization that helps the national healthcare system respond to crises.
The 2024 Global Shipping Issues Threat Assessment highlights that there are two ongoing major supply chain disruptions: The Panama Canal restricting ships and increased danger and vessel rerouting in the Red Sea and Suez Canal.
The Panama Canal
The disruptions in the Panama Canal have largely been caused by an unprecedented drought that started in late 2023. The current drought has Panama experiencing the driest months since 1950, according to BBC News. As a result, water levels in the canal have caused long wait times for vessels and lengthy shipping delays. Delayed ships are often carrying much-needed medical cargo onboard such as medications and supplies.
The Panama Canal is responsible for moving 80% of global trade, and authorities have placed restrictions on daily vessel transits that are expected to remain going forward. Additionally, some ships are being forced to carry 40% less cargo to decrease weight in low-level water, according to Becker’s Hospital Review and Healthcare Ready.
Shipping vessels, as a result, are experiencing extended transit times. Ships going through the Panama Canal are facing constraints on capacity and size, often having to leave medical products behind.
Danger in the Red Sea
In the Red Sea, there has been an increase in attacks by Houthi rebels targeting commercial vessels, according to Healthcare Ready. Shipping conglomerates are taking measures such as halting shipments or rerouting around the Suez Canal and Red Sea to avoid attack.
The Suez Canal accounts for nearly 15% of global trade and almost 20% of container trade. With shipping vessels having to detour and reroute from the Suez Canal, they instead travel along the tip of Africa, which causes exorbitantly longer travel times.
Detouring from the Red Sea, and traveling around the southern tip of Africa adds an additional 10-12 days of sailing and an additional $1 million in extra fuel, according to Healthcare Ready. Suppliers looking for alternative shipping routes to bypass this challenge have faced significant cost increases that in turn impact their consumers.
Also, many commercial vessels coming from China were using the Suez Canal due to the drought in the Panama Canal, and now face obstacles due to the Suez Canal dangers.
Impact on Healthcare Supply Chain
The global shipping crisis has caused significant delays for healthcare products. According to the Health Industry Distributors Association (HIDA), demand for shipping has drastically increased alongside shipping challenges, causing obstacles for the medical industry.
The shipping time for medical supplies in the ocean is currently 2.5 times longer than usual, and ports are experiencing delays of up to 3 times longer, per HIDA’s Shipping Challenges Cause Medical Supply Delays report. Impacts have included delivery delays, constrained supplies for physicians, and increased costs for physicians.