The economic recovery has been hampered in recent months by major supply difficulties related to raw materials. Decryption of this phenomenon with Philippe Chalmin, economist and professor at Paris-Dauphine University.
Are we facing a raw material shortage unprecedented since the advent of globalization?
The term shortage bothers me a bit. We had in fact the conjunction of several phenomena, with on the one hand the pandemic which caused the stoppage of certain productions, as well as logistical problems. So a drop in supply, at a time when the economic recovery was getting strong, starting with China, the United States, and to a certain extent in Europe. From the start of 2021, therefore, we have seen price increases, particularly for industrial raw materials. These increases have already subsided during the summer, or even reversed, but the relay has been taken because of the climatic hazards in the field of agricultural products. And what has played a fairly strong role is the total congestion of transport systems, with an unprecedented rise in prices, especially in the container freight category. What could cost $ 1,500 in transport from Asia to Europe before the crisis now amounts to $ 10,000, to give you some idea. With delays, with congestion, with ports that have closed, etc. But we cannot really speak of a shortage of raw materials, rather of a rise in prices. There is never a shortage when you are willing to pay the price.
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For the consumer, this nevertheless translates into empty shelves of certain products …
Yes, and that’s the whole problem with this bad habit that we have acquired, of having increasingly long supply chains that go through China, Bangladesh, etc. Even a company like McDonald’s, which a priori should not be concerned by this lack of raw materials, was forced to change the gift in its Happy Meal menus intended for children because the toys were made in China. They were replaced by small books printed in France. For bikes that are sorely lacking, it’s the same problem, there is still a part of the bike manufactured abroad, with delivery times today considerable.
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If we look ahead, at what horizon can we envisage a return to normalcy and can it be accompanied by a regain of a certain industrial sovereignty in France?
To regain sovereignty may say a lot. In France, we mourn our industrial past, and at the same time, we are reluctant to open new factories, considered polluting monsters, for ecological reasons. So French deindustrialisation is far from over. Otherwise, logically, the return to normal in maritime transport should take place at the beginning of next year, but that may take longer and it will depend above all on what happens as a result of the pandemic. Another recent example with Vietnam, which has just practically closed its borders because of a resurgence in the number of cases. In particular, this causes a surge in coffee prices, since the country is the largest producer of robusta coffee in the world. And he doesn’t come out anymore. And that must be true for other products that we bring from Vietnam.
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Will the return to normal be accompanied by a return to pre-crisis prices?
More or less. Lumber, for example, highly prized in the United States, which sold for between $ 300 and $ 500 before the crisis, was able to rise to $ 1,600 in March-April. Today it is between $ 500 and $ 600. But you have to keep in mind that, by the way, some will try to keep prices up. Take your baker, who because the price of wheat is increasing, will increase your baguette from 95 cents to 1 euro. Once this increase is recorded, even if the price of wheat falls again, that of the baguette will not fall.
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