Down the rabbit hole
Dominic Roskrow looks at the current global supply chain issues and asks if all is really as it appears…
I used to have a badge that said ‘There are theories at the bottom of my jargon’. And it’s true: I do, indeed, like a good, complex conspiracy theory. So with that caveat, here’s a spoiler alert: the rest of this column may be delusional, meaningless piffle. Or more so than normal anyway.
The issue is, with the news dominated for months by COVID and more recently the war in Ukraine, are governments across the world trying to blame domestic woes on circumstances beyond their control, rather than domestic ineptitude?
Here in the United Kingdom this theory is borne out by the unpopular and untrusted Conservative Government and the miserable failure of Brexit. Despite promises of the opportunity to trade across the world, we have so far gained little beyond the right to buy some kangaroo meat and box jellyfish ready-meals from Australia.
“Are governments across the world trying to blame domestic woes on circumstances beyond their control, rather than domestic ineptitude?”
Not your problem, right? Well, it may be. We can all accept that world events have led to increasing costs of fuel, which will inevitably negatively impact on the price of imports from the United Kingdom.
But what about the other supply channels? During the worst of the COVID virus we were told that the shortage of bottles and packaging was caused by the need to close these respective industries every time an employee caught COVID.
Fair enough, but what if that delay was actually caused by the breakdown of the economic cycle between the United Kingdom and the European Union? What if those bottles and cardboard boxes are being delayed in multi-mile queues at Britain’s ports?
You’d think the matter of wooden pallets wouldn’t be an issue here would you? But they are. Before Brexit they were used and reused at will between EU nations. Now, every pallet used in the UK has to be logged and registered, causing a huge amount of red tape, delay and cost. Given the complex logistics of global trade, this is going to matter. Britain’s closest European neighbour is Ireland. In the last year, food chain Marks & Spencer has grappled with empty shelves across Ireland (North and South) and didn’t send its Christmas range this year. Eleven stores in France have closed.
It could be argued that it is only a matter of time before world markets will be hit by shortages of Scotch whisky, with small independent outlets struggling the most.
This is best illustrated by a British independent bottler that has been marketing high quality single cask, cask strength single malt whiskies from Diageo. It has been forced to review its business model and start retailing blended malts. The reason is that the drinks giant is providing fewer single casks to independents and rechannelling its malt whiskies into blends to service huge demand for blended whisky among younger drinkers in South American markets such as Mexico and Brazil. If supply issues are impacting here, why wouldn’t they affect New Zealand?
This is the tip of the iceberg. Now that Scotland is not part of Europe, what’s to stop America’s bourbon producers selling whiskey under three years to the rest of the Continent? And how will that affect how they trade in the Southern Hemisphere? All sorts of unexpected twists and turns lie ahead.
Blame the Russians. But watch for a sleight of hand or two closer to home.
Dominic Roskrow is a UK-based world spirits expert and editor of Stills Crazy
