As Prices Rise Across Supply Chains, Will Inflation Come for You Too?

  • Date: 02-Apr-2021
  • Source: Asharq AL-awsat
  • Sector:Economy
  • Country:Middle East
  • Who else needs to know?

As Prices Rise Across Supply Chains, Will Inflation Come for You Too?

There's an underappreciated side effect of all the disruptions across global supply chains: the cost of producing and distributing everything from furniture and foam to cars and machinery is rising. While that has thrown off the plans of companies, the effect on consumer wallets is much more subtle and uneven “” for now.

In the US, 3M Co. has pointed to rising freight costs to ship its goods while Mattel Inc. has said plastic is more expensive. In China, the cost of products like furniture are going up because chemicals and metals for foam are rising. Some toy wholesalers in the country have raised prices by as much as 15%. Factory gate prices have been edging up there too.

It isn't hard to see how we got here: Manufacturers cut back as the start of the global pandemic led to forecasts of a massive economic slump. But the reverse happened: consumers continued spending, demand stayed put or got even stronger for some things. Countries everywhere embarked on fiscal stimulus. That was good news but producers weren't prepared and the demand-supply equation was thrown into imbalance. All we hear about now are shortages.

Logistical problems have contributed to the scarcity of goods. The shipping