UAW strike at John Deere threatens supply chain and food supply
The United Auto Workers’ ongoing strike at John Deere factories in several states could cause serious damage to already fragile supply chains in the United States – and the longer it continues, the worse the problems will be, according to an expert.
“If we take a look at the John Deere situation, it adds another layer of disruption to an already disrupted supply chain,” says Jennifer Blackhurst, Ph.D., a supply chain expert at the Tippie College of Business. University of Iowa.
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“We can really look at the supply chain in two directions,” Blackhurst told FOX Business. “As we look downstream [their] customers, they will not have the parts needed to make the product or repair the existing product, depending on parts shortages. And so that eventually that ripple, disruption or problem ends up affecting food supply chains that are already in crisis. “
Blackhurst says, “It doesn’t end there.”
“We can look the other way upstream from these suppliers,” she continued, noting that “all of these suppliers have suppliers, and all of these suppliers have suppliers.”
She added, “If a supplier has John Deere like a big part of his business, you just cut it to the knees because now [their] the company is disappearing. “
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The associate dean went on to point out that an interruption in farm equipment could not come at the worst time for farmers – during harvest – when a shortage of spare parts means “layer upon layer of the perfect storm”.
Hitting producers also means hitting Americans more in the wallet.
Highlighting shortages of proteins like bacon, which is hovering at its highest price in 40 years, Blackhurst said the strike could make matters worse.
“It probably won’t be immediate, but it will definitely hit,” she said. “What will be more immediate with this strike at John Deere is that you are going to see prices skyrocket.”
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Deere & Co. and the UAW both confirmed to FOX Business on Monday that talks between the two have resumed, but both declined to comment when repeatedly asked about supply chain issues. .
Blackhurst said: “I imagine both sides want a deal pretty quickly.”