Monday, September 27th 2021
As if Things Weren't Bad Enough, China is Now Experiencing Power Shortages
If you were hoping for relief from the electronics shortages, then we have more bad news for you, as China is now being hit by power outages in various parts of the country. The outages are due to shortage in production, as China is trying to balance pollution vs. production, while at the same time trying to make sure its population doesn't feel the worst of the power shortage.
Factories in at least five provinces have suspended production to try and appease the government, which in turn will lead to delays in shipping whatever part or component they're making that is an important cog in the greater machinery that produces so many of the world's goods. Not all factories are affected and the suspension is obviously temporary, but it seems like we can expect a rolling production suspension over the next few months at the very least, which suggests that not everyone will get their new shiny toy from Santa this Christmas.
The report from the AP suggests that several of Apple's suppliers have been hit and the unexpected power cuts have also caused human casualties, as 23 people were hospitalised from gas poisoning due to the ventilation system in a metal casting factory being unexpectedly shut off. This just adds to all the other issues when it comes to production and shipment of goods and with winter arriving in northern China, things are likely to get worse. Part of the reason for all of this is that the party is hosting a U.N. environmental conference in mid October, followed by the Winter Olympics in Beijing in February next year and President Xi wants to present a nation with clear blue skies to the world.
However, increasing prices for coal and gas is also causing power supply shortages, as the utility companies in China aren't allowed to charge consumers more than a certain amount and can as such not increase prices, unlike in most other countries. This makes them unwilling to increase power output, as they would have to cover the additional costs. The companies that have suspended their production are expecting to be back in production by the start of next month, if it wasn't for the fact that the first week of October is a national holiday in China. Reports coming out of Taiwan suggest that Taiwanese PCB manufacturers in China haven't been too badly affected and have so far been able to make up for the shortfall using stock.
Sources:
AP, Reuters
Factories in at least five provinces have suspended production to try and appease the government, which in turn will lead to delays in shipping whatever part or component they're making that is an important cog in the greater machinery that produces so many of the world's goods. Not all factories are affected and the suspension is obviously temporary, but it seems like we can expect a rolling production suspension over the next few months at the very least, which suggests that not everyone will get their new shiny toy from Santa this Christmas.
However, increasing prices for coal and gas is also causing power supply shortages, as the utility companies in China aren't allowed to charge consumers more than a certain amount and can as such not increase prices, unlike in most other countries. This makes them unwilling to increase power output, as they would have to cover the additional costs. The companies that have suspended their production are expecting to be back in production by the start of next month, if it wasn't for the fact that the first week of October is a national holiday in China. Reports coming out of Taiwan suggest that Taiwanese PCB manufacturers in China haven't been too badly affected and have so far been able to make up for the shortfall using stock.
77 Comments on As if Things Weren't Bad Enough, China is Now Experiencing Power Shortages
www.france24.com/en/asia-pacific/20210912-why-china-is-developing-a-game-changing-thorium-fuelled-nuclear-reactor
I didn't notice the price for gas yesterday because I went a slightly different route to work, so maybe it had jumped already but I just didn't know. However, I drive by the gas station today by my work and gas is at $3.14....seriously? How the hell does it just jump 30 cents in the span of 3-4 days?
Because the demand won't go away. This is not doing a thing for mass consumption, and I'm not sure what the point really is altogether. Could it be that Xi's let the power go to his head, at last? He was on that trajectory for a while now.
In the end what this is is simple bean counters doing the work. Gas shortage is a money problem.This is a decade plan though, not gonna help them for gas problems today. They still need more coal, too.
From tradebarrierindex.org
New Zealand's tariff score is 2.92
Australia's tariff score is 3.08
Japan's tariff score is 4.06
US's tariff score is 4.58
Germany's tariff score is 4.92
EU's tariff score is 4.92
China's tariff score is 6.8
South Korea's tariff score is 7.35 (there's a reason why South Korea is not a member of CPTPP).
Lower is better.
CCP complaints about Australia's new "Negative List of Market Access Restricted" targeting CCP companies when CCP has its "Negative List of Market Access Restricted" list.
Reciprocal trade is a simple concept to understand.
Your argument is naive.
Real-world communism is just an extreme case of very big government.
At any rate, it's irrelevant.
What part of communism allows private enterprise to operate? It's clear this is happening en-masse in China, and that's really where the argument ends.
For China, foreign private enterprises can operate as per CCP's "Negative List of Market Access Restricted" list. China has a 100% government land lease.
CPTPP is enforcing WTO rules without promises exception (i.e. fixing the mistake done by the Clinton administration). Due to China's current protectionist policies, China's CPTPP application will fail i.e. both Japan and Australia will reject China's CPTPP application.China has a 100% government land lease for both foreign entities and its citizens.
IF Australian mining companies can't invest in China's mining industries (land-related), then the Australian government will apply reciprocal investment restrictions on CCP companies.
At any rate *I* certainly think this looks quite different from what we conventionally consider communism. You'll be hard pressed to convince me otherwise when compared to nations like the USSR, Chinas own past, etc.
the west will have no choice but to pay these higher prices.. higher prices will mean the west buys less stuff..
this kind of reminds me of what the arabs did to oil prices near fifty years ago.. cut production and jacked up prices..
why should china keep making cheap stuff and polluting its own country when it dosnt have to.. :)
limiting energy use is just a neat way of limiting production and jacking up prices.. its win win situation for china..
trog
WARIt’s not like the west are handcuffed, again referring to the previous example you gave about ME , a lot of bad things can happen it doesn’t always end the way you concluded
trog
We need each other, is the simple fact and it should eventually lead to some form of balance. Xi is trying very hard to look like he doesn't need anyone else. And the US, too. Neither of them are credible.
There is also a growing group of global citizens that can easily oversee all the petty politics at play here and how pointless it really is. Wasteful, too. How long can we keep up that charade with climate change peeking around the corner? Its going to hit specific parts of the world in specific ways, killing resources or production options while creating them elsewhere. It always has and it already does.
When my Australian federal government applied investment restrictions against CCP state-owned companies, CCP didn't like it (refer to 14 points complaint against the Australian government) while CCP has Market Access Negative List.
You don't know crap when my nation has a trade war against China!
The U.S has imposed trade sanctions (e.g. tariff) on China due to CCP's failing to execute the promises made prior to WTO entry.
VS
1st. China has a Market Access Negative List that restricts foreign (and local) investments that is the by-product of its communist system.
2nd. Australia applies reciprocal investment restrictions on CCP state-owned companies.
3rd. China has imposed trade (goods) sanctions on Australia. Australia's goods trade to China across the affected commodities, including barley, beef, and coal has dropped by 78 percent. Australia has replaced China with alternative markets e.g. China's mass dam building has caused drought in the downstream countries, hence creating alternative markets for Australia. LOL
Not interested in debating the particulars beyond that, honestly, though I will admit/concede it does excecise a heavy hand on it's respective markets.