November 11, 2021 – Cardinal Health (Dublin, OH) CEO Mike Kaufmann said that the company expects at least $100 million in extra supply chain costs in fiscal year 2022 due to congested ports and the rising cost of commodities, according to Bloomberg.
Cardinals Health’s shipping partners have reported full ports and too few people to work through the backlogs, Kaufmann told the publication.
Kaufmann said that supply chain struggles are driving up the cost of manufacturing and distributing medical supplies, including gloves and syringes. Container costs rose 10 times, and commodity prices doubled over pre-pandemic levels in the company’s first fiscal quarter, which ended Sept. 30.
As a result of those factors, the company expects added supply chain costs of $100 million to $125 million in fiscal year 2022.
Although supply chain issues are raising costs, they aren’t resulting in shortages for the company, Kaufman said. However, he also doesn’t expect the supply chain issues to be resolved this year.
“We do truly believe they’re temporary, that they will come back down, it’s just really hard to project the timing of when they’ll come back down,” he told Bloomberg.
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