The Red Sea Supply Chain Disruptions: an Opportunity for Distributed 3D Printing

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Starting in October 2023, militants backed by Iran and based out of Yemen — referred to as the ‘Houthi movement’ because of their association with the Houthi tribe — began launching attacks against commercial maritime vessels in the Red Sea. In December 2023, multinational giants, mostly from the shipping and oil & gas sectors, began altering their maritime traffic from the Red Sea-Suez Canal route to a much lengthier route around the Horn of Africa.

Map of the Red Sea, image courtesy of Nations Online Project

From the 18th to the 21st Century

The Houthis’ activity is intended as support of Hamas in the latter group’s war with Israel. The Red Sea disruptions, meanwhile, are occurring at the same time as drought has led to similar rerouting decisions concerning the Panama Canal.

As the AP recently noted, these two developments are directly impacting on each other: “Some companies had planned to reroute to the Red Sea — a key route between Asia and Europe — to avoid delays at the Panama Canal… Now, that’s no longer an option for most.” A Bloomberg headline described the issue most strikingly: “Twin Crises Send Cargo Ships Back to 18th Century Trade Routes

As I noted in a recent 3DPrintPRO article, at the same time as these supply chain crises have emerged, the Biden administration has continued to accelerate its focus on supply chain management. The White House announced the establishment of a Council on Supply Chain Resilience at the end of November 2023, comprised of more or less all of the agency heads of cabinet-level departments.

Additionally, other associated announcements the White House made in Q4 of last year have also begun to materialize, including the release of two major policy documents in December 2023 and January 2024: the Department of Energy’s (DOE’s) Options for a National Plan for Smart Manufacturing and the Department of Defense’s (DoD’s) first-ever National Defense Industrial Strategy (NDIS).

Trafficking routes may have temporarily been knocked back into the 1700s, but this crisis seems likely to ignite an exponentially increasing push to move supply chains fully into the 21st century.

Image courtesy of Fieldnode, provider of the Industry Collaboration Project digital inventory platform for the energy sector

Digitalization’s Moment Has Arrived

In November 2008, Rahm Emanuel — the current US Ambassador to Japan, former Mayor of Chicago, and one-time Chief of Staff to President Obama — bared his soul rather brazenly to the Wall Street Journal. Speaking about the 2008 financial crisis, Emanuel said, “You never want a serious crisis to go to waste. And what I mean by that [is] it’s an opportunity to do things that you could not before.”

Despite the fact that it is Obama’s VP who now sits in the Oval Office, much has obviously changed since 2008. What once seemed like the height of political cynicism now seems, in retrospect, like a fairly straightforward description of the modus operandi of global policymakers. And, of course, even at the time, Emanuel was far from an originator of the concept.

This is simply what is to be expected when immediate crisis response is built into the standard operating procedure of the global economy over the course of decades. And Western crisis response has been immediate in the case of the Red Sea. Another development from December 2023 was US Secretary of Defense Lloyd Austin’s announcement of Operation Prosperity Guardian, a coalition of around 20 nations, led by the US and the UK, to counter the Houthi activity in the Red Sea. (Interestingly, at least eight of those nations have joined the coalition anonymously.)

In January 2024, both sides have quickly escalated the conflict significantly, including as many as two dozen drone and missile attacks by the Houthis on January 10, leading to the Western coalition’s first airstrikes on Yemen, on January 12. Although it certainly pales in comparison to the human cost, there has already been an extraordinary impact on shipping rates: according to a January 12 article in Sky News, “Shipping costs have risen by more than 300% since November amid the disruption caused to freight in the Red Sea from attacks…”

The US had already started to move determinedly towards reshoring in 2022 and 2023. Other Western nations have followed that lead, including the US’s primary partner in Operation Prosperity Guardian, the UK.

It took quite some time to decimate the Western industrial base, and it will take at least as long to truly rebuild some semblance of one. But the image of the industrial base that nations like the US and UK are working towards, long-term, will have to be embedded directly in the process from the beginning.

That is, rebuilding manufacturing capacity in the places where it has been most whittled down will have to be achieved in a way that looks far different from what ‘an industrial base’ has ever looked like before, and everyone involved in planning the future needs to take that into consideration in the present. Here, the “opportunity to do things that you could not before” is an opportunity to build new, digital supply chains centered around advanced manufacturing processes, especially additive manufacturing (AM).

Now, these won’t be “replacement” supply chains — they clearly can’t be at this point, and if they ever can be, it won’t be for many years — but, instead, supplemental supply chains. Along these lines, they should be built around the existing ones, in such a way that the supplemental supply chains are complementary, to the fullest extent possible. A slogan of Ivaldi Group, a San Francisco-based supply chain digitalization network specializing in applications for heavy industry, perfectly expresses the right idea for what’s needed: “Send Files, Not Parts.”

The Velo3D platform has been validated for distributed manufacturing of oil & gas parts. Image courtesy of Velo3D

As I’ve noted frequently, this has long been an idealized vision for AM that has nonetheless fallen short from being possible in practical reality. But an increasing number of companies, from original equipment manufacturers (OEMs) to service bureaus to software providers, seem to have seen the writing on the wall when it comes to enabling distributed manufacturing with 3D printing.

Moreover, money talks: the more that shipping rates start to cut into everyone’s bottom line, the less expensive AM will start to seem by comparison. The more quickly that AM is able to gain new adopters, the faster that the industry can reach economies of scale, thereby lowering costs. All of a sudden, supply chain digitalization is looking like an effort worth going all in on.

Conclusion: You Can’t Spell Opportunity Without Unity

Every group, industry, government, etc., needs an organizing principle. COVID and Ukraine started to push supply chain resilience to the forefront of the agenda for AM. The shipping disruptions in the Red Sea are solidifying the role of digitalization for supply chain resilience as the AM industry’s organizing principle.

The mark of an effective organizing principle is that, once in place, it more or less spontaneously creates an assigned task for everyone involved. As broad-sweeping and abstract as the idea might sound on the surface, when considering it in the context of AM deployment, “digitalizing supply chains most affected by Red Sea traffic disruption” in fact becomes a highly specific rallying cry that can motivate every organization with the ability to contribute in the right direction.

Especially for a task as big as building entirely new supply chains, there is ample room for everyone who is willing to act cooperatively, and no room at all for those acting from the mistrustful standpoint of competitive paranoia. The problems waiting to be solved are serious, but there is still reason for optimism: it’s apparently still not too late to try to change the world.

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