Coronavirus is having an impact on supply chain, Minnesota companies

As the world continues to watch what happens with the spread of the coronavirus, experts say the economy is starting to suffer.

"It has potential for supply chain disruptions, it has the potential for transportation disruptions," said Karthik Natarajan, a University of Minnesota associate professor in the Supply Chain and Operations Department.

The health impact is evident as well.

"How are organizations going to respond to this crisis?" he questioned.

Natarajan said two huge local companies are already increasing production of products to deal with the virus.

"3M is a big producer of face masks, and they are already announcing to ramp up production of face masks all across the globe. The same is happening with Honeywell as well," he said.

The problem is getting those masks to the areas where needed, particularly with transportation routes shut down and cities and ports closed.

"The virus is spreading. It’s not inland anymore; it’s going to coastal cities," Natarajan said. "What this implies is you could see shutdowns of ports, which means the product could be sitting in the ports waiting to be cleared, but either the port is shut down or there are not enough employees to clear the facility."

When it comes to products we get from overseas, Natarajan said generic medications could be an area that sees an impact.

"Most of the generics are made in India, but the ingredients are coming from China, so even though India is not affected yet in a big way, you can see the disruption going through the supply chain," he explained.

Natarajan says uncertainty around the virus will continue to impact the supply and demand process around the globe for several months.

"I don’t see this ending in the next two months or three months, I would say six months to a year before this is all said and done," he said.