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I learn something new every day with this game.

To my surprise I found out today that factories (and presumably cities) need to be "in supply" to produce units.

When I put one HQ in ships to bring it to an island, the factories and cities that belonged to this HQ did not produce anything while the HQ was on board the ships and all the units belonging to this HQ and its sub-HQ became "red" (out of supplies). No supplies at all were transferred to any of those sub-units which could have been disastrous if the AI had countger-attacked at that point [X(]. This was very annoying because an enemy destroyer was harrassing my transports and cutting off supplies to the island, and I had ordered the shipyard to produce a couple of cruisers to get rid of that destroyer.The cruisers were not produced and it took me a while before I figured out why.[:'(]

I am still a bit puzzled about how supplies are transferred by sea from port to port: Does one have to have a HQ in one or both ports for the supplies to get through?[&:]

Henri

Interesting! I was just reading through the supply tutorial on the ATG wiki page. I think what is happening is ships only get supply while in port and they use their very large reserves while at see. It seems the HQ, while on the ship, was out of supply while at sea and the cities and factories had no HQ to produce for so they stopped production.

Does 4.1.2) PORTS AND WHY YOU REALLY, REALLY WANT TO CONTROL THEM
http://www.vrdesigns.nl/atwiki/doku.php ... ntrol_them
(sorry I couldn't get the link to insert)
answer the port to port question? Do ports need to be in supply of an HQ then the next port is in as much in supply as the first port? After that is the second port able to extend supply relative to the distance the first port is to the 1st HQ?

Not sure I completely understood the question but here is my 2ct:

Cities will need a "supply line" to the HQ they are producing for. If a HQ is transported by ship it will not have a supply line to any unit so all HQs will stop delivering to the HQ and the HQ will stop distributing or receiving supplies. Actually production goes on and is stockpiled until the time that a supply line can again be traced to a HQ (could be another HQ).
I think it needs to be differentiated between automatic sending of supplies and the manual transfer of supplies.
This is the approach for the automatic sending of supply: Ports allow the tracing of supplies (without the usual 150 ap modifier) out to the sea and into the sea irrespective of whether the HQ is located on them or not. So the supply line length calculation via port is: Starting HQ (or production site) to port plus port on the sending side to port on the receiving side plus receiving port to target unit iirc. If a port on the receiving side is missing than a 150 point penalty is added, if the port on the sending side is missing no supply will be sent.
In case you want to manually transfer supplies (which works from HQ to ships at sea or to a HQ in another port) then the HQ which is sending must be located on a port and have some cargoships available...

Reading that wiki, do your ships get "out of supply" after 10 turns at sea?

From my experience it depends:
If you look at the stats for most ships then they can carry about 10x as much supply as they burn through each turn. The exception being the Carrier and the Cargoship which are special cases as they will need to provide supply for the planes/the cargo they carriy.
So this means that if you can provide them with 100% supply to start with (which is a big if as then you are putting in a lot of your production here. I usually try not to load up with more then 3-4 turns of supply) then they will last 20 turns if at 100% readiness (100% readiness means you need only half of the supply). However usually your fleet will see some action and go below 100% readiness at some point.
On the plus side you have to take into account that you can supply your ships at sea with transfer via cargoships and that if you bring in new ships to a fleet then supply levels average out.
So there can be several strategies on how you supply your ships...