Non classé

Top Supply Chain Risks to Prepare for in 2025

Published

9 mois ago

13 janvier 2025

Top Supply Chain Risks To Prepare For In 2025

This is the time of year when analysts get bombarded with pitches from PR firms. The pitches share a “sneak peek” of the predictions that a CEO at a solutions company is making and then asks the journalist if they want to interview the CEO. These predictions mostly seem obvious.

I got a pitch from the PR firm representing Everstream Analytics that was different. Everstream Analytics is sitting on a vast trove of risk data. The company applies AI and other analytics to this data to provide supply chain risk analytics and insights to its clients. In short, what makes them different is that they can quantify and thus prioritize supply chain risks.

Their 2025 outlook identifies the five most likely supply chain events that will impact supply chain operations this year. Each event is assigned a risk score.

Drowning in Climate Change

This is the top risk identified by Everstream. They apply a risk score of 90% here. “Flooding has become so volatile that even nations with the most sophisticated weather warning systems and infrastructure are caught off guard by the ferocity and speed of sudden flash flood events. Companies will be upended by even more frequent small-scale events and larger-scale storms like Hurricane Helene’s unexpected and extensive destruction across several states in the U.S. Appalachia region in 2024.”

The company points out that forecasted rainfall totals for Helene were very accurate one week in advance of the flood that devasted the Blue Ridge mountain region of North Carolina. “But nobody in that region had ever experienced or even expected that amount of rainfall in such a brief period. The existing infrastructure (bridges, roads, rails) was built in the past and was insufficient to handle these copious rainfall totals. The damage impacted more than 50 electronics, automotive, and aerospace manufacturers, plus general machinery and materials processors, and medical device and health care companies.”

Climate change is causing more frequent and intense extreme weather events around the world. In 2024, flooding events contributed to 70% of the weather disruptions covered by Everstream Analytics.

So, what can companies do about this risk? They recommend looking at key company-owned facilities and those run by key partners and suppliers. The “evaluation should include a review of area infrastructure, egress routes, and waterways. Pay attention to applied meteorology forecasts as far in advance as possible and take flood warnings particularly seriously. Prepare for the worst and react aggressively.”

Geopolitical Instability with Increased Tariff Risk

Everstream applies a score of 80% to this risk. “International political and economic relations are destabilizing, caused by political upheaval, ongoing skirmishes, and full-scale wars. In 2025, it will be impossible to avoid conflict and its impact on sourcing, manufacturing, and logistics.”

The report cites intensified political turmoil in the Middle East, including the Israeli-Hamas war and its spillover, the Syrian civil war, and continuous Houthi attacks on Red Sea vessels. “Even if the traffic along the Suez Canal route returns to full throttle in 2025, this shift would cause weeklong processing delays, container backlogs, and a spike in congestion at many European seaports due to the sudden increase in cargo volume.”

In Ukraine, Russian forces now occupy around 20% of the country. Additional support from Western allies looks less likely. It is likely Russia will be able to destabilize Ukraine’s remaining manufacturing and trade activities and that further strain between Europe and Russia will result.

In Asia-Pacific, China believes Taiwan rightfully belongs to them. This has led to the souring of cross-strait relations between China and Taiwan as Taiwan exhibits more political independence. “A full-scale invasion seems unlikely.” This may be overly optimistic. However, the report summarizes the military drills around Taiwan in recent years and comments that “more or bigger Chinese military exercises could disrupt transportation through significant seaports and airports in the region. Nearly a third of all global trade – and 40% of all globally traded petroleum products – flows through sea lanes in the region.

Meanwhile, tariff increases always affect global trade flows. President Trump has proposed tariff increases, including a global baseline tariff of 10–20%, a 60% tariff on Chinese imports, and a 100% tariff on goods from de-dollarizing countries. De-dollarization is an effort by several countries to reduce the role of the U.S. dollar in international trade. Countries like Russia, India, China, among others, are seeking to set up trade channels using currencies other than the dollar.

Everstream’s report did not mention Mexican or Canadian tariffs. An increase in the flows between China and Mexico of assembled products, and materials and components produced in China has occurred. This has been described as a “back door” into the U.S. to avoid Trump and Biden administration tariffs. Trump’s negotiations with Mexico to close the back door could heighten the impact of new tariffs on China.

The automotive, semiconductor, and manufacturing industries are at risk due to potential tariffs on solar wafers, polysilicon, steel/aluminum imports, and the closure of the back door to Mexico. Additionally, tariffs on Chinese goods could lead to retaliatory measures, affecting U.S. companies operating in China. This would primarily affect U.S. agricultural exports and finished goods.

The key strategy, according to Everstream, is to understand the multi-tier supply sources by country so that a company can make sourcing adjustments when an event occurs. If a company can do this more quickly than its competitors, that leads to a competitive advantage.

More Back Doors for Cybercrime

Everstream assigns this risk a score of 75%. “While a company’s cybersecurity front doors may be double-bolted, but there are more unlocked back doors than ever available to increasingly sophisticated attackers. In 2025, cyberattacks will primarily arrive via sub-tier supply chains, where criminals can more easily exploit common programming errors and vulnerabilities. They can then leapfrog into top-tier corporations via phishing, software connection links, or other methods.”

Cencora, a sub-tier pharmaceutical supplier, had a security breach in the early spring of 2024. At least 11 global pharmaceutical companies linked this breach to their later ransomware and phishing attacks. Everstream’s data document 471 attacks in 2024. The data shows that cyberattacks were particularly common in the electronics, logistics, and consumer goods industries.

Larry O’Brien, a vice president at ARC Advisory Group, says that an European Union regulation known as Network and Information Systems Directive 2 provides a good framework for companies to follow to bolster their supply chain cybersecurity capabilities. While NIS 2 is an EU regulatory framework, NIS 2 applies to companies headquartered outside the EU if they provide services within the EU. “Adopting a risk management framework for cybersecurity is something that all manufacturers should be doing,” Mr. O’Brien points out. “As with any regulatory framework, NIS 2 tells you what needs to be done, not always how to do it.”

Rare Metals and Minerals on Lockdown

The score assigned to this class of risks is 65%. “Countries and companies alike are recognizing global mineral scarcity coupled with increasing demand, and both are responding by locking up supplies.” Between rising regulations, new tariffs, and long-term or exclusive contracts, rare minerals and metals will be harder and more expensive to obtain.

“Within a politically charged atmosphere between the West and the major commodity producers—China and Russia—companies will face new tariffs and sanctions on critical metals. Governments are placing renewed emphasis on the negative environmental and social impacts of mining, which will present challenges for metal producers over the coming year.”

But, China is not the only nation with proposed or enacted commodity restrictions. “Political tensions over the Russia-Ukraine war led to restrictions on Russian metal imports by the U.S. and the UK. Additionally, security concerns and allegations of industry product dumping led many countries to enact measures against Chinese metal imports.”

As concerns mount surrounding critical commodities, companies are increasingly turning to direct mineral purchasing agreements with mines. However, when a nation supplies an overwhelming majority of a mineral based on mining or processing, direct agreements with mines may have limited value. Graphite, for example, is a core raw material for producing Lithium batteries which are core to the electronic vehicle market. 80% of the world’s graphite is produced in China.

Crackdown on Forced Labor

No nation’s enforcement of any ESG issue comes close to the US Customs and Border Protection Agency’s enforcement of the Uyghur Forced Labor Protection Act. $3.7 billion in shipments have been detained at the border based on enforcement of this act. In some cases, the shipments are eventually cleared, but only after supply chains were disrupted and demurrage charges accrued. But a significant proportion of shipments were never allowed entry into the US.

What gives the US act teeth is that “the ‘rebuttable presumption’ part of UFLPA is truly unique. Anything coming out of Xinjiang is presumed to have used forced labor unless an importer can prove the negative. There is also a lack of a de minimis exception; this means that even an insignificant input of product produced in whole or in part with forced labor could result in enforcement action.

While the UFLPA is the most stringent, other nations and regions have also enacted legislation. These include the EU’s Corporate Sustainability Due Diligence Directive (CS3D) and regulation on Prohibiting Products made with Forced Labor (FLR); Mexico’s Forced Labor Regulation; and Canada’s Fighting Against Forced and Child Labour in Supply Chains Act.

While legislation has pushed many companies to find alternative suppliers in other low-income countries, many emerging economies do not have adequate laws or enforcement mechanisms. This is particularly true when sub-tier suppliers employ migrant labor.

The technology exists to detect whether a company’s supply chain includes sub-tier suppliers based in the Uighur region of China. This technology is not flawless, there can be false positives and misses. Nevertheless, it is a powerful tool to prevent shipments from being detained based on UFLPA.

However, finding bad actors among sub-tier suppliers in other parts of the world is still difficult. Everstream points out that the food industry is a particular source of concern. Vanilla, palm oil, cocoa, and soy – produced in Madagascar, Indonesia, Cote d’Ivoire, Ghana, and Nigeria – have frequently accrued violations and allegations based on child labor or forced labor issues.

The post Top Supply Chain Risks to Prepare for in 2025 appeared first on Logistics Viewpoints.

Non classé

Federal Industrial Partnerships and Supply Chain Realignment Under the Trump Administration: Pharmaceuticals, Semiconductors, Critical Minerals, and Energy

Published

2 jours ago

3 octobre 2025

Federal Industrial Partnerships And Supply Chain Realignment Under The Trump Administration: Pharmaceuticals, Semiconductors, Critical Minerals, And Energy

In the months leading up to the 2026 midterm elections, the Trump administration has launched a broad initiative to negotiate agreements with companies across as many as thirty industries. According to reporting from Reuters and other outlets, these deals involve a range of mechanisms, including tariff relief, equity stakes, revenue guarantees, and regulatory adjustments.

The purpose of the initiative, according to administration officials, is to strengthen U.S. national and economic security by encouraging companies to expand production domestically, reduce reliance on China, and ensure the availability of critical products.

For logistics and supply chain leaders, this represents a significant change in the relationship between government and industry. Federal agencies are no longer simply regulators or supporters of infrastructure. They are becoming active participants in corporate strategy, investment, and supply chain design.

Structure of the Deals

The administration’s approach is not uniform. Each agreement varies depending on the sector and company involved. Examples include:

Pharmaceuticals: Eli Lilly was asked to expand insulin production, Pfizer was pressed to increase output of its cancer and cholesterol drugs, and AstraZeneca was encouraged to establish a new U.S. headquarters. In exchange, companies have been offered tariff relief or regulatory flexibility.
Semiconductors: A portion of grants provided under the CHIPS Act has been converted into equity stakes, including a reported 10 percent stake in Intel.
Critical Minerals: The Department of Defense took a 15 percent stake in MP Materials, secured a floor price for future government purchases, and facilitated a $500 million supply agreement between MP Materials and Apple for rare earth magnets.
Energy: The Department of Energy has asked companies such as Lithium Americas for equity stakes in exchange for federal loans supporting domestic mining and battery production.

The unifying theme is the use of federal leverage, such as tariffs, financing programs, or regulatory approvals, to secure commitments from private companies that align with stated national security objectives.

Agencies as Dealmakers

What distinguishes this initiative is the scale of inter-agency involvement. The White House has described the approach as “whole of government.”

The Department of Health and Human Services is leading negotiations in pharmaceuticals.
The Department of Commerce, under Secretary Howard Lutnick, has overseen transactions in steel, semiconductors, and industrial manufacturing.
The Department of Energy is linking financing programs to equity arrangements in energy and mining.
The Pentagon has led negotiations with defense contractors and suppliers of critical minerals.

Senior officials, including White House Chief of Staff Susie Wiles and supply chain coordinator David Copley, are directly involved in negotiations. The presence of Wall Street dealmakers, such as Michael Grimes (formerly of Morgan Stanley) and David Shapiro (formerly of Wachtell, Lipton, Rosen & Katz), illustrates the administration’s transactional orientation.

Financing Mechanisms

The administration is using multiple sources of capital to finance these arrangements:

International Development Finance Corporation (DFC): Originally designed to support development projects abroad, the DFC has proposed expanding its budget authority from $60 billion to $250 billion. If approved by Congress, it would fund projects in infrastructure, energy, and critical supply chains within the U.S.
Investment Accelerator (Commerce Department): Seeded by $550 billion pledged by Japan as part of a bilateral trade agreement, this entity will direct capital into U.S. strategic sectors, serving as a replacement for an earlier proposal to establish a sovereign wealth fund.
Existing Programs: Agencies are repurposing funds from programs such as the CHIPS Act and Department of Energy loan guarantees, often converting grants into equity holdings.

Together, these mechanisms represent one of the largest coordinated federal interventions in U.S. industrial and supply chain development in recent decades.

Implications for Supply Chains

The administration’s policies carry several direct consequences for logistics and supply chain management.

1. Reshoring of Manufacturing

Many of the deals include explicit requirements for expanded U.S. production. This will increase demand for domestic transportation, warehousing, and distribution capacity. It also implies higher utilization of U.S. ports and intermodal corridors, as inputs shift from finished imports to raw materials and intermediate goods requiring processing inside the United States.

2. Critical Minerals and Energy Security

The focus on rare earths, lithium, and other inputs for advanced manufacturing indicates a restructuring of upstream supply chains. Logistics providers should expect increased flows from domestic mining regions, such as Nevada’s Thacker Pass lithium project, to processing and manufacturing centers. This represents a shift away from reliance on Asian supply hubs, particularly China.

3. Government as Stakeholder

Equity stakes and long-term purchase agreements create a different operating environment. Logistics providers serving these industries may find demand more stable due to government-backed contracts. However, these arrangements may also impose compliance requirements and reduce flexibility in adjusting supply networks.

4. Public-Private Coordination

Federal involvement in freight and industrial infrastructure financing could accelerate long-delayed projects. Rail expansion, port upgrades, and domestic warehouse capacity may benefit from this investment. Companies positioned to partner on these projects may see long-term opportunities.

Risks and Concerns

Several risks accompany this shift:

Policy Reversal: Executives have expressed concern that a future administration could unwind or renegotiate these deals. Supply chains built around government-backed agreements may face uncertainty if political priorities shift.
Equity Demands: Some companies are wary of ceding ownership stakes to the federal government. This creates hesitation in sectors where ownership control and investor confidence are sensitive.
Market Distortions: Critics argue that selecting which companies receive government support could disadvantage firms excluded from the arrangements, altering competitive dynamics within industries.
Implementation Capacity: The scale of proposed financing, particularly the expansion of the DFC, requires congressional approval and capable management. Delays or political opposition could slow execution.

Policy-to-Supply-Chain Impact Table

Policy Mechanism
Industry Example
Government Action
Supply Chain Impact

Tariff Relief
Pharmaceuticals (Pfizer, Eli Lilly)
Tariff exemptions in exchange for expanded U.S. production
Increases demand for domestic warehousing, distribution, and cold-chain logistics for added output

Equity Stakes
Intel (10% stake), MP Materials (15% stake)
Federal ownership through converted grants or Defense Production Act
Creates long-term stability in supply flows, but may add compliance requirements for logistics providers

Purchase Guarantees
MP Materials with Apple
Pentagon set floor prices, Apple committed to $500M supply contract
Locks in demand for rare earth shipments, increasing domestic transport flows from mining to manufacturing

Federal Loans Linked to Equity
Lithium Americas (DOE loan, 5–10% stake requested)
Loan support tied to partial government ownership
Supports new mining and battery projects, creating future logistics demand for raw materials and finished batteries

Investment Accelerator Funding
Commerce Department
$550B in financing, partly funded by Japan, allocated to U.S. manufacturing and freight infrastructure
Potential expansion of ports, intermodal rail, and distribution centers, reducing bottlenecks in supply chains

Expanded DFC Financing
Multiple critical industries
Proposed budget growth from $60B to $250B for U.S. supply chains and infrastructure
Large-scale capital for freight corridors, warehouses, and strategic materials, enabling reshoring of production

Case Examples

MP Materials

The rare earth mining company received federal backing through a 15 percent Pentagon stake, floor pricing commitments, and a supply agreement with Apple. This illustrates the administration’s template: equity participation, purchase guarantees, and private-sector co-investment.

Intel

The conversion of CHIPS Act funding into a 10 percent federal equity stake in Intel highlights the new approach to semiconductor supply chain security. By tying financial support to ownership, the government ensures both accountability and a direct role in strategic sectors.

Lithium Americas

A Department of Energy loan of $2.26 billion, paired with negotiations for a 5 to 10 percent federal equity stake, demonstrates how energy supply chains, particularly those tied to electric vehicles and batteries, are being secured through mixed financing and ownership arrangements.

Long-Term Outlook

The administration’s strategy marks a departure from the traditional U.S. model of private-sector–led industrial development. Instead, it resembles coordinated industrial policies pursued in other economies, though with American characteristics.

For supply chain professionals, this means that:

Government will play a larger role in shaping sourcing, production, and distribution decisions.
Access to federal financing and contracts will become a key factor in strategic planning.
Logistics infrastructure may receive substantial investment, creating new opportunities for providers.
Companies must assess political as well as market risks when designing long-term supply chains.

The Trump administration’s pre-midterm industrial deals reflect a significant realignment of government and industry roles in the United States. By leveraging tariffs, financing programs, and direct equity stakes, the federal government is reshaping supply chains across pharmaceuticals, energy, critical minerals, and freight.

The initiative is intended to secure domestic production, reduce reliance on China, and ensure access to strategic inputs. For logistics leaders, the result will be increased reshoring activity, new demand for domestic infrastructure, and closer integration of supply chains with federal priorities.

At the same time, risks remain. The durability of these arrangements depends on political continuity, effective implementation, and the willingness of companies to partner with government under new terms.

In this evolving environment, logistics and supply chain professionals will need to monitor policy developments as closely as they do market trends. Supply chains are no longer shaped solely by efficiency and cost considerations. They are now integral to the nation’s industrial strategy.

The post Federal Industrial Partnerships and Supply Chain Realignment Under the Trump Administration: Pharmaceuticals, Semiconductors, Critical Minerals, and Energy appeared first on Logistics Viewpoints.

Non classé

Supply Chain and Logistics News Sept 29 – Oct 2nd 2025

Published

2 jours ago

3 octobre 2025

Supply Chain And Logistics News Sept 29 – Oct 2nd 2025

This week in supply chain news, major companies are demonstrating a mix of strategic adaptations and responses to global pressures. ExxonMobil and Kinaxis are collaborating to develop a next-generation supply chain management solution specifically for the complex oil and gas industry, aiming to increase resilience and provide comprehensive visibility. In a push for network efficiency, FedEx has launched a new direct cargo flight between Dublin, Ireland, and Indianapolis, Indiana, bypassing congested coastal hubs to reduce transit times. The pharmaceutical sector is also focused on resilience, with Eli Lilly and Amgen announcing significant U.S. manufacturing investments to bring critical drug production back to North America. Conversely, General Mills is restructuring its supply chain by closing three manufacturing plants in Missouri as a cost-saving measure in response to changing consumer spending habits. Finally, the U.S. government is imposing new tariffs on imported wood products and furniture, effective October 14, 2025, in a move to address what it identifies as a threat to the domestic industry and supply chain security.

The News of the Week:

ExxonMobil and Kinaxis are Developing a Next-Generation Supply Chain Management Solution for Oil and Gas

The oil and gas industry supply chain is one of the most complex in the world. It involves myriad complex production assets both onshore and offshore, transporting highly volatile products around the globe through pipelines, tank farms, ports, ships, rail, and truck. The end product could be gasoline, petrochemicals, natural gas, hydrogen, or any of hundreds of products from asphalt to motor oil. Disruptions to the oil and gas supply chain can have serious consequences for end users. The industry needs more comprehensive supply chain solutions that increase resilience, provide complete visibility across all aspects of the supply chain, and enable swift responses to business challenges and opportunities. Kinaxis and Exxon are collaborating to digitalize various sectors of Exxon’s business. They aim to leverage Kinaxis’s Maestro software to enhance planning and decision-making processes. Through this collaboration, the two companies aim to share solutions tailored to the oil and gas industry, which currently lacks supply chain management solutions that cater to their specific needs.

FedEx Expands Global Air Network with New Dublin- Indianapolis Route

In an effort to shorten transit times and strengthen its international network, FedEx has launched a new direct cargo flight between Dublin, Ireland, and Indianapolis, Indiana. The new four-day-a-week service bypasses traditional, more congested coastal gateways, which is expected to reduce shipping times by a full day for goods moving between Ireland and the U.S. Midwest. This strategic expansion is a response to the growing trade between the two regions and demonstrates how major carriers are adapting their networks to create more direct and efficient routes to meet evolving customer demands.

Eli Lily and Amgen Announce Massive U.S. Manufacturing Investments

In a major push for domestic drug production, pharmaceutical giants Eli Lilly and Amgen have announced huge investments in new U.S. manufacturing facilities. Eli Lilly is planning a new $6.5 billion factory in Houston, while Amgen is expanding its Puerto Rico plant with a $650 million investment. These moves are a direct response to the global supply chain vulnerabilities exposed in recent years and represent a significant effort to boost the resilience of the U.S. pharmaceutical supply chain. The investments aim to bring critical drug production back to North America, creating jobs and reducing reliance on overseas manufacturing.

General Mills is Closing Three Manufacturing Plants in Missouri

General Mills is closing three manufacturing plants in Missouri—a pizza crust facility in St. Charles and two pet food locations in Joplin—as part of a multiyear supply chain restructuring effort. The company expects to incur $82 million in restructuring charges, including asset write-offs and severance costs. This action is part of a broader trend among food and beverage companies to implement cost-saving measures in response to consumer spending pullbacks. The closures follow previous organizational actions by General Mills, such as job cuts and the closure of its innovation unit, and are intended to improve the company’s competitiveness.

US to Begin Furniture, Wood Import Tariffs on Oct. 14

New tariffs on imported wood products, including furniture, will take effect on October 14, 2025, following a Section 232 national security investigation. The initial duties will be 10% on softwood lumber and 25% on upholstered furniture, kitchen cabinets, and vanities. On January 1, the tariff rates are scheduled to increase to 30% for upholstered furniture and 50% for kitchen cabinets and vanities. The executive order provides for lower tariff caps for imports from specific trading partners, such as the U.K., Japan, and the European Union. These new tariffs are intended to address what the administration has identified as a threat to domestic industry and supply chain security.

Song of the week:

The post Supply Chain and Logistics News Sept 29 – Oct 2nd 2025 appeared first on Logistics Viewpoints.

Non classé

Call for Speakers: Ready to Drive Real Change in Intelligent Operations and Resilient Supply Chains – ARC Industry Forum 2025

Published

3 jours ago

2 octobre 2025

Call For Speakers: Ready To Drive Real Change In Intelligent Operations And Resilient Supply Chains – Arc Industry Forum 2025

Call for Speakers – ARC Industry Forum 2025

The ARC Industry Forum is the premier event where operations, supply chain, and technology leaders gather to shape the future of intelligent and resilient enterprises. In 2025, supply chains face unprecedented disruption, but also unmatched opportunity. We are seeking speakers—executives, practitioners, and innovators—who can share strategies, frameworks, and real-world experiences to inspire and guide their peers.

Sample Session Themes

To help illustrate the types of topics we feature, here are a few recent examples:

The New Frontier of Operations and Supply Chain: AI, Resilience, and Intelligence – Exploring how AI, analytics, automation, and connected intelligence converge to deliver agility and resilience.
Building Resilient Supply Chains in the Age of Shifting Geopolitics – Addressing the regulatory, tariff, and policy challenges facing global supply networks.
Unlocking the Power of Knowledge Transfer in Enterprise Systems – Showcasing best practices to fully leverage enterprise and knowledge management systems.

These examples are only a sample of the many tracks available. Additional sessions will cover digital transformation, sustainability, cybersecurity, workforce strategies, and other timely topics.

Submission Guidelines

We invite proposals that highlight real-world case studies, practical lessons, and strategic frameworks. Presentations should be vendor-neutral, educational, and tailored for an audience of senior executives and practitioners.

If you are interested in speaking, please submit:

A proposed session title and abstract (150–250 words)
Key takeaways for attendees
Speaker bio and organizational role

To submit a proposal, or simply for more information, contact us now

The post Call for Speakers: Ready to Drive Real Change in Intelligent Operations and Resilient Supply Chains – ARC Industry Forum 2025 appeared first on Logistics Viewpoints.