Watch: The Biggest Risks in Supply Chain Today

Derek Lemke, senior vice president of product level intelligence with Exiger, lays out the biggest risks that supply chains face today. Hint: There are more than a few.

When it comes to coping with risk, supply chains today are confronting “a little bit of everything, everywhere, all at once,” Lemke says, citing tariffs, export restrictions, availability of critical materials and geopolitical conflict as sources of disruption.

As manufacturers look to reshore or nearshore production away from China and other formerly low-cost countries, one thing remains constant: Global supply chains “are still very much interconnected,” Lemke says. Moreover, they lack visibility into the interdependencies that define their operations. “They’re facing the question: How can I get more prepared?”

Access to critical minerals is a particular problem, given China’s near-monopoly over supplies of rare earths and other mined materials. U.S. manufacturers have gotten a temporary reprieve with China’s moratorium on export restrictions of rare earths, while the nation conducts ongoing trade negotiations with the U.S. But that period of relief is due to expire on November 10, at which time an even stricter ban could be imposed, should the two parties fail to reach agreement on sensitive trade issues.

Some companies are appealing to the U.S. government to create a domestic source of rare earth minerals, but that effort is years away from becoming reality. In the meantime, manufacturers need to fully understand where they’re getting their materials and components, so that they can assess the level of risk in their supply chains.

“It’s really important that organizations look at supply chain mapping not as a one-off activity, but as something that’s continuously evolving,” Lemke says