What's Happening?
The GEP Global Supply Chain Volatility Index reports a significant rebound in global manufacturing demand in January 2026, reaching its highest level since May 2022. This surge is driven by increased procurement activity in major economies, particularly in Asia and North America. The index, which tracks demand conditions, shortages, transportation costs, inventories, and backlogs, indicates that supply chain capacity is being stretched. North America's supply chains are at their busiest since May 2024, with U.S. manufacturers showing resilience despite trade uncertainties. Meanwhile, Asia's manufacturers are experiencing their busiest period since November 2024.
Why It's Important?
The rebound in manufacturing demand suggests renewed confidence among global supply
chain leaders, potentially signaling a recovery from previous economic slowdowns. For the U.S., this resurgence could bolster industrial growth and economic stability, providing a positive outlook for businesses and investors. The increased demand in Asia highlights the region's critical role in global supply chains, which could influence trade dynamics and economic policies. However, rising transportation costs due to higher oil prices may pose challenges for manufacturers and logistics providers.
What's Next?
As global manufacturing demand continues to rise, businesses may need to adjust their procurement strategies to manage stretched supply chains effectively. The ongoing recovery could lead to increased investment in supply chain infrastructure and technology to enhance efficiency and resilience. Policymakers and industry leaders will likely monitor transportation costs and labor market conditions to mitigate potential disruptions. The next release of the GEP Global Supply Chain Volatility Index is scheduled for March 11, 2026, providing further insights into supply chain trends.
