Supply chain leaders are raising buffer stocks to their highest level since January 2023 amid ongoing disruption risks. Manufacturer backlogs hit their highest since late 2022, with bottlenecks expected through at least Q3 2026. U.S. input purchasing accelerated to its fastest pace since April 2022, while Japan, China, and Vietnam led Asian purchasing growth. Transportation costs remain elevated — their highest since June 2022 outside of April–May — reflecting persistent geopolitical uncertainty. According to GEP’s John Piatek, companies are stockpiling not due to current cost pressures, but because they lack confidence in global trade stability.
According to www.sdcexec.com, supply chain leaders are increasing buffer inventories to their highest level since January 2023 amid persistent global disruption risks — even as oil prices fell sharply in June 2026 and transportation costs eased.
Backlogs and Bottlenecks Persist Through Q3
Manufacturers reported the highest levels of order backlogs due to shortages of critical inputs since late 2022. The data indicates supply chain bottlenecks will persist through at least Q3, as companies wait for delayed materials needed to fulfill customer orders. Backlogs rose sharply not because of labor constraints — reports of backlogs tied to labor shortages aligned with historically average levels — but due to inadequate item availability. The underlying index measuring supply shortages remained well above its long-term average, despite a modest decline in the ‘items in short supply’ indicator in June.
Safety Stockpiling Hits Multi-Year High
Safety stockpiling surged to its highest point since January 2023. Procurement managers across geographies are holding surplus raw materials, commodities, and intermediate goods to hedge against both supply disruptions and inflationary pressure. Reports of stockpiled materials rising due to price or supply concerns reached their peak since that same month — a sustained uplift linked directly to the onset of the Middle East war.
Regional Demand Divergence Drives Purchasing Patterns
Input demand remained robust in North America and Asia, while weakening across Europe. In the United States, input purchasing rose at its fastest rate since April 2022. Within Asia, Japan, China, and Vietnam led accelerated purchasing expansions. This regional divergence reinforced expectations that supply chain activity — including inventory replenishment and order fulfillment — would remain elevated in the coming months.
Transportation Costs Remain Elevated Despite Oil Price Drop
Although global oil prices declined sharply in June 2026, transportation costs stayed high by historical standards. Excluding April and May 2026, transportation costs were their greatest since June 2022. This persistence reflects ongoing uncertainty surrounding the U.S.-Iran ceasefire, as tracked by GEP’s Global Supply Chain Volatility Index. The index registered elevated pressure in June — confirming that falling energy prices alone have not restored confidence in trade stability.
Strategic Caution Over Trade Environment
John Piatek, VP, consulting at GEP, underscored the strategic rationale behind continued stockpiling:
“The rise in stockpiling and persistent order backlogs point to one clear conclusion: businesses still don’t trust the global trading environment to remain stable. Despite lower oil prices and easing transportation costs, companies continue buying ahead because they expect further disruption. While this is encouraging for the global economy in the near term, it also shows manufacturers remain very cautious and are planning for more disruption in international trade.” — John Piatek, VP, consulting, GEP
His assessment aligns with observed behavior: procurement decisions are driven less by current cost metrics and more by geopolitical risk exposure — particularly in chokepoints like the Red Sea and Strait of Hormuz.
Source: sdcexec.com
Compiled from international media by the SCI.AI editorial team.
