Supply chain managers are all too aware of looming risks, but they can’t always quantify them.
In an effort to help make the details easier to understand, Everstream Analytics has released its 2025 Risk Report.
“Our supply chain risk experts leverage a vast database of supply chain disruptions to analyze past events, uncover trends, and build accurate projections,” the company said. “Everstream’s Annual Risk Report takes a deep dive into the year’s coming threats and what’s driving them so that you can plan for what’s ahead. Our 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 to help prioritize your planning and mitigation efforts.”
Risk number one – Drowning in climate change
Everstream gave climate change of score of 90% when it comes to risk factors
“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,” Everstream said. “Companies will be upended by even more frequent small-scale events and larger-scale storms like Hurricane Helene’s unexpected and extensive destruction in several states across the Appalachian Mountains in the U.S.”
Everstream recommends evaluating flood risks in both operating area and that of suppliers.
“This evaluation should include a review of area infrastructure, egress routes, and waterways,” Everstream said. “Flood events are only one aspect of a large range of extreme weather events (heat waves and convective storm events, such as hail and wildfires) that have increased over the past few decades. 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.”
Risk number two – Geopolitical instability with increased tariff risk
“International political and economic relations are destabilizing, caused by political upheaval, ongoing skirmishes, and full-scale wars,” Everstream said. “In 2025, it will be impossible to avoid conflict and its impact on sourcing, manufacturing, and logistics.”
Citing the Israel-Hamas war, the overthrow of the Syrian regime, the Russian-Urkraine war and trade restrictions souring cross-strait relations between China and Taiwan, instability across the globe can negatively impact supply chain operations and received an 80% risk factor score.
Impending tariff changes are also a concern.
“The incoming U.S. administration’s 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, pose significant risks to global supply chains. Everstream said. “The tariffs will inevitably lead to supply chain disruptions forcing companies to increase prices and thus triggering a ripple effect on the economy.”
Everstream recommends keeping abreast of all political changes, not only in the U.S., but across the globe.
“Early notice of political developments can create valuable lead time for supply chain managers to respond,” Everstream said. “The key here is understanding multi-tier supply sources by country so that when news breaks, you can make sourcing adjustments while your competitors are still figuring out exposure and impact. Depending on a company’s risk tolerance and specific supplier cost and performance dynamics, some companies will preemptively make adjustments. That said, with such a degree of uncertainty, in many cases, it’s better to prepare now than to start sourcing. And if risks don’t come to fruition, those companies will have a competitive disadvantage. Assume that any plans in place will change, and build resources and a system for quickly evaluating alternate options. The faster you can respond, the less time and money you’ll waste.”
Risk number three – More back doors for cybercrime
With a risk score of 75%, cybercrime can be a major disrupter to supply chains.
“Your company’s cybersecurity front doors may be doublebolted, but there are more unlocked back doors than ever available to increasingly sophisticated attackers,” Everstream said. “Growing reliance on artificial intelligence and cloud computing within supply chains is creating new opportunities for bad actors. They can take advantage of the rapid proliferation of Internet of Things (IoT) connected devices coupled with the widespread use of outdated security protocols. Improperly configured firewalls further exacerbate the issue, providing ample entry points for a cyberattack. In 2024, Everstream Analytics tracked that most cyberattacks were reported in the Electronics and Manufacturing sectors.”
Everstream recommends that supply chain managers prioritize the implementation of robust security measures to protect sensitive data and operations.
“Surveys alone can no longer identify the amount or extent of risk that sub-tier suppliers are exposed to,” Everstream said. “Companies must turn to AI and other automated computer calculations to evaluate rising risks in various sectors, geographies, and types of operations so that they can work with Tier 1 suppliers to identify and manage specific risks in sub-tiers.”
Risk number four – Rare metals and minerals on lockdown
According to Everstream, 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 than ever and more expensive to obtain. Because of this, Everstream has given this issue a 65% risk score.
“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,” Everstream said. “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.”
According to Everstream, in other parts of the world, the UK has banned aluminum imports from Belarus, while Chile has imposed anti-dumping tariffs on Chinese steel. Turkey has taken a similar approach, imposing duties on steel imports from China, Russia, India, and Japan. Meanwhile, China has tightened export controls on the critical metals antimony, gallium, and germanium. The U.S. and Canada have implemented tariffs on steel and aluminum, indirectly targeting Chinese imports through Mexico.
“Companies can avoid unnecessary risk to their supply chain by sourcing commodities from multiple sources or purchasing directly from miners with a forward commodity sales contract between a buyer and producer, specifying terms for future project output delivery, Everstream said. “By monitoring commodity and material intelligence, clients can stay ahead of unanticipated disruptions. They can also use a system like Everstream to map their sub-tier network and connect back to the raw materials being used in those tiers to quickly assess the impact and mobilize resources to avoid production stoppages.”
Risk number 5 – Lockdown on forced labored
With a risk score of 60%, rising levels of concern surrounding labor conditions in China and the country’s ongoing geopolitical rivalry with the U.S. have pushed many companies to find alternative suppliers in India, Mexico, and other Southeast Asian countries, according to Everstream. However, many of these emerging economies do not have adequate laws or enforcement mechanisms for workers, especially migrants from other developing countries, and unknown sub-tier suppliers may still be located in those areas.
“As more and more countries focus on tackling forced and child labor in global supply chains, companies are facing growing pressure to manage and even eliminate suppliers violating human rights,” Everstream said. “To effectively do this and avoid any operational and reputational disruptions, companies are increasingly using risk management tools to identify forced labor in global supply chains. Don’t wait for your goods or materials to be held up in customs. Create and document a robust mitigation strategy that includes ongoing monitoring of sub-tier labor issues risk. Work with Tier 1 suppliers to help them thoroughly evaluate and eliminate risk in their sub-tiers before enforcement or watchdog organizations discover problems.”
To download the 2025 Risk Report in full including more detailed information, click here.
Dana Guthrie is an award-winning journalist who has been featured in multiple newspapers, books and magazines across the globe. She is currently based in the Atlanta, Georgia, area.
