The GEP Global Supply Chain Volatility Index fell to -0.45 in February, down from -0.21 in January, its lowest level since July 2023. A value below 0 indicates that supply chain capacity is being underutilized, reducing supply chain volatility.
The index tracks demand conditions, shortages, transportation costs, inventories, and backlogs based on a monthly survey of 27,000 businesses. It is produced by GEP, a company providing artificial intelligence-powered procurement and supply chain solutions, and S&P Global, a company providing credit ratings, benchmarks, analytics and workflow solutions.
In North America, the index rose from -0.22 to -0.18, a seven-month high. This indicates North American supply chains are their busiest since July 2024, but it only reflects conditions in the United States. Canadian and Mexican manufacturing industries slowed in February.
“With tariffs driving uncertainty, U.S. manufacturers are racing to secure materials, while Canadian and Mexican suppliers are feeling the squeeze from weaker export demand,” Krish Vengat N., GEP vice president of consulting, said. “In contrast, Asia’s supply chains are operating at full capacity, fueled by strong export growth. Companies must remain agile—diversifying supply sources and optimizing inventory strategies to navigate this ongoing volatility.”
Global transportation costs remain close to levels which can be considered normal.