Global supply chain pressures eased in July, says GEP report
Global supply chain pressures eased in July as factories reduced stockpiling and transport costs moderated, according to GEP’s monthly supply chain volatility index report.
Although the global index score fell by 0.59 points to 0.78 in July, supply shortages remained and production backlogs continued to build. The material shortages indicator fell only fractionally in July, with overall supply shortages remaining high by historical standards. Rising production backlogs from missing components, meanwhile, indicated bottlenecks could worsen if the Middle East conflict drags on.
GEP’s July data also mostly preceded the latest escalation in the US-Iran war – and its renewed disruption to shipping in the Strait of Hormuz and increase in energy prices.
All global regions registered an easing of supply chain pressure, with Asia dropping to 1.37 from 1.95, North America falling to 0.76 from 1.17, and Europe falling to 0.68 from 1.17.
An index value above 0 indicates supply chains are being stressed, while a value below 0 means supply chain capacity is being underutilized.
Demand for inputs fell to its lowest point in 2026, driven by a decline in stockpiling in China and the US. Stockpiling of inputs due to price or supply concerns fell for the first time since January as factories ran down inventories that were built up since the start of the US-Iran war.
The global transportation cost indicator fell in July to reach its lowest level since March, but data was collected prior to the oil price surge at the tail-end of the month.
