Local companies that continue to do business and employ people will face obvious short-term operational constraints, warns a new Bain & Company study focused on the impact of the Russia-Ukraine crisis on the global supply chain. .

Globally, it says, companies will have to deal with demand volatility in certain categories – of raw materials and products – as consumers adjust their spending amid food and energy costs.

On the latter, and in terms of supply, the prospects for raw materials are varied. The consultancy estimates that trade restrictions with Russia will reduce the production and availability of key strategic metals.

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The price of steel is likely to stabilize as international players increase their production capacity, while trying to balance environmental commitments with the increased use of coal needed to supply that additional capacity.

The report indicates that unless the conflict escalates significantly, road, rail and air logistics should stabilize, although global disruptions to air logistics may continue to exist due to Russian airspace restrictions and capacity limitations. heavy cargo from Ukraine.

At a macroeconomic level, the sanctions imposed on Russia could contribute to the end of the era of glut and globalization of capital, limiting foreign direct investment flows and influencing supply chain investment decisions.

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The report, whose original name is How Should Your Supply Chain Respond to the Crisis in Ukraine?, lists six actions in the supply chain that companies should consider to protect their business in the short term.

The first three are to assess and prioritize risks across the value chain, monitor changes in risk signals, and actively counteract the effects of inflation.

The second group of three actions contemplates updating risk mitigation strategies, improving the traceability of the supplier base and finally, refining its operating model to support risk management and recovery.

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