DP World: What is the Scale of Supply Chain Climate Risks?

Global trade faces an era of persistent disruption as climate-related shocks, geopolitical instability, port congestion and customs delays create mounting challenges for supply chains worldwide.

The impact varies significantly depending on geography and sector.

DP World, a global leader in logistics combining worldwide infrastructure with local expertise to develop efficient end-to-end supply chain solutions, has published its 'World Without Logistics: Global Report'.

The document consolidates all findings from its 'Without Logistics' series into a single comprehensive analysis.

Understanding disruption patterns

The research reveals disruption affects regions differently, with the Global South experiencing the most severe impact.

According to the study, 83% of firms encountering disruption in Sub-Saharan Africa (SSA) report operational time affected by more than a month within disrupted years, compared to 50% in North America, 41% in Germany and 36% in the UK.

The study identifies two major categories: chronic and catastrophic disruption. High-volume sectors including perishables, healthcare and retail experience constant shocks, while automotive encounters less frequent but more expensive disruption.

Firms that distribute logistics investments across their supply chain demonstrate greater resilience.

Consumer goods companies that have invested in four or more logistics areas report approximately 76% lower disruption costs than their low-investment counterparts.

Most regions and sectors report increased customer complaints following disruption (from 80% to 95%).

Around 80% of companies in France and Sub-Saharan Africa report an impact on brand image following disruptions.

Between 81% and 89% of cargo owners expect higher investment in AI, robotics and automation.

"To get closer to an answer, we spoke to hundreds of beneficial cargo owners across eight major industries, every major trade region, at both C-suite level and below," explains Beat Simon, COO for Logistics at DP World.

"Their responses paint an unsettling picture of disruption that is no longer exceptional but common. The consequences of geopolitics, climate events, labour shortages, congestion and critical infrastructure failures are keeping cargo owners in firefighting mode."

How regions experience disruption

North American firms experience disruption but demonstrate more resilience than other locations globally. 38% of respondents face disruption costs of US$1m or more, while 50% lose more than one month of operational time annually. They are directing investment towards logistics spend (65%) and AI, automation and digital tools (78%).

Europe experiences high disruption, though some countries are affected more severely.

The UK and Germany demonstrate confidence in their resilience strategies, but France faces more brand damage. 90% of German firms express confidence in their partners, whereas only 41% of French firms say the same.

The Middle East and North Africa (MENA) represents one of the most stressed regions, with 72% of firms losing more than one month of operational time every year and 43% reporting annual disruption costs exceeding US$1m. 100% of firms have indicated that disruptions have led to a loss of brand image.

"In many African and Middle Eastern gateways, a single extreme weather event or conflict flare up can ripple quickly through already tight networks," explains Beat. "The encouraging signal is that the same regions under the most pressure are also pushing hardest on modern terminals, inland connectivity and digital platforms."

SSA experiences the worst disruption with the longest outages – 83% of brands report losing more than one month of operational time, with 86% reporting their brand image has suffered. However, these firms display the strongest intentions to improve, with 97% planning to invest in logistics and AI.

All sustainability, net zero and sustainable supply chain leaders should attend:

• Sustainability LIVE: The Net Zero Summit - QEII Centre, London, March 4-5
• Sustainability LIVE: The US Summit - Navy Pier, Chicago, April 21-22

Co-located with Procurement & Supply Chain LIVE, these events brings together CSOs, ESG leaders and senior decision-makers at a moment when sustainability, supply chains and commercial performance are increasingly interconnected.

Tickets can be booked online today for The Net Zero Summit and The US Summit. Group discounts available.

Calculating costs and planning investments

Industry disruptions require careful consideration. For the automotive industry, the annual disruption cost stands at US$13bn with only 13,000 incidents per year. This contrasts with retail, which experiences 18,000 incidents annually but only a cost of US$7.5bn.

The disparity between incident frequency and cost impact highlights the need for sector-specific resilience strategies.

High-value, complex supply chains in automotive face catastrophic financial consequences from relatively few disruptions, whilst high-volume sectors absorb frequent shocks with lower individual impact.

Most firms plan to invest in their supply chain and logistics in the coming year, focusing on AI implementation, digital tools and more diverse logistics partners.

These investments are particularly high in stressed regions, though France acts as an anomaly with high disruption and low drive to invest.

"Without Logistics offers a way of seeing the system as it is today: where disruption stress is highest, where momentum for change is strongest, and what kinds of investment actually move the needle on resilience," adds Beat.

Priorities for change focus on ensuring resilience strategies are built from the beginning.

Leaders need to prioritise routes and markets where disruption causes the biggest operational damage, focusing on building reliable infrastructure before adding technology.

Finally, leaders must consider their interactions with supply chain partners and customers to enable trust and ensure operations remain strong.

To hear from experts on supply chain sustainability, come to Sustainability LIVE: The Net Zero Summit, co-located with Procurement & Supply Chain LIVE.

Here, you will be able to witness a Keynote Presentation by John Trenchard, VP Sustainable International Supply Chains, Europe Region at DP World, titled Leading the Shift: Sustainability, Scale and Competitive Advantage. This will take place on Day 1 of the event at 10:00am on the Sustainability stage. 

DP World is also sponsoring the Sustainable Supply Chains Panel Discussion on Day 2 of the event, at 2:20pm on the Procurement & Supply Chain Stage.