A new study has forecast that a range of threats to global trade could see prices climb by as much as 20 percent this year as tariffs and geopolitical challenges increase uncertainty.
Research by the UK's Chartered Institute of Procurement and Supply (CIPS) highlighted disruptions to supply chains, cybersecurity concerns and tension in the Middle East as among the issues that could make it harder for companies to source components and transport goods around the world, the Guardian reports.
Sectors such as electronics, chemicals, metals, machinery and petroleum are among the industries particularly exposed to these challenges, the trade association noted, with prices set to increase by between five and 20 percent in the coming months. In addition, CIPS predicted that the cost of importing and exporting food and drink products could rise by a fifth, which companies will be forced to pass on to consumers.
Chief executive of CIPS Ben Farrell said: “What is clear from our research is that there are a number of strategic challenges that are likely to disrupt the smooth flow of goods and services … These will present particular challenges for consumers, who are likely to be disproportionately impacted unless these issues are managed effectively.”
This is before the impact of potential tariffs that may be imposed by incoming US president Donald Trump are taken into account, the organization noted. Mr Trump has floated the idea of a flat ten percent tariff on all imports to the US, as well as levies of up to 60 percent for goods from China.
Firms have already sought to protect against such moves by bringing forward imports and stockpiling goods. However, the CIPS study warned that this will only temporarily delay the impact of price rises, as the introduction of new duties is likely to increase costs, disrupt the flow of trade and lead to retaliation against exports from the US.