Takeaways from BSI Connect SCREEN’s Quarterly Risk Intelligence Outlook: Part 2
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November 3, 2023 - BSI Connect SCREEN’s Quarterly Risk Intelligence Outlook webinar in October delved into supply chain security risks tracked by BSI’s analysts throughout Q3 2023 as well as trends in business continuity, corporate social responsibility, and the food and beverage industry. Please be on the lookout for our upcoming annual report, which will spotlight Q1 predictions.
Takeaways from BSI Connect SCREEN’s Quarterly Risk Intelligence Outlook: Part 1 summarizes the risks highlighted in the SCREEN Q2 insights webinar. Now in part two, we discuss four security threats highlighted in the Q3 webinar.
Continuing inflationary pressures and cargo theft
As seen in H1, inflationary pressures likely underpinned cargo theft trends in Q3, with food and beverage products being stolen most frequently. An uptick in fuel thefts, which correlates to volatile fuel and globally increasing automotive prices, has also been underpinned. Over the past six years, the price of fuel has averaged $3.00 per gallon, $0.55 per gallon cheaper than today. Basic goods experiencing higher than usual prices are attractive targets for thieves, and this is predicted to continue through to 2024.
Stowaway uptick in Europe
Incidents of irregular border crossings at the external borders of the European Union (EU) rose by 17 percent (279 to 350) in the first nine months of 2023, the highest total for the period since 2016. This increase in arrivals has promoted multiple countries within the EU’s Schengen Area of free movement to implement border controls.
Border controls can extend wait times for truck crossings and otherwise increase friction for international trade. The German Federal Ministry for Economic Affairs and Energy reports that introducing full border controls within the Schengen area would decrease bilateral goods exports by approximately 2.7 percent per border crossing. This would have substantial damaging effects on perishable and industrial intermediate goods such as food and wood.
Natural disasters spark business disruptions
Flooding was the top recorded natural disaster in Q3. Flooding during early August in Asia resulted in $30bn worth of economic losses through Beijing and several Chinese provinces. Though flooding will subside in Q4, the increase of people living in flood-prone areas means that when incidents do occur, the effects on communities will be worse.
Droughts have been a concern across North and Central America, where low water levels at key waterways have reduced commerce. In the United States, the Mississippi River dropped to near-record low water levels, and in the Panama Canal, authorities capped the number of daily transits to 31, with container ships required to decrease container loads
Wildfire season has created substantial destruction in Europe, especially in Mediterranean countries. In August, Greece saw the most devastating wildfires since records began in 2000, with an area nearly equivalent in size to New York City wiped out. Nonetheless, early estimates show that the total area of hectares burned by fires in 2023 decreased from 2022. As Europe moves into winter, severe winter storms and flooding will replace this concern.
Climate change and food cargo thefts
Though global inflation has begun to subside in many parts of the world, food inflation is predicted to stay high until at least 2024. Thieves are expected to continue targeting food and beverage products into 2024, especially as adverse climate conditions result in price hikes and shortages of staple foods, which further exacerbate theft risks. (Read more on food security in Bridging the gap between food fraud and food security).
To see the full presentation, “Quarterly Risk Intelligence Outlook,” please download the slides in the Special Reports section on SCREEN News. For more supply chain, digital trust, and environmental, health, and safety topics that should be at the top of your list, visit BSI’s Experts Corner.