Supply risk

Supply risk

The risk associated with a change in raw materials or input to a project from those assumed or projected. In the context of a resources production project, this is called reserves risk.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Supply Risk

The risk that a company will suffer a loss because it becomes unable to buy the raw materials necessary to make its products. For example, a corn mill has the supply risk that not enough corn will grow or farmers will be unable to transport it to the mill or something else will happen that will render the mill unable to provide its services.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
Thus fuel supply risk is considered adequate, pertaining to meaningful addition of RLNG in Pakistan's fuel mix.
Trade finance facilitates global business by removing various obstacles including payment and supply risk."The proposed project involves the second renewal of the existing funded risk-sharing facility with Standard Chartered Bank for a trade finance facility of $80 million to support ETG agri-commodity trader's export of cash and food grains, storage, and import of fertiliser in sub-Saharan Africa," the IFC said in its investment disclosures.
Other areas of cooperation include the provisioning of conventional and Murabaha trade credit insurance, credit risk and supply risk solutions, export and SME financing, factoring, and Letter of Credit confirmations.
Fuel supply risk is mitigated by a two-year, fixed-price fuel supply agreement sufficient to meet the project's expected fuel requirements through 2019.
* Supply Risk - is supply exceeding demand in your market?
The business venture would become the group's means of mitigating the domestic fuel supply risk, he said.
The high-frequency risks (appearing in at least 10 of the 35 cases) comprise public opposition risk, environmental pollution risk, government decision-making risk, defective legal and regulatory system, and MSW supply risk and may heavily affect the performance and development of the WTE incineration industry in China.
In contrast, "going long" minimizes the cost throughout the supply chain, especially if combined with collaborative supply chain management activities such as sharing production, marketing, and engineering informa- tion among exploration and production companies, refiners, and manufacturers; sharing of capital investment; and sharing of supply risk through price indexing and the use of options and futures contracts.
titled "2016 Strategic Roadmap for Supply Solution Deployment," Wilson cites several examples of narrowly scoped, spend-category-specific solutions that address supply risk. For example, she says that the MetricStream enterprise risk management (ERM) app identifies IT vendor technology spend--she also names Hiperos as a leader in this space.
In this year's Suppliers'Forum, CDMOs, CMOs and suppliers will gain customer-centric perspectives on different aspects of supplier relationship management from Bristol-Myers Squibb, Pfizer, Novartis, PwC and others on the evolving expectations of pharmaceutical and biopharmaceutical companies in areas such as governance, alliance management, supply risk and working capital issues (i.e., payment terms and inventory management).
In the supply risk space, these reflect solutions that help companies better manage, understand, and take proactive actions against hidden risks that could negatively impact their network of strategic suppliers.
In addition, because the supplied product is in use, it is highly reliable, its supply time is very short and its supply risk is very low.