Key Insights: GEP Global Volatility Index February 2026

Purchases across the world for raw materials, commodities and critical components rose at the fastest pace in almost four years – according to the GEP Global Supply Chain Volatility Index.

The indicator, which tracks the demand conditions, shortages, transportation costs, inventories and backlogs, based on a monthly survey of 27,000 businesses. 

The underlying data suggest the upturn was broad-based across sectors, with procurement activity rising in both capital-intensive and consumer-facing industries, pointing to a cyclical upswing prior to the war in the Middle East.

Purchasing growth and emerging bottlenecks

Asia was a key driving force in this global factory demand, as China, Japan, India, South Korea and Taiwan all reported strong rates of purchasing growth among key markets, leading Asia’s supply networks to record their busiest month in three-and-a-half years.

In North America, this was not the case, as it saw a weaker trend in factory purchasing in February – which has stalled the US’ momentum within its manufacturing economy. 

Over in Canada, it saw goods producers lift their purchases of raw materials and intermediate products for the first time in more than a year.

While in Europe, its industrial recovery continued to make progress – with the manufacturing sector of Germany, its largest economy, gathered momentum. As the rise in procurement activity across Europe has led to the emergence of bottlenecks, with supply capacity becoming slightly stretched. 

This was a similar story for the UK in February.

“The war with Iran is already creating an oil supply shock that will disrupt global supply chains,” says John Piatek, Vice President of Consulting at GEP. 

“Companies need to assess their exposure to energy, petrochemical and shipping costs now, while US manufacturers should also move quickly to proactively secure price reductions from suppliers following the Supreme Court’s tariff ruling.”

February 2026 regional key findings

• Asia: Index jumps to 0.40, from 0.12, its highest level since October 2022, signalling that supply chains into Asia were their busiest in nearly three-and-a-half years.
• North America: Index slips from 0.06 to -0.26, signalling underused supplier capacity in North America after a pick-up in January. US factories tapered purchasing activity.
• Europe: Index rises to 0.05, from -0.27, indicating further progress in Europe’s industrial recovery.
• UK: Index increases to -0.01, from -0.17, suggesting that the UK’s supply chains are running at full capacity. 

February 2026 key findings

• Demand: Global demand for raw materials, commodities and intermediate products rose substantially in February to its strongest level since March 2022. Asia was a key factor behind this resurgence, with stronger growth in factory purchasing seen in key manufacturing economies across the region such as China, Japan, India, South Korea and Taiwan. 
• Inventories: Global reports of manufacturers stockpiling materials due to concerns regarding supply or price were below historically typical levels in February. This is in line with the general trend seen over the past two years, where firms have strongly favoured lean inventories.
• Material shortages: The items in short supply indicator rose markedly in February, signalling a rise in reports of shortages from global manufacturers. That said, the overall frequency at which supply issues were noted was contained, recording in line with the long-run average level. 
• Labour shortages: Reports of backlogs rising at manufacturers due to shortages of staff were anchored around the level seen on average, historically, during February. This indicates that labour is not a restrictive factor for global production.
• Transportation: The global transportation costs indicator posted in line with its historical average during February.  

How GEP's index works

The GEP Global Supply Chain Volatility Index is a collaborative effort between S&P Global and GEP.

It draws from S&P Global's PMI surveys, which are distributed to 27,000 companies worldwide, a weighted aggregation of six sub-indices derived from PMI data, PMI Comments Trackers and PMI Commodity Price & Supply Indicators provided by S&P Global.

A positive value in the GEP Global Supply Chain Volatility Index indicates strained supply chain capacity, leading to increased volatility. The higher the value, the greater the strain on capacity.

Conversely, a negative value suggests underutilised supply chain capacity, resulting in reduced volatility. The lower the value, the greater the degree of capacity underutilisation.

A value above 0 indicates that supply chain capacity is being stretched and supply chain volatility is increasing. The further above 0, the greater the extent to which capacity is being stretched.

A value below 0 indicates that supply chain capacity is being underutilised, reducing supply chain volatility. The further below 0, the greater the extent to which capacity is being underutilised.