Anticipate the Unknown: Does Supply Chain Disruption Lead to Increased Credit Risk? – S&P Global

April 27, 2022 by No Comments

This article is written and published by S&P Global Market Intelligence, a division independent from S&P Global Ratings. Lowercase nomenclature is used to differentiate S&P Global Market Intelligence credit scores from the credit ratings issued by S&P Global Ratings.

In recent times, inefficiently functioning supply chains have come under increasing scrutiny, with risks amplified during the height of the COVID-19 outbreak when companies struggled to balance supply constraints with changing consumer demand. Despite easing COVID-19 restrictions across the globe, we have seen supply chains struggle to return to pre-pandemic levels. The Russia-Ukraine conflict, shortage of critical components, rising energy and commodity prices, the Omicron variant-related lockdowns in multiple Chinese cities and a host of other issues have placed renewed pressure on the flow of goods. In the Global Credit Conditions Q2 2022 report by S&P Global Ratings,[1] it was determined that supply chains were one of the top contributing risks to global credit conditions given “sharply higher input costs and supply chain disruptions that are being further fuelled by the rising energy and commodities prices”.

To analyze the impact of recent events on supply chains, we have used shipping data and supplier intelligence from Panjiva, our extensive global trade offering, along with our Probability of Default Market Signals (PDMS) model from Credit Analytics. This later capability incorporates stock price and volatility to calculate a one-year probability of default (PD), enabling us to reflect the more immediate market shocks and assess which industries have experienced material changes to their default risk.

Supply Chain Import Trends

To understand which industries experienced the greatest supply chain disruptions, we looked at the year-over-year reduction in seaborne U.S. import volume between March 1, 2021 and March 1, 2022 as a proxy.[2] As shown in Figure 1 below, imports slowed most in key parts of the Materials and Consumer Discretionary sectors, with Metal & Glass containers displaying the most significant percentage decrease in shipping volume within Materials, followed by Forest Products. Within Consumer Discretionary, a sector sometimes characterised as comprising non-essentials that people can forgo in times of economic downturn, Auto Parts & Equipment saw the most significant decrease, followed by Household Appliances and Auto Manufacturers.

Figure 1: Biggest reduction in seaborne U.S. import volume

A Deeper Look at Industry Supply Chain Dynamics

Looking at the top six industry movers shown in Figure 1, Table 1 below summarizes the decline in imports over the period March 1, 2021 to March 1, 2022.

Table 1: Industries with the highest decrease in U.S. seaborne shipping volume (TEUs)


March 1, 2021

March 1, 2022

Import Change

Metal & Glass Containers




Forest Products




Auto Parts & Equipment




Household Appliances




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