杰富瑞-美国化工：供应链冲击入门-Supply-Chain Shocks：A Primer-20260426

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Supply-ChainShocks:APrimer

30-40%potentialsupplyshocksacrossmultiplesupplychains(helium,sulfur,ammonia,methanol,etc.)couldleadtomorenarrowlyfocusedshocksdownstreamin2H26-2027ascertainclustersofcompaniescurtailproduction.Weprovideahigh-levelframework,withthekeyprinciplebeingthatlongershockshavenon-lineareffects--andconsequentlyaremorelikelytotriggerstrategicpivotsbychemicalcompanies.

Thesegridsarenotironcladpredictionsbutrulesofthumb–theyillustratehowquicklyaseeminglyshortdisruptioncansnowballintoalong-lastingcrisiswhenbuffersarelowandalternativesscarce.Thetypeofshockalsomakesadifference.Companiesthatarerunningfullout,orhaveasinglesource,facethemostvolatility;companieswithsparecapacity,diversifiedsuppliersandampleinventorylikelytakeshare.Afewkeypoints:

Thetypeofshockanditsscopeestablishtheoverallframework(e.g.,shortagesvs.bottleneckvs.policychoice).Atrafficjamisn’tafactoryoutage;asanctionisn’tastorm.

Theimpactchangesinnon-linearwayswithduration,sogettingthedurationrightmattersmorethannailingtheseverity.

Adjustforstartingconditions:Ifyouknowthesectorwasrunninghot(highutilization,lowinventories)theoddsfavorsignificantoutputlosses,longdelays.andsharppricespikes.

Lookforbuffersandbottlenecks:Whatinventoryisavailableateachstage?Along-cycleindustrywithintermediatestockpilesmightbehavemorelikeashort-cycletemporarily(theycankeepassemblingfromstockforabit).Orashort-cycleindustrymighteffectivelybecomelong-cycleifavitalupstreamstageisthegatingfactorwithalongleadtime.

Monitorforbullwhipsignals:Earlyinashock,watchorderbehaviors.Ifyouseewidespreadover-orderingorpanicbuys,braceforabiggerswing(pricesandleadtimeswillovershoot,andlatertherecouldbeanabruptfall-off).

KISS:ifsupplyistight,a2-monthoutageimplies>6monthsofeffectsdownstream.

...continuedbelow...

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Pleaseseeanalystcertifications,importantdisclosureinformation,andinformationregardingthestatusofnon-USanalystsonpages11-15ofthisreport.

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Belowwepresentfourscenariogridsshowinghowafixed10%supplyshockplaysoutundervaryingshockdurations,initialutilizationlevels,andindustrytypes.Thesegridsserveasapracticalreferenceforestimatingtheoutputimpact,lead-timedelays,priceswings,andrecoverytimeassociatedwithdifferentshockscenarios.Wethensummarizehowshiftingtheshocktype(e.g.,aphysicalinputshortagevs.alogisticsjam)alterstheseoutcomes.

Exhibit1-Net%OutputLoss(CumulativeProductionHit)

ShockDuration

~2weeks

~2months

~2quarters

SCCons70%

~0%(absorbed)

~0.5%

~3%

80%

~0%

~1%

~4%

90%

~0.4%

~1.5%

~5%

LCCons70%

~0.1%

~0.8%

~4%

80%

~0.2%

~1.2%

~4.5%

90%

~0.5%

~1.5%+

~5%+

SCInd70%

~0%

~0.5%

~3%

80%

~0.1%

~1%

~4%

90%

~0.4%

~1.5%

~5%

LCInd70%

~0.1%

~1%

~4%

80%

~0.3%

~1.3%

~5%

90%

~0.5%

~1.5%+

~5%+

%ofannualoutputeffectivelylostduetotheshock,afteranymake-upproduction

Source:JefferiesEstimates

Interpretation:Ashort(2-week)disruptioncanoftenbefullyoffsetifthere’sslack(0%lossat70%utilization–productioncatchesupviaovertimeoridlecapacity).Butat90%utilization,evenashortshockcausessomeirrevocableloss(0.4%ofannualoutput)becausethere’snoextracapacitytomakeupthedifference.Foramoderate(2-month)shock,ahigh-utilizationindustrylosesessentiallyalltheforegoneproduction(1.5%ofannualoutput,matchingthe10%×2-monthshortfall),whereasa70%-utilizedchainmightonlylose0.5–1%,recoveringtherestbyrunningharderpost-shock.Aprolonged(2-quarter)shockyieldsmulti-percentageoutputlossesevenwithsomecatch-up;at90%utilization,thefull5%ofannualoutput(10%shortfalloverhalfayear)isgone.Lower-utilizationsectorsstilllose3–4%outputbecausea6-monthdisruptionoverwhelmsinventorybuffersandcatch-upcapacity.(Note:Output“loss”heremeansproductionthatispermanentlynotdelivered,notjustdelayed.)

Exhibit2-Lead-TimeImpact(DeliveryDelays)

ShockDuration

~2weeks

~2months

~2quarters

SCCons70%

~0(nodelay)

~1–2wks

~2mo

80%

~3–5days

~2–3wks

~4mo

90%

~1–2wks

~1–2mo

~6–9mo

LCCons70%

~0–1wk

~2–4wks

~4–6mo

80%

~1wk

~2mo

~9mo

90%

~2–4wks

~3–4mo

~12+mo

SCInd70%

~0–7days

~2–3wks

~4mo

80%

~1wk

~1–2mo

~6–9mo

90%

~1–2wks

~2–3mo

~12mo

LCInd70%

~1wk

~1–2mo

~9mo

80%

~1–2wks

~3–4mo

~12mo

90%

~1mo

~6+mo

~18+mo

Approximateadditionalwaittime

Source:JefferiesEstimates

Interpretation:At70%utilization,evenalongshockmightonlyextenddeliverytimesbyafewmonths,assurpluscapacityandstockpileskeepgoodsflowing.Incontrast,at90%utilizationdelayscompounddramatically.Ashort2-weekshockcanaddweeksofbacklogwhenthere’snoslack.A2-monthshockathighutilizationmightmeancustomerswaitanextra2–3months.Ina6-monthdisruptionwithanalreadytightsystem,leadtimescanspiralintotherealmof6–15monthsofdelays–effectivelyforcingconsumerstoskipapurchasingcycleoracceptsubstitutes.Inextremecaseslikespecializedindustrialequipment,leadtimescanextend2-4years.Theruleofthumb:beyond85%utilization,eachadditionalweekofdisruptioncreates1-8weeksofbacklog,asevensmallhiccupstriggerqueueingdelays(akintoahighwayat95%capacitywhere“evenasinglebraketapcanresultingridlock”).

Abbreviations:

SC=short-cycleLC=long-cycle

Cons=consumer-facingsupplychainInd=industrialsupplychain.

70%/80%/90%=startingcapacityutilization;95%iseffectively“maxed-out.”inthisframework

Lowerutilizationandshortercyclesallowsomecatch-up,reducingnetloss.

Highutilizationmeansalmosteveryunitofsupplyshortfalltranslatestolostoutput.

Highutilizationcausesevensmallshockstosnowballintobigdelays,whileslackcapacityhelpsmaintainreasonabledeliverytimes.

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Exhibit3-PriceResponse

“Snapback”behaviorislikelyforlongershocks

ShockDuration

~2weeks

~2months

~2quarters

SCCons70%

Nochange(absorbed)

Flat(alts/stock)

+3–5%(someinflation)

80%

Flat

+1–3%

+5–10%

90%

Slight(+<5%)

+5%(temp.)

+10–20%(notable)

LCCons70%

Flat

+0–5%

+5–10%

80%

Flat

+3–5%

+10%

90%

Minor(+few%)

+5–10%(dealerscutdiscounts)

+15–30%(MSRPhikes,markups)

SCInd70%

Flat

+5–10%(spot)+0%(contracts)

+15–25%(spot),snap-backlater

80%

+0–5%(spot)

+10–20%(spot)+5%(contracts)

+25–50%(spot),snap-backlikely

90

+5–10%(spot)

+20–30%(spot),contractsresethigher

Huge

spike(50–100%+),overshoot↓

LCInd70%

None

+5–10%

+10–20%

80%

None

+10–15%

+20%

90%

Slight(surcharges)

~+15%(surcharge)

+50–80%(repricingofcontracts)

Source:JefferiesEstimates

Interpretation:Consumergoods(SCCons):Shortdisruptionsusuallydon’tbudgeretailprices–companiesdipintosafetystockorexpediteshipmentsinsteadofraisingprice.Evena2-monthshortageinalow-marginconsumerproductmaynotresultinlistpricechangesat70–80%utilization;manufacturersandretailerstypicallytrytoavoidpricehikesfortransitoryissues,oftenchoosingtorunpromotionsatlowerdepthorsubstitutesuppliers.At90%utilization,however,amoderateshockcanforcesmallpriceincreases(mid-singledigits)oratleastreduceddiscounts.Inahalf-yeardisruption,consumerinflationbecomesnoticeable--andtriggersubstitutionandthriftingbehavior.

Durable/Long-CycleConsumer(LCCons):Here,theshortageisoftenfeltviamarketpricingdynamicslikedealermarkupsorsurchargesratherthanofficiallistpricechanges.Ashortshockhaslittleeffect(e.g.,a2-weekpartsdelaywon’tmakecarcompaniesrepricemodels).Buta1–2monthshockathighutilizationleadsautomakersanddealerstopullbackdiscountsandincentives,effectivelyraisingtransactionprices5–10%.Duringthe2021–22chipshortage,newcaraveragepricesrosebyhigh-single-digits,andusedcarpricesspikedmuchmore(30%+),reflectingrationedsupply.Ina6-monthshock,companieswillimplementstickerpriceincreases,prioritizehigh-endmodels,andcustomersmaybidupscarceinventory–expectontheorderof15–30%effectivepricejumpinworst-hitsegments.Thesepricestendtostickforawhile–andmaynotfullyreverseifautomakersfacehighercostsorpersistentlylowinventories.However,ifsupplyovershoots(e.g.,ademanddroporproductionsurgelater),somepricecorrectiontypicallyoccurs.

Short-CycleIndustrial(SCInd,e.g.,commodities):Priceshererespondfastandhardtoshocks.At90%utilization,evenablipcausesimmediatespotpricejumps(forinstance,a2-weekrefineryoutagecanpushoilup5–10%briefly).Longershocksseeproportionallybiggerspikes:a2-monthsupplyhaltinacommoditymightliftprices20–30%ormoreifstockpilesarelow.Thesespikesareoftenamplifiedbyspeculativebuying(bullwhip).Notably,contractprices(e.g.,quarterlysupplyagreements)maylag–suppliershonorcontractsatpriorratesinitially,whilespotsoars,leadingtowidespot-premiums.Iftheshockpersists,contractpricesresethigheronrenewal(e.g.,2021sawmanychemicalcontractpricesjumpbydouble-digitsafterquartersofspottightness).Fora6-month-plusdisruption,spotpricescanreachextremes–oftenmulti-yearhighsorevenmultiplesofpre-shocklevels.Example:Europeannaturalgaspricesmorethantripledin2022undersupplyshockconditions,andglobalshippingratessoared5–8×duringthelogisticssnarlsof2021.Suchextremespikestypicallycollapse(“snapback”)oncesupplynormalizesordemanddestructionkicksin.Thus,anextendedshockoftenfeatures

Higherutilizationandlesssubstitutabilityleadtosharperpricespikes

Slackoralternativesupplydampenspricemoves.

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volatileovershooting:e.g.,aninitialsurgeof+50–100%(ormore)followedbyasharpcorrectionbacktowardbaselineorevenbelow(gluts),ashappenedwithmanycommoditiesinlate2022–23.

Long-CycleIndustrial(LCInd,e.g.,capitalequipment,specialtycomponents):Priceshereareusuallysetbycontractsorcustombids,soimmediatereactionsaremuted.Ashortshockmayresultinnopricechange–justdelays.Amoderateshock(2months)canleadtosurchargesorspotpremiumsforrushedorders(10–15%higher)andeventuallyhigherofficialquotesfornewcontracts.Foraprolongedshortage,manufacturersusuallyraisesellingpricessignificantly–oftentocovertheirownhigherinputcostsandtocapitalizeonstrongdemand.Thesesectorsmaynotseepricescrashbackdown,aslong-termcontractsandextendedorderbacklogsactasastabilizer,butbuyersmightnegotiatediscountsordelaypurchasesuntilpricesease.Insummary,long-cycleindustriesexperiencemoregradualbutoftenlong-lastingpriceincreaseswhensupplyischoked,versusthesharpboom-bustofcommoditymarkets.

Exhibit4-TimeItTakesForOutput,Inventories,LeadTimesandPricesToReturnToPre-ShockRangesAfterShockEnds

ShockDuration

~2weeks

~2months

~2quarters

SCCons70%

Near-instant(days)

~1–2mo

~6mo

80%

~2wks

~2–3mo

~9–12mo

90%

~1mo

~6mo

~12–18mo

LCCons70%

~Weeks

~3mo

~9–12mo

80%

~Weeks

~4–6mo

~12mo

90%

~1–2mo

~6–9mo

~18–24mo

SCInd70%

~Weeks

~4mo

~12mo

80%

~2–4wks

~6–9mo

~18mo

90%

~1–2mo

~9–12mo

~24+mo

LCInd70%

~Weeks

~6mo

~18mo

80%

~Weeks

~9–12mo

~24mo

90%

~1–2mo

~12+mo

~2–3yrs

Source:JefferiesEstimates

Interpretation:Shortshockswithslackseevirtuallynolingeringeffects–thesystem“snapsback”immediatelyoncesupplyresumes.Forexample,whenaminor2-weekdisruptionendsina70%-utilizedchain,productioncatchesupanddeliveriesareontrackwithinthenextplanningcycle(daysoratmostacoupleofweeks).Athighutilization,though,evenafterthechokepointisremoved,backlogsanddepletedbuffersprolongthehangover.

Foramoderate2-monthshock,expectnormalizationtolagthephysicalfixbyafullquarterortwoat70–80%utilization.Forinstance,econometricstudieshaveestimatedaonemonthshockcanclipoutputby4-5monthsandinflatepricesfor6-9months.At90%utilization,thetailislonger:roughly6–12monthstounwindeffectsofthesameshock.Suchanextendedtimelinecanthentriggerthebullwhipeffect,asexcessinventoriestriggerasharperthannormaldeclineinneworders--whichthencreatesitsownbullwhipeffectduetotheconsequentdropinrealizedprices.

Aprolonged6-monthshock,therefore,canbecomeamulti-yearsagaathighutilization.At90%utilization,weexpecta6-monthshocktoleadtoan18-24monthtransitionbeforeallsupplychainindicatorsarebacktonormal.Theglobalsemiconductorshortage(roughlya4–6quartershock)tookroughlytwoyearstoresolveaftertheinitialcrunch.Infar-reachingshocks,the“normal”thatreturnsmayalsobeanewequilibrium–e.g.,companiescarryhighersafetystockpermanently,orpricessettleatadifferentlevelduetonewsuppliersoraltereddemand.Lowerutilizationchainsrecoverfaster–ontheorderof10-12monthsaftera6-monthdisruptionends,sincetheycouldpartiallyfulfillordersthroughoutandmorerapidlyrefillpipelinesafter.Longer,deeperdisruptionsaremorelikelytotriggersignificantstructuralchanges.

HowDifferentShockTypesChangethePlaybook

Finally,it’simportanttoadjusttheseheuristicsforthenatureoftheshock.A10%supplylosscanarisefromverydifferentevents–a“molecule”shortage(criticalinputvanishes),afocusedcapacityoutage,alogisticslogjam,orapolicy-drivendisruption–andeachhasdistinctivefootprints.Belowarekey

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differencestoanticipateforeachshocktype(assumingthesame10%magnitudeanddurationsasabove):

•Non-SubstitutableFeedstockShortage(“Molecule”Shock):Thisisashocklikeasuddenlossofacriticalrawmaterialorcomponent(e.g.,aspecificsemiconductorchip,arareearthelement,aproprietarychemical)withnoeasysubstitute.Outputimpactisimmediateandproportional–ifyoucan’tgetthe“molecule,”productionofalldependentproductsdrops10%straightaway.Inventoriesbufferonlybriefly,afterwhichdownstreamplantssitidle(e.g.,idledautolinesin2021waitingforchips).Utilizationdoesn’tmatter–youcanhavecapacity,butnothingtorunthroughit.Thusourgridsabovearepessimisticforallutilizationlevelsinthiscase:evenat70%util,youloseoutputbecausesupply,notcapacity,isbinding.Leadtimesblowoutquicklyandremainhighuntilthefeedstockisrestored.Pricesspikesharply–oftenmorethaninotherscenarios–becausethere’snoalternatesupply;themarketclearspurelybydemanddestructionandrationingviaprice.Forexample,whenakeygraphiccardchipwasscarce,GPUpricesdoubledinsecondarymarkets;whenrareearthexportswerecut,pricesjumped500%+.Normalizationisentirelydependentonre-establishingsupply(ordevelopingsubstitutes,whichtakestime).Soevena“short”moleculeshock(iftrulyzerosupplyforsay2weeks)cancreatelastingripples(stockouts,urgentpricespikes)thatonlysubsideafterinventoriesarerebuilt.Alongmoleculeshockoftenforcesstructuralchanges:companiesre-engineerproductstouselessofthematerial,governmentstapstrategicreservesorfundnewproduction,etc.Theupshot:forapurefeedstockshock,expecthigherpricespikesandlongerrecoverythanthebaselinegridsatanygivenduration,becauseyou’reeffectivelyatautilizationof100%(supply-constrained)fromthestart.

•FocusedCapacityOutage(Single-NodeorRegionDisruption):Thinkofafireatasole-sourcefactory,akeysupplier’sfactoryoutage,orageopoliticalcutoffinonecountry.Thisbehaveslikeafeedstockshockifthatcapacityistrulyunique(theaffectedoutputvanishes).However,iftheindustryhasotherproducersoralternatecapacity,theshockispartlymitigated:at70–80%globalutilization,competitorscanrampupoutputtofillsomeofthegap.Forinstance,whenonelargeautopartsplantwentdown,othersaddedshiftstocover50%ofthelostoutput,softeningtheblow.Thus,theeffectiveshockmagnitudemightbelessthan10%ifotherscompensate.Leadtimesandpricesstillworsen(customersmustqueueattheremainingsuppliers,sometimespayingpremiums),butnotasdramaticallyasasolefeedstockshock.Ifglobalutilizationwasalready90%,though,otherscan’tpickuptheslack–itbecomeseffectivelya10%supplydropwithnohelp,likeamoleculeshock,andourworst-casegridentriesapply.Onenuance:afocusedoutageoftencomeswithanexpectedrepairtime(e.g.,“factorywillbedown8weeks”).Thiscancurbextremepanicorderingbecausebuyersseeanendinsight–unlessthetimelinekeepsextending(whichsometimeshappens).Iftheoutageislong,firmsmayqualifynewsuppliersorworkaroundthatnode(similartoadaptingtoafeedstockshock).Oncethecapacityisrestored,normalizationcanbequickerthaninamoleculeshock,becauseyoueffectivelygainabigchunkofsupplybackinonego–butanybullwhipinventorydistortionsstillneedunwinding(e.g.,aftertheplantcomesback,double-ordersmightgetcanceled,causingatemporaryglut).Bottomline:asingle-nodeshock’simpactdependsonavailableslackelsewhere:withslack,actualoutputlossanddelaysarelessthanfeared(ourgridswouldoverstateit),withnoslack,treatitlikeadirectsupplylossscenario.

•Logistics“TrafficJam”:Theseshocks(e.g.,portclosures,shippinglaneblockages,truckstrikes)don’tdestroygoodsorcapacity–theydelaythroughput.TheclassicexampleistheSuezCanalblockage:aweekofclosureheldup$10Bofgoods/day,butoncereopened,thosegoodsstillarrived.Thus,netoutputlossisnearzero(ourGrid1doesn’treallyapply;everythingiseventuallydelivered).However,leadtimesandbacklogssurgewhilethedisruptionlasts(Grid2’shigh-

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utilizationdelayestimatesareveryrelevant–e.g.,a2-weekportshutdowncaneasilycause4–8+weeksofdeliverydelays).Pricesforshippingandfreightmayspiketemporarily(spotfreightratesjumpedduringSuez),butproductpricestoconsumersseeminimalchangeifthedelayisshort.Inalongerlogisticssnarl(saya2-monthportlaborstrike),manufacturersmightincurextracoststoreroutegoods(airfreight,alternateports)–whichcouldtranslateintominorpriceincreasesifitdragson,butmoreofteniteatsintomarginsorleadstoshort-termstockoutsratherthanrepricing.Normalizationafteralogisticsshockisallaboutclearingthequeue:it’softenfairlyquick(weekstoafewmonths)becauseoncethechannelreopens,everyoneworksovertimetocatchup.Forexample,whenWestCoastUSportshadbacklogs,manyimporterscaughtupwithinaquarterbyexpeditingshipments.Logisticsjamscancausebullwhip-likeswingstoo(over-shippingthenpause),butsincegoodsweren’tmissing,justlate,thesystemtendstosmoothoutwithinoneinventorycycleafterthejamresolves.Inshort,apure“trafficjam”shockmainlyaffectstiming(leadtimes)nottotalvolumesorlong-termprices–forthese,it’sthemildestscenariointheplaybook.

•Policy/RegulatoryShock:Theseincludeexportbans,suddentariffsorsanctions,quotas,orevenabruptregulatorychangesthatrestrictsupplyorchangethecoststructure.Theimpactherereallydependsonwhetherthepolicyremovesphysicalsupplyorjustmakesitcostlier.Anexportbanonacommodityiseffectivelyafeedstockshockforimporters–e.g.,whenIndonesiabannedpalmoilexports(20%ofglobalsupply)in2022,importingcountriesfacedimmediateshortagesandsoaringprices.Acrucialdifferencewithpolicyshocksistheelementofuncertaintyandduration–it’softennotclearhowlongthepolicywilllastorifitmightescalate,whichcaninducemoreextremeprecautionarybehavior.Forinstance,China’srareearthexportclampdownin2010triggeredglobalpanicbuyinganda26-foldpriceexplosionover2+years,farovershootingtheunderlying40%exportcut,becauseoffearandspeculativehoarding.Policyshockscanthusgenerateoutsizedpriceandinventoryeffects(companiesmayoverstockinfear).Ontheotherhand,somepolicymovesaremoresignalthansubstance:e.g.,atariffmightraisecostsafewpercentbutnotactuallycurtailvolume–firmsmightabsorbcostorreroutesupplychains,sothe“shock”isinmarginmorethaninphysicalflow.Regulatoryshockscanalsopromptpermanentsupply-chainshifts:companiesdiversifyawayfromanunreliabletradepartnerorgovernmentsinvestindomesticcapacity.Thismeans“normalization”mightneverreturntotheoldbaseline–instead,anewconfiguration(withhighercostsorlongerleadtimesbutlessgeopoliticalrisk)emerges.Forexample,Europe’sresponsetoagassupplyshock(sanctionsonRussiangas)wastorestructureitsgassupplyviaLNGimports;pricestookayeartostabilizeanddidsoatahigherequilibriumthanpre-shock.So,forpolicyshocks,usetheplaybookvaluesasaguidebutexpectmorevolatilityandpotentiallylongerpolicy-drivendelays.Also,anticipatefragmentsofresiliency:strategicreservesreleasescantemporarilyalleviateimpact(dampingpricespikes),anddiplomacymightresolvesomeissuesfasterthanmarketfixes(or,conversely,politicscouldprolongtheshock).Insummary,policyshocksoftenamplifyinitialshockreactions(viauncertaintyandhoarding)butcanalsoleadtofastermitigation(viaemergencypolicies),makingthemhigh-variancescenarios.

AlternateScenarioGrids:30%SupplyShock(vs.10%)

Weconsidershockdurationsof~2weeks,~2months,and~2quarters,acrossinitialutilizationratesof70%,80%,90%,forfourindustryarchetypes(short-cyclevs.long-cycle,consumervs.industrial).Note:A30%suddensupplydropisanextremescenario–impactsscalenon-linearlycomparedtothe10%case,especiallyinhigh-utilization,low-inventoryenvironments.Expectfasterbufferexhaustion,steeperdelays,sharperpricespikes,andlongerrecoverytimes(oftenrequiringstructural

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adjustmentslikedemandrationingornewcapacity).Rangesreflecttypicaloutcomesandinflectionpoints(buffering→rationing→structuralresponse);theyarenotprecisepredictions.

Exhibit5-Lead-TimeImpact(DeliveryDelays)

Approximateadditionaldeliverydelaybeyondnormalleadtimes.Valueshighlighthowrisingutilizationdrives

dramaticallylongerbacklogsforthesameshocklength.At90%+startingutilization,evenabrief30%shockcancreatemulti-weekqueues;longershocksproducesevereschedulingbreakdowns(measuredinmonthsofdelay).

ShockDuration

~2weeks

~2months

~2quarters

SCCons70%

~0.5–1wk

~2–4wks

~2–3mo

80%

~1–2wks

~1–2mo

~4–6mo

90%

~4–6wks

~4–6mo

~6–12mo

LCCons70%

~2–3wks

~2–3mo

~6–9mo

80%

~3–4wks

~4–6mo

~9–12mo

90%

~6–8wks

~6–9mo

~12+mo

SCInd70%

~1–2wks

~2–3mo

~6mo

80%

~2–4wks

~4–6mo

~12+mo

90%

~4–8wks

~9–12mo

~18+mo

LCInd70%

~2–4wks

~4–6mo

~9–12mo

80%

~4–8wks

~9–12mo

~18–24mo

90%

~8–12wks

~12–18mo

~24+mo

Source:JefferiesEstimates

Interpretation:At70%utilization,robustbuffersandsurgecapacitymeanevenalargeshockcanoftenbeabsorbedwithonlymodestdeliveryhiccups.Forinstance,a30%supplycutovertwoweeksmightextendconsumer-goodsleadtimesbyjustafewdaystoaweek(versusnodelayinthe10%scenario)assafetystockcoversmostorders.Higherutilization,however,triggersdisproportionatedelays:At90%util,thatsame2-weekshockcreatesmulti-weekbacklog(4–6+weeks),sincevirtuallyeverymissedshipmentduringthedisruptionoccupiesaplaceinthequeuethatcan’tbeeasilycleared(only~5%surgecapacityexists).Bythetimea2-monthshockends,backlogsat90%utilcanstretchtoahalf-yearormore,asproductionandtransportnetworksstruggletoprocessbothregulardemandandtheaccumulateddeficit.Fora6-monthshockat90%util(e.g.,aprotractedin