Editing Raw material (section)

==Raw material in supply chain==
[[Supply chain]]s typically begin with the acquisition or extraction of raw materials.<ref>{{Cite web |title=The Supply Chain: From Raw Materials to Order Fulfillment |url=https://www.investopedia.com/terms/s/supplychain.asp |access-date=2023-03-03 |website=Investopedia |language=en}}</ref> For example, the [[European Commission]] notes that food supply chains commence in the agricultural phase of food production.<ref>European Commission, [https://ec.europa.eu/economy_finance/publications/pages/publication16061_en.pdf Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: A better functioning food supply chain in Europe], page 2, provisional version published 28 October 2019, accessed 2 February 2023</ref> 

A 2022 report on changes affecting [[international trade]] noted that improving sourcing of raw materials has become one of the main objectives of companies reconfiguring their supply chains.<ref>Economist Impact and [[DP World]], [https://impact.economist.com/projects/tradeintransition-2022/key-findings-08/ Trade in Transition 2022: Key Findings], accessed 2 February 2023</ref>

In a 2022 survey conducted by [[SAP]], wherein 400 US-based leaders in logistics and supply chain were interviewed, 44% of respondents cited a lack of raw materials as a reason for their supply chain issues.<ref>{{Cite web |last=Jenkins |first=Abby |date=January 31, 2024 |title=15 Key Supply Chain Challenges to Overcome |url=https://www.netsuite.com/portal/resource/articles/erp/supply-chain-challenges.shtml |access-date=April 10, 2025}}</ref> Forecasting for 2023, 50% of respondents expect a reduced availability of raw materials in the US to drive supply chain disruptions.<ref>{{Cite web |date=October 24, 2022 |title=New Research Forecasts the State of U.S. Supply Chains in 2023 |url=https://news.sap.com/2022/10/us-supply-chains-in-2023-new-research-forecast/ |access-date=March 14, 2023 |website=SAP News Center}}</ref>

=== Raw materials markets ===
Raw materials markets are affected by consumer behavior, supply chain uncertainty, [[manufacturing]] disruptions, and regulations, amongst other factors. This results in [[Volatility (finance)|volatile]] raw materials markets that are difficult to optimize and manage. Companies can struggle when faced with raw material volatility due to a lack of understanding of market demands, poor or no visibility into the indirect supply chain, and the time lag of raw materials price changes.<ref>{{Cite web |title=Read @Kearney: How to navigate a volatile raw materials market |url=https://www.kearney.com/procurement/article/-/insights/how-to-navigate-a-volatile-raw-materials-market |access-date=2023-03-03 |website=Kearney |language=en}}</ref>

Volatility in the raw materials markets can also be driven by [[Natural disaster|natural disasters]] and [[Geopolitics|geopolitcal]] conflict. The [[COVID-19 pandemic]] disrupted the steel industry, and once demand rebounded, prices increased 250% in the [[United States|US]]. The [[Russian invasion of Ukraine]] caused the price of natural gas to increase by 50% in 2022.<ref>{{Cite web |date=2022-10-07 |title=Gauging the Risks of Raw-Material Volatility |url=https://www.bcg.com/publications/2022/gauging-risks-of-raw-material-price-volatility |access-date=2023-03-03 |website=BCG Global |language=en}}</ref>