Study: Water woes will continue to disrupt supply chains

Add water to the list of things most logistics and supply chain managers probably don't worry about but should.

Two-thirds (66 percent) of the 190 organizations that participated in a study by the Carbon Disclosure Project (CDP) said exposure to water-related risk could have an impact on their supply chains in the next five years. One-third of the respondents said their companies had already suffered water-related business impacts. Water-related business impacts include disruptions to operations from severe weather events like floods or water shortages.

The CDP noted that in 2011, parts of China, East Africa, the Middle East, and the United States experienced the worst droughts in decades, causing crop failures, production cutbacks, and other difficulties.

Quite the opposite has been true in parts of the Pacific Rim. Thailand experienced flooding during the 2011 monsoon season, while Queensland, Australia, earlier this year had its prolonged drought alleviated by once-in-100-years floods, leading to severe supply chain disruptions throughout the region.

The study's findings are detailed in the 2011 CDP Water Disclosure Global Report.