Key Drivers of Raw Material Price Volatility PPT
This PPT slide, part of the 20-slide Raw Material Management PowerPoint presentation, outlines 3 fundamental forces that influence the volatility of raw material prices: Supply Situation, Demand Situation, and Key Input. Each of these components is critical for understanding the dynamics that affect pricing in the raw materials market.
The Supply Situation section highlights several factors that determine the availability of raw materials. It emphasizes the importance of current supply capacity within a specific geographic region, as well as the impact of import and export flows. Import/export duties also play a role, affecting cost structures. Additionally, inventory levels maintained at manufacturing locations are crucial, as they can buffer against supply disruptions.
In the Demand Situation segment, the focus shifts to the drivers of raw material demand. Major economic activities in the region are identified as key influencers, alongside investments made in the area. The slide notes the significance of activity in key demand markets, which can shift based on economic conditions. A noteworthy point is the potential for demand to be affected by lower-priced substitute products, indicating that market dynamics can quickly change based on competitive offerings.
The Key Input section encompasses a broader range of factors that affect raw materials and supply chains. It includes considerations such as manufacturing capacity and transport capabilities within the region. Natural disasters are also mentioned, highlighting the unpredictable nature of external factors that can disrupt supply chains.
Understanding these elements is essential for any organization looking to navigate the complexities of raw material pricing effectively. The insights provided can help in making informed decisions regarding sourcing and inventory management.
This slide is part of the Raw Material Management PowerPoint presentation.
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Manufacturing Procurement Strategy Inventory Management Supply Chain Disruption
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