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Trade moves through a few narrow places

Part I describes systems and their couplings. It ranks no country or operator and assesses no authority.

7 min read2 figures1 table13 notesNR-STRATEGIC-SUPPLYCHAINS-GLOBAL-2026-BASELINE

Contents
  1. ·Edition home
  2. ·Executive summary
  3. 1Trade moves through a few narrow places
    1. 1.1 The questions this part answers
    2. 1.2 The argument
    3. 1.3 Twenty couplings between five systems
  4. 2Key findings
  5. 3Systems and sectors at baseline
  6. 4Risks and capability
  7. 5A chokepoint closure that overlaps a Red Sea diversion and high freight rates
  8. 6Readings from the other desks
  9. 7The 2027 agenda
  10. 8Systems in depth
  11. AMethodology
  12. BData appendix
  13. CReferences and record
  14. ·Complete edition, for print

1.1The questions this part answers

Key questions

  • Where is supply chains and chokepoints risk concentrated?
  • Which couplings carry supply chains and chokepoints shocks into other systems?
  • Which supply chains and chokepoints capabilities hold under compound stress?
  • What must 2027 evidence measure first?

In this part

  • Narrative
  • Headline finding
  • Lead figure
  • Five mechanism chapters
  • Twelve-domain reading
  • Sector screens
  • Dependency matrix
  • Risk objects
  • Capability ladder
  • Scenario
  • Three lenses
  • Portfolio

1.2The argument

Global trade is usually reported as flows between countries. The 2024 to 2026 evidence reads it as a network with narrow places: straits, canals and a few processing hubs. Ships carry most of the world’s goods, and the routes they take decide cost, time and exposure14.

The causes repeat. Attacks on vessels moved Red Sea traffic around Africa in 20241. Low water levels cut Panama Canal transits until mid-202414. A war closed the Strait of Hormuz to most traffic from March 2026546. Export licences govern a set of rare earth elements22.

The effects reach beyond shipping. About one fifth of oil and LNG and about one third of seaborne fertiliser normally pass through Hormuz786. Urea prices rose 52 percent in the United States and 60 percent in Brazil by mid-April 202617.

Aggregate trade has held up. The WTO March 2026 baseline put 2026 merchandise volume growth at 1.9 percent after 4.6 percent in 2025, and 72 percent of merchandise trade still runs on MFN terms1315. The edition therefore asks four questions of every event: what was the common cause, how did it spread, what was shared, and what threshold was crossed. It makes no attribution and ranks no route.

Figure 1.1How did the WTO see 2026 trade in March? Merchandise volume growth, percent

The March 2026 baseline put 2026 growth at 1.9 percent, after 4.6 percent in 2025, and 1.4 percent if high energy prices persist. The bars are an estimate and two forecasts and are not added13.

ItemBar, scaled to the largest valueValue
2025 estimate4.6
March 2026 baseline1.9
March 2026 high-energy-price case1.4

Source: as cited in the note to this figure. Year 2026.

Figure ID FIG-STRATEGIC-SUPPLYCHAINS-GLOBAL-2026-BASELINE-01-003

1.9%

March 2026 baseline, 202613

1.4%

high-energy-price case, 202613

4.6%

merchandise volume growth, 202513

−9.7%

Middle East export volumes, first quarter 2026, year on year14

1.3Twenty couplings between five systems

The supply chains and chokepoints-centred matrix types the twenty couplings between the five core systems, read for their supply chains and chokepoints content. Strengths are Nexus estimates (ESTIMATED) from the cited evidence and analogue events; they set the graph that 2027 evidence will test.

Figure 1.2Couplings between the five systems

Each line is one coupling from one system to another, drawn by the strength the edition assigns. Strengths are Nexus estimates from the cited evidence and analogue events.

  • Strong
  • Moderate
  • Weak

Source: this edition’s coupling matrix (Table 1.1); status Estimated.

Table 1.1Coupling matrix: from the row system to the column system
From, toWATENEFOOHLTBIO
WAT Water·WEAK
cooling		MODERATE
irrigation · processing		MODERATE
safe supply · hospitals		WEAK
flows
ENE EnergyMODERATE
pumping · desalination		·STRONG
fuel · fertiliser feedstock · cold chain		STRONG
freight · hospital supply		WEAK
land use
FOO FoodWEAK
withdrawals		WEAK
biofuels		·MODERATE
nutrition · food safety		WEAK
land conversion
HLT HealthWEAK
workforce		WEAK
workforce		WEAK
labour		·WEAK
residues
BIO BiodiversityWEAK
natural infrastructure		WEAK
hydrology		WEAK
pollination		WEAK
zoonoses		·
Strength: strong, moderate or weak; a Nexus estimate (status Estimated) from cited evidence and analogue events. The scale is defined in Annex A.

Transmission paths

  1. 01

    ENE → FOO

    A strait closure removes fuel and fertiliser inputs together.

    Reported 2026 Hormuz64617

  2. 02

    CON → TRD → INF

    Attacks on vessels reroute ships and lift distance.

    Reported 2024 Red Sea1

  3. 03

    CLI → INF → TRD

    Low water levels cut canal transits.

    Reported Panama to mid-202414

  4. 04

    TRD → FIN

    Lost transit revenue reaches national budgets.

    Reported Suez18

  5. 05

    MIN → TRD

    Export licences on processed minerals reach downstream makers.

    Reported 2025 controls22

Notes

Numbers are the edition’s reference numbers, so a note reads the same in every chapter. The full list, with every source and its licence, is in Annex C. Annex C, references

  1. 1UNCTAD (ed.), Review of Maritime Transport 2025, chapter I: International maritime trade (12,720 million tons and 66,781 billion ton-miles in 2024; Cape detour about 30 percent; cobalt and copper concentration). United Nations Trade and Development, Geneva. Observation year 2024. Accessed 2026-11-03.back
  2. 4UNCTAD (ed.), Review of Maritime Transport 2024, chapter II: World shipping fleet and services (Suez Canal about 10 percent of maritime trade volume and 22 percent of container trade; Panama Canal about 3 percent). United Nations Trade and Development, Geneva. Observation year 2024. Accessed 2026-11-03.back
  3. 5UNCTAD (ed.), Hormuz disruption deepens global economic strain across trade, prices and finance (second rapid assessment; transits about 130 a day in February and 6 in March 2026; merchandise trade growth 1.5 to 2.5 percent projected for 2026). United Nations Trade and Development, Geneva. Observation year 2026. Accessed 2026-11-03.back
  4. 46EIA (ed.), Short-Term Energy Outlook, September 2026, global oil markets (Brent averaged USD 91 a barrel in August 2026; Middle East crude oil production shut-ins from the Hormuz closure averaged 9.4 million barrels a day from March to June 2026 against February production of 25.2, and were 5.0 in July and 6.7 in August). US Energy Information Administration, Washington. Observation year 2026. Accessed 2026-11-03.back
  5. 22China Briefing (ed.), How will China’s rare earth export controls impact industries and businesses? (April 2025 controls on seven elements; 9 October 2025 expansion to five more; suspended until 10 November 2026). Dezan Shira and Associates, Hong Kong. Observation year 2025. Accessed 2026-11-03.back
  6. 7EIA (ed.), World Oil Transit Chokepoints (last updated 3 March 2026; 2024 total oil flows: Hormuz 20.7, Malacca 22.5, Suez and SUMED 4.8, Bab el-Mandeb 4.1, Cape of Good Hope 9.3 million barrels a day). US Energy Information Administration, Washington. Observation year 2024. Accessed 2026-11-03.back
  7. 8EIA (ed.), Amid regional conflict, the Strait of Hormuz remains critical oil chokepoint (Today in Energy, 16 June 2025; about 20 million barrels a day, about one fifth of global LNG trade in 2024). US Energy Information Administration, Washington. Observation year 2024. Accessed 2026-11-03.back
  8. 6UNCTAD (ed.), initial assessment of the Strait of Hormuz disruption of 10 March 2026 (about one third of global seaborne fertiliser trade, about 16 million tonnes), as reported by a Pakistani daily newspaper; the UNCTAD text itself was not opened. Observation year 2026. Accessed 2026-11-03.back
  9. 17FAO (ed.), Strait of Hormuz crisis: FAO Director-General outlines risks, actions and policy responses (remarks to the 180th Council session, 28 April 2026; urea up 52 percent in the United States and 60 percent in Brazil by mid-April). Food and Agriculture Organization of the United Nations, Rome. Observation year 2026. Accessed 2026-11-03.back
  10. 13WTO (ed.), Global Trade Outlook and Statistics, news release of 19 March 2026 (2025 merchandise volume growth 4.6 percent; 2026 baseline 1.9 percent; high-energy-price case 1.4 percent; Hormuz traffic from 138 vessels a day to almost zero). World Trade Organization, Geneva. Observation year 2025. Accessed 2026-11-03.back
  11. 15WTO (ed.), World Trade Report 2026: A critical juncture for the world trading system (about 72 percent of merchandise trade on MFN terms). World Trade Organization, Geneva. Observation year 2025. Accessed 2026-11-03.back
  12. 14WTO and UNCTAD (eds.), Global goods trade resilient in Q1 2026 despite Middle East war (WTO news item of 31 July 2026; Middle East export volumes down 9.7 percent and import volumes down 11.9 percent year on year in the first quarter). World Trade Organization, Geneva. Observation year 2026. Accessed 2026-11-03.back
  13. 18IMF (ed.), fourth review of Egypt’s arrangement (Suez Canal revenue USD 6.6 billion in FY2023/24 and projected USD 3.6 billion in FY2024/25), as reported by Hellenic Shipping News from Arab Finance; the IMF report itself was not opened. Observation year 2025. Accessed 2026-11-03.back

Cite this chapter

Valadbaygi, S. (Ed.). (2026). Chapter 1: Trade moves through a few narrow places. In Strategic Systems Report 2026: Global Supply Chains, Trade and Chokepoints (Baseline Edition 2026, Report No. NR-STRATEGIC-SUPPLYCHAINS-GLOBAL-2026-BASELINE) [Draft under review]. The Global Centre for Risk and Innovation (GCRI).

Every citation form of the whole report, BibTeX and RIS included, is on the edition home. Cite this report

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