The Iran war, the Hormuz blockade, the UAE's withdrawal from OPEC, China's export controls on rare earths, and new US tariffs: Procurement is currently facing multiple simultaneous crises that are impacting raw material prices, energy costs, and logistics capacities in various ways. This webinar demonstrates how procurement organizations can understand the chains of effect behind the headlines, distinguish between justified and excessive price increases, and use concrete tools to counteract them.

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Simon Schaub (Customer Development, Tacto) and Orestis Michaelides (Strategy & Operations, Tacto) provide context on the current geopolitical situation, analyze its impact on industrial supply chains, and present both proactive and reactive strategies for procurement. Practical examples from Sonax and Hauraton illustrate real-world implementation. A demo will showcase the Defender Agent, which automates and provides data-driven responses to price increase notifications.

Four crises at once: why the current situation is particularly challenging for procurement

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Orestis Michaelides breaks down four geopolitical developments currently affecting procurement in parallel. The blockade of the Strait of Hormuz threatens 14 million barrels of oil per day, accounting for 20% of global fuel. The UAE's withdrawal from OPEC removes up to one million barrels of daily production quota from the organization, making oil price formation structurally more unstable. China's control over approximately 90% of global rare earth production remains a long-term supply risk: about 80% of large European companies have a Chinese producer in their supply chain. Added to this are US tariffs of 25% on vehicles and 50% on steel and aluminum, which could cost the German automotive industry alone up to 15 billion euros annually. The result: over a third of companies are already reporting concrete delivery delays for intermediate products and raw materials.

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Understanding chains of effect: from oil prices to packaging film

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Using two examples, the webinar shows how geopolitical crises ripple through multiple value-added stages to affect seemingly unrelated product groups. In the first case, a disruption in oil supply leads to a 20 to 30% increase in plastic granulate prices within two months via naphtha and basic chemicals. A packaging film supplier subsequently demands a 15% surcharge. The crucial question for procurement: if plastic accounts for 50% of the film's costs and the granulate price rises by 20%, mathematically only a 10% increase is justified, not 15%. The second example illustrates a domino effect in logistics routes: blocked sea lanes not only lead to higher fuel, insurance, and crew costs on alternative routes, but also tie up global freight capacity. A truck that takes eight days instead of five for a trip is unavailable for the next one. This makes even crisis-free routes more expensive.

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From reacting to steering: five maturity levels and concrete tools

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Simon Schaub presents a five-stage maturity model: from a purely order-oriented organization (Level 1) that does not explicitly track raw material exposure, to proactive management (Level 5) that uses market volatility as a negotiation lever. On the proactive side, tools range from early warning systems and scenario planning to strategic stockpiling, framework agreements with price escalation clauses, and financial hedging via futures and swaps. Reactively, cost structure analyses, index comparisons, alternative offers, and partial acceptance with index-linking are available. Two customer examples illustrate the implementation. Sonax, winner of the 2023 BME Procurement Excellence Award, conducted a cross-departmental risk analysis and identified 57 critical risk items. For one raw material, they contracted at 1.23 euros per unit and called off the total quantity early. When the market price rose to nearly 3.00 euros due to the Middle East crisis, Sonax was able to continue purchasing at the agreed price without supply shortages. Hauraton, on the other hand, received a blanket 8% price increase request citing rising raw material and energy costs. Their own cost structure analysis showed that 50% of the item's value was attributable to casting, plus steel, plastic, and small parts. After breaking down the individual cost drivers, only a 5% increase was justified. Three percentage points were successfully fended off.

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Automated price defense with the Defender Agent

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The session concludes with a demo of the Defender Agent, which, as part of the negotiation cockpit, automatically responds to price increase letters. The process: an incoming price increase letter is forwarded to the agent via email. It analyzes the demand based on over 20,000 market indices and historical supplier data from the ERP system. Within minutes, it creates a personalized response letter with data-driven counterarguments. In the example shown, a 3.6% demand is rejected because the relevant indices are in decline. The buyer can iteratively adjust the tone and arguments. The letter is only sent after human approval.

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Conclusion

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This webinar highlights how current volatility in commodity and energy markets forces procurement teams to choose: reactively process individual price increases or systematically build transparency to distinguish between justified and excessive demands. Real-world examples from Sonax and Hauraton demonstrate that proactive risk management and data-driven negotiation deliver measurable results. The Defender Agent automates the most time-consuming part of this process: the fact-based creation of price rejection letters.

Simon Schaub and Orestis Michaelides from Tacto analyze the geopolitical crises surrounding Hormuz, OPEC, rare earth elements, and US tariffs, illustrating how their ripple effects impact industrial procurement across multiple tiers.