Globalization isn’t disappearing, but it is becoming more selective. For decades, businesses built supply chains with one goal in mind: minimize cost. Production flowed to wherever labor and inputs were cheapest, and efficiency ruled decision-making. That model is now being recalibrated.
A growing number of companies are embracing what has come to be known as “friend-shoring”—the practice of sourcing goods and building supply chains with countries considered stable and reliable partners. Instead of asking only where production is cheapest, firms are increasingly weighing where it is safest and most predictable. This shift reflects a broader reality: risk, once treated as secondary, is now central to global business strategy.1
A Shift Toward Regional Trade
Alongside friend-shoring is a parallel trend toward regionalization. Trade is increasingly concentrated within large geographic blocs such as North America, Europe, and parts of Asia. These regions are strengthening internal supply chains, making them less dependent on far-flung partners.
This doesn’t mean countries are cutting themselves off from the rest of the world. Rather, they are rebalancing. Shorter supply chains reduce exposure to disruptions, whether from geopolitical tensions, shipping bottlenecks, or regulatory differences. For businesses, proximity can offer a level of control that global sprawl often cannot.2
Why This Change Is Happening3
The shift toward friend-shoring and regional trade didn’t emerge overnight. It has been shaped by several overlapping pressures over the past decade. Trade disputes and growing attention to strategic industries have both exposed the fragility of highly dispersed supply chains.
In response, companies are placing a premium on resilience. That often means accepting slightly higher costs in exchange for stability. Industries tied to national priorities—such as energy, agriculture, and advanced manufacturing—have been especially affected, as governments and firms alike seek to reduce dependence on uncertain partners.
North Dakota’s Place in a Regionalizing World
While these trends are global, their effects are felt locally—even in places like North Dakota. Our state’s economy, anchored in agriculture and energy, is closely tied to international trade, but increasingly within a regional context.
North Dakota’s agricultural exports, particularly wheat, soybeans, and corn, are part of a North American system that values reliability. In a friend-shoring environment, food security becomes more important, and stable suppliers gain an advantage. The United States, including its northern plains, fits that role for many trading partners.4
Energy tells a similar story. Oil production from the Bakken formation connects us to broader North American energy networks. As countries prioritize sourcing energy from trusted partners, regional supply chains become more significant. Stability, not just price, shapes demand.
Even beyond these sectors, regionalization has indirect effects. As companies move production closer to home, domestic supply chains expand. This creates opportunities in transportation, logistics, and processing—areas where our infrastructure and location can play a supporting role.
The Trade-Offs
This shift toward trusted partners and regional blocs is not without consequences. Moving away from the lowest-cost producers can raise prices and reduce some of the efficiencies that defined earlier phases of globalization. A more fragmented trade system may also limit the scale of global growth.1
Yet for many businesses, the trade-off is worth it. The disruptions of recent years have made clear that efficiency alone is not enough. Reliability, predictability, and alignment now carry real economic value.
A Different Kind of Globalization
What is emerging is not a retreat from global trade, but a reconfiguration of it. Supply chains are becoming more regional, relationships more strategic, and decisions more risk-aware.
For North Dakota, this evolution is less about adapting to a new system and more about recognizing its place within it. As part of a stable, resource-rich region, the state is positioned to contribute to—and benefit from—a model of trade that values trust as much as cost.
In that sense, friend-shoring is not just a global trend. It is a reminder that in today’s economy, where something is produced matters—but who it is produced with may matter even more.