STACKING CHALLENGES Rising prices of raw materials, energy costs and shipping and logistics have pressured the supply chain
The stainless steel industry has been under severe supply chain pressure caused by rising prices of raw materials, such as nickel, as well as shipping and logistics and energy costs, in Europe and Asia.
As a result, stainless steel and valves supplier EMV Africa has had to be creative and resourceful in finding alternate supply sources, as well as adjusting buying patterns to compensate for the restrictions and challenges.
However, as the majority of stainless steel products are imported, local production, particularly for long products, has not been sufficient to meet demand, says EMV Africa metals business unit manager Clinton Lautenberg.
Further, steel prices have strengthened over the past 12 to 18 months. Initially, prices were driven by increased global logistics costs, owing to Covid-19 restrictions, but the more recent fallout from Russia’s invasion of Ukraine has added pressure to already higher energy costs, further impacting on steel prices.
Lautenberg explains that the cost of finished primary product steadily increased, and stabilised, with nickel trading “in a relatively broad band” of between $28 000/t and $32 000/t.
Moreover, the recent Covid-19 lockdowns in China have resulted in transit times increasing, as fewer vessels have been available, and fewer vessels leaving China has had a knock-on effect on freight shipped from other Asian countries such as India.
While EMV Africa previously secured direct sailings from China to South Africa with short transit times, transshipment vessels are becoming more frequent, “adding weeks to expected delivery times”, says Lautenberg.
A shortage in cargo equipment, such as containers, also results in the cost of containers increasing – sometimes by up to 80%, he adds.
Despite the challenges, the company has ensured that supply issues have been mitigated by sourcing steel from a variety of suppliers in different countries. Every supplier is fully verified for quality and conformity to internationally recognised standards.
EMV Africa has prioritised customers’ continuing to have access to the company’s range of products sold through its three divisions, as well as its Cape Town branch.
The EMV Africa Metals division offers round bars, welded pipe, polished tube and flanges, along with British standard pipe and buttweld fittings, while the EMV Africa Valves division provides a range of valves and actuators.
The EMV Africa Multi Alloys division provides special alloy products in plate, pipes and round bar, along with duplex, super duplex and high nickel corrosion and heat-resistant alloys.