Ronald Phillips Explains the Most Effective Ways for Mining Companies to Combat Supply-Chain Issues

Over the past several years, global supply-chain issues combined with government stimulus programs and green energy mandates have caused an increase in demand for commodities like nickel and copper, driving up their market values. Unfortunately, mining companies attempting to increase production to meet global demand are facing their own supply chain issues and increasing costs of production

Supply-chain issues aren't like to end any time soon. Mining expert Ronald Phillips believes that the best solution is to create a modern and practical plan to prevent shortages and deficiencies, such as:

Use Strong Vendors Able to Guarantee Delivery at Set Prices

Mining companies need steel, truck tires, diesel fuel, explosives and other inputs whose prices are, themselves, linked to global commodity prices. To correctly estimate costs, mining companies may need to prioritize large financially strong vendors who can guarantee set prices or increases within set ranges over time.

Think Creatively About How to Reduce Demand for Volatile Inputs

Prices of certain inputs like diesel fuel are skyrocketing, while electricity prices in many mining jurisdictions are relatively stable. Mining companies may want to spend more money upfront to purchase electric equipment fleets and thereby reduce their dependence on volatile fuel prices.

Similarly, sulfuric acid prices have increased exponentially over the past two years and mining companies that use acid in their production processes are looking for alternatives and efficiencies where ever they can find them.

Updating Crisis Management Protocols

The pandemic turned the mining industry upside down. With new covid variants possible and other global issues demanding attention, mining companies should still update their post-crisis management protocols accordingly. Thorough planning can ensure your company will withstand whatever the future may bring, advises Ronald Phillips.

Stockpile Inventory of Critical Parts and Inputs

Like other modern companies, mining companies where able to save money by ordering what they needed when they needed it, trusting global supply chains to deliver. With shipping, trucking and air freight badly snarled around the globe, mining companies are keeping more inventory on hand and, in some cases, investing in 3D printing capabilities to supply their own replacement parts.

Invest in Training and Retaining Employees from the Local Community

Skilled labor is in short supply and visa problems between countries have increased with the pandemic. At the same time, community relations have taken on greater importance in ensuring permits and smooth operations for mines. Therefore, mining companies have ever greater incentives to invest in training local community members to take on critical mining jobs that might have previously been held by fly-in fly-out workers.

Bottom Line

Ronald Phillips believes that mining companies will benefit from integrating modern technologies and hiring practices. Considering today’s socio-political and economic climate, mining companies would do well to develop new ways to deliver, source, mine, and transport commodities.