ABHR speaks to Fenner Dunlop’s Chief Operating Officer and TUNRA’s Operations Manager to learn how local manufacturing can support the essential bulk handling industry during challenging times.
In the final moments of 2019, the World Health Organisation was alerted to several cases of pneumonia symptoms in Wuhan City, in the Hubei Province of China.
The virus, which did not match any other at the time, began to raise concerns. Within weeks, the entire city of Wuhan was under lockdown and COVID-19 had begun to spread across the globe.
In March 2020, Australia began imposing social distancing laws, with State Governments moving to close non-essential services and major events to curb its spread.
However, Steve Abbott, Chief Operations Officer at Fenner Dunlop, says the option of shutting or slowing down wasn’t available to the bulk handling industry, as it is essential to keep powering the country.
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“The industry as a whole is essential for its economic contribution to the country, alongside its support of key forms of infrastructure,” Steve says.
“Bulk handling is like the road or rail system. Without it, companies can’t get their goods to market.
“The mining industry in particular depends on conveyors. In many cases they are the only way to move the product out of the ground and into a train or a ship. This is recognised by the mining industry – we’ve received letters from large mining customers recognising Fenner Dunlop as an essential supplier and service provider. This has been done to ensure governments understand our essential role in mining.”
Social distancing soon became the new normal for essential workers in the bulk handling sector, with major miners establishing their own methods of reducing risks to keep their employees safe.
Fenner Dunlop established a Crisis Management Team to oversee the evolving situation. It has also ramped up site access controls, personnel hygiene measures and put additional screening procedures in place.
To date, no employee of Fenner Dunlop has tested positive for COVID-19, and the company has not seen a material impact on its ability to supply product. At the time of writing, the company did not expect the crisis to have a material impact on future supply either, based on current available information.
Abbott says the reason for this is Fenner Dunlop’s business model is based on local supply.
“Fenner Dunlop has always had its own local supply chain for its materials. Our business strategy has been to manufacture our components as close to our customer base as possible. We need to be able to respond quickly and ensure quality standards,” he says.
“Every conveyor is different. In order to provide the right engineered solutions for our customers, we need to understand them and have clear lines of communication with them.”
Fenner Dunlop manufacturers its conveyor products in Australia, with facilities located in Melbourne, Sydney, Kwinana (Western Australia), Brisbane, Mackay and on the Central Coast of NSW. This diversity and regionalisation helps reduce the risks to supply.
As a business, Fenner Dunlop has 1000 employees across every state in Australia. The majority of its workforce are situated near clusters of bulk handling activity, helping insulate the business from restriction to movement across state lines.
“Our focus on local supply has been critical to responding to the crisis. We’ve seen global supply chains face uncertainty and disruption. This has put the value of a strong, diversified and nearby supply chain into the spotlight,” he says.
“We’ve seen demand from customers rise substantially as existing customers begin firming up their own supply and customers that had traditionally bought from off-shore companies start to look local.”
The company has now begun to look to the future, taking the lessons the industry has learned so far and reaching out to policy makers to consider further support of Australian manufacturing.
Daniel Ausling, Operations Manager at TUNRA Bulk Solids, says the industry is as busy as ever, with enquiries up and no drop in business. However, he adds that it is possible a slowdown will hit the industry sometime in the future.
“It takes a while for the lack of demand to wash through the bulk handling industry,” he says. “The nerves are out there, and it may have an effect down the line, though it will not be as steep as some other industries have faced.”
“I would like to think it would also put a spotlight on supporting the local supply chain after this, though there remain a number of political factors that make local manufacturing a difficult topic to influence,” he says.
Larger economies of scale and lower prices have made overseas manufacturing attractive to bulk handlers and seen much business move overseas, though this is not limited to the bulk handling industry.
Fenner Dunlop’s Abbott says that policy and regulation will be required after the crisis passes to ensure essential industries such as mining can be insulated against these global shocks.
“Governments, regulators and mining houses need to understand that if they want Australian made mining supplies, some form of local content legislation for supply to the mining industry will be required. This happens in other countries to ensure there is security of supply. ,” he says.
“The impact of the long-term decline of Australian manufacturing has been highlighted by COVID-19’s economic impacts. We need to make sure that this topic enters industry debate and reaches the policy makers.”