Page 23 - Logistics News - December 2021

S HIP P IN G

Shipping container crisis continues

With 90 percent of the world’s goods transported by sea, the current shipping crisis has
resulted in spiralling costs and bottlenecks in global supply chains.

he shipping crisis has been exacerbated “While we have been affected by the container
by a shortage of shipping containers and crisis along with many other companies reliant on
T massive congestion at major ports, explains shipping, there are ways of getting around it as
Conrad Smith, founder and owner of MHS Plant & only certain routes and ports have been affected. In
Equipment, an equipment disposal specialist that addition, we are able to dismantle yellow equipment so
focuses on the mining and construction industries that it takes up the least space, thereby assisting our
specifically. clients to curb their transportation costs during this
difficult period,” explains Smith.
Smith comments that the current shipping crisis
is having the biggest impact on the used equipment The disruption in global supply chains could not
sector as major original equipment manufacturers have come at a worse time for the mining industry.
(OEMs) still tend to have stock on hand to tide them Already having to deal with a shortage of new, large
over during the current crisis. However, shipping equipment from major OEMs, a recent uptick in
experts predict that lead times will only begin to commodity prices has seen speculation about a
stabilise by mid-2022. potential new commodity super-cycle. With lead times
for new equipment now already stretching to 2022,
The shortage of shipping containers can be compounded further by the shipping crisis, Smith
traced back to 2019, a relatively bad year for global highlights that sourcing used equipment is probably
trade due to strained relations between the US and the best option now for major mining houses or
China. This stand-off between two of the world’s junior miners to ensure they are in a position to take
largest economies resulted in fewer containers advantage of any emergent green shoots.
being produced in the run-up to 2020. However,
COVID-19 then extended the lull in container Apart from supplying both new and used
manufacture throughout the first half of last year. equipment, MHS Plant & Equipment also assists
Instead of dampening demand, the pandemic had banks in the valuation and disposal of any repossessed
the opposite effect and container prices skyrocketed, equipment, specialising in turnkey solutions
with some brands reportedly paying up to 10 times for construction companies and mine closures.
more to import the same goods as before. The latest Supplementing the trading side of the business, the
development is that some companies are opting to company owns equipment that it rents out to cement
transport their goods via air charter, at more than and aggregate producers, including a diamond mine in
double the pre-pandemic price. the Northern Cape. •

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PHOTO BY DAVID DIBERT FROM PEXELS