What’s causing disruptions in the supply chain?

Yanik

In last month’s Start-Up Guide, we reported how supply chain disruptions were surfacing and how aggregate producers could face delays if they don’t have necessary components on hand or readily available with their dealers.

That supply chain disruptions theme carried over to our preparation for this month’s issue, with equipment suppliers sharing what they’re seeing on the front lines of the supply chain.

According to suppliers, the source of disruptions isn’t necessarily any one thing, but several.

“Even if you can source parts and raw materials, it is getting harder to find modes of transport to get them from where they’re manufactured to where they’re used,” says Joe Grell, vice president of heavy capacity at Rice Lake Weighing Systems. “That’s the first issue we’ve noticed.”

Steel prices have been going up for months, Grell adds, and they’re now at a record high. That dynamic has created issues for some manufacturers who purchase steel from local service centers, both in terms of cost and availability.

Delays in overseas shipments are common these days, as well, with Kimball Equipment’s Mark Oviatt noting in last month’s Start-Up Guide that new pressures were recently introduced to the supply chain.

“Prices are certainly going up, and there are tariff wars with China,” says Oviatt, president of a dealer operating locations in six Western states. “Most of the steel manganese comes from India or China, so shipping times have increased. China has some issues with their foundries.”

Sheldon Shepherd, aggregate division sales manager at Tecweigh, has also observed supply chain disruptions that originate overseas. The aggregate industry is far from the only industry being impacted, though.

“You can easily see how chips for automobiles and trucks – including medium-duty and 1-ton trucks – are being impacted just because of a shortage,” Shepherd says. “That’s a big deal.”

And it only takes one part to disrupt the manufacture of a piece of equipment.

“What occurs a lot is you have a piece of equipment that needs, say, 100 parts,” Shepherd says. “You have 99 of those. Sometimes, you can build the whole thing and wait for part No. 99, or you may be stuck and can only build it 30 percent of the way. You’re waiting extra weeks for that specific part because you can’t continue and finish it.”

Supply chain disruptions are also creating problems for contractors, with the Associated General Contractors of America reporting that construction costs are going up and projects are slowing.

Featured image: iStock.com/D3Damon