offshore

Due to a large percentage of work being shipped offshore, Western Australia steel fabricators have been going through a tough time. This is because, though there is no shortage of steel and pipe fabrication skills, local steel fabricators are unable to compete on a price level with overseas steel companies which are able to bag the majority of high-end engineering design projects. However, there are multiple benefits to leveraging the services of home-grown fabricators when working on metal fabrication projects. So, what are these benefits and how can WA fabricators be utilized in this regard? This blog will look to explore this topic in greater detail.

The Major Issue

Though Western Australia is home to some of the world’s finest steel fabricators, many projects are going overseas to London and USA amongst other nations. This is  a challenge to the fabrication industry causing many steel workshops to close or retrench employees and run on a shoestring budget until new work comes in. A good example is the Chevron financed Gorgon gas project on Barrow Island, which was expected to keep steel workshops in WA busy for years. Now, while some work has trickled into the western state, most of it has been shipped overseas, like many other projects.

Local steel workers are not taking this lying down, with strikes and protests calling for local or national government to subsidize the local industry in order to make them more price competitive. The local steel market is critical to the Western Australian economy and the shrinking of this industry can have several adverse effects on the state and its economy in general. Using local steel fabricators not only ensures the local economy remains vibrant, it keeps many people employed.

Domestic X-Factor

Local steel fabricators are having more success in the smaller steel projects that require niche skills such as heat induction bending services, which our industry has an abundance of. In addition to offering these specialized skills, local steel companies also offer lifestyle maintenance for their projects, something their overseas competitors do not. Hence, the issue is an interesting one, because while Australian steel fabricating companies often outperform foreign companies when competing in the global marketplace, they lose out due to pricing. It is not just Australian companies that should be using local, but the high level of skill of domestic workers suggests there is a huge international market that would send their steel fabrication work to Australia if prices are more affordable. Subsidized companies overseas enjoy a competitive edge and can outbid their competitors on price alone, since price will outsell skills every time.

Benefits Offered

There are several reasons for contractors and developers to make use of Australia’s local, highly skilled steel companies.

Impact on Economy – The local steel economy is huge and when contractors invest in local, the money stays here. This leads to a stronger economy, keeps people in jobs and that money is then spent at local businesses.

Impact on Environment – Using local lowers the delivery time, removes the enormous freight costs, lowers the carbon footprint of the entire project, and it means maintenance and supplies are close at hand. It also means contractors and fabricators can communicate in person as opposed to digitally.

Lower Inventories – Builders and construction companies do not have to hold large stocks of steel, cutting into their operation budget, because supplies are always just around the corner, usually a phone call away. They are easy to deliver, meaning companies can pay for what they need when they need it.

Final Thoughts

Clearly, the Australian steel industry is as robust and strong as some of its products, but it often cannot compete with other countries because their governments understand the importance of attracting steel contracts. This is an enormous industry, and the advantages of government investing in it are numerous. The implications do not just affect the bottom line; it affects other businesses, and ultimately people’s lives. When one is looking for a steel company, it is preferable to work with a skilled and knowledgeable company which has experience in a wide range of projects of all sizes. This is where Australian fabricators can go one up against foreign fabrication companies!